Investment helps egg firm bag Aldi deal

By Nicholas Robinson

- Last updated on GMT

Cottey has turned his dad's former beef farm into a egg processing facility
Cottey has turned his dad's former beef farm into a egg processing facility

Related tags Eggs Aldi

First-time egg producer Ken Cottey has cracked the industry and is now selling to Aldi after a £1.5M investment.

Key points

My dad would be spinning in his grave if he could see what we’ve done here. He used the whole 35 acres for grazing his dairy herd and we’ve built chicken sheds and a great big egg processing factory on it.

Mum and dad used to farm this whole site, on which I was born. Dad kept dairy cows and he went into beef production too. I lost my dad in 2000 to motor neurone disease. From the day he was diagnosed to the day he died was one year exactly. He passed away on April Fool’s day, which is poignant, as he loved playing tricks.

It took me two years after he died to get my act together and decide what to do with the site here in Somerset. But I finally took the plunge with free-range egg production and that's how Blackdown Hills Westcountry Eggs was born.

Investment (Return to top)

House one was built in 2004, which was our first laying shed; house two was built in 2005, which meant we had 32,000 laying birds at that point. We built house three in 2008, which gave us another 16,000 birds. Each house gives around 5,700 eggs a day. To get us to that point we had invested £400,000 into the project.

Our initial contract was to supply Deans Foods, which was another family company. We were getting several pounds per bird’s-worth of eggs every week from Deans because the margins for free-range were better back then. From 2004 we built our contract with Deans to up to 500 cases a week, which is around 180,000 eggs as there's 30 dozen eggs to a case. The eggs were packed using a tiny hand-packer, which could only do one case an hour.

Deans Foods merged with Stonegate to form Noble Foods in 2006 and that’s when things started to change for us. Noble Foods was run by more business-focused people and we felt our margins were being squeezed more and more. We were still supplying them with 500 cases a week, which was 90% of our business, but our income was shrinking.

It wasn’t helped by the caged egg ban in 2012, which made free-range eggs less of a niche product and brought prices down to £1 or £2 per bird’s-worth of eggs each week.

There were lots of politics with Noble Foods and I wasn’t prepared to carry on with them. We had some interesting meetings and eventually told them we wanted to go it alone and took a three-month option to leave at the end of 2011.

At that point, I thought “what do we do now?”​ We decided to take the business to the next level and do our own egg processing and packing to sell directly to the retailers. This would require a lot more investment because we wanted to go as big as possible.

We visited lots of regional egg packers and graders and Noble Foods even let us into some of their sites because they suggested we could pack for them.

What we need to succeed (Return to top)

That never happened, but Moba, which manufactures egg-grading machines, took us to Chippindale Foods in Harrogate to see its Omnia170 egg-grader, which can pack more than 2M eggs a day. It came from the Moba training school so it had everything on it, including dirt-detection, ultra violet (UV) disinfection and pre-handling technology. When I saw it, I knew that’s what we had to have if the business was going to succeed.

Moba thought the Omnia was too big for us. But, I knew we would outgrow a smaller machine and we needed something like the Omnia if we were ever going to have a relationship with a supermarket.

We’ve had £1.5M of investment in the site now and we’ve got a new 1,600m² packing hall where the new machine, which we bought from Chippindale as it was expanding, is housed.

Now we’re processing and packing 1.3M eggs a week. Just short of 200,000 of those come from our hens, so we have to bring others in from local farms that meet our standards.

Our biggest customer is Aldi, which came to us on the off-chance when one of its suppliers let the discounter down in 2012.

At the time Aldi was 95% of our business, but it’s now 60%. It is worrying that more than half of our business is one contract, but you need your bread and butter business. Aldi is also allowing us to grow by 30% a year and we are in talks to supply other customers.

There are 17 people working at the site, which runs seven days-a-week. We only grade and pack five days-a-week though. Our shifts run from 7am until 5pm.

Our egg laying and production process obviously starts with the free-range hens, which lay their eggs in houses powered by solar panels. The solar panels are saving us £3,332 a quarter on our electricity bill.

The process (Return to top)

The eggs are laid in special boxes at the egg farm with conveyers below them, which deliver them to the collection room. But we also collect them by hand because not all of the birds lay where they’re supposed too.

Grading starts at 9.30am after the eggs are received from the collection room. They are loaded onto the grading and packing machine. They first go through the crack detector to check for cracks on the shells at a rate of 60,000 eggs an hour. From that point they go through the dirt detection process, where the eggs are checked for misshapes, dirt, feathers and blood. Then the outside of the eggs are disinfected with UV.

From disinfection they go through point detection, which is where the machine ensures the eggs are pointing the right way to reduce breakages when they are boxed.

Once they are packed into one dozen or half-dozen egg trays for the customer, they are automatically labelled and then stacked on pallets for shipping.

Along with the food safety assurances the processing and packing machine gives us, we are accredited by the British Retail Consortium (BRC) and we also follow the Lion Code of Practice.

The Lion Code means all of our flocks are fully traceable. The eggs are stored and transported below 20°C and have a best-before (BB) date that is a minimum of 25 days. The BB date means the eggs have to be processed within six days of laying.

Turnover (Return to top)

We have come a long way and we were knocking on the door of £3M in turnover for last year, which has trebled in a year.

This year we will be making a further £250,000 investment to build a new roadway onto the site, as well as three new loading bays, which will reduce our loading times and our need to use forklift trucks. The investment will allow us to grow and we will be able to take on another eight staff this year as a result.

We’re also looking at ways of improving our packing and grading efficiency. We can do this by learning how to make the most out of the Omnia’s features. When that happens, we could boost output by another 500,000 eggs a week.

My dad would be worried sick about everything that’s been going on and especially the amount of money we’ve had to invest. If he was still here, he would have told me not to do it, but I know he would be proud of what we’ve achieved.

Find out how Cottey is saving thousands of pounds each month with a renewable energy scheme by listening to our exclusive podcast.

Personal (Return to top)

Name: Kevin Cottey Age: 46

Domestics: Married with two of my own boys and my wife has three boys from a previous marriage, so we have five boys aged 17–27 between us.

Outside work: It’s a seven-day operation, so I work! But it’s nice to get a bit of time away. We dream about going away overnight somewhere. I used to refit Land Rovers and I’m still passionate about them.

Proudest moment: What we’ve worked to achieve here so far. Also, getting our BRC accreditation, which will enable us to grow with Aldi.

Factory facts

Location: Blackdown Hills Westcountry Eggs, Higher Buckland Farm, Buckland, St Mary Chard, Somerset TA20 3QZ

Staff: 17

Products: Fresh eggs

Customers: Aldi, other regional retailers and wholesalers

Output: 1.3M eggs a week

Related topics Ambient foods

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