Eating into the British food industry

For those fond of complaining about the British retail invasion of main street Ireland, an examination of the level of Irish …

For those fond of complaining about the British retail invasion of main street Ireland, an examination of the level of Irish involvement in Britain offers considerable food for thought.

Kerry Group's acquisition of the Dalgety food ingredients company this week is just the tip of a rather profitable iceberg.

Consider this: in Britain, Irish companies control 60 per cent of the beef market, 30 per cent of the cooked meats market and a rapidly maturing 50 per cent of the cheese market. This means that in British restaurants and takeaways, approximately half the pizzas are smothered with Irish-owned cheese.

In fast-food outlets, the majority of beef will have originated in Irish-owned plants. That cooked ham on your British sandwich? There's a good chance it's Irish. The bread, butter and cheese, too.

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The situation might offer some comfort to those who have described Dublin's Jervis Centre as Little Britain. Now Ireland Inc has turned the tables and positioned itself at the forefront of food in Britain.

Billions have been spent on acquisitions. The big players, Avon more-Waterford Group, IAWS, Kepak, Greencore, ABP and the Kerry Group all have a significant presence in Britain. Careful strategic planning over a number of years has had astounding results. The future of food in Britain is a lucrative shade of green.

For the Kerry Group, securing Dalgety has consolidated its already enviable position in the British market. In 1974 Kerry was only the sixth-biggest co-op in the Republic and boasted a turnover of just £23 million. In 1996, 10 years after going public, this had increased to £1.23 billion. With the most recent Kerry acquisition, next year's turnover is expected to top £1.7 billion.

The group has ingredients divisions from Broxburn in Scotland to Southampton in England. Its consumer foods division has its European HQ in Surrey. Specialist poultry is produced in Diss in Norfolk. Convenience foods, rea dy meals and prepared meat products come under the banner of Mattesson Walls and Richmond Irish Sausage. They bought the business from Unilever in 1994.

"The group has expanded organically and by acquisition in a strategic and planned fashion," said a spokesman. "We successfully established manufacturing facilities in Ireland, UK, Germany France, Italy, the US, Canada, Mexico, Australia and more recently Malaysia . . . We are important players and, in the aftermath of Dalgety, we will copper fasten this leadership," he said.

Avonmore Waterford Group has a food presence in every county in Britain. It is the largest dairy processor in Britain, producing 375 million gallons of milk ahead of Northern Foods, Unigate and Dairy Crest. It is also the largest cheese manufacturer in Britain, 85,000 tonnes each year. It produces 50 per cent of the cheese for pizzas (in restaurants such as Pizza Hut) and 24 per cent of the cheese in the retail market.

Everywhere you go in Britain - hospitals, schools, jails, doorsteps and shops - Avonmore-Waterford is there. It is huge in the meat sector, holding 35 per cent of the market share of sliced cooked meats. Group turnover in Britain in 1996 was £1 billion.

The company controls 15 per cent of the British national milk pool. Manchester residents are very familiar with Waterford Dairies: in Birmingham they are well acquainted with the Avon more brand. Past acquisitions have included the Cheese Company and Beni Foods.

"We are a food island," said a spokesperson. "One of the critical routes into the market is the acquisition strategy which has a dual affect of buying growing businesses and providing new markets for Irish products."

Irish companies have gained a foothold in the British market in other sectors. Greencore is Britain's largest producer of bread, while IAWS controls 50 per cent of the fishmeal.

Larry Goodman's Anglo-Beef Processors includes eight plants which slaughter and process 10 per cent of all British cattle. Irish companies control 60 per cent of the beef industry in Britain when Kepak's British beef business and the acquisition of four slaughtering packing plants by Dawn Meats are taken into account.

"The reasons for this success are clear," says Michael Duffy, chief executive of An Bord Bia. "Traditionally a third of our exports have gone to Britain. We have always supplied meat and dairy products to retailers there.

"Given the knowledge and expertise the Irish have accrued it is not surprising that Britain has become a target for their expansion programmes." A combination of management capability, expertise in the industry and strong leadership have also encouraged the current state of play, he adds.

There are other footnotes to the Irish gastronomic invasion. Golden Vale recently introduced its brand-leader Cheesestrings in the Netherlands. Sales of the profitable product in Britain and Ireland are estimated at more than £17 million, not bad for the cheese that peels with a twist.

An Irish woman, Veronica Steele, was declared supreme champion at the prestigious British Cheese Awards last year. Milleens, produced by Ms Steele on the Beara Peninsula, was deemed by the judges "unmissable at five feet". When Ms Steele started in 1978, there was no such thing as an Irish farmhouse cheese industry. Twenty years later specialised Irish goods are proving as popular as the mass-produced products.

There are now more than 50 such producers making £3 million worth of cheese each year, and most can be found on the shelves of British multiples.