Marybelle Dairy shows family businesses can work
It was, he says, a thankless task, filling the tanker that called daily from the large dairy to which his farm was contracted, and imagining it driving all over eastern England before his milk disappeared into the anonymous mass on the supermarket shelves.
Instead, he, his parents and his brother dreamed of opening their own dairy, where they would produce a range of products they could supply under their own brand to local outlets close to their Suffolk farm.
Brother George, who was then at university, decided to carry out a feasibility study as his final year dissertation. “George got a lot of positive feedback from the interviews he carried out among local people, so we thought there was enough interest for us to take the plunge,” James recalls.
The family put everything they had into starting Marybelle Dairy. “We sold part of our property and mortgaged the farm. We threw everything on the line.”
They also received a rural development grant of £50,000 but when the goalposts kept moving before the grant could be finalised, it ended up delaying matters by more than six months and probably had little effect in real terms as costs had soared in the meantime.
Although it is difficult to put a definitive figure on the start-up costs, James believes that, together with the losses that were inevitable in the first two years, the total was around £500,000. “If you were doing the same thing today, you could easily treble that figure,” he reckons.
The first and most important thing was to establish a milk network. Despite being something of a loss leader, the Strachans recognised that regular daily deliveries of milk to a wide range of customers would be the key to the development of value added products.
“We have a wonderful coastline around here with some really superior hotels, so we knew we would need a lot of cream.” Retirement homes, restaurants and village shops were on the target list, as well as doorstep delivery operators.
But James was also sure that a quality product with local provenance would be well-received in the supermarkets, though he accepts that Marybelle was probably ahead of its time. “Asda took us on at quite an early stage but initially we seemed to be just milk competing with milk.”
To underpin the brand’s environmentally friendly positioning, it has recently run a trial, with Asda’s support, of a newly developed, recyclable container for its milk and it has been a great success.
James explains: “Around three years ago we were approached by Martin Myerscough, a local inventor, who had set up GreenBottle, producing the world’s first milk bottle made from recycled and recyclable paper. We agreed to help him with the development, and Asda agreed to take the prototype run of 250 bottles into their Lowestoft store.”
The 50 bottles a day that Marybelle delivered were snapped up in less than an hour and there are now plans to roll out GreenBottle in 14 Asda branches in East Anglia.
Meanwhile, the business has been successful in expanding beyond its original target market. “We’re very excited about a contract to supply 4,000 yogurts a week into Cambridge schools from November, and we’ve had a lot of interest from other local authorities as well.”
Family businesses present challenges, but the Strachans have been so successful that James’s sister, Katherine, will be giving up her high-flying career to join the company in the spring. So what is James’s advice to other families working together? It is easy, he says, to slip into a pattern where everyone is trying to manage all aspects of the business. “Separate responsibilities and stick to them,” is his recipe for success.
Source: Daily Telegraph 25/10/2008