The Food Chain Centre (FCC) has reported on its five-year pilot programme aimed at testing a variety of business methods to help boost profitability for UK farmers and growers.
Farmers and growers from the fresh produce, red meat, cereals and dairy sectors involved in pilot projects have saved more than £14 million, FCC chairman and IGD chief executive Joanne Denney-Finch told guests at the final meeting on Wednesday.
But she stressed that the awareness raised across the food and farming sector was far more valuable.
“This has been the biggest-ever evaluation of business improvement techniques for food and farming, which has involved almost 2,000 farm businesses and more than 120 other food companies,” Denney-Finch said. “The results show the tremendous capacity of the industry to profit from working more effectively together.
“Companies involved in 25 of our pilot projects reported savings totalling a minimum of £14.4m, much of which is repeatable in future years.
“However, the real value is not for these participants, but in demonstrating the potential returns for farm businesses of the work we have undertaken in applying marketing, lean thinking and benchmarking.”
The project, which saw the analysis of food chains and advice on cost savings, the promotion of benchmarking, and the improved use of market information by growers, had a budget of £5.3m, with grants making up £3.8m and some £1.5m in resources provided by IGD and Defra.
The scheme found that 20 per cent of costs do not add value to the end product.
Farm businesses involved in a pilot with the dunnhumby Academny at Kent Business School were given the opportunity to access the shopping habits of a million shoppers to test their business ideas, and saw an average sales uplift of more than 10 per cent.
Individual projects saw the NHS Purchasing and Supply Agency save £3m on the cost of the 5 A DAY initiative through more efficient packaging and distribution, and Jack Buck Growers reduced distance travelled by 23 per cent to save more than £50,000 a year.
“The FCC was tasked with making the case for farmers reconnecting with consumers, and with techniques used in other business sectors,” said Denney-Finch. “These results unequivocally demonstrate the benefits of that approach.”
Defra minister of state Lord Rooker, who spoke at the wrap-up event, said: “The issue of food and the way it is grown and distributed is so far up the agenda that it does not compare to how it was 10 years ago.
“I doubt there is a farmer or grower in the country who won’t benefit from this initiative.
“This project has done the job it was set up to do, and now it has finished, but its findings will not be buried, but can benefit all UK farmers."
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