Link to original article: https://www.irishexaminer.com/business/economy/arid-40275188.html
Very mixed outlooks for Irish SMEs, surveys indicate
Three-quarters of food sector SMEs expect their revenue to grow over the next 12 months
Three-quarters of food sector SMEs expect their revenue to grow over the next 12 months, with nearly 70% not intending to delay investment, a survey shows.
The study – conducted by PwC for the Love Irish Food industry group – found that despite Brexit, the UK remains a key market for Irish food SMEs, with more than a quarter still viewing it as their most important export market.
Conversely, separate research has painted a grim picture for SMEs in the construction sector. The Construction Industry Federation has warned that a “significant” number of construction SMEs could go out of business if there is any further delay in reopening the sector on a widespread basis.
Meanwhile, the introduction of any State-backed domestic tourism-targeted spending initiatives could boost the domestic economy by up to €6bn, the Banking & Payments Federation Ireland has estimated.
The Government is expected to replace the heavily criticised €270m Stay and Spend scheme with a more consumer-friendly initiative aimed at boosting domestic holiday spend.
One which promotes value for money and removes challenges linked with the original Stay and Spend idea could unlock some of the €6bn which Irish consumers spent on overseas holidays in 2019, according to BPFI CEO Brian Hayes.
“While many consumers may have additional savings available that can be spent on domestic tourism, value for money will be an important factor that will influence their decisions in how they will spend,” he said.
The Keelings family business was until the 1970s, when the family set up a established in 1926 when WP and wholesale business. Following the emergence of Christine Keeling began growing the multiple retailers, Keelings evolved further rhubarb. They progressed to in the late 1970s and 1980s, developing a strawberries in 1937 and apples in business to serve that growing market. “In the
revealed that consumers wanted to build relationships with Irish growers, so we launched our own brand in-store. The Keelings brand has supported the growth in the consumption of berries since it was launched in 2010.
“We have been lucky to have a brand that is well regarded and we have done a lot of work with consumers over the years with events in- store. We have worked hard on the quality of the berries that are available on the farm – we can’t grow them all year round, so we follow the sun to ensure supply 52 weeks of the year. Our Irish strawberry season starts in March and finishes in mid-November. Raspberries are June to early October, blackberries are June to September, while blueberries are July and August. We import from carefully selected suppliers around the globe to ensure that Irish consumers have great tasting berries throughout the year.”
1949, and the business was then handed on to the next generation. “My father and uncles ran the business between the 1950s and the 1990s,” says David. “It was then passed onto my sister Caroline, my brother William and myself.” Growing was the focus of the business
late 1990s we invested significantly in our own farms in Ireland and in the berries business,” he says.
The growing process
The growing process at Keelings has changed beyond recognition since David’s grandparents were supplying the market. “They would have had a few plantings and the season would last for six weeks – now everything is covered and even if it is raining we can still harvest,” he says. “We now have 26 separate plantings to ensure availability of excellent quality strawberries. We start the season with heated glass houses, then move to cold glass houses and then tunnels and then back to cold glass houses and heated glass houses. How we staff our farms has changed a lot too – a few decades ago most of the work was done by local, seasonal staff. However, the Irish economy and employment levels have grown significantly over the last 20 years, so that has made the securing of seasonal staff particularly challenging for us, as it is for other Irish growers, so we currently source our seasonal staff from abroad.”
Embedded in the community
Keelings is a major employer in north county Dublin. They employ an average of 1,500 people throughout the year and that figure goes up by about 40% in the summer, when the seasonal staff arrive to help them harvest the crop. About 900 staff are from the locality.
Keelings are also keen to keep things local when it comes to their suppliers. “We work with various growers of Irish berries, cherries, tomatoes, apples, carrots, beetroot, flowers and plants, as well as packaging suppliers, whether it is punnets, boxes or labels,” he says. “We also work with refrigeration
companies and other suppliers relating to our buildings, so we work with a lot of Irish, and for the most part, local companies.”
Working with the local community is important to Keelings, and not just in terms of employees or suppliers. They are also focused on giving back to the local community and to causes that are important to them at a national level. This is the third year in a row that the company has worked with the ISPCC Childline charity, donating 10c per punnet.
“We worked hard to contribute more this year in what has been a particularly challenging year for the country,” says David. “We also try to bring experiences from our farm to the annual Bloom Festival, and we have hosted our own summer harvest festivals that bring people to our site, so they can see what farming looks like.”
Keelings have been members of Origin Green for the last five years and David says that this has helped them to deliver plans that have significantly reduced their impact on the environment. “We have developed our own sustainability strategy, which includes a number of key measures such as capturing the rainwater on our farms, using integrated pest management, and creating grass areas that are beneficial to insects,” he says.
“We don’t have any landfill in terms of our waste and, in conjunction with local farms, we are using surplus fruit for animal feed. In 2021, we will be part of the Business in the Community Pledge, which pledges us to have a 50% reduction in the intensity of carbo emissions by 2030.” Keelings have also invested in improving the efficiency of their transport fleet and they have upgraded to more environmentally friendly refrigeration systems. “We have been actively involved in removing single use plastics from our business and we have engaged with packaging specialists to help us understand consumer behaviour towards packaging,” he says.
“Together with our supplier we worked on one of our packaging items, which is used to pack 500g grapes. We engineered a new pack design, which has a reduced weight but is still strong enough to go through our conveyors and sealers without compromising the quality of fruit. The project was such a success that we are now extending this to our full packaging portfolio. By the end of 2023, the net effect of this will be to reduce Keeling’s R-PET usage by almost 80 tonnes, which is equivalent to over seven million fruit punnets!” Another recent innovation is their residue- free pineapples, which they are supplying to supermarkets and to the foodservice sector throughout Europe. It follows their purchase of their own farm in Costa Rica last year which, David says, has given them access to a unique way of growing pineapples.
Is David concerned about the impact that Brexit will have on the Keelings operation or is there an opportunity to develop their import substitution capability? “It is really important for us to be able to transport goods in and out of Ireland efficiently and quickly to ensure fresh stock for our customers. We have been doing a lot of work on alternative routes to ensure that we are geared up for what is coming and that we can get our products through the ports. However, until we are fully clear as to what the real picture will be, we can’t make any definite plans. We have tried to be as agile as possible for when the deal becomes clear. In terms of import substitution, if Ireland becomes harder to deliver to, then opportunities may arise for Irish businesses, including Keelings, so there may be some positive aspects to Brexit, as well as challenges.”
According to David, Keelings experienced sales growth that was higher than expected in the retail sector over the past few months. “However, our costs were significantly higher too and the costs have been higher than the impact of the growth in sales,” he says. “During the lockdown there was increased demand for a number of weeks and, thanks to our amazing staff, we were able to deliver big volumes eight weeks in a row, but demand is more stable now as restrictions have been reduced. Sales had been growing fast in our foodservice business, but during lockdown they were dramatically reduced and then started growing again, but they have fallen back down once again following the introduction of Level 3 restrictions.”
David says that the most immediate impact on the supply chain during lockdown was the significant demand in the retail sector because a lot of countries in Europe shut down. “I’m really proud of how all of our teams delivered at such a challenging time,” he says.
“It has been incredibly challenging for Irish growers to harvest the crops because there was more local recruitment than normal and they aren’t as experienced as the crews that we bring in from abroad. I can see that being a problem next year as well. Also, growers overseas would have had challenges running their farms and that impacts on us. In addition, the transport of produce has been difficult because there are a lot less flights, so security of supply and managing quality will be big ongoing challenges, but we have experienced and committed teams on our side, so that helps.
Love Irish Food
Keelings joined Love Irish Food in 2010, when they launched the Keelings brand. “We have really enjoyed our association
with Love Irish Food and we use the Love Irish Food logo in all of our packaging on Irish grown seasonal produce,” says David.
“I love the concept of Love Irish Food. We are an island nation and we are proud of the standard of quality fresh food that we
produce. As suppliers and retailers, we are also lucky that consumers are proud to buy Irish because that boosts the overall economy. We are big supporters of telling the story, not just of our own brand, but of all Irish food brands because, collectively, we are much stronger. I think local brands,
a sense of community, and supporting each other, takes on a greater significance during challenging times, and that is why
Love Irish Food will continue to play such a vital role for Irish businesses as we navigate through the current pandemic.”