Typescript, late 1970s – historical article
Typescript found in folder belonging to David Black (undated – late 1970s?)
FORMATION AND EARLY HISTORY
In the winter of 1910, a group of Suffolk Farmers held a meeting in Bury St Edmunds; the meeting had been called by Mr T Robinson, a Pjg Farmer from Woolpit, and its purpose was to discuss the poor return being gained for pigs in relation to the high price being charged for ham and bacon products. Great concern was displayed as to the fact that the farmers had only two options when selling their pigs, one to sell directly onto the market and the other to sell to local butchers and, as such, it was deicded that the only possible altern- ative to this problem was to start their own factory and sell their pigs directly to it. Numerous meetings followed and the farmers soon realised that they would require expert knowledge to help this idea materialise. One member was, therefore, sent to Denmark to study the ‘Danes’ very successful methods of pig production and farmer owned factories. After the favourable reports that were received from Denmark, it was decided that the new factory should be set up as a farmer owned co-operative and built and run as closely as possible on the lines of its Danish counterparts.
The location chosen for the factory was at Elmswell, a small village in the heart of Suffolk being equidistant from Bury St Edmunds and Stowmarket and within easy reach of all farmers who were planning to become members. The site consisted of five and a half acres of land situated quite close to the Great Eastern Railway line, with the idea being that a siding could be run directly into the factory yard to allow easy transportation of bacon sides to London.
To ensure that the factory developed along the required lines Mr J Wendelbo, a Danish Architect, was brought to Elmswell to draw up the plans. All construction work, excepting machinery installation, was undertaken by a committee of farmers under the supervision of Mr N Kirk- ebjerg, another Danish expert. And so it was that the planning and construction of the factory was based entirely on similar types of factories that existed in Denmark at that time.
The laying of the foundation stone took place in May 1911, the ceremony being performed by the Marchioness of Bristol; among the many eminent guests were politicians, businessmen, local dignitaries and some 300 members of the co-operative. A luncheon was then held in a large marquee on the grounds and among the many telegrams of congratulations was the following, “I am pleased to inform you, in reply to your letter of the 22nd inst. , that His Majesty has been pleased to accede to your request to receive the first samples of bacon from your Co-operative factory”. And so it was that the first samples of bacon produced at the factory were presented to the King of England.
When the building was complete, the plant consisted of a slaughtering area, cutting room, chilling room, lard making room, sausage room and despatch area, the total cost including machinery being £7,000. The first farmer owned co-operative of its kind in England had now been established, and it was hoped that this type of factory would not only ensure a better return for the pig farmer but also help educate the farmers in the best ways of feeding, breeding and grading of their pigs. The whole concept of the factory was to take pigs from its members by arrangement and at competitive market prices, to process and sell the bacon at a profit and to return this profit to its members; firstly as interest on their shares and secondly as trading bonuses related to the value of pigs supplied. In March, 1942, these members totalled 408 supplying about 300 pigs per week to the factory. These pigs arrived by rail, on foot and by horse drawn cart, and after arrival at the factory were killed and cured as whole sides of bacon. The bacon was then despatched via the railway to be sold on the London Provision Exchange, the main bacon trading concern in the country; a few pies, sausages and blocks of lard were also produced and sold through a small shop at the factory.
Throughout the 1914-18 War, the factory remained open and indeed flourished; cattle, sheep and calves as well as pigs were slaughtered. In 1919 a profit of £10,007 – 12 – 8d was recorded and this type of profit remained consistent in the early years, proving to the many people who had originally been sceptical of the idea that a farmer-owned co-operative could indeed prove a viable proposition. By 1925, St Edmunds branched out into the pork product market with the idea of providing another outlet for the farmers’ pigs. Three retail shops were also opened in Gt Yarmouth, Lowestoft and Gorleston, where goods under its own “St Edmunds” brand were sold directly to the consumer. In the first year these shops recorded a loss of £1,058 – I – 6d and indeed were only open for three years before being sold due to their unprofitability.
The factory continued making a profit until about 1927 when competition suddenly became tougher and it was found that the main reason for this was the amount of imported bacon being consumed in the UK. A breakdown of imports at that time revealed –
Denmark 198,924 Tons
USA 91,758 ”
Canada 59,513 ”
Ireland 29,752 ”
Others 13,357 ”
Total 393,304 Tons
– this being against an estimated English production of 80,000 Tons. It was rather ironical that Denmark, the country from which the factory had been styled, now threatened its very existence. From 1927 – 30, the factory made substantial losses and the entire workforce agreed to take a cut in wages at the factory until the early 1930’s when at last profits were again made and no more major problems were encountered until after the second World War. During the war years, the factory again flourished, but even so it was somewhat restricted because all food production was very closely supervised by the Ministry of Food; rationing was introduced and some 30% of all bacon factories were closed, so perhaps this is why the St Edmunds factory was able to progress.
In 1949, due to the nationalisation of all transport coupled with heavy increased freight charges, the factory acquired a fleet of road vehicles to carry its products, a garage was built and facilities for maintenance and overhaul were provided, and from this point the reliance on the railways as a method of despatch vanished.
Rationing controls ended in 1954 and St Edmunds tried to return to its old pre-war lines, but trading conditions had changed with foreign producers supplying even more bacon to our markets. The Danes again proved the biggest problem with their considerable skill and heavily financed advertising campaigns. The British producers found it very hard to compete, many small bacon producing companies went into liquidation and the staff of St Edmunds realised that a complete overhaul of their marketing methods was required if they were to stay in business. Indeed, a complete change was soon in evidence-, the company diversified, modernised and improved its products, the amount of bacon sold on the London market was reduced and sales were now aimed at the retail and wholesale markets. Sales staff were employed to sell directly from vans thus promoting a direct link with the customers, new products were produced, pies, gammons, sausages and pre-packed bacon were the main lines.
All this was very well, but the staff at St Edmunds also realised that to compete with the imports the consistency of product was also a vital factor; the great problem with British Bacon at that time was that one week it could be first class but the very next poor. The only way they knew to overcome this was to ensure the raw material was of a consistent high quality, but no method existed for grading the pigs according to the amount of fat they contained, but St Edmunds introduced a scientific measuring device that was to rectify this. Based on the war-time Asdic principle, an ultrasonic machine called an introscope was introduced which could measure the amount of fat to within 2 mm; this coupled with paying the farmers higher prices for leaner pigs, ensured a high quality product could be consistently produced. Here the fact that St Edmunds was a farmer owned co-operative was very important because they were able to find ideal rearing facilities to produce the required pig. The result of all this work was that grading standards were agreed with leading British Bacon Curers and the County Quality Bacon Federation, and British Bacon was now able to compete in terms of quality with most of the imported bacon.
1960 to 1976
One of the main reasons that the St Edmunds Bacon Factory has been able to survive for so long, is that whenever a problem occurs, it is dealt with swiftly and efficiently and this has definitely applied to its marketing aspect. In 1960, a sub-committee was set up to report on this very aspect of the business; it looked at the current marketing situation and made recommendations for its future. The recommend- ations of the committee, which were later accepted and put into practice, were once again significant in that the idea of selling whole bacon sides was again denounced, with the swing being towards the sale of smaller products. The idea being that products should be progressed as far along the production lines as possible, thus obtaining added value and, consequently, being able to attain higher prices when sold. This added value concept was even more important, in view of the fact that the plant at St Edmunds has always been fitted with up-to-date machinery to increase its throughput of pigs and produce a varied range of products.
As a result of these moves, the St Edmunds van fleet was expanded from three to thirteen, and by 1962 a flourishing wholesale trade had been established in London and the Midlands. The Farmers were also made aware of this change, and for the first time since the factory opened they were encouraged and rewarded for producing some of the required pork type pigs.
In 1964, St Edmunds commenced trading with Marks & Spencer Limited, as was noted in the Annual Report: “During the year we made arrangements with Marks & Spencer Limited which we hope will be to our mutual advantage”. This relationship has now progressed for fourteen years, and was the beginning of trading with large multiple companies that is so important today.
In 1970, St Edmunds faced its biggest crisis in its short history – an outbreak of Salmonella Panama, a form of food poisoning. The factory was closed for two weeks, with pigs being diverted to other plants and considerable disruption being forced upon the customers. Although the factory was generally accepted as amongst the most hygenic in the country, this was, indeed, a testing time. A loss of £40,000 for the year was recorded, against an anticipated profit of £60,000, but such were the ties already created by the company that all its suppliers and customers returned when production was finally resumed.
Another example of the company reviewing its marketing policy arrived in the early 1970’s. In 1971 the factory changed its brand name to Farm Kitchen Foods in the hope of progressing more van sales under this new title. In 1972, when large losses were being incurred, an analysis of product margins was the reason for the complete with- drawal from the production of bacon sides; after a period of sixty years, no more Elmswell bacon was to be sold on the London Market. Indeed a loss making situation remained to such an extent that in 1974, due to severe cash flow problems, the company had no alternative but to put itself forward to be taken over by a larger concern, or go into liquidation.
The larger concern that was forthcoming, proved to be Eastern Counties Farmers, the major Ipswich based Co-operative which has dealings in almost every aspect of the farming world. Cash was immediately injected into St Edmunds and all shares in the Company were exchanged on an equal value basis for Eastern Counties Farmers shares. This takeover meant that the first farmer-owned co-operative bacon factory was now part of the second largest co-operative in the country but still the farmers retained some say in the running of the business. Indeed, St Edmunds retained its own Board of Directors which, at present, contains five farmer Directory but it was now responsible to the Main Board at Eastern Counties Farmers.
During these difficult times, came the inevitable changes in the business itself; at the time, the factory was losing about £10,000 per week and drastic changes had to be made swiftly. Many internal changes were effected, especially to the information systems, but once again the marketing aspect quickly came under the microscope. All products that were earning low profit margins were withdrawn, including the complete range of pies that had, by now, been built into a major line. Sausages were sold frozen as opposed to fresh, thus cutting deliveries from five to one or two per week. All outbased depots were closed, except the London depot, and the van sales fleet was cut from 35 to 10, with a minimum delivery of £10 per customer being included. The whole idea of these changes was to move away from small unprofitable deliveries and to increase trading with the multiple and wholesale customers who took bulk deliveries, which would, obviously, contribute greater profits. The importance of added value was again stressed, and production was now geared around high profit-earning goods such as cooked meats, pre-packed bacon and cured bacon joints and steaks. A result of these changes was a reduction in the company workforce from 500 people to 310, but again the company had reacted quickly and hoped to see improved profits as a result.
These profits did not materialise in the first year, indeed in 1975 the company recorded a loss of £150,000, but the benefit was certainly seen in 1976 with a record profit of £301,000 being made. The latest figures for 1977 indicate a profit of about £375,000, so once again the company appears to have made the right decisions at the right time.
In April 1976, as a result of these changes, the pig requirement was again revised. A pig somewhat lighter than previously purchased was required and a Syndicate of Producers was set up to ensure the correct quality and, more important, that required numbers could be procured.
The raw material supplied to the factory constitutes about 70% of its total costs, and it is, therefore, very important that it can be procured in the exact form required – this has been very obvious in the past and remains equally important today.
The main factor when determining the type of pig required, is the products for which it is to be used: in the early years only one type of pig, the baconer, was required. This produced the best and leanest sides of bacon, and the farmers were suitably rewarded for its supply. In later years bacon pigs were still required as was the cutter type pig – a lightweight pig from which pork cuts and pork manufactured products could be produced. Prior to 1970, when about 2,600 pigs per week were being killed, the ratio required was 1800 bacon pigs and 800 cutter pigs, and prices were set to attract a pig of 120 – 160 lbs (deadweight) with additional reward for the 140-160 lbs pig. Any pig purchased below 120 lbs was not suitable for processing and was sold, at a reduced price, as a carcase.
Today, the factory kills 2,600 – 2,800 pigs per week, with the emphasis being towards a pig slightly heavier than the average bacon pig, about 75 kgs as opposed to 68 kgs. Approximately 90% of these are purchased on contract, with the odd 10% being bought on the open market (flat rate pigs). Contracts are set up with the producers on an annual basis, being made up of six periods; each producer contracts a certain number of pigs each period and is allowed a 10% tolerance on this number. This method allows a consistent flow of pigs throughout the year and also allows the producer some lee-way on his contracted number.
Prices are worked out on a fixed formula on a weekly basis, bearing in mind price trends, competition, requirements and the current profitability of the company,with the overall aim being that of giving the farmer the best possible return, whilst also allowing the company to remain profitable. Contract pigs fall into two categories, high weight being72½ – 80 kgs and low weight being 64 – 72 kgs, with approximately 75% of the weekly kill being high weight and 25% being low weight; pigs falling outside these weight ranges are penalised and the price paid is reduced. Within each range the price paid depends on the amount of fat contained on the animal. The fat thickness is measured at a point on the pigs back by Government approved Inspectors, and can vary from under 10mm to over 30mm with the highest being paid for under 18mm, and the lowest for over 26 mm. This grading and payment method is, obviously, a way of rewarding the producer who sends the highest quality pigs, and is both beneficial to the factory and the producer alike. Flat rate pigs cannot be subjected to such close scrutiny, with the prevailing market price being paid for any animal up to 25 mm, and only after this can any penalty be imposed.
St Edmunds currently procures 30% of its pigs from contracts with Eastern Counties Farmers, United Pig Breeders and Porcofram Limited, and a further 60% come from the eighteen Syndicate Members. The Syndicate has proved to be an enormous success, with regular meetings taking place between producers and the factory management, when any relevant points can be discussed.
This is just another example of the benefit of the very close ralationship that exists between St Edmunds and its suppliers.