Dairy Crest rejigs management in improved efficiency bid
management structure as part of a drive to increase efficiency at
the UK chilled-food company. Tom Armitage reports.
As of November, Dairy Crest's four business divisions will be consolidated into two operating units: foods, comprising spreads and cheese, and dairies, comprising liquid products and ingredients as well as the household unit, which includes its milk delivery unit.
The move comes after last month's trading statement, in which CEO Drummond Hall said that Dairy Crest's priority in the second half would be "to address the ongoing profitability of the fresh milk business while continuing to invest in developing brands".
Speaking to DairyReporter.com, Will Shaw, head of investor relations at Dairy Crest, denied that the company was seeking to cut costs simply by culling management. He cited "contractual issues in the liquid milk division" and "increased competition across all sectors" as the prime motivators for "evaluating strategies to increase efficiency".
Earlier this year, Dairy Crest lost a key contract to supply own label fresh milk for the UK supermarket Asda to rival processor Arla Foods UK.
The long term financial consequences of the disruption to its liquid milk division still remain to be seen - the Asda business alone accounted for £60 million of the company's annual revenues - but for now, the company is focusing its efforts on consolidating its position in a rapidly changing dairy sector by streamlining its management.
The management restructure sees the appointment of Peter Thornton, previously executive director with responsibility for spreads and liquid products, as executive managing director of the food division, who will also continue his current responsibilities in respect of Yoplait Dairy Crest.
Mark Allen, previously executive director with responsibility for cheese and household, has been appointed executive managing director of the dairies division.
