21 January 2011
Dear Farmers Guardian (offered but not published...a bit on the long side methinks)
Readers prepared to study FG (21 Jan) thoughtfully will find it contains a solution to our milk marketing and low pricing problems. On pages 36 and 37 (Doorstep delivery is cornerstone...), the power of a farmer-owned brand for which customers develop an affection and loyalty is ably demonstrated by the Tweddle siblings and their Acorn Dairy enterprise. Earlier in the paper, on your letters page, C Marshall from Harrogate identifies with pin-point accuracy that allowing or, worse still, helping the development of dedicated milk supply groups to supermarkets and processors has handed a spectacular divide-and-rule victory over milk producers to milk buyers. Rather than championing these divisive groups, should not the combined power of the NFU, NFUS, TFA, CLBA, FFA and farmer-owned co-ops be working together on a solution?
Without milk, no processor has a business. In contrast, a guaranteed supply of milk together with a range of brands under which it is sold will give a processor—either farmer-owned or otherwise—a decent chance of some leverage over the price they earn for milk. For supermarkets, the need for customers to buy fresh milk every few days is a powerful vector in persuading shoppers to return more frequently that they otherwise would. That's why milk is discounted, not because supermarkets don't value it. On the contrary, their need for fresh milk is fundamental to their business model, and if it's unbranded or their own brand so much the better because that allows them to play one supplier off against another. But if the availability of unbranded milk was restricted, or ideally eliminated, they'd have no choice but stock branded milks, among which the strongest brands (like Muller yogurts, perhaps) would earn the best prices for their suppliers.
Clearly, this strategy would be very demanding for those involved at the dairy farming end of things. It would require unprecedented vision, unity and persuasiveness among its leaders; and an equally unprecedented level of intelligent analysis and decision-making, both individually and collectively, by dairy farmers. But we're not in today's situation by accident; it's deserved as a result of past decisions, actions or inaction that have allowed negotiating power to be taken away from farmers. No one is going to turn back the clock, or make retailers and processors behave 'more fairly' as we see it, no matter how often and persuasively our leaders call for it.
Instead, improving the ex-farm milk price needs a new and clear objective: to restore farmers' control over their own product, right through to consumers. It needs a new strategy: By making milk available to retailers solely via farmer-owned channels (albeit several competing ones) in the form of farmer-owned brands. And it needs sound tactics and implementation: Effective presentation and persuasion by dairy farmers' leaders; loyalty to those leaders by individual dairy farmers; co-ordinated mass migration of supply contracts to farmer-owned businesses; excellent supply chain negotiation by those businesses from a new position of strength; and please, an end to futile public pleas for a fair share of the retail price.
Otherwise, most liquid milk, with the noble, notable and minority exceptions of innovative farmers' brands like Acorn, Bowland Fresh and Jess's (all reported upon at some time by FG), will continue to be anonymous generic white stuff in plastic cartons, sold at give-away prices by retailers as an important part, to them, of their customer retention strategies. For farmers to be treated as play-makers not pawns, they have to act accordingly. The choice, dear reader, is yours.
Yours sincerely
Phil Christopher
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