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Established in 1961 and still owned and run by the Mead family, British food firm Yeo Valley produces the Yeo Valley Family Farms range of yoghurt and the Roscombe Dairy Ice Cream brand and owns three cafes. 

The firm makes its own branded products and supplies the major retailers with own-label produce. Stockists include all the major multiples including Tesco, Sainsbury’s, Waitrose, Co-op, and it also exports to specialist retailers in international markets. 

While many restaurants were shut during the lockdown, supermarkets remained open and saw a surge in business. This trend helped Yeo Valley, which is up substantially year on year. 

This surge in business presented some operational challenges for the company. With demand patterns changing, food manufacturers have been under increasing pressure to produce higher volumes whilst under operational pressure of staffing issues. 

“The challenge has been operationally how do we gear the business to fulfil demand. COVID-19 has seen an increase in sales fueled by changing eating habits, more people working at home meaning demand for dairy products have been at an all-time high.”

I think we’re at a size that we can be nimble and agile, yes we have lots of SKU’s but from a manufacturing point of view we are all within the same site or nearby, we don’t have factories miles away, we can therefore influence change at pace.

The response

Yeo Valley adapted to meet the increase in demand. It has changed the way it operates in a short space of time. To help it achieve this, it has rationalised its range. “Rather than produce the full range of products, we have delisted a number of products to focus on the core SKU’s [stock keeping units]. Our mission has been to keep producing in the challenging operational environment.” 

Staff at the company’s head office also trained to work in the factory to ensure business continuity, while it has also implemented a range of health and safety protocols. 

“In summary, trading has been great, the production has been challenging, more time required, more cost and fewer people. All our effort has been focused on getting product out the door. In light of how other businesses are being impacted, a nice problem to have,”

The impact

The team adapted quickly and the production line had to change. “I think we’re at a size that we can be nimble and agile, yes we have lots of SKU’s but from a manufacturing point of view we are all within the same site or nearby, we don’t have factories miles away, we can therefore influence change at pace,” 

“As a leadership team we’re tight, and decisions get made quickly, we’re a big company with a start-up mentality, which means we make stuff happen, decisions are made, and we step into action stations. There is no long chain of decision making at Yeo, maybe because at the heart of it we are still a family business.”

The outlook

According to the Yeo Valley Leadership team, “This isn’t going to change anytime soon and therefore for us, it’s about thinking ahead rather than being sentimental about the past. The game’s changed and we need to adapt and predict the new ways, not look to go back to the old ways. The challenge is how do we get this mindset into our people. 

“For food, it’s a positive story, after all everyone needs to eat, I think for us it’s about the division of business and therefore how do we need to structure ourselves to be matching the change in demand and buying behaviour. 

“We’re also looking at a D2C (Direct to Customer) offering for the future as working from home will be the new normal.”

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