Milking machine manufacturer Fullwood wants to double its turnover within 5 years. It will do so by focusing more on product innovation, increased support of its current dealers and expansion of the dealer network.
The British milking machines manufacturer Fullwood has been a daughter company of the Dutch industrial conglomerate Verder Group for over a year now. "It has been a challenging year," says CEO Spencer Davis. "The dairy crisis decreased our revenues."
Dairy Global: Thus, a substantial loss in the first year under the new shareholder?
Spencer Davis: "Turnover doesn’t mean a gain or loss. We only give a statement about this when the annual figures are presented. But everyone will agree that the figures are not the results you aim for. We are very pleased with Verder Group being the sole shareholder. The Group works according to the Dutch principle: structured and disciplined. We as management are now getting more questions and are being challenged more than ever before. And the fact that it is a family business gives us confidence. Despite the poor market, we were still able to invest €2 million this year in innovation projects and €1 million for improvements in our production processes.”
Having a new shareholder, does that mean you will make changes to company policy?
"No, that is not the case. However, the emphasis is slightly different and the pace of change is faster. We are now much more focused on the support of our dealers. By further professionalising this, growth opportunities arise. We also look at attracting dealers in our home markets, United Kingdom, Germany, Belgium and the Czech Republic, and the emerging Baltic states and Russia.”
That sounds nice, but what will the end–user (the dairy farmer) see of it?
"The dealer will communicate more with the dairy farmers about maintenance, especially preventive maintenance. He will also discuss the more programmed maintenance and tender more. The stock position has been improved at the dealers. The dealers will question the dairy farmer more directly about the problems or improvement areas regarding the working conditions and milking technology. This feedback will help us to improve and act fast, leading to quick wins and more satisfied customers."
Where will this lead to? Where would you like to be in five years from now?
"Firstly, we want to recover from last year, which was a bad year. We also want to improve our Merlin2 milking robot. There are several improvements in the pipeline which are patent pending. These broad applicable innovations will hit the market in the coming 18 months. We also want to double our turnover, which will make us the third biggest manufacturer of milking robots and milking parlours in Europe. We are now the fourth biggest. And no, I will not say anything about any of our competitors, we want to pop out of the current top three list."
Which innovations can we further expect from Fullwood?
"Because of the patent application I cannot go deep into the details. But it is obvious that these innovations are related to increasing the milk quality and boosting the efficiency of milking. Regarding the latter, you can think of solutions aimed at increasing the capacity in such a way that a conventional milking system can do with 1 or 2 places less, while maintaining the capacity. This should lead to lower investment for the farmer."
You want to grow. This will mean that dairy farmers have to change their milking machinery brand. Do you think dairy farmers will do so?
"We think so, and also see that they do in practice. We offer the best robotic milking systems and milking parlours and continue to do so. Through our sister company Packo, we can also provide cooling systems. We innovate, provide value for money, we are reliable and our dealers quickly solve the problems farmers have. This way we are able to build trust. It's all about the service. If this is good and the supplier solves the problems, the confidence of our dealer grows and they will continue to stay our dealer. And if not, then the farmer will regret his choice. Then he will make a different decision the next time and will also reveal that to other farmers, as they often share experiences. This is why we put so much emphasis on service, because that is what matters in this type of business."