Sector News

Müller reveals £100m cost and margin improvement initiative

February 14, 2019
Food & Drink

Müller Milk & Ingredients (MMI) has launched a £100 million cost and margin improvement programme in the UK, in a move to “return to sustainable levels of profitability”.

The UK-based milk supplier said the programme aims to secure a vibrant future for the business, benefiting consumers, customers, employees and farmers.

Called Project Darwin, the initiative includes a comprehensive review of every aspect of MMI’s operations – including logistics, back office and people organisation – in order to simplify the business, reduce costs and further improve customer focus and accountability.

The 12-month programme is already underway, but the company stressed it is too early to convey specific changes in each part of the MMI business and organisation and in customer relationships and priorities.

MMI CEO Patrick Müller said: “Fresh milk is loved by British families with 96% of UK households having milk in their fridges. But the market environment has changed significantly due to global dairy market volatility, decline in consumption and changes in retailing and we need to adapt and return to sustainable levels of profitability so that fresh milk can continue to be part of the fabric of British life.

“We have the best-invested network in our industry and aim to be the leading fresh milk processor in the country for years to come. We’ve invested in unique and class-leading propositions in farm to fridge product quality and shelf life. We have fully recyclable packaging including securing 50% of Britain’s stocks of recycled HDPE for use in bottles, efficient dairies and innovative ways of working with farmers to help protect them from market volatility.

“Project Darwin is about adapting to the changing market environment, becoming a customer-centric, agile and simpler business.

“This transformation programme will inevitably require tough decisions and a great deal of change but when Project Darwin succeeds, consumers, customers, employees and farmers will benefit, and we can again look forward to a vibrant and progressive future.”

MMI said it has already started the transformation by securing long-term strategic partnerships with customers. Last month, the business inked a dairy sourcing deal with Lidl in the UK.

The cost-saving initiative comes two months after MMI revealed a £15 million investment to sustainably upgrade its fresh milk facility in Bellshill, Scotland.

The company said the project “represents the largest single investment in Scottish dairy processing for more than a decade” and gives the Bellshill site the capacity to process more than 370 million litres of fresh milk and cream each year.

By Jules Scully

Source: FoodBev

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