Suppliers left adrift by Titanic sinking of DFB

Jun 13 2009 by Karen Dent, The Journal

As the crisis at collapsed dairy co-operative Dairy Farmers of Britain (DFB) reached its peak, Northumberland-based industry expert Bruce Jobson offers his perspective on what went wrong.

Meantime, PwC has a difficult task in salvaging saleable assets from the forlorn wreckage. Lincoln dairy has this week been closed with a loss of 127 jobs and Llandyrogg factory in North Wales has been sold to Milk Link for an estimated £10m.

The recent downturn in the global marketplace situated DFB in a vulnerable position and prices paid to its farmer members were probably the lowest in the country.

Other dairy companies faced similar industry challenges and this week rivals Milk Link announced a 13% increase in profit to more than £10m.

DFB farmer-directors must take a proportion of the blame for the collapse of a company that had a 10% industry stake.

Over the years, I’ve participated in numerous marketing and board meetings in the UK and North America and the level of required expertise is immense.

Well meaning farmer-directors are generally ill-equipped to manage national and international organisations. Farmers are, literally, very successful in their own fields, but few have the necessary modern day business acumen and London Business School qualifications to run complex multi-million pound corporations.

Bruce Jobson is Northumberland-based dairy expert from www.brucejobsonassociates.com

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