Small abattoirs outperforming big firms research says

19 March, 2007

A group of small companies are taking the abattoir industry by storm and showing the bigger players the way forward according to business analysts Plimsoll Publishing.

The research reveals that emerging companies are increasing sales at three times the rate of their larger competitors, delivering four times the profitability and showing five times the return on investment.

According to Plimsoll, price deflation is hitting the bigger companies where it hurts - in their pockets.

The Plimsoll research said that seven of the top 36 firms are losing money, while 14 are making less profit than last year. Salaries alone at the top 36 companies eat up 9% of sales. In general they pay their staff more and are less productive.

It added: "But the new kids on the block are nimbler, slicker and more efficient."

Plimsoll's senior analyst, David Pattison, said: "Seven of the bigger companies are displaying symptoms of extreme tiredness. But the big companies are desperate not to miss out on the new profit and growth areas, so they are busy hunting down the emerging firms.

"At Plimsoll, we have identified why this is happening, and who it is happening to."

Policy director for the Association of Independent Meat Suppliers (AIMS), Norman Bagley, said that he was not surprised the small and medium businesses were performing well.

He said: "If you look back six years ago when we started, it was the perception that small and medium businesses had been blown away by the supermarket suppliers.

"We said at the time that 'store wars' would ensure vast competition and cost cutting with these bigger businesses and the competition in that sector was so savage that it could only provide more opportunities for our suppliers."

However, he added: "I am not surprised that these smaller businesses are being recognised for their forward thinking approach to business. We are seeing an awful lot of investment in our sector."

Director of the British Meat Processors' Association (BMPA), Maurice McCartney, said: "The industry is experiencing difficult trading conditions at present.

"There is room for progressive smaller businesses offering something different to the customers and this is to be welcomed and celebrated and it is positive for our industry in general."

McCartney added he was not sure how relevant Plimsoll's claims made about larger companies performing less well than smaller ones were, when larger businesses operated in entirely different fields.

Plimsoll's findings are contained in a special two-part analysis of the industry.

The first part of the study focuses on the top 36 abattoirs companies and sets their performance within the context of the overall market, while the second identifies and charts the progress of the up and coming firms outside the elite 36.





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