McCarren Meats

Source: Exec Digital UK

Date :27/06/2007 10:50:02

McCarren & Co looks to the rewards of diversification

Following an investment grant from Enterprise Ireland, Cavan-based meat processing firm McCarren & Co is looking to diversify and improve its competitiveness in a tough meat products environment

Written by James Hurley & Produced by Ben Weaver

As Ireland’s burgeoning Celtic tiger economy grows towards maturity, it retains significant roots in an agriculture industry that it has been so closely associated with historically. The country is more than self-sufficient in most products, but it’s not just the Irish who enjoy the large quantity of meat produced annually in Ireland. The country has a thriving export industry, accounting for almost half the agriculture and food sector’s output. Cavan-based meat processing firm McCarren & Co exports more than the average Irish meat producer, with only a minority of its produce remaining in Ireland.

McCarren & Co has been in business since 1863. A fifth generation of McCarrens is now at the helm. While Andrew McCarren Jnr is Managing Director, John is sales manager, while another brother, Christopher, manages its logistics function. The company provides pork and bacon products to a number of different distributors and service industry outlets, including hotels and restaurants. It employs 120 staff at its Cavan town premises, and reported a turnover of €24 million in 2006.

The Irish pig meat industry is very export orientated, with the UK representing Ireland’s biggest market, accounting for over 50 per cent of total exports and the UK is a consistently good outlet for McCarren’s produce.

A pivotal moment

In the mid 1980’s a major rationalisation and investment helped to develop an

internationally competitive export orientated pig meat industry. The Irish pig industry is highly specialised and concentrated on a small number of intensive and large producers. Production has changed from a small scale enterprise carried out by a large number of farmers as an addition to their main farming activities, to today’s industry where a small number of specialist producers operate large scale units using high quality breeding stock and up-to-date production techniques. In this environment, it’s a constant challenge for the company to keep apace with its larger rivals, but McCarren & Co was recently handed a major boost in its efforts to remain competitive.

An exciting and potentially pivotal stage in the firm’s development was heralded in April when the company secured a €2.5 million investment grant from Enterprise Ireland, the Irish state development agency focused on transforming Irish industry. In early 2006, the company decided that it wished to secure assistance to update internal processes and purchase new technology in an effort to improve its competitiveness. After discussions with the agency, McCarren & Co submitted a business plan at the end of last year.

Diversification

The resulting grant will enable McCarren & Co to expand its pig processing facility in Cavan and will lead to the creation of 40 new jobs in the company over the next three years. Equally importantly, the funds will allow the company to enter the next stage of its development as it looks to diversify into higher value, individually marketed meat products. After consultation with its customers it discovered a demand for individually differentiated products in a marketplace that is becoming increasingly homogenized.

When the grant was announced, the Irish Minister for Enterprise, Trade and Employment, Mr Micheál Martin said: “The investment, with support from Enterprise Ireland, will enable McCarrens to implement a new strategy based on developing new higher-value added products and responding quickly and innovatively to changing consumer demands internationally.

“Enterprise Ireland is working closely with the company to increase competitiveness and improve export capability. Not only will this investment bring high-quality employment to the Cavan region, it will also generate spin-off economic benefits for the local economy.”

Managing Director Andrew McCarren summarized the influence the funds will have on the company’s future marketing and growth strategies. "McCarrens are working to increase export sales by targeting the high growth food service and manufacturing sectors in the UK and Europe. This investment marks the next phase of growth for McCarrens,” he said. It is anticipated that the funding will also support management development and training initiatives.

Business at home

As margins grow ever tighter in the Irish market, investment in upgrading the machinery and facilities at the site in Cavan has been crucial. In an environment where a handful of main players dominate the market, efficiencies are absolutely critical, and the company has worked hard to reduce waste, implement lean techniques, and use as much meat as possible from each animal to maximize profits and compete with its larger rivals.

The company is beginning to see more business at home as a larger staff and improved facilities allows more boneless products to be sold, which is crucial in the Irish market. Thanks to EU enlargement, expanding the workforce is no longer as challenging as it once my have been. As with many industries in Ireland, the meat industry has seen the benefit of non-national workers, and McCarren & Co is no different. In particular, the company has a large Polish contingent in its workforce, a fact that it is very thankful for; it has found its Polish workers to be hardworking, flexible and reliable, a crucial advantage in such a competitive market.