STATE OF FLUX
2014 GLOBAL SRM RESEARCH REPORT
CASE STUDY 81
VOICE OF THE FARMER
CASE STUDY
Dairy Crest has an extensive network of farm suppliers who make a critical contribution to the continued success of the business. Their procurement strategy concentrates on delivering sustainable value, as well as excellent quality and service, to customers and consumers. Most of the fresh raw milk they use each year is bought from the nearly 1,100 direct- supplying farmers with whom Dairy Crest has an exclusive contractual relationship. In the dairy industry, the supplier-customer relationship might be considered a little unusual. While in most industries suppliers are typically competing to win business with customers, the reverse often applies in the dairy industry – the customers (i.e. dairies) are more often competing to enrol and keep farmers. Therefore, the competition Dairy Crest faces downstream (in the dairy products market) is just as tough upstream. This makes it essential for Dairy Crest to continuously develop and strengthen its relationships with its farming partners.
Dairy Crest is an added value dairy foods business. The company's performance is driven by a strong portfolio of branded dairy products created from a rich and varied history. Dairy Crest has grown from the wholly owned subsidiary of the Milk Marketing Board and since its floatation in 1996 has become the leading British-owned dairy foods business. Using close to 2bn litres of milk every year, Dairy Crest processes and delivers fresh milk to most major UK supermarkets. Dairy Crest's doorstep delivery service delivers fresh milk, together with a wide range of other products, to around 1.2m residential and business customers throughout England and Wales. Dairy Crest also makes some of the best known brands in the UK dairy sector, such as Cathedral City, and the leading cheese brand in the UK, as well as the Country Life and Clover product range.
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