FDBusiness.com

Müller Milk & Ingredients (MMI), Britain’s largest producer of branded and private label fresh and flavoured milk, cream, butter and dairy ingredients, is to review its network of dairies as part of its £100 million Project Darwin programme, and enter a logistics partnership with Müller Group sister company Culina Group. The business will commence a 45 day statutory collective consultation process to assess current and future utilisation and capacity requirements at its network of six dairies.

Whilst the outcome will not be determined until this work is completed, the company cannot at this stage rule out any necessary action including the closure of a manufacturing site should this be required in order to bring capacity into line with current and future customer requirements.

MMI has also confirmed that it intends to operate in a business partnership with Culina Group, the market leading chilled distribution and transport specialist owned by Unternehmensgruppe Theo Müller, to further optimise its cost base while maintaining high levels of customer service.

Culina Group will assume day to day management control of MMI Distribution from June 1, 2019. All 2,500 employees working in this area will remain part of Müller UK & Ireland LLP and will see no change to their terms and conditions of employment.

Ian Smith of Culina Group will be responsible for MMI Distribution and all of the current MMI logistics leadership team will work with him accordingly. Reporting to Thomas Van Mourik, CEO Culina Group, Ian has extensive logistics leadership experience spanning 30 years having worked for some of the UK’s leading logistics businesses including Exel, Tibbett & Britten and Nightfreight.

MMI Distribution will assume control from the point that vehicles have been loaded for delivery at MMI’s network of six dairies to the point that products are successfully delivered directly to customers or to our network of depots. Tanker operations bringing milk from farms to MMI’s dairies will continue to be managed by MMI, as before.

Patrick Müller, Chief Executive Officer of Müller Milk & Ingredients, says: “Project Darwin is making excellent progress with the whole workforce fully engaged in securing a vibrant, progressive future for our fresh milk business and very positive collaboration with customers who share our desire to reinvigorate this important sector.

“It is a matter of considerable regret that we must consult on steps which could result in a restructuring of our dairy network and capacity but we must ensure the sustainability of our business and address potential over-capacity in our network.

“The distribution business partnership with Culina Group, a sister company within Müller Group, will put together the two major chilled logistics networks in the UK, ensuring that we can further build upon our reputation for great customer service at the lowest cost.

“MMI has the best invested dairy network in our industry, and sector leading quality and shelf life. We have fully recyclable packaging and innovative initiatives to protect dairy farmers from the worst effects of farm gate milk price volatility. Combining this with Culina’s market leading distribution capabilities gives us an end to end solution which we believe is unbeatable in our industry.“

Launched in February, Project Darwin is designed to secure a vibrant and sustainable future for the business through cost reduction and margin improvement against a backdrop of declining consumption of fresh milk and significant changes in retailing.

The transformation programme includes a comprehensive review of every aspect of MMI’s operations, logistics, back office and people organisation to simplify the business, reduce costs and increase customer focus and accountability.