Farm Ireland
Independent.ie

Sunday 23 April 2017

Meet the woman running one of Ireland's most successful farm machinery companies

Abbey Machinery managing director Clodagh Cavanagh. Photo: Liam Burke/PRESS 22
Abbey Machinery managing director Clodagh Cavanagh. Photo: Liam Burke/PRESS 22
Darragh McCullough

Darragh McCullough

Clodagh Cavanagh is a woman on a mission - several missions, in fact. Expecting her second child in August, and juggling crèche duties for her first-born with dad Steve Smyth, it's impressive that the Nenagh woman still finds the time and headspace to manage one of Ireland's most successful machinery manufacturing businesses.

She is the fifth generation of the Cavanagh family to make a living out of forging steel for the benefit of farming customers, with the origins of Abbey Machinery stretching back to a forge in the Premier County.

A transformative change happened when Clodagh's grandfather Joseph spent time learning about the then cutting-edge welding technology being used in fabrication plants in the US.

He arrived back home and established the Abbey brand in 1947 with his wife, Mary.

"He was the innovator, but she was the real business brains," says Clodagh, of the grandmother that became a real role model.

"It was very unusual for the time but she was the woman going into the bank and doing the deals. She was very, very shrewd."

Abbey Machinery's new tanker range offers greater flexibility with large flotation tyres
Abbey Machinery's new tanker range offers greater flexibility with large flotation tyres

The company's boss laughs when she remembers her gran, who was approaching her 100th birthday, double-checking numbers from computer spreadsheets with her calculator when the business was planning the big move to a new premises in Toomevara last year.

"She was just that kind of woman. She passed away shortly after her 100th but I think she was excited about what was happening in the business," notes Cavanagh, who took over from her father, Charles, as managing director in 2012 while still in her early 30s.


However, she had served her time as a director of the company during one of the toughest patches during the firm's 70 year-long history when turn- over nosedived by 46pc in 2009.

"It took a year or two for it to filter through for us, but when the crash hit, it hit hard," she says.

The company embarked on a redundancy and cost-cutting programme that put the Cavanaghs in an awkward position, with such deep roots in the locality and having personal relationships with so many of the employees' extended families.

"We were growing so rapidly before the crash that efficiencies were not a key focus. But the crash made every Irish business leaner," she says.

Four generations of the Cavanagh family with EU Commissioner Phil Hogan at the opening of Abbey Machinery's new premises last year (pictured from left:) Charles Cavanagh, Mary Cavanagh, Clodagh Cavanagh, Cathal Cavanagh Smyth, Bernadette Cavanagh and Owen Cavanagh
Four generations of the Cavanagh family with EU Commissioner Phil Hogan at the opening of Abbey Machinery's new premises last year (pictured from left:) Charles Cavanagh, Mary Cavanagh, Clodagh Cavanagh, Cathal Cavanagh Smyth, Bernadette Cavanagh and Owen Cavanagh

Abbey certainly seemed to weather the bust better than most, with pre-tax profits doubling to €851,637 for 2015.

And while the global downturn in milk price during 2016 did hit sales, family shareholders were sitting on funds close to €13m, putting them in a strong position to make the move to brand-new 100,000sq ft premises in Toomevara last year. Yet Cavanagh is already talking about expanding the premises even further.

"We're aiming for annual growth of 15pc a year," says the ambitious young woman, acknowledging that such a feat would see the business double in size every five years. Is that a realistic target for a business that is selling a large portion of its exports - which count for 60pc of Abbey's sales - into Britain post-Brexit?

"It's not going to be easy but we've come through plenty of challenges over the years. And even with Brexit, we have still been getting significant orders from the UK. Just before Christmas, we struck a deal with a machinery dealer in the southwest of the UK, who has five branches," says Clodagh.

But she also stresses that they are working hard at developing export markets outside of the UK.

"We've developed a lot of business with New Zealand and Australia, which is great because it offsets the seasonality that used to hamper production here. In the past we used to make a lot of toppers in the spring before that trade would die a death. Now we can plan on more even output throughout the year."

Would it make sense for Abbey to relocate part or all of its manufacturing to lower-cost economies such as Poland?

"It would certainly be cheaper, not just in terms of manufacturing but also in terms of transport costs to get the finished product to the customer because the road freight would be so much less," says Clodagh, but not without stressing that the company has no ambitions to move anywhere outside of Ireland.

"One of our key success factors is our in-house expertise. Nearly half of all our 100 staff have farming interests so they bring that know-how to their work. And we feel that any product that survives on the Irish market is good to go anywhere in the world."

And what about other untapped markets, like South America? "Language is one factor that certainly helps us in places like New Zealand and Australia. And we're on a level playing field in those markets because most of the competition is from Europe, so they have the same transport costs. But in Brazil, which would be a massive market, you're facing massive import tariffs and plenty of local competition."

Which is probably why Cavanagh will find herself on a plane to Reykjavík rather than Rio next month. "Yes, they do have cows in Iceland! And that's one of the big buzzes for me - seeing a machine born and bred in Ireland working away in a field in somewhere like Iceland," she says.

Expansion plans will focus on company's core values

Abbey routinely sinks close to €500,000 annually into research and development, but Clodagh Cavanagh doesn't see the company drifting away from the core lines that they already specialise in.

"We like to think we cater for the total cow - from our feeders and toppers through to our slurry spreaders. Any innovations that will be coming on stream in the coming years will be closely related to those lines, especially in the slurry handling and tub feeders, which are our two big-ticket items," she says.

The biggest trend that Cavanagh sees is towards larger and larger capacity models.

"Obviously, farmers need more and more precision in terms of how they feed their cows or how they are utilising their slurry, and there is plenty to be working at improving there.

"But the main driver is size. While we might have had a yard full of new 1,600-gallon tankers in years gone by, now the standard size is closer to 3,000 gallons, and we have more and more enquiries for machines up to 6,000 gallons, especially from the anaerobic digester sector," she says.

With the increase in scale, the price tags also get pretty hefty, with a 6,000 tri-axle tanker costing close to €55,000. The same trend is evident with the feeder wagons, with tri-auger 33.5 cubic metre tubs capable of holding enough feed for 200 cows hitting the €77,000 price mark.


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