Still making dough after getting back to bread basics
This family business has put its focus on the products its consumers really need now, writes Siobhan Creaton
For more than 60 years, the O'Hara family has been baking bread and cakes in Foxford, Co Mayo. The business, started in the 1950s when Michael and Maureen O'Hara won a few bob in the Sweepstakes, has endured good and bad times and continues to produce the sliced pans, Madeira cakes and Foxford lunches that are among the best-selling brands west of the Shannon.
Today it is a major employer in the region. With 140 staff who mostly live around Foxford, with others driving every day from as far away as Castlebar and Ballina, it provides a big boost for the local economy.
It remains very much a family business, run by the founders' son, Pat, and his wife, Phil.
He was the eldest of 12 children and works alongside his brother Martin, sisters Margo, Kate and Teresa and his son and daughters at the Foxford factory. Margo said they were all "reared" in the business that their mother kept going after her father died in 1971 before Pat took it over.
"They are a very hands-on family who operate an open-door policy," the bakery's sales director Sean Trayers says. "There is nothing that you can't talk to them about."
Every week, the firm produces 40,000 of its trademark white sliced pans in the distinctive red wrappers and between 15,000 and 20,000 cakes. Traditionally, bread and cakes were an equally important part of O'Hara's annual production but in response to changed trends in the past couple of years, it now sells slightly more bread than cakes as cash-strapped consumers are focussing on the essentials.
"We are lucky we are involved in the food business," Trayers says.
"It's a case of back to the basics. Bread is a staple product. It would have been much harder for the business if it was solely making cakes, which are not essential items. Consumers are still prepared to buy cakes, but at a price."
O'Hara's cakes are high-end brands, priced from €3 up, and sales declined rapidly as consumers began to lose jobs in increasing numbers and fret about paying the mortgage. Once this became evident in 2009, the company worried about cake sales over the bumper Christmas period, where it not only sells its own brands but also produces traditional cakes for the own-brand ranges sold at Dunnes Stores, Musgrave and Superquinn. "Luckily it stayed strong and shows that consumers will still buy Christmas cakes," Trayers says.
Bread sales also took a hit. During the boom, O'Hara's, like others, created more niche products, like healthy seeded breads, but has now firmly switched back to the sliced white and browns and soda breads.
It was a time to tighten up on costs across the board to remain competitive but so far the company has managed to avoid laying staff off or cutting their wages. It is a tightly knit workforce and many of the employees, like the O'Hara's themselves, have long family ties with the bakery where their parents and relatives have worked.
"We have a cap on job numbers," Trayers explains.
"There have been retirements that happened naturally and these people were not replaced. Wages and bonuses have been frozen and we have become more aggressive with suppliers such as the ESB and phone to drive costs out."
Last year, the company turned over €21m and has consistently re-invested in the business and the brand. It has recently spent €400,000 "refreshing" its packaging, making subtle changes to keep it contemporary while retaining the familiar and trusted traits that appeal to its loyal customers.
O'Hara's is a business dependent on selling to the cut-throat big retailers that work on thin profit margins. It is a tough market, Trayers says, but the big Irish retailers have been loyal to the company over the past 10 years.
"The Irish market is different because consumers here are still quite brand loyal. Because they still want brands, O'Hara's is an important part of their portfolio." Every day it competes against other strong Irish brands like Brennans Bread, Irish Pride, Pat the Baker, Gateaux and the private labels but is conscious of the popularity of Aldi and Lidl, which have shown consumers are becoming more accepting of other brands. Shoppers are increasingly driven by price, Trayers says, and that is unlikely to change in the near term.
With a large employer in the small village, Foxford and its environs are resilient in the teeth of the recession. And there are plenty of people who would like to work at the bakery. "We have seen a huge number of builders, plumbers and electricians applying for work here," Trayers says, as there are few options for those workers now that the building boom is over.
The O'Hara family, who moved to their purpose-built factory on the outskirts of the village in 1986, are in it for the long haul. They hope to be baking for at least another 60 years.