Family firm keeps on rolling
John Flahavan shares with Sean Gallagher the secret behind Flahavan's 230 years in the oats business.
Flahavan's porridge oats have been a favourite among Irish consumers for generations. In business for over 230 years, the company's reputation today is stronger than ever with more than two million servings consumed each week around the world.
Now into their seventh generation, this is a story about love for their business as well as a commitment to remaining relevant in an ever changing marketplace through continuous innovation and new product development.
This week, I visited the family business and its mill and production facility in the village of Kilmacthomas, Co Waterford.
"The business was set up originally, in 1785, by my great, great, great grandfather, Thomas Dunne, on this very site and we have been milling oats in one form or another ever since," explains John Flahavan, the company's managing director.
Marketing director John Noonan drops into the boardroom with an armful of the company products. These include traditional Progress Oatlets, Jumbo Oats and Pinhead Oatmeal as well as their Quick Oats convenience range of individual sachet servings and the even more convenient portable pots. He even has samples of their more recent lines of tasty muesli, granolas and flapjacks.
Noting my surprise at just how many different ranges the company produces, John Flahavan explains that when he took over in 2000, their Progress Oats represented 95pc of total turnover with only a handful of smaller niche lines making up the balance. "Today we make 45 different lines," explains John. "While 75pc of our sales still come from the Irish market, we now export 25pc to 16 different countries including the UK, US, South Korea, Russia, India, and Spain."
The mill itself is a towering seven stories high and uses gravity to help with the production process. The oats used by the company are sourced from local farmers, predominantly within a 50-to-60 mile radius. Many of these farmers have been supplying the mill for generations. Once delivered, the oats are then dried in order to reduce the moisture content ensuring they are safe to store. During the year, these are transferred from their oat storage to the mill and are kilned or roasted to deliver their unique Flahavans' flavour. Before going through the production process, they are put through a very comprehensive and highly automated cleaning process that meticulously removes materials such as weed seeds. A series of high-speed rotary shellers are then used to remove the outer shells of the grain which is segregated and brought to the boiler house. There the outer shells are burned to generate the steam needed in the production process. The remaining oat flakes are then either rolled to become jumbo flakes and packed as a product in their own right or chopped into smaller pieces to become pinhead oats which are then steamed and rolled into the company's famous porridge oats. While still a traditional family run business, much has changed since John took over.
"My father and uncle ran the business when I was young. Immediately after completing a degree in Business and Accounting in the College of Commerce in Rathmines I joined full-time in 1972 and have been here since," says John. Starting out in the finance and sales areas, John eventually took over in 2000 having bought out the other family members who were involved at the time.
"The first significant change was our decision to get out of the agri side of the business," explains John. "Up to that point, we had been producing animal feedstuff which made up almost 50pc of our total turnover. Deciding to cut off half of our revenues was scary but it allowed us to concentrate fully on the consumer side of the business where we saw the greatest potential. Since then turnover has grown fivefold," he adds.
In 2003, the company began producing a range of organic oats to fill what they thought was a small niche market. However, this soon grew to become an important part of their business and today is the largest brand of organic oats within both the Irish and UK markets. As we make our way next door to the newest addition to the site, the bakery, the sweet smell of orange and cranberry comes wafting through the air. Here staff are busy rolling, baking and packing the days production of flapjacks.
"Our decision to build this flapjack and granola plant in 2015 has also helped introduce a new cohort of consumers to our brand," says John.
Sustainability is now an important part of the company's ethos with 60pc of the energy they use now coming from sustainable sources. The oat husk shells that are burned in the boiler to produce the steam needed for the drying and roasting process, has led to a reduction of over 400,000 litres of diesel per year - something that is good for the bottom line as well as for the environment. Similarly, we have our own on site wind and water turbines which both generate electricity for the site," adds John.
While the company employs 70 staff there's still a strong family feel to the business with most of the staff coming from the local area.
"We are lucky to have a very dedicated and experienced workforce with very low levels of employee turnover," says John. "Everyone takes great pride in what they do here and every morning at the mid-morning tea break, we all enjoy tasting that day's oat production."
What's next for Flahavan's? I ask
"The one thing I learned over the last 45 years working in the business is that you're either moving forward or backwards but you can never afford to stand still," insists John. "Our objective now is to continue to build our brand, grow the export side of the business and drive innovation through new product development. In particular, we see huge potential to expand the organic side of the business, something that is good for the consumer, good for us and good for the farmers we work with," he adds.
The company has just been invited to take part in this years' RTE Operation Transformation, a move that will see them give away 200,000 packs or 3 million healthy servings of porridge, for free, in one day. "We are delighted to be associated with the programme. After all, living healthier and living longer has always been at the heart of the Flahavan's' message," he insists.
John's wife Mary, who is a keen baker, has played a significant role in helping with recipes and new product development. Three of their children have also recently joined the family business. James works in exports while Annie is in finance and Ellen in marketing. "They are now the seventh generation to work in the business and it really will be a privilege to be able to pass it onto them. I see myself more as a custodian of this business rather than its owner. My job now is to pass it on to the next generation in better shape than when I took it over," he adds.
For further information: www.flahavans.com
Sunday Indo Business