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Wednesday 24 October 2018

Biscuit bosses realised that looking abroad was only chance of survival

Tom McEnaney Business Editor

When two Quakers, William Beale Jacob and Robert Jacob, set up a bakery in Waterford in 1881, they saw a business opportunity to supply the many boats that docked at Waterford Harbour.

In seeking a hard, tasty bread that would not go off easily at sea, they founded one of the few Irish brands to gain international recognition.

The business moved to Dublin soon afterwards and since then the company has been producing premium biscuits mainly for the Irish and British markets.

But no more. Yesterday Jacobs Fruitfield announced that it was closing down the Tallaght plant that makes the ubiquitous fig roll, not to mention Kimberly, Mikado and Coconut Creams.

The products will continue to be available, but manufacturing will now be outsourced to other European countries.

Where hasn't been decided but Jacobs Fruitfield is talking to rival biscuitmakers in the UK, France and Portugal.

Jacobs has seen a number of incarnations in its time. W&R Jacobs had a branch in Liverpool, but that split away in the 1920s.

In the 1970s it merged with Bolands Biscuits, took a new name, 'Irish Biscuits', and moved to the Tallaght headquarters, which has now been lined up for closure some time next year.

Jacobs Ireland and the UK became two sides of the samecracker again in 1990 when the business was acquired by French company Danone. Fruitfield, the jam company, acquired the Irish operations again in 2004 and changed the name to the Jacobs Fruitfield Group. Since then chief executive and sharehodler Michael Carey has been looking at ways of driving further efficiencies out of a plant designed to produce 60,000 tonnes of biscuits a year but which, for many years, has only been operating at about 10,000 tonnes a year.

The original strategy was to acquire other food companies making products that could be manufactured in Tallaght.That proved difficult, as many interested parties vied for a small number of opportunities.

Along the way the company sought to make the best of what it had and in 2005 let go 40 workers. In fairness to Jacobs, it has given the employees plenty of notice and has ringfenced a €10m fund to ensure they get more that their statutory redundancy entitlements.The company will now employ only 120 people, about half of whom will be in administrative functions.

The 60 manufacturing jobs will be in the company's biscuit wafer plant in Gweedore, its sauces and jam plant in Drogheda, and a plant in west Cork that makes premium oat crumble biscuits.

Although this is very bad news for 120 families in Tallaght, the cold hard reality is that it makes business sense for a company that had sales of €90m in 2006 but nursed losses of €10m. In effect an Irish manufacturing plant is being sacrificed so that a great Irish brand may live on.

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