Wexford farm develops a taste for quality yogurt

The Dunnes of Courtnacuddy, Co Wexford, are best known as the producers of Killowen Farm yogurt. Three generations of the family are involved in the business, which employs 22 people at its base near Enniscorthy. Nicholas Dunne took over the day-to-day running of the farm from his father in 1992, but his family can trace its heritage on this land back nine generations.

The Dunnes first began looking at ways of adding value to their milk output in 2004 and considered a number of possibilities before deciding on yogurt. Over the last 10 years, they have built Killowen into a nationally recognised brand with extensive distribution in the retail and food service sectors.

“All of our yogurt is made from milk produced by our 160-strong herd of pedigree Holstein Friesians. We want control of the product from farm to spoon and this is the only way you can do it,” Dunne says. “When we starting looking at bringing our milk to the next stage, we initially thought about frozen yogurt but felt there wasn’t a sufficient market for it. We then approached a local yogurt maker who was getting out of production and subsequently purchased the business from him.

Milestones

“At that time Killowen was very small, with mainly local listings. Since then, we have grown by between 20 and 30 per cent a year. The first important milestone was in 2007 when we were listed with

Pallas

foods. This gave us the opportunity to serve every hotel and catering establishment in the country. The second was in 2008, when we won a three- star gold at the Great Taste awards. This is a very rare occurrence for a yogurt and it convinced us that we had something special.”

The Killowen herd is free grazing and carefully managed to ensure the consistency of the milk quality year round. The yogurt is fermented slowly in small tanks to optimise the flavour.

“We believe our yogurt has a superior taste and that’s why it continues to win awards,” Dunne says. “For the second year running, our Wexford blackcurrant yogurt won the gold medal at Blas na hÉireann and at the recent Great Taste food awards in the UK we won 16 gold stars for our products.”

Killowen produces three lines of yogurt – Classic (cartons), Greek style Premium (glass jars) and catering packs. There are about 15 different flavours on the go depending on seasonality. “Ideally, we’d like to be able to get all of our fruit in Ireland and we go out of our way to find Irish producers. It’s part of our desire to be in complete control of what we’re doing,” Dunne says.

Own label

About 50 per cent of Killowen’s output is own label. It also produces for

Aldi

,

Dunnes Stores

and Musgraves. The multiples often get criticised for driving prices so far down that suppliers can’t make a living. However, Dunne says Killowen has not been put under undue pressure on price.

“We would dig our heels in if we had to but we have an exceptional product and buyers seem to recognise that,” he says. “They also realise that you can’t buy a quality product from a small producer for nothing. It simply doesn’t happen.”

Dunne describes the recent economic downturn as “a tough discipline that makes you grateful for every sale. There is no doubt that 2008, 2009 and 2010 were very difficult”, he adds. “Yes, we lost contracts during that period because people often buy our premium yogurts as a treat and they didn’t have the money for treats. But we pushed hard and managed to grow sales by around 10 per cent and to expand our workforce. However, a lot of ideas for new products had to go on hold because they would have been too expensive in a recessionary climate.”

Despite the trading challenges, the combined incomes of the farm and the yogurt business allowed Killowen to continue investing in growth during the slump, with new hires in quality and marketing roles.

“I think we put down very strong foundations for the future during the recession,” Dunne says. “On the one hand you are fighting for every sale, on the other you have to keep building. We have no aspirations to be a Danone or a Muller. We’d just like to be a viable size commercially and to be the best at what we do. We only use about half the milk we produce so we still have plenty of room for growth.”

Dunne estimates total investment in the yogurt business to date at about €1 million and says the company has made the best of every support available including local Leader and Enterprise Board funding. It has also tapped into the services of Bord Bia and Enterprise Ireland through its innovation voucher scheme. Teagasc’s dairy research centre at Moorepark also played a key role in helping Killowen refine its products. “We are now looking at developing and launching new products that are just a little bit different to what’s already out there. Let’s just call it ‘next generation’ yogurt with the emphasis on health benefits,” Dunne says.