Aussie rules as Tayto increases emphasis on home market
Australian Jeff Swan is overseeing €16m plan to fuel Tayto’s growth
Tayto Snacks Managing director Jeff Swan at the company’s facility near Ashbourne in Co Meath. Photograph: Dara Mac Dónaill
Before taking over the Tayto reins half way through 2018, Jeff Swan went on the company’s factory tour anonymously to follow families around and listen to what they had to say about the brand that has sat on Irish shelves since 1954.
The cheerful Australian concluded that Tayto is an “extraordinary” brand, the likes of which he has never experienced before despite working for global powerhouses such as Coca-Cola and Cadbury. Now the managing director of Tayto Snacks – the outfit which also owns Hunky Dory, King and Perry – and de facto Mr Tayto, he has his work cut out to ensure crisps continue to hold a central role in the Irish diet.
At the company’s Ashbourne headquarters, Swan details the investment and changes under way at the crisp maker. Its parent company – the German-based Intersnack – is spending €16 million in a programme that began last year and will run to 2020. Rather boringly, this is to “release capacity” in the Meath plant so Tayto can fuel its “growth agenda” and ambitions, according to Swan. But it is an interesting move for a company that has almost totally wound down its contract manufacturing business in a sign that its strategy is clearly focused on its branded presence.
As market leader, those ambitions can only be to stay at the top of the pack, and the company has just started selling a new brand of snacks in an effort to shore up its share of the sharing/dipping market.
Cracking open a packet of the smokey chilli chicken flavoured “Muchos”, Swan details how the television ad for the new tortilla/crisp hybrid plays on the Mexican flavour and Irish love of Tayto. How so? By filming a portion of it in Copper Face Jacks, of course.
“Our view is that we love being Ireland’s favourite brand so we’re going to celebrate that,” he says of the ad which also features former general election candidate Mr Tayto.
It is, I proffer, a far cry from the 2010 Hunky Dorys ad which caused ructions before being withdrawn. The campaign featured women in low-cut tops with straplines such as “Are you staring at my crisps?” and “Tackle these”.
The ad was swiftly withdrawn after attracting more than 300 complaints, with the Irish Rugby Football Union threatening legal action over a reference to the crisps as a “proud sponsor of Irish rugby”.
“That’s not an ad we’d want to make today but boy did it have an impact,” says Swan. He seems quite proud of their latest TV offering, a more muted affair, but amusing nonetheless.
The Muchos brand has taken about two years to get from idea to production and, without Intersnack’s ownership of the company that was formerly Largo Foods, it would have been unlikely to have hit Irish stores. Unusually, Muchos was developed in association with the parent company’s UK operation, which also owns KP snacks, meaning that it carries the Tayto brand here but not elsewhere.
More importantly, it’s produced in the UK – a warning for anyone planning on getting too fond of the snack as Brexit looms. The company says it will consider whether to manufacture Muchos in the Republic pending the snack’s success on the market.
In an almost clichéd Australian way, Swan is relaxed about the challenges Brexit will bring. Perhaps with good reason given that more than 70 per cent of the company’s ingredients and products come from and are sold in the Republic. “We’re probably not as exposed as other organisations,” he says, noting that they are nonetheless increasing their stock holding because some retailers have asked them if they could have more stock.
While they’ve taken some additional warehouse space to hold extra ingredients, Swan says they’re well prepared.
It’s important to him personally that the Brexit negotiations don’t end in a no-deal scenario, considering he commutes to London every weekend, something he describes as a “compromise”.
Born in New Zealand, Swan considers Australia to be home given the fact his family moved to Melbourne when he was young. “Equal second” in a family of four children, he has a twin brother who runs a pub – the Royal Standard Hotel in Toora, in southwest Victoria. His older brother works for an ice cream company, while his younger sister works in finance.
His father worked “for many years” in Fosters, the Australian lager brand now owned by AB InBev. For Swan, business wasn’t instilled into him as a child, but brand marketing was something he was interested in doing “way back then”.
Roles in some of the world’s biggest brands including Coca-Cola and Cadbury followed in a high-flying career which involved travelling the world in three-month assignments.
In the early days, he was based in the UK before returning to Australia after a long stint in the food and drink sector to work for a clothing company. Two years later he moved to Lion Dairy and Drinks before returning to England in 2015 to work for KP Snacks, now Tayto’s sister company.
Around the same time, Tayto’s master marketer Ray Coyle was pulling back from the company, having sold his remaining shares to the German snacks behemoth, ending his prominent association with the food brand. The company remains a sponsor of Coyle’s Tayto Park – situated across the road from its headquarters – in a five-year deal of which two years remain.
“I think it’s a good fit for us,” Swan says of the deal, “and it’s great because Ray is across the road [and] we’ll catch up and have a coffee”.
Will they renew the deal when it ends?
“Well, it’s our third year. We do evaluate it every six months but look, so far we’re pleased.”
One would have to imagine continued support of the theme park is key to ensuring the wider community in Meath lends its support in turn now that the popular Coyle is gone from the corner office.
That’s not to say Swan will face resistance. He’s a likeable chap and his extensive experience with market leading brands is clearly a positive for the company he now leads. Additionally, the company is a strong supporter of the local area in business terms, scooping up the vast majority of potatoes supplied by farms in the region.
The managing director also seems personally committed to ensuring Tayto retains a strong sales performance, given his daily habit of indulging in a packet of cheese and onion crisps.
Is such a habit compatible with healthy living?
“Over the last five years, we’ve launched about 118 products, 60 of those have been in the ‘better for you’ space,” Swan says. And while that’s all well and good, he admits that their business is “ultimately about taste” so any changes they make will come only as long as the best flavours remain.
In the seven years to 2012, the industry reduced its salt content by 37 per cent, according to a report from food analysts CremeGlobal produced in 2017. Clearly, the healthier preferences of consumers are driving a change to some degree and Tayto Snacks doesn’t want to be left behind. In the last three years, the company has reduced salt by 13 per cent and fat by more than 17 per cent, according to Swan.
And despite this trend, revenues have grown solidly with net sales of about €98.5 million in 2018, up from €88.5 million the previous year. Tayto alone saw sales rise 4.5 per cent while the smaller O’Donnell’s brand recorded double-digit growth. While there has been a trend for “better for you” products, there has also been a move into “premiumisation”, Swan says, citing the example of gins and tonics.
In any event, the company’s sales are all the more impressive when one considers its retreat from the export market, instead focusing its efforts on its domestic supply. Taking the view that having different languages on packaging and other such requirements had a marked impact on efficiency, Tayto Snacks has substantially reduced its overseas focus to deal with cost headwinds in the snacking category.
“In order to deal with that and make sure we can absorb as much as possible, we need to make sure we can be as efficient as we possibly can,” Swan says.
In the absence of its desire to be an exporter, Swan is happy that the business is “big enough to have influence in its category but also small enough that you can actually know people”, including the roughly 400 people on site.
While Swan is the archetypal corporate man, he has his interests outside the fast-moving consumer goods sector. He’s currently in the process of restoring a 1965 E-type Jaguar series one, having begun fixing up old cars when he was in high school.
“It’s therapeutic and it’s a different form of problem solving,” he says of the hobby. While progress on the Jaguar has been slow, that’s not unreasonable given his weekend family commitments. He has four children, one of whom lives in Australia. Not only that but he appears to have a buoyant social life and, by his own admission, he’s typical Australian on account of his fondness for barbecue and Aussie rules football.
In any event, his motivation for restoring cars isn’t in a desire to get rich quick but rather the “ownership and the pride that comes with that”. While it sounds like a relatively expensive hobby, it’s not a whole lot different from golf membership, something that typifies membership of the executive ranks.
Now living in Malahide during the week with the weekly commute to the UK, there’s a sense that Swan is a caretaker in Tayto Snacks, unlikely to be there right up to pension age. He doesn’t necessarily see it that way.
“You’ve also got to love what you do and, if loving what you do means that the experience is an hour away from home on a plane, I’m okay with that.”
Nevertheless, his stewardship comes during a time of change, when the company’s German owners are seeking to put their stamp on brands over which so many Irish consumers feel ownership.
“I don’t sit here and go: ‘I’m in this job for a finite period of time.’ I feel like I’ve found a business here and an owner in Intersnack that’s unbelievably unique. I’ve worked with brands that are absolutely loved and worshipped in their markets and I can honestly tell you I’ve not experienced something like Tayto.”
And perhaps nobody has. There’s uniqueness in the packaged potatoes from Meath that few have been able to compete with. For the biggest company in the market, that means bettering itself year-on-year.
Very often, start-up businesses are painted on these pages as the ones with the biggest hills to climb, the Davids struggling against Goliath. But being Goliath is no walk in the park and Swan, with his work cut out for him, sounds like he has both the experience and ambition to steer Tayto Snacks onto the next stage of its growth as a consumer brand.
Name: Jeff Swan
Position: Managing director of Tayto Snacks
Lives: Malahide, Co Dublin, and Windsor in the UK
Family: Married to Kim with four children: Millie, Charlie, Harry and Poppy
Something you might expect: Swan eats a packet of Tayto cheese and onion crisps every day after lunch
Something that might surprise: Swan is a classic car enthusiast and is in the process of restoring a 1965 E-Type Jaguar series one