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'We had to realign our supply base to avoid the UK where possible'

Getting ready for Brexit: As an Approved Economic Operator, products are processed in a ‘fast-lane’ system through Dublin port

David Brett, general manager, Oakpark Foods, in Cahir, Co Tipperary. Photograph: Donal O’Leary

David Brett, general manager, Oakpark Foods, in Cahir, Co Tipperary. Photograph: Donal O’Leary

 

David Brett is managing director of Oakpark, a bacon and pork manufacturer based in Cahir, Co Tipperary that he runs with his younger brother John. The Brett family has been part of the agri-food sector in the southeast for several generations, and is one of the country’s leading animal feed millers and grain merchants. The Brett family took on the Oakpark business in the early ’90s and has grown to employ 150 people at its facilities in Cahir.

“We are producing about 500,000 packets of rashers each week,” says David, “and we are producing 60,000 bacon joints each week as well.”

The Oakpark products are stocked across Ireland and it also has substantial trade with supermarkets such as Aldi, Lidl, Iceland, Morrisons, and Farm Foods in Britain.

“Forty per cent of our overall sales are exported to the UK,” says David. “We’re projecting to turn over €40 million this year, assuming that Brexit doesn’t step in the way of that.”

With such a significant portion of its business reliant on UK trade, Brexit has created multiple challenges for the company. “Brexit has been all encompassing really,” says David. “It has taken over everyone’s life.”

Our margins got eroded massively overnight

The challenges began immediately after the vote in 2016, when a drop in the value of sterling impacted on Oakpark’s UK trade. “Our margins got eroded massively overnight,” says David, who spent the next six months travelling back and forth from the UK meeting customers to renegotiate prices.

“That was the first major impact that Brexit had on our business and we had to readjust our business accordingly,” he says.

With the aid of Enterprise Ireland, Oakpark made changes to its business in order to prepare for doing business after Brexit.

“We had to sit down and look at the finished product – not just the rasher itself, but everything that goes into the end product,” says David. That included finding alternative sources for packaging, labels and boxes.

“Over the past nine months we had to realign our supply base to avoid the UK where possible,” says David, “and that was a challenge because our game is all about the cost on a packet of rashers, and we are always trying to be as competitive as we can be.”

One of the biggest implications that Brexit may have for Oakpark is in the realm of customs and logistics. Operating on a tight turnaround, pallets of goods produced on a Monday morning in Tipperary land with customers in the north of England by noon on Tuesday, with the rest of the UK receiving deliveries before 6am on Wednesday.

“It is a very efficient transport model,” says David, “and that is essential in our business because we have a product that has a limited shelf life.”

There is a serious body of work involved in getting the AEO approval

Part of the work Oakpark is completing with aid from Enterprise Ireland is to apply for AEO status – as an Approved Economic Operator. It will mean its products are processed in a “fast-lane” system through Dublin port.

“There is a serious body of work involved in getting the AEO approval, we are in the latter stages of it and we hope to have approval in the coming weeks,” says David, who has taken on extra staff to help cover the additional workload.

The company has also enrolled in a similar fast-tracking scheme in the UK. However, even with approval from both schemes, its shipping model won’t be as effective as it is currently.

“It’s a huge amount of extra work,” says David, “and we’re taking it on in the hope that we’ll never have to use it, that some deal will be found. But it is such a large part of our business that we have no other choice than to try to tackle it in order to mitigate against potential problems.”