Abbey Logistics Liquid Tanker

Steve Granite, MD of Abbey Logistics, has said the business’s new animal feeds division will fuel his ambitions to create a £100m group within the next three to four years.

Abbey Logistics unveiled its new animal feeds division, which will provide bulk transport and logistics for animal feed nationwide, yesterday (26 September).

Granite told MT that the decision to provide a distinct focus within the animal feeds market grew out of the acquisition of liquid food operator Armet in January 2017.

“We acquired Armet in January 2017 and quite a large share of the liquid food market.

“So when we looked at our plans to grow into a business with a £100m turnover by 2021, we looked at the different market places we operated in and asked ‘is there opportunity for growth, to fulfil that ambition?’”.

However, the liquid food market "didn’t offer the headroom for growth” according to Granite, while the feed sector, which it operated in but only on a small scale, did.

To that end he expects it to develop to provide around 10%, or £10m, of the group’s annual turnover once the £100m mark is achieved. The company's next published accounts are expected to show annual turnover of around £70m up from £55m in the year to 30 June 2017.

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Granite believes there are huge opportunities for growth in the feeds market, which is presently very regional in its nature.

“I think that we can offer something different, in terms of a national solution where there’s more flexibility than a smaller haulier could offer and to pull on the resources of Abbey – the tank cleaning station, the depots that we have, the tractor units, the drivers – who can operate liquid or feed. So I think we’ve got a really good offer for the market,” he said.

Steve Granite1

He added: “What we’ve said is, let’s not have animal feeds as a bolt on to the liquid foods business, as the liquid food business would always take priority. And that’s going to cause poor customer service.

"So we’ve ring-fenced part of the fleet, re-branded it and we’ve given one of our very experienced transport managers to head it up and one of our very experienced commercial people. Let’s grow it as a separate business and give those customers the specialist knowledge, dedicated equipment and that personal service that we want to deliver,” Granite said.

Speaking about the constitution of the group today, which has an annual turnover of £70m, he said: “The liquid food business is around £20m to £25m. Our bulk powder of the business is just over £30m. We have a few million in European businesses, and the balance is in warehousing."