Future’s bright for Loch Fyne Oysters
Last week, Scottish Salmon Co. and its majority shareholder Northern Link Ltd., announced, through a joint venture named Scottish Seafood Investments (SSI), a significant investment in Loch Fyne Oysters Ltd. The seven-figure investment will enable the Scottish oyster, mussel and smoked salmon producer to expand its operations at home as well as its sales domestically and internationally.
SeafoodSource Contributing Editor Nicki Holmyard recently caught up with Bruce Davidson, managing director of Loch Fyne, to discuss the company’s future.
Holmyard: A seven-figure investment in Loch Fyne will mean big changes for the company. What lies behind such a bold move?
Davidson: We were in a position of needing to make changes to maintain our margins and remain profitable. As with most other medium-sized companies, we were feeling a knock-on effect from the downturn in the global economy and a slowdown in consumer spending. In the end, it made more sense to try to realize ambitious plans rather than maintaining the status quo.
Loch Fyne was formerly employee-owned, so how did your staff feel about transferring ownership to SSI?
We looked long and hard at ways to raise funds while maintaining that status, but they all involved borrowing, which was not feasible in this financial climate. SSI offered a strategic partnership that gives us room to develop and grow with its support. The employees were kept up to speed with developments, and all agreed to the transfer. In particular, they were pleased that their jobs are secure and that the company has a future.
What’s important to Loch Fyne?
We have always stressed the sustainability, provenance/heritage and quality of our products, and our brand is known to deliver this world-wide. We now have a five-year plan to develop and strengthen it, and I believe we are in a position to do the brand justice. Local development is also important, and the investment will enable us to build new premises, update and strengthen the retail and restaurant capacity at our headquarters and bring real socio-economic benefits to the area through growth.
What are the company’s plans for production and sales?
The strategy is two-fold: Firstly, to increase our export sales from 20 percent to around 50 percent, with a particular focus on the United States and Europe. And, secondly, to increase output of farmed shellfish. This will be done using an IMTA (integrated multi-trophic aquaculture) model in conjunction with the Scottish Salmon Co. and will see us step up production of mussels and oysters, while adding in seaweed and sea urchins.
We see huge potential for developing new value-added products and making our packing more sustainable, and we are putting effort into R&D to achieve this. We already have one new product — a lightly smoked salmon fillet that has just achieved a listing on British Airways business class flights, and we are working on a number of others.
Plans are also in hand to increase sales of fresh Loch Fyne-branded salmon, grown in partnership with the Scottish Salmon Co, which is just moving over to Freedom Food standards. We currently take around 1,000 tons per year. But the company grows 24,000 tons, so there is considerable room for growth. The United States is seen to offer particularly exciting potential for marketing this product.
Finally, how are sales performing on the domestic front?
We are strong in the restaurant sector in the southeast of England and in top retailers, including Harrods and Selfridges. The seafood home delivery and corporate gift market is really busy at key times such as Christmas, but there is room for improvement during the rest of the year. Web-based shopping is on the increase and we aim to have a greater slice of this.