Müller Milk & Ingredients (MMI) has confirmed that it is considering closing some of its dairies in the UK as part of its £100m ‘Project Darwin’ cost reduction and margin improvement programme launched earlier this year.
The largest producer of branded and private label milk stated that it was commencing a 45-day consultation process to assess the “current and future utilisation and capacity requirements” at its network of six dairies.
Whilst it stressed that the outcome will not be determined until this work is completed, the company stated that it was not ruling out any necessary action, including the closure of a manufacturing site should this be required.
Patrick Müller, Chief Executive Officer of MMI said: “Project Darwin is making excellent progress with the whole workforce fully engaged in securing a vibrant, progressive future for our fresh milk business and very positive collaboration with customers who share our desire to reinvigorate this important sector.
“It is a matter of considerable regret that we must consult on steps which could result in a restructuring of our dairy network and capacity but we must ensure the sustainability of our business and address potential over-capacity in our network.”
Meanwhile, the group revealed that it was entering a logistics partnership with Müller sister company Culina as part of its moves to optimise the cost base. Culina will assume day-to-day management control of MMI Distribution from the beginning of June.
However, the company stressed that all 2,500 employees working in this area will remain part of the Müller UK & Ireland business with no change to their terms and conditions of employment. Ian Smith of Culina will take responsibility for MMI Distribution and all of the current logistics leadership team.
Patrick Müller commented: “The distribution business partnership with Culina Group, a sister company within Müller Group, will put together the two major chilled logistics networks in the UK, ensuring that we can further build upon our reputation for great customer service at the lowest cost.
“MMI has the best invested dairy network in our industry, and sector leading quality and shelf life. We have fully recyclable packaging and innovative initiatives to protect dairy farmers from the worst effects of farm gate milk price volatility. Combining this with Culina’s market leading distribution capabilities gives us an end to end solution which we believe is unbeatable in our industry.”
