Productivity gains see NZ firm reinvest

By Oscar Rousseau contact

- Last updated on GMT

Alliance Group claims to be a 'much fitter' business after driving through a host of changes
Alliance Group claims to be a 'much fitter' business after driving through a host of changes
Farmer-owned meat processor Alliance Group will invest tens of millions of dollars back into the cooperative after delivering on its strategy to produce meat more efficiently.

The New Zealand-based company, which claims to be one of the world’s largest lamb processors, said it would reinvest NZ$54m ($38m) this year to bolster its physical assets.

Alliance is now a much fitter co-operative as a result of our focus on lifting efficiency and improving sales and marketing,​” said Alliance Group chief executive David Surveyor.

We are making good progress against our key measures, with a stronger balance sheet, improved profitability and better livestock pricing for farmers. We’re working hard to ensure our improvements are sustainable through further investment, growing our value add and building our organisational capability.​”

Pool payment to farmers

In the last 12 months, the company has made a number of significant investments to improve its efficiency and reduce operating costs. Among them, NZ$3.4m was spent installing band saws​ at eight factories across New Zealand and NZ$15.2m was invested to enhance the design of its venison plant in Southland​.

The business also installed new primal cutters at its Dannevirke plant in New Zealand and brought in improved packaging equipment at its Pukeuri facility.

These improvements mean Alliance Group believes it is in a position to reinvest money it has saved by being more efficient back into the business.
A pool payment will be made to all 5,000 or so farmers who have a stake in the business.

Alliance Group also plans to reward its lamb, sheep and beef farmers by increasing their share in the co-operative business. The increase will be determined by the quantity of livestock famers supply during the 2017-18 season.

Meanwhile, Alliance Group’s director James Ogden will retire on 30 November. He will be succeeded by Peter Schuyt. 

Related topics: New Zealand, Industry & Markets, Lamb, Beef

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