Need scale to drive growth
Over 50 key seafood companies in Ireland recently met at an intensive networking seminar organised by Bord Iascaigh Mhara (BIM), to discuss how to achieve scale in the Irish seafood sector. It is believed that an increase in scale through the pooling of individual companies’ resources will boost profitability, reduce time to market, and improve customer service.
The Irish Minister for Agriculture, Food and the Marine, Simon Coveney, T.D. - who opened the event, stated that although Irish seafood exports continue to perform well with an estimated growth of 13 per cent to approximately €420 million, there were a number of challenges that needed to be overcome including scale, route to market and meeting market requirements.
“Currently, out of approximately 138 seafood companies in operation, only 40 of these have a turnover of more than €5 million, while 70 have sales of less than €1 million. In contrast, our typical European competitor has a turnover in the order of €20 million. This lack of scale limits our ability to invest in the market place and maximise the profitability of the sector.
"Adding value to our seafood is also required if we are to differentiate ourselves from our competitors.
“I have provided significant funds to BIM in 2012 to deliver a support package that will facilitate companies to achieve scale in their operations,” Coveney said.
Also up for discussion was Ireland’s peripheral location which presents a significant challenge to the processing industry. Access to raw material is another key challenge. BIM are working on a number of projects to overcome these issues including the development of deep sea farms, which each would be capable of producing up to 15,000 tonnes of Irish organic farmed salmon annually and would generate generate full time direct employment for approximately 350 people and a further 150 jobs would be created indirectly
Jason Whooley, BIM’s CEO said: "There is a major market opportunity available to the Irish Seafood processing sector in the medium term; the increased global demand driven by population growth in developing countries particularly in Asia and Africa, are good examples of this. Our International competitors are gearing up for that opportunity and we need to think long term and get ahead of the game. If we can use this seminar to discuss solutions to ensure we can meet this opportunity then the industry will benefit from increased profitability across the board"
