The food industry has taken strong root in Oldham with several major suppliers feeding the nation a richly varied diet of locally-produced confectionery and breads. Many of the leading supermarket chains source products from the town’s bakeries.
A number of smaller companies have also made their home in the Borough to cater for the growing ethnic food and snack markets. Asian and Chinese entrepreneurs are a distinctive feature of the specialist end of the sector.
The concentration of producers at the volume end of the food chain is part historical. Park Cakes, the sector’s biggest employer with 1200 staff, can trace its birth as a commercial venture to 1937 when three men launched McDowell Cakes on a part-time basis from a “two up, two down” cottage on Hathershaw Lane, Oldham.
In 1948 the business changed its name to the Park Cake Bakeries and secured its first orders from Marks & Spencer. Since 1986-87 the company, now part of the Northern Foods Group, has focused its business almost entirely on Own Label production with M & S accounting for most of its £70 million turnover.
Since 1994, Park Cakes has spent £5 million a year upgrading and modernising its cluster of bakeries in Ashton Road, Oldham, to meet M&S's exacting quality standards. A further £16 million was invested in the 2000 acquisition of Bristol-based R & K Wise (which had a £20 million slice of M&S's small cakes and pies markets) and the subsequent transfer of production to Oldham and Bolton.
The company makes a wide range of products for its main customer, from Swiss rolls and Victoria sandwich cream cakes, to chilled pies and croissants. It has a large group of bakers and chefs constantly developing new ideas and products for Marks & Spencer.
E-tendering and intense retail pressures has made the cake market highly competitive and Park Cakes has lost some contracts to other producers. This has been balanced by a new drive to establish its own Fox label as a quality contemporary cake brand, initially with the launch of a range of mini-bite cakes sold through multiples like Sainsbury and Tesco.
The initial sales target is £7 million a year but the Oldham bakeries hope to grow the Fox cakes brand into a £20 million-a-year business.
Warburtons is another household name with a strong Oldham pedigree. The privately-owned company has been baking bread in the town since it acquired the Ideal Bakery in 1965, its first expansion outside Bolton. The Shaw bakery, one of 10 in the Warburtons chain, produces 750,000 loaves a week with a workforce of 200 for distribution over a 30-mile radius.
Investment of £6 million over the past five years has transformed the bakery into one of the most modern in the country. Computer controlled systems have made the baking process less labour intensive but have helped ensure consistency of product.
The bakery’s “relentless commitment to quality” has resulted in the Shaw operation lifting the Derrick Warburton Trophy for the excellence of its 800 gram white sliced bread three years in succession.
Warburtons has a 39 per cent share of the branded wrapped bread market in its Lancashire heartland. Sales manager Jim Stott says the company’s ambition is to be the nation’s favourite baker, something it hopes to achieve in three years. “We are proud that Shaw was the first stepping stone towards realising that dream.”
Blackburn-based Inter Link Foods plc is another food producer with a major investment in the Borough. Its Lisa Bakery in Coldhurst employs 100 and supplies independent retailers and leading multiples with a range of Swiss rolls and chocolate mini-rolls.
Voted AIM-listed company of the year in 2001, Inter Link has established a reputation as one of the industry’s fastest growing groups with an impressive 146 per cent increase in its 2002 turnover to £46 million. Two new products launched by the Oldham bakery after six-month plant trials are expected to further boost turnover.
Croda Food Services, which makes oils, fats and emulsifiers for the national baking industry, is another firm that has helped Oldham generate a critical mass of food manufacturers. Part of Hull-based Croda International, the company has a 70-strong workforce at its site on Ashton Road.
It points out that the majority of volume cake, bread and pizza bakeries and food processors are located in the Midlands and North and easy access from the town to the national motorway network facilitates both delivery of raw materials and distribution of finished products.
Eastern promise
Ethnic-owned businesses are making a growing contribution to Oldham’s mainstream economy. Asian entrepreneurs are represented in clothing, food and catering, travel, property, nursing homes, software and web design, and are increasingly involved in the professional life of the Borough.
It has been estimated that about a tenth of the 4300 VAT-registered businesses in the town are owned or managed by Asians. Chi Yip, a cash-and-carry grocery business, has grown to be the 10th biggest Oldham-based company with a turnover of nearly £30 million and over 100 employees.
Tariq Amin, chairman of the Asian Business Association, believes the whole concept of Asian business is changing. “People are becoming more educated and don’t want to work all hours in the corner shop. The young Asian entrepreneur is becoming more corporate in outlook.”
The Association is trying to encourage more Asian women to think about self- employment. One of the most successful runs a publishing business.
The explosion in ethnic restaurants has created a huge demand for food service companies who understand the market and are dedicated to supplying it.
Tariq Amin, managing director of family-owned Amin Poultry, is typical of the Asian entrepreneurs in the town. His father started the company 30 years ago supplying quality halal meat and poultry products and it has since grown to a £4 million-a-year business.
The firm supplies its products to 250 retail and catering outlets across the North West. It employs 20 and has expanded its wholesale and retail operations into the preparation and distribution of value-added products for supermarkets and restaurants.
It has invested in a fleet of temperature-controlled trucks and in 2002 opened a cold store on the Coppice Industrial Estate. The company’s aim is to be largest supplier of halal poultry products in the North of England.
Oldham’s main producers tend to operate in the traditional end of the food. One local company, Conagra Foods, has established its reputation in an altogether different corner of the industry – popcorn.
The company, part of a US-owned group, makes microwave popcorn for UK and European retail and cinema chains. Corn is shipped to England in a processed form by a sister company in Argentina and converted into 100 gram bags by the firm’s 35-strong Middleton workforce.
Conagra Foods produces 40 million bags of the product a year in the Borough and claims 65 per cent of the market in microwave popcorn. Europe is considered to be a big growth area for popcorn and three quarters of local production is exported.
German sales have rocketed from 2 million to 5 millions bags in just 18 months. British consumers currently munch their way through 10 million of the 40 million bags produced in Oldham.
Why is popcorn so popular? Conagra says Britons are just picking up more of America’s eating habits. “It’s much healthier alternative to eating crisps. Popcorn contains much less saturated fats,” says a company spokesperson.