With the love and support of his wife Sarah Louise, Daniel Fairburn, Managing Director of one of the UK’s largest egg producers LJ Fairburn & Son, had to act fast to reinvent the business before the company got into serious financial trouble.
Due to a change in the law on caged chickens, the third generation family firm made huge investments, financed through bank loans. But shortly after, the cost of eggs went down and the price of chicken feed went up and there wasn’t enough money coming in to pay off the loans.
Now, the company has expanded to have over two million chickens and is expecting a £60 million turnover at the end of the year, whilst Daniel and Sarah Louise look forward to a fourth child which is due any moment now.
Always destined for the Alford-based family business, Daniel had been going down to his grandfather’s chicken farm since the age of three. “I was born into it basically,” he said. “My grandfather started the business and my father took it on after. I came into the business working as a boy all the way through to now. I was given options to do other things in life, but I have always had a passion for what I am doing.”
Daniel was proud to take on the history of his family. “It all started in 1951, when my grandfather, who just recently passed away at 89 years old, worked as a labourer on the farm that we are in today. He saved up enough money to buy 150 chickens. He worked seven days a week on this farm and looked after his own chickens before he went to work and after he came home from work. We have a saying of ‘feed the chickens before you feed yourself.'”
Daniel’s grandfather had put everything back into the business to help it grow and expand and that is something he has continued into the third generation. The company is now in its fourth year of continuous growth, moving from a turnover of £12 million in 2011 to a prediction of £60 million by the end of the year. Some £19 million has been invested over the last few years to keep the business growing in a very competitive market.
Demand is also on the rise with a 12% increase from last year. LJ Fairburn and Son is now selling between 13 and 14 million eggs a week and staff numbers have grown to around 200 from only 65 in 2011.
But it has been a long, bumpy road to get to where it is now.
Running the show
With his father taking a back seat, but still owning the company with 50% of the shares, his mother as Chairman and his two sisters with 10% of the shares each, Daniel took up the position of Managing Director with a 23% share in the business.
When his father became ill, and although still heavily involved in the business today, Daniel moved up the pecking order. The company did everything up to putting the eggs in the box, which were then distributed and sold through a third party. But when the law changed, the businesses needed a big overhaul.
“The business went through a massive transformation in 2011/12,” said Daniel. “The conventional cage ban came into effect and we invested heavily into the new enriched chicken colonies in multi-tiered sheds. Where as the existing battery cages were a small confined space, now it’s like an avery. It’s got perches in it and nest boxes. The room is more than double per bird.
“At that point we borrowed a lot of money for the new systems. We found that very challenging because egg prices actually dropped and the feed price went up.
“This put us into an uncomfortable situation with the bank. They came back and gave us two options. We either had to stay with the third party and try and maximise what we earned from them, or we looked to market our own eggs. We took plan B.”
The move to market their own brand was drastic but required. Daniel enlisted his wife Sarah Louise to come in a few days a week to help organise the office in preparation. As a business in the digital age, they had very little in place to build up a presence in the market on their own.
The couple became used to the idea of sleepless nights while they tried to enact the change and get back on track. It was a mission in itself, never mind trying to raise three children to be the next generation of LJ Fairburn and Sons at the same time.
“We had nothing,” said Sarah Louise. “We had one phone line coming into the office. We didn’t have a proper email address, didn’t have a website, none of us had a business card. It was just family in here running it. We had no other staff in the office. Everything was run on a shoestring because the money that we were taking in wasn’t enough to pay all our staff and for all the eggs that we were selling.”
Sarah Louise very quickly became a key part in the running of the business and assumed the full time role of Brand Director to help set up the new brand. The couple teamed up to make the company a success, putting into place their own distribution lorries for eggs and even setting up the company with its own feed mill so that they can cater to each client’s individual needs.
The change over to becoming their own distributor and finding new clients to supply was a big challenge. Daniel said: “We had, at one point, over 200 pallets of eggs on the floor with no home to go to. On a pallet there are 8,640 – it was horrible.”
“There was a lot of pressure put onto us within the industry not to succeed and that was our most determined thing – to prove everyone wrong.”
Sarah Louise continued: “Because Fairburn’s have done so well as a family and as a business at times, certain people wouldn’t sell Fairburn’s eggs because they didn’t want us to continue to grow and continue to push forward.
“That’s why as a family it just makes you more determined and tenacious. Daniel is just buying land left, right and centre to put sheds up so that we will always hold much more of a surplus. It’s quite a different industry and the supermarkets know that as well.”
Aldi was the first chain to take a chance on the company’s own brand and the couple couldn’t be more grateful. Daniel said: “They took 2,000 cases a week off us at one point. They have been very good to us and continue to be.
“It was very challenging but we got there,” Daniel added proudly. Now he supplies many of the supermarkets including Sainsbury’s and Asda.
Flying the coup
Now that the company is back on track and with more than a few local and national awards to show off for their brand and work ethic, Daniel and Sarah Louise are happy to wave goodbye to the hard times that they have overcome together. Currently they are looking at how they can make the family business self sustaining for the next generation of Fairburn children to take charge.
Around £19 million has been invested into the company over the last few years on both land and equipment. Daniel said: “The packing centres have cost us a lot of money with new machines. At one point we had the biggest machine in the UK for egg grading, which was £2 million. Everything has gone back in to making the company efficient.”
“I can’t begin to describe to you how it’s transformed,” Sarah Louise added. “I think that’s why we won the IGD Transformation Award. That was a huge win. We won against George Asda, Wallace and Quorn. We couldn’t believe it!
“I think they recognised that we had nothing. Daniel started from nothing. He took over from his father and he had the chickens and the production but we didn’t have any structures in place to take that to another level at that time. We had to do it all within the space of a few months.”
But despite the growth and the need to now take on staff from outside of the family, Daniel remains insistent that the family remain in control of the business. “It’s very important that the business stays in the family because we have some very good staff,” he said. “It doesn’t just stop at 9-5. If we get hurt, it hurts them as well.
“We have some great staff now who adopt the same ethos. We were up until 1.30am talking about work and sending emails and one thing or another. My grandfather always said, ‘You’re married to the job. It’s your life.’ That’s why it’s important that the ethos stays the same and the family come in to make sure that the ethos carries on.”
This feature interview was first published in issue 59 of the Lincolnshire Business weekly magazine.