Jordans cereal company : Still growing those wild oats
Thirty years after founding Jordans, Bill Jordan tells Roger Trapp why he prefers ploughing on to selling up
Sunday 24 July 2005
According to figures from AC Nielsen, the UK's ready-to-eat breakfast cereal market (that is, everything except porridge) is pretty static. But Jordans is growing at about 10 per cent a year by both value and volume. Its market share is still a tiny 3.5 per cent, but it is the country's fourth biggest supplier, behind Kellogg's, Nestle and near neighbour, Weetabix. Moreover, its cereals business has grown 59 per cent in the past five years.
It's not a bad performance for a company that is solely trading at the premium end of the market. Indeed, it is all the more impressive when it is realised that Jordans is still a privately-owned business - with Bill and David the only shareholders - pitting itself against huge international companies that are increasingly targeting the health-food business.
Proud of the company's position in a market dominated by big names, Jordan tends to keep thinking of it as a small family business, indeed as an extension of his family's milling business that this year celebrates its 150th anniversary. He likes to point out that staff loyalty is high, with more than 15 per cent having at least 10 years' service and many family members working alongside each other - just as they would have done on the area's farms before mechanisation drove them off the land.
The family-business approach is hardly surprising, considering the company's beginnings. Jordan had the germ of the idea when travelling around the United States as a drummer in a rock and blues band in the 1960s. Fascinated by the burgeoning interest in health foods in the country, he was particularly interested in the cereal known as granola, for which he thought there might be a market in Britain. Returning home, he started Jordans Cereals with David and a friend using a second-hand oven to cook the cereal. And what started as three men touring the country in transit vans to sell their product until they got a foothold in UK supermarkets, has been transformed into a company that employs 400 people and turns over £60m a year.
Not surprising, perhaps, when you consider that Jordans has been offering organic produce long before most consumers were aware of what it meant. Although the company began as 100 per cent organic, the premiums involved in totally organic farming were difficult to pass on. As a result, Jordans has developed what it calls "conservation grade", a slightly less pure standard that Jordan says is "about 90 per cent organic".
Conservation grade cereals are a product of conservation grade farming, an independently-audited agricultural system, pioneered by Jordans, which increases the number of wildlife species on farming land, without compromising farming sustainability. The 80 farmers involved in the Guild of Conservation Grade Producers take 10 per cent of their land out of production to create habitats for wildflowers, birds, insects and small animals that were lost when factory farming took hold in the 1970s. "Once you get that, there's five times as much wildlife," says Jordan, adding: "The farmers are going back to what they've always been - protectors of the countryside."
This year, Jordans Cereals is taking this a stage further by working with the Wildfowl and Wetlands Trust to return 150 acres of neglected land back to nature. One aim is to restore to the British countryside the common crane via a project at the company's nature reserve, and own conservation grade farm, at Pensthorpe, Norfolk. Leaflets promoting this work are being included in certain packs of the company's products. A parallel project involves re-introducing corncrakes to British farmland.
Jordan is clearly passionate about these programmes and the general approach to encouraging healthy eating. But he is also aware of the need for a company like Jordans to keep moving and diversifying, or risk being swallowed up by the bigger players.
The company's innovative spirit is well demonstrated by the decision, 25 years ago, to produce a bar version of its healthy breakfast cereal. Today, the market that Jordans invented with the launch of the Crunch bar is worth £232m, with more than 320 different bars from various companies on sale. Jordans alone has many different combinations of fruit, muesli and other cereals. It has also noticed the boom in porridge sales, again due to health reasons, and has introduced a unique multi-grain porridge.
At the same time, it is looking abroad to increase sales. Traditionally, North America, Australia and the UK have been the big cereal eaters. But countries that have traditionally eaten breads or other foods at this time of day, such as France and Italy, are changing their habits as the world gets smaller and people become more health-conscious.
"Twenty-five per cent of what we sell goes to the continent," says Jordan pointing out that the company is the fourth cereal brand in France, just as it is in the UK. "Other markets are opening up. Everybody is changing," he says. Or rather, in their breakfast habits at any rate, they are rediscovering what their grandparents already knew.
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