A DONEGAL family bakery has just secured a multi-million euro contract which will bring their gluten free breads to up to 10,000 outlets in America and Canada in the New Year.
The news comes just five years after Mr Declan Gallagher, MD of Gallagher’s Bakery in Ardara, bought back the business when the then owners, IAWS, announced it was moving its operation to Dublin. This resulted in the loss of 189 jobs.
Mr Gallagher’s late parents, Frank and Dot, founded the business in 1968. The company was sold to IAWS in 2007, although Mr Gallagher remained on as Managing Director.
“We initially hope that 70 new jobs will be back up and running, but I would personally hope that we can increase that to 100 positions in the future,” said Mr Gallagher at the time.
Today, there’s a team of 300 with an additional 70 jobs coming on stream over the next three years as part of a €2.5 million expansion to the site at Cashel which is due to commence in the new year.
“It was a blessing in disguise for the Gallagher family and the village at that time as it would have closed down had we not came back in. It was no-one’s fault. The market changed and by the middle of 2008 the builders had gone, the breakfast baguette had gone while the value of the Euro versus UK currency was having a serious impact.
“While we bought back the Gallaghers side of the business, we didn’t buy the frozen end. They (IAWS) moved that back to their production facility in Dublin and took all their equipment with them leaving the site three quarters empty. We started off from scratch and re-built it,” he explained.
“The family have a history of developing breads going back thirty years – with multi grains, wholemeal and whole grains. We tend to be dreamers and come up with ideas and that’s what we did again,” he added.
It’s that ability to recognise and develop the niche market that has quickly allowed Gallagher’s Bakery to become a market leader once again.
“We carved out our own niche and started to export. We had a little bit of luck as we got into Australia through another business venture over there. Then we started shipping our products across the Atlantic and have expanded sales through a number or retail organisations.”
While the fresh bread ‘Gallagher’s’ side of the business continues to blossom – sales have doubled in the last three years – it’s been the move into gluten free products which has really seen things take off.
“We’re always looking to develop something different, that people want. For example, we recently launched a new protein bread – a bread that contains 22 per cent protein and is also dairy free and we have big ambitions for it – but we were two years developing that product. There was a lot of hard graft involved,” he said.
It demonstrates the importance of employing six people in product development in Ardara.
“We’re making little changes to our breads every day, constantly trying to improve the product. When we started out our Gluten free range we had 200 ingredients on the table and tried to find the right mix. Eventually, we ended up with 25 ingredients in a product that actually worked.
“Again, we were eighteen months at that before we got anywhere close to the product that we wanted. We started out the process looking for a gluten free bread that was low in fat and high in fibre and if we couldn’t achieve or meet criteria we wouldn’t commence production,” he said.
It’s that product with low fat high fibre that captured the attention of the major US retailers.
“The company has just secured a new contract, due for shipping from November, which will bring availability of our product in around 10,000 outlets in the USA and Canada. It’s a long term exclusive contract.”
Gallagher’s trade under different brand names in different countries. In the US they use the ‘Promise’ brand while it’s ‘Purebred’ in Ireland, the UK and Australia.
The company already ships gluten free bread to more than 1,000 stores in Australia while, earlier this year, they started to supply M&S and Sainsbury’s in the UK, with additional Purebred products available on shelf in November.
They also ship containers of Gallagher’s standard fresh bread which also makes it’s way from Ardara to mainland Britain each and every day.
“Initially, we didn’t go after the UK business as we were struggling to keep up the capacity required to fulfil our Australian contract. It all happened very quickly and it’s only now that we’ve found the time to enter the UK market properly. It’s going well, but now Brexit has thrown a new curve into the mix,” he said.
Three local men recently returned home from Australia to take up employment in Gallagher’s bakery, while workers commute from Enniskillen, Letterkenny, Ballybofey and all parts in between. They also took on two new graduates from Letterkenny IT in more recent times.
“Between van drivers, agents and staff here on site we have a team of about 300 people and we hope to bring in another 70 jobs in the next three years. But that’s a challenge too as (housing) accommodation within Ardara is a problem for people coming in. They’re finding it increasingly difficult to get rental accommodation. That wasn’t a problem when we started back in 2011.”
It’s a challenge of growing a business in a rural area, but one which Mr Gallagher feels the local community will relish.
Strong local team
“We have a good strong local team in place. We’ve a number of non nationals here too – some of whom have been with us for fifteen years and have children in the local schools and have made Ardara their home. We’re also proud to have been able to give up to thirty students employment throughout the summer months. That’s very important for a small community too,” he said.
The gluten free bread produced in Ardara is frozen and shipped, via Dublin, to the States, Canada or Australia. From there it’s taken to a warehouse and distributed to customers.
“Products for our new contracts, which will be shipped from here in November, will be on the shelves late January, early February. We have to order in our ingredients two months in advance of that so you’re looking at a five month cycle. That ties up a lot of stock and involves a fair bit of planning the whole way through,” he said.
Closer to home, the bakery has a number of lorries travelling across the country every day while Gallaghers bread has also a growing presence in mainland Europe.
“We’ve a launch coming up in Denmark while we’re also targeting Sweden and France and Spain. We’re looking at expending in these regions too but we won’t go crazy. We have to be careful not to overstretch. We’ve built up a close working relationship with a number of customers who we believe are a right fit for us. It’s not all about volume it’s about being comfortable with the customer and we both have the same goal ,” he said.
“We get a knock on the door every day of the week because of our gluten free range but it’s not a race to the bottom. We have to protect our business,” he added.
Winner of the Food & Drink Exporter of the Year at the Export Industry Awards in both 2015 and 2014, Gallagher’s Bakery are looking to make it three in a row this year.
“It’s a big thing for a small rural company in Donegal. We only started in 2011 and it shows what can be done. People may give out about Donegal, and it is peripheral, but we have a loyal team of people which, to us, is as important as anything else.
“If we have that the rest will work. Ironically, our growth is a problem and we’ll have to manage that too but I suppose there are worse things to have to worry about,” he smiled.
“Another problem is that the bigger guys come after you and copy our ideas, but we’re good at developing products which are in trend and testing markets we’ll continue to work hard at that. We’ve a very good team here in Ardara and are very proud of what we produce,” he added.
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