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Banking support enables egg farm to expand

Published: 23 October 2015

Father and son duo, Mark and Sam Beckett, produce 250,000 eggs per day from their Kinswood Eggs business at Horsham in Sussex. With AMC’s continuing financial support the company has successfully converted from a battery cage system to enriched colonies. And with planning permission in place for additional capacity and a new pullet-rearing shed being constructed, the family-run business is adopting a policy of expansion and cost-savings to tackle the challenges of marketplace volatility.

Kinswood Eggs was founded at Brooks Green in 1970 by Bill Beckett. Today the business is run by Bill’s son, Mark, and grandson, Sam, and consists of five egg production sheds which house 10 flocks of laying hens producing an average of 250,000 eggs per day. A substantial packing shed, complete with modern egg grading and packing facilities, completes the company’s infrastructure, with bulk and pre-packed eggs distributed throughout the south of England to customers which include the food processing, catering trade and wholesale markets.

The company employs a full-time staff of 50 people, with Sam joining the business five years ago after graduating from Chichester College.

The last decade has been challenging for the poultry sector, with volatile cereal prices just one of the many factors squeezing margins. The sector has also undergone some major legislative changes, with egg producers being required to update their facilities from battery cage systems with high stocking densities, to welfare friendly colony based units.

Kinswood Eggs used an AMC 15-year loan to update the farm’s facilities so that it met the new regulations.

The other banks either wanted to impose too many covenants and restrictions, or would only make stage payments which would have made it difficult when tendering for the conversion work to be carried out.

Mark Beckett Kinswood Eggs, Sussex

“When the new EU legislation was announced we knew we needed to invest heavily to make our facilities compliant,” Mark Beckett explains. “AMC really came into their own at that time. We had already borrowed from them to expand the business but needed extra funds to upgrade the farm. Thankfully they understood our predicament and wholeheartedly supported us.”

Mark approached a number of other banks to compare interest rates and terms but found that AMC’s offer was the most attractive to his business. “The other banks either wanted to impose too many covenants and restrictions, or would only make stage payments which would have made it difficult when tendering for the conversion work to be carried out.

“AMC on the other hand could not have been more accommodating. They understood that, like many agricultural businesses, cash flows may vary significantly from year to year. They appreciate the cyclical nature of farming and could see that our long-term business plan was robust enough for them to release the necessary funds. They have supported us through thick and thin without imposing too many restrictions or controls and are happy to let us get on with running our business.”

Since upgrading the laying sheds, the Becketts have installed 300kW of roof-mounted solar panels. “On an annual basis we are producing about half of the electricity we use which makes a huge difference to our overheads. It was an obvious way for us to cut costs and protect the business from rising energy prices,” Mark adds.

More recently, Mark and Sam have turned their attention to expanding the business and have secured planning permission for a sixth laying shed to extend the farm’s total capacity to 420,000 birds. For now however, those plans have been put on hold with the most recent AMC loan being used to construct the site’s first rearing shed instead.

“We looked at what the really big egg producers are doing and identified that rearing our own hens from day-old chicks to point of lay birds could save us a significant amount of money each year.”

Bought-in birds currently cost up to £4.00 each, but Sam has calculated that he can rear his own at a cost of £3.50 per bird. “For an outfit of our relatively modest size that represents a huge saving. It will also give us greater control over the quality of our replacement birds as we will know that we are taking all the necessary precautions to safeguard each bird’s health and immunity status.”

“AMC could not have been more accommodating. They understood that, like many agricultural businesses, cash flows may vary significantly from year to year.”

The new rearing shed, which will produce its first batch of birds in early 2016, will have a capacity of 30,000 birds per rear, with about three rears per year possible.

“If everything goes to plan and the birds we produce are of the quality we expect, we will build more rearing capacity as we have an Environment Agency (EA) permit to have 110,000 pullets on site,” Sam explains. “Otherwise we will continue to fine tune the system and expand egg output instead by completing the sixth laying shed.

“Either way, we fully intend to keep growing the business in order to improve our own efficiencies and drive down production costs. With AMC on our side, we are confident we have got the right support to enable us to achieve those goals.”


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