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Making Dryfish Drive Results |
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Archives -
2007 Archive
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Written by B. Tyril
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Monday, 21 May 2007 |
Building on the business success of its high-quality stockfish concept, Faroe Marine Products is investing in a new production hall to handle the rising processing needs of its up and coming pet food division.
Judging from a history of strong organic growth and prospects of continued success, the business model of Faroe Marine Products (FMP) looks like one that only few domestic seafood processors would be able to match.
Just a few years since founded in a joint venture with Icelandic partners, the company headed by the energetic Eirik á Húsamörk has quickly carved its own niche in the Nigerian market for stockfish. New product development has nonetheless been prioritized from early on and in order to meet the growing demands from new overseas clients, FMP is working on another round of extension, adding a multi-story, 2500m3 production hall to its current Leirvík premises, which were enlarged a couple of years ago.
Based on its advanced drying process, FMP today offers a whole range of protein rich, non-boiled, non-salted fish products.
Most of the products are made and marketed for the high-end segments of diverse specialty markets: dried fish heads and backbones for use in Nigerian cuisine; dried fillets and portions of saithe (coley/Atlantic pollock) for markets in the north including Russia and Faroe; pet food snacks manufactured from dried pelagic fish, for the international pet food market.
The argument for high quality, dried fish would seem quite obvious to many.
“First we make sure the raw materials we get are of good quality and handled correctly from the beginning and all through,” Mr á Húsamörk said.
“Second, the drying process applied here is very effective so the final product contains maximum nutrition and taste yet has no salt added—because no boiling is involved, it’s pure fish ready to eat, with all the proteins and vitamins preserved, including Omega-3 fatty acids.”
Betting on pets: The raw fish is received chilled at FMP’s terminal, then cleaned and spread on specially designed plastic grids to allow for an automated process with a high degree of hygiene; then the stacked grids are placed into purpose made drying chambers in a pre-drying process, after which the raw materials are taken to further processing in after-drying boxes, the final step before packaging and shipping.
With the abundance of fish in the Faroes, access to premium raw material will not pose any serious problem for FMP. However fulfilling quality standards takes skill and effort.
“Our products are processed and presented as high quality products,” Mr á Húsamörk remarked, “so, quality inspection is rigorous.
“We have chosen to emphasize product quality over relaxing routines with no substitute substances. Our clients appreciate the fact that quality has a price and recognize that FMP delivers superior value for the price.”
FMP’s rapidly rising exports reached a total value of around 50 million dkk in 2006 (6.7m eur / 4.6m gbp). With a monthly payroll that amounts to about 1m dkk (134,000 eur / 90,000 gbp), the company’s socio-economic impact on the small community of Leirvík and neighboring towns and villages is tangible.
In 2005, FMP was awarded the Faroe Industry Association’s Company of the Year prize for successful and inventive use of natural resources and green energy in a financially sound business. For instance, while recycling heat from a nearby combustion plant in order to sort, clean and dry its products, the company at the same time makes maximum use of generally underutilized small-size fish and fish offals.
Good working relationship with fish producers and processors are no doubt paramount for raw material supplies. But if it wasn’t for the FMP facility, many more thousands of tons of fish heads and backbones would be ground into meal and oil as industrial fish.
As Mr á Húsamörk pointed out: “We have turned heads and backbones into a valuable export business and the Nigerians get their favorite flavors…”
Meanwhile, pet food products made from dried pelagic fish are becoming a new major source of business for FMP, in fact the main driver behind the planned extension, Mr á Húsamörk said. “We have set a clear goal of becoming the number one manufacturer of pet foods made from fish and we intend to realize it.”
Earlier investments in computerized processing technology, drying chambers and an advanced inventory system did require healthy profits, and over the five years or so since the FMP facility became fully operational, the average return on equity investment has been 25 percent. However, with another round of heavy purchasing and costly construction coming up, the heat is on to yield high results.
Link to pdf presentation...
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