Stephen Jardine: Pie-in-the-sky plan is half baked

Two factories, two very different outcomes and a lesson to be learned. On the same day Hall’s of Broxburn confirmed they’d failed to find a buyer and would close with the loss of 1,700 jobs, Chanel stepped in to save Hawick based Barrie Knitwear.

Wait a minute. Isn’t the Scottish food and drinks sector supposed to be booming while the Borders textile business is in terminal decline? On the face of it the outcomes seem odd, until you look at the end products.

A century ago Barrie was producing underwear but it moved with the times and recently has been manufacturing quality cashmere for Chanel and other top brands including Turnbull and Asser. That quality niche ensured it’s survival.

Under parent company Vion, Hall’s of Broxburn have carried on doing what they have always done, producing traditional, low-cost processed meat products.

The front page of Hall’s website says it all. Under the strapline “Made for Rainy Scottish Saturdays”, the image shows mum and two kids hiding under the duvet watching a DVD. Presumably Dad is at the football. If you look very closely you might just spot some Hall’s product in the shape of a couple of rolls and sausages.

Contrast that with the strategy of Simon Howie, the multi-award winning Perthshire butcher. While Hall’s have struggled in recent years, Howie’s business has grown and grown, based on the key principles of quality local ingredients and high standards of animal welfare.

In explaining their decision to close Hall’s, Vion defended their stewardship of the company. “Vion has invested tens of millions of pounds in the Hall’s site over a number of years but the outdated and inefficient layout, overcapacity in the marketplace and increasing costs mean that it has been loss making for a number of years, a position we can no longer sustain”, said Vion Chairman Peter Barr.

Perhaps some of the cash spent at Broxburn should have been devoted to product rather than productivity. Think of Hall’s and you think of value rather than taste but that is where overcapacity in the marketplace is most acute. The Danes and Dutch have lower cost, more intensive systems churning out bigger volumes and we could never hope to beat them

As a result, hard working Scottish pig farmers and 1,700 skilled and dedicated workers have been let down by a company obsessed with scale and margin rather than quality.

In food or fashion, Scotland is never going to win at the price game. Instead we need to play to our strengths by aiming for the added value, quality end of each and every market place. Simon Howie understood that and prospered. Under Vion, Hall’s of Broxburn didn’t and has paid the ultimate price.