Saying the grain and seed industry changes with the weather is as close to the truth as you can get for many companies in the agricultural industry, but David Sheppard, 53, has been part of a team that has helped to create a successful national business since becoming Managing Director of Gleadell in 2005.
With the help and support of a good team, good strategy and a bit of luck, the company has more than doubled in size over the last 10 years to become one of the UK’s leading grain, oilseed and pulse exporters, a significant supplier to UK millers, feed compounders and other consumers of grain and a large scale supplier of fertiliser and seed to UK farmers.
Taking on the responsibility of a company that in 2005 was 125 years in the making, was no small feat. David’s predecessor had already started a change of course by setting up a team in East Anglia in 2001. Now David and his fellow directors had the responsibility of taking up the challenge of the continued expansion. Gleadell now has six offices across the country, organises 90,000 lorry movements and between 250 and 400 ships per year, but the company was first planted in Lincolnshire.
“The Gleadell family owned the company until the mid 1980s, and indeed our head office in Hemswell which the company bought from them in around 1999,” explained David. “A lot of the staff are local to here and it’s a big grain area. Actually the three largest companies in our sector are all based in Lincolnshire.
“It’s a county where the name Gleadell counts for a lot in our world and we’ve been active in Lincolnshire for all of our existence. Similarly the name Dunns, Long Sutton, the seed and pulse processing business Gleadell bought in 2012, is a long standing and well-known name in Lincolnshire and further afield.”
With a £500 million turnover and continued expansion, David puts the success of the company down to several factors but one key aspect is the people in the business.
“Everyone in Gleadell and Dunns has bought in to being successful and supplying a good service. Nobody can do what we do without working as a team. We have excellent farm traders who deal with 6,000 farmers all over the country, we have forwarders who organise all of the transport, all backed up by good systems and back office colleagues – at the end of the day it’s down to the quality of the people.”
With equal shares, Gleadell is owned by American company ADM and French cooperative InVivo. “They’re of great assistance to us in dealing internationally where we perhaps don’t have the local influence or the contacts and both have been shareholders since the early 1990s.”
David and the shareholders of Gleadell aim to maximise company growth and a percentage of profits is reinvested into the company for expansion or development – a process that has been in place since the start. “We’re trying to make 1% net profit. So if we can make somewhere between £5 million and £7 million of pre-tax profit every year, that’s what we’re aiming to do. We operate in a market where large turnover and small margins are the order of the day.
“Since I have been MD we have grown considerably and we have put a lot of resources into training and the development of people. Young people want to see their career moving forward, they want to see progression and I think that’s something that we have come to recognise.
“Career development is just as important as how much they earn sometimes. What you take home at the end of every month isn’t necessarily it, it’s ‘where am I going to be in five years time and what can you offer me in terms of development that’s going to make my career interesting and exciting?'”
Making a smart investment
With a keen interest in building things, David has successfully managed to not only help and watch the company grow, but also played a key part in what have been record breaking shipments. The company has commissioned new equipment to streamline the loading of grain onto ships for export, making it as efficient as possible sending grain across the world to over 140 countries.
“We like building things, it’s not as if I am machine mad or anything, but to envisage a project and then to see something that actually works and operates and does what it’s meant to do is a good feeling.”
In 2010 Gleadell invested £6 million into a new site at Great Yarmouth grain terminal to help with the ever-expanding business and it is something that David is very proud of.
“When we started talking to the port in Great Yarmouth, there was just a harbour and nothing in it at all. About 18 months later we had a grain store, we had our own ship loader and we saw the first vessels to load from that facility.
“I had been involved from the moment we started drawing on a piece of paper what it might look like and how it might work. In the last two years, we’ve done record volumes out of there. If I look back, that’s probably one of my key achievements.”
There has also been significant investment at Immingham with Associated British Ports, where Gleadell helped to develop a unique ship loader next to a specialist grain store. “A lot of the infrastructure was already there but to have our own proper grain storage facility and our ship loader working next to it was a great step forward.
“Nothing like our Immingham ship loader exists anywhere in the world. It has four tipping points, where most ship loaders have two. It can load up to about 1,200 tonnes an hour, and it’s been there since 2001, so it has more than paid for itself – it’s what do we do when that one breaks!”
Gleadell has also played a part in introducing new crops to the UK, including Canadian red wheat and supplying grain that goes into many household brands including Carlsberg and Weetabix. But the plan is to stay ahead of the times and prepare for the future. Gleadell’s acquisition of Dunns gave the business access to one of the largest seed and pulse processors in the UK and enabled it to add value to farmers’ pea and bean crops and to the newest and best seed varieties.
The company is very aware that times will get harder with the predictions for a large growth in population before 2050. With the demand for food expected to rise dramatically, Gleadell is always looking at ways to maximise sustainable production.
“There are less chemicals that we can use on crops than we could five years ago, so we’re looking at some of the new technologies that might enable farmers to produce higher yields from less input. That is the Holy Grail.”
Always a helping hand
As extreme weather events seem to become more frequent, the climate has become more unpredictable and has a big effect on Gleadell’s clients, as well as the company itself. David has found that they need to be very flexible, not only to be able to survive, but also to help their suppliers out wherever they can.
“Farming and grain markets are influenced by the weather probably more than anything now-a-days. If it has been very hot in the US and their crop yields are impacted badly, then suddenly you see grain prices going up dramatically. You get a deep winter freeze in Russia or Ukraine and the same thing happens.
“The thing that’s happened for the last three years is that we have had pretty much good conditions worldwide, which is why farmers have been able to produce good crops; there is more supply than demand at the moment and grain prices are low. But things can change.”
During hard times Gleadell is ready to help out. One example is the successful and growing national grain pool where they market grain on behalf of the farmers. “The idea is we achieve a high average price for them and with grain markets being generally depressed for the last 18 months to two years, farmers are finding it hard to know when to sell.
“In the context of the grain market we can take emotion out of it and market the grain at what we think is the right time for them. That’s been very successful.”
The help that Gleadell lends to farmers doesn’t stop there – they also provide a safety net for times when farmers need a little extra cash flow in advance. “One of our other functions is that we are a bit of a bank. We lend money to farmers who have got grain sold to us. We give them extended credit terms on paying us for fertiliser and seed and when times are tough, which they are at the moment, our role as a blue chip credit provider is pretty vital as well.”
This feature interview was first published in issue 63 of the Lincolnshire Business weekly magazine.