The impact of Brexit on the availability of non-UK EU nationals was becoming a “huge concern”, and the government needed to provide interim support to companies to ease the transition period, Tulip chief executive Steve Francis told Food Manufacture.
The company was overhauling its graduate and apprenticeship schemes in response to the mounting problem, Francis added.
With Danish Crown as its parent company, Tulip employs around 7,000 people across its 16 manufacturing sites, and rears 1.5M pigs a year on its farms.
“We are seeing a very clear impact of the concern around Brexit in our factories and on our farms. It varies a lot by region, but there is a real tightness in the labour market,” Francis said.
“There have already been situations where we have had to bus workers around districts, and even outside districts, to make sure we’ve got the people we need in our factories.”
‘Deeply engaged’ with the UK government
According to Francis, both Tulip and Danish Crown were “deeply engaged” with the UK government over the Brexit process.
In August, newly appointed Department for Environment, Food and Rural Affairs Minister Michael Gove visited a Danish Crown facility in Horsens, Denmark, as part of a fact-finding mission to understand the country’s agricultural systems. On meeting Gove, Francis said he was encouraged by the minister’s commitment to understanding the impact of Brexit on the food and farming industries.
“From his tone, there appears to be a serious desire to understand the needs and concerns of food businesses,” he added.
A “cliff-edge” Brexit in March 2019 was now a “very unlikely outcome”, according to Francis. Despite Prime Minister Theresa May calling for a two-year transition period, Francis believed a period of at least three to four years would be necessary.
“I suspect both sides of the negotiating table will soften their positions, and there will be a pragmatic resolution – but it will take longer than a couple of years.”
Reverse falling sales at Tulip
Francis, who has built up a reputation for turning around ailing businesses, was hired a year ago to reverse falling sales at Tulip. The company reported a £21.8M loss for the year to September 30 2016.
Last month, Francis told Food Manufacture that Tulip had returned to a trading profit in June, after a strategic refocusing of the business more towards the needs of customers.
He exclusively revealed Danish Crown was to invest up to £70M in acquisitions, equipment and product innovation in Tulip over the next 12 months.
Later in September, Tulip announced a deal to buy Suffolk-based pig producer Easey Holdings, to meet rising demand for high welfare pork.
However, in July it was revealed that 118 jobs would be lost at Tulip’s King’s Lynn site, in response to falling volumes of cooked meat.