1 Mackie’s Of Scotland — case study © The following case study has been approved by Mackie’s of Scotland. History Mackie’s Of Scotland has been farming in the North East of Scotland for four generations. The family-owned company has Maitland (Mac) Mackie as Managing Director and his sisters, Karin as Marketing Director and Kirstin as Development Director and all are entrepreneurial innovators. Doctor Maitland Mackie (1884-1975) started the business, his son diversified from dairy farming into milk retailing, and Mac Mackie’s father began making ice cream. Ice cream ‘Mackie’s of Scotland’ as it is today was born in 1986 when the business changed from traditional farming and milk retail into ice cream production. A small investment in real dairy ice cream manufacturing used cream surpluses arising from the increased demand for semi-skimmed milk. The shift to year-round ice cream consumption stimulated sales of high quality premium ice cream and Mackie’s sales reaching £2.5 million in 1993. The continued growth in sales is a major achievement as powerful competitors were already well established in the high-quality indulgence ice cream market. 1993 saw farm buildings converted into a modern ice-cream dairy capable of producing 10 million litres of ice cream each year. Mackie’s only make premium quality ice cream with fresh milk and cream, the most popular product in the Mackie’s range is ‘Traditional’, a smooth creamy ice cream with no added flavours. In 1994 the decision was taken to sell the milk retail business and concentrate on producing luxury real dairy ice cream. The years since have been busy with the development of many new high quality premium products. The ‘Highland range’ of ice cream was launched with flavours including Drambuie, Toffee Fudge and Vanilla. A state-of-the-art New Product Development Kitchen was created (see Appendix A), where innovative products with distinctive Scottish characteristics were created. Developments included Ice Cream Truffles and the launch of ‘Mackie’s with More’ ice cream dual brand range products, Walker’s Ginger Chocolate and Baxter’s Vintage Marmalade flavours. (Walker’s and Baxter’s are iconic Scottish food brands). A soft scoop ice cream for children, with sorbet products were launched in 2001, and other new products/flavours being regularly launched. The company have launched over 200 new products with limited edition seasonal flavours proving popular. Mackie’s have their own herd of over 300 Holstiens, a popular milking breed of cow who produce the fresh whole milk used to make the ice cream. Mackie’s describe the ‘dairy difference’ between this fresh dairy ingredient in comparison to other ice creams made with other fats from vegetable oil. The process from milking to ice cream can be completed in less than 24 hours. 1 Mackie’s Of Scotland — case study © The following case study has been approved by Mackie’s of Scotland. History Mackie’s Of Scotland has been farming in the North East of Scotland for four generations. The family-owned company has Maitland (Mac) Mackie as Managing Director and his sisters, Karin as Marketing Director and Kirstin as Development Director and all are entrepreneurial innovators. Doctor Maitland Mackie (1884-1975) started the business, his son diversified from dairy farming into milk retailing, and Mac Mackie’s father began making ice cream. Ice cream ‘Mackie’s of Scotland’ as it is today was born in 1986 when the business changed from traditional farming and milk retail into ice cream production. A small investment in real dairy ice cream manufacturing used cream surpluses arising from the increased demand for semi-skimmed milk. The shift to year-round ice cream consumption stimulated sales of high quality premium ice cream and Mackie’s sales reaching £2.5 million in 1993. The continued growth in sales is a major achievement as powerful competitors were already well established in the high-quality indulgence ice cream market. 1993 saw farm buildings converted into a modern ice-cream dairy capable of producing 10 million litres of ice cream each year. Mackie’s only make premium quality ice cream with fresh milk and cream, the most popular product in the Mackie’s range is ‘Traditional’, a smooth creamy ice cream with no added flavours. In 1994 the decision was taken to sell the milk retail business and concentrate on producing luxury real dairy ice cream. The years since have been busy with the development of many new high quality premium products. The ‘Highland range’ of ice cream was launched with flavours including Drambuie, Toffee Fudge and Vanilla. A state-of-the-art New Product Development Kitchen was created (see Appendix A), where innovative products with distinctive Scottish characteristics were created. Developments included Ice Cream Truffles and the launch of ‘Mackie’s with More’ ice cream dual brand range products, Walker’s Ginger Chocolate and Baxter’s Vintage Marmalade flavours. (Walker’s and Baxter’s are iconic Scottish food brands). A soft scoop ice cream for children, with sorbet products were launched in 2001, and other new products/flavours being regularly launched. The company have launched over 200 new products with limited edition seasonal flavours proving popular. Mackie’s have their own herd of over 300 Holstiens, a popular milking breed of cow who produce the fresh whole milk used to make the ice cream. Mackie’s describe the ‘dairy difference’ between this fresh dairy ingredient in comparison to other ice creams made with other fats from vegetable oil. The process from milking to ice cream can be completed in less than 24 hours.
2 In 2002 a family-owned Korean company contacted Mackie’s leading to creation of some ‘Mackie’s of Scotland’ branded ice cream parlours in Seoul, South Korea. Organic produce is popular in Korea and Mackie’s products were enthusiastically received in product tests. The first temperature-controlled shipments by sea arrived to coincide with the Korean World Cup Games in 2002. The partnership ended and Mackie’s now sells their products, all branded as Mackie’s of Scotland, direct to wholesalers and supermarket chains, providing opportunities throughout Asia. Sales are now well established in Korea, Malaysia, Taiwan, China and Mackie’s had export sales of almost £2m in 2019. Mackie’s prides itself on its new product innovation and in 2004 launched Mackie’s Ice Cubes using the farm’s spring water. Initially called Icy Glen they were subsequently rebranded as Mackice. Other innovations include a Low Fat Chocolate Iced Desert suitable for diabetics and an ‘Indulgent’ range with new flavours being regularly added including Salted Caramel and Madagascan Vanilla. Demand was stimulated by carefully crafted advertising such as the 2012 ‘Simply Creamy’ campaign, as well as using targeted price promotions. Production capacity was expanded to 15 million litres a year and 2018 saw demand reach 11 million litres. Mackie’s became the number one take home ice cream brand in Scotland being available nationally in multiples such as Tesco, Asda, and Ocado as well as through independent outlets. Ocado is a major British online supermarket and online sales have been growing rapidly. In the year to May 2019 annual turnover rose to £16.7million with pre-tax profits at £2.18 million (see Appendix B). The firm developed strong links with their consumers and been quick to adopt social media platforms as a means of interacting with and informing its customers. The company website is fun and informative and seeks customer views through the ‘Have your say’ page. Consumers are regularly involved in testing products and voting for new flavours and chose Indulgent Chocolate Orange as a limited-edition flavour ice cream. Product testing at the Royal Highland Show, and a consumer poll with the ‘Friends of Mackie’s’ email club (see Appendix C), saw Caramel Biscotti became a limited-edition flavour. Mango and Passionfruit flavour was added in 2018 as part of the ‘Celebrate the summer’ campaign. Mackie’s regularly uses fun in its communications and the ‘Extra Posh’ product range tubs pictured cows wearing tiaras (jewelled crowns). For the 30th anniversary of making ice cream, special anniversary tubs were produced. In 2017 the Ice Cream Parlour, ‘Mackie’s 19.2’ opened in Aberdeen. 19.2 represents the number of miles from the farm to the parlour which is ‘Sophistication dipped in fun’. The interior contains an illuminated multi-coloured cow and neon lit Italian ice cream counter. The parlour showcases, tests and gathers feedback on new handmade ice cream flavours and other innovative products. 2 In 2002 a family-owned Korean company contacted Mackie’s leading to creation of some ‘Mackie’s of Scotland’ branded ice cream parlours in Seoul, South Korea. Organic produce is popular in Korea and Mackie’s products were enthusiastically received in product tests. The first temperature-controlled shipments by sea arrived to coincide with the Korean World Cup Games in 2002. The partnership ended and Mackie’s now sells their products, all branded as Mackie’s of Scotland, direct to wholesalers and supermarket chains, providing opportunities throughout Asia. Sales are now well established in Korea, Malaysia, Taiwan, China and Mackie’s had export sales of almost £2m in 2019. Mackie’s prides itself on its new product innovation and in 2004 launched Mackie’s Ice Cubes using the farm’s spring water. Initially called Icy Glen they were subsequently rebranded as Mackice. Other innovations include a Low Fat Chocolate Iced Desert suitable for diabetics and an ‘Indulgent’ range with new flavours being regularly added including Salted Caramel and Madagascan Vanilla. Demand was stimulated by carefully crafted advertising such as the 2012 ‘Simply Creamy’ campaign, as well as using targeted price promotions. Production capacity was expanded to 15 million litres a year and 2018 saw demand reach 11 million litres. Mackie’s became the number one take home ice cream brand in Scotland being available nationally in multiples such as Tesco, Asda, and Ocado as well as through independent outlets. Ocado is a major British online supermarket and online sales have been growing rapidly. In the year to May 2019 annual turnover rose to £16.7million with pre-tax profits at £2.18 million (see Appendix B). The firm developed strong links with their consumers and been quick to adopt social media platforms as a means of interacting with and informing its customers. The company website is fun and informative and seeks customer views through the ‘Have your say’ page. Consumers are regularly involved in testing products and voting for new flavours and chose Indulgent Chocolate Orange as a limited-edition flavour ice cream. Product testing at the Royal Highland Show, and a consumer poll with the ‘Friends of Mackie’s’ email club (see Appendix C), saw Caramel Biscotti became a limited-edition flavour. Mango and Passionfruit flavour was added in 2018 as part of the ‘Celebrate the summer’ campaign. Mackie’s regularly uses fun in its communications and the ‘Extra Posh’ product range tubs pictured cows wearing tiaras (jewelled crowns). For the 30th anniversary of making ice cream, special anniversary tubs were produced. In 2017 the Ice Cream Parlour, ‘Mackie’s 19.2’ opened in Aberdeen. 19.2 represents the number of miles from the farm to the parlour which is ‘Sophistication dipped in fun’. The interior contains an illuminated multi-coloured cow and neon lit Italian ice cream counter. The parlour showcases, tests and gathers feedback on new handmade ice cream flavours and other innovative products.
3 Crisps In 2009 Mackie’s launched a range of potato crisps after establishing a joint venture company with the 4th generation Taylor family who owned the Taypack potato growing and processing company. Mackie’s at Taypack is licensed to use the Mackie’s of Scotland brand name and has its own distinct website. The slogan ‘From plough to pack’ emphasises product quality through the stages of Ploughed, Picked, Perfected and Packed. Traditional crisps with three core flavours were launched, alongside new flavours with a unique Scottish identity — like Haggis and Cracked black pepper. Products are sold through major Scottish outlets and the company regularly attends trade fairs. There is a strong focus on new products such as ridge cut crisps, lentil waves and popcorn. In 2010 the firm received the Scotland Food & Drink Excellence Award, with Scotch Bonnet Chilli Pepper potato crisps winning Product of the Year. Second and third Excellence awards were subsequently gained along with a Great Taste Gold Award. Growth in international sales and expanded sales through Asda stores in England and Northern Ireland led to a move to a larger factory. 2015 saw the firm listed in a government initiative as one of the UK’s ‘50 Food Stars’. Sales continued to grow domestically and internationally with rapid expansion in China, moves into Europe, the UAE and Asia, and by 2017 the firm exported to 25 countries. That year they secured the Export Business of the Year prize and the International Growth Award delivered in partnership by private sector group Opportunity North East (ONE) and Aberdeenshire Council. Later that year the firm’s products gained an important listing with Ocado. Chocolate In 2014 Mackie’s launched a range of chocolate bars with four flavours similar to some of the ice creams, including honeycomb, dark mint, traditional milk and dark 70% cocoa. Initially production was trialled with an established producer in Arbroath before establishing their own farm based factory capable of producing five million bars per year. Mackie’s is well established in serving the growing indulgence product segments and high quality chocolate fits well with their quality ice cream and crisps. Exports have been helped by working with an established food distributor in Singapore and sales of chocolate grew by 63% in the year to May 2019, with exports a key driver in that growth. Ethical production The Mackie’s family is very proud of their environmental credentials in farming the land and producing the freshest high quality products. The company vision is to ‘be a Scottish global brand from the greenest company in Britain created by people having fun’. 3 Crisps In 2009 Mackie’s launched a range of potato crisps after establishing a joint venture company with the 4th generation Taylor family who owned the Taypack potato growing and processing company. Mackie’s at Taypack is licensed to use the Mackie’s of Scotland brand name and has its own distinct website. The slogan ‘From plough to pack’ emphasises product quality through the stages of Ploughed, Picked, Perfected and Packed. Traditional crisps with three core flavours were launched, alongside new flavours with a unique Scottish identity — like Haggis and Cracked black pepper. Products are sold through major Scottish outlets and the company regularly attends trade fairs. There is a strong focus on new products such as ridge cut crisps, lentil waves and popcorn. In 2010 the firm received the Scotland Food & Drink Excellence Award, with Scotch Bonnet Chilli Pepper potato crisps winning Product of the Year. Second and third Excellence awards were subsequently gained along with a Great Taste Gold Award. Growth in international sales and expanded sales through Asda stores in England and Northern Ireland led to a move to a larger factory. 2015 saw the firm listed in a government initiative as one of the UK’s ‘50 Food Stars’. Sales continued to grow domestically and internationally with rapid expansion in China, moves into Europe, the UAE and Asia, and by 2017 the firm exported to 25 countries. That year they secured the Export Business of the Year prize and the International Growth Award delivered in partnership by private sector group Opportunity North East (ONE) and Aberdeenshire Council. Later that year the firm’s products gained an important listing with Ocado. Chocolate In 2014 Mackie’s launched a range of chocolate bars with four flavours similar to some of the ice creams, including honeycomb, dark mint, traditional milk and dark 70% cocoa. Initially production was trialled with an established producer in Arbroath before establishing their own farm based factory capable of producing five million bars per year. Mackie’s is well established in serving the growing indulgence product segments and high quality chocolate fits well with their quality ice cream and crisps. Exports have been helped by working with an established food distributor in Singapore and sales of chocolate grew by 63% in the year to May 2019, with exports a key driver in that growth. Ethical production The Mackie’s family is very proud of their environmental credentials in farming the land and producing the freshest high quality products. The company vision is to ‘be a Scottish global brand from the greenest company in Britain created by people having fun’.
4 They aim to be self-sufficient in energy with zero fossil fuel use, and in 2005 installed a wind turbine with a further three producing some 3MW. Solar panels installed on buildings and a 4 hectare site of panels installed in 2015 produce 1.8MW. The family established a Scholarship for Renewable Energy at Aberdeen University, delivered guest lectures at Abertay University and has offered work placements for students. An innovative refrigeration system, to be an exemplar low carbon refrigeration system began installation in 2020, replacing all old refrigerants with ammonia (a natural gas, with zero climate warming potential), powered by the energy efficient biomass boiler and absorption chiller — and on completion this will help Mackie’s in their aim to be self-sufficient, as it will reduce CO2 emissions and energy use by up to 80%. A biomass boiler also heats the office and farm buildings and solar panels are on roofs of the byre. Mackie’s arboretum contains 112 different tree species, providing a beautiful space that can be enjoyed by visitors and staff. A further 48 hectares were planted to provide habitats for wildlife, and grass strips sown around fields to create wildlife corridors and help protect waterways from fertiliser. Wetland areas and a pond encourage a diverse wildlife population. Mackie’s has its own water source and all water used is recycled and reused on the land along with the plentiful fertilizer produced by the cows. In 2010 Mackie’s started making their own ice cream tubs saving some 50,000 food miles per year as the tubs were previously imported. The firm actively encourages the recycling of its tubs and recycles card, paper, batteries and plastic at the farm. Cow welfare is very important, and happy cows produce more milk. The cows are milked by a voluntary access milking system – milking themselves on average three times a day. Each cow wears a collar which also measures the cows activity levels. The cows are housed with its own lying space complete with mattress, and feed is available at all times with fresh food added twice per day. A vet visits every week and an innovative ‘Moo-sic’ (music) experiment saw country music played to the cows resulting in a positive impact on the animals’ behaviour. Participation in the TV ‘Eat Well for Less’ series allowed Mackie’s to highlight the qualities of real dairy ice cream that led to their highly successful ‘Taste the Dairy Difference’ brand message. The people Mackie’s employs over 70 staff and the company vision recognises the contribution of its loyal, flexible and energetic workforce. The company signed up to pay the ‘Living Wage’ in 2015 and also the ‘Scottish Business Pledge’. The Living Wage is set at a higher rate than the legally set minimum wage. The Scottish Business Pledge is a values-led partnership between Government and business that is based on boosting productivity and competitiveness through fairness, equality and sustainable employment. Mackie’s places staff training, youth development, family friendly shift patterns and reward programmes at the core of the business. 4 They aim to be self-sufficient in energy with zero fossil fuel use, and in 2005 installed a wind turbine with a further three producing some 3MW. Solar panels installed on buildings and a 4 hectare site of panels installed in 2015 produce 1.8MW. The family established a Scholarship for Renewable Energy at Aberdeen University, delivered guest lectures at Abertay University and has offered work placements for students. An innovative refrigeration system, to be an exemplar low carbon refrigeration system began installation in 2020, replacing all old refrigerants with ammonia (a natural gas, with zero climate warming potential), powered by the energy efficient biomass boiler and absorption chiller — and on completion this will help Mackie’s in their aim to be self-sufficient, as it will reduce CO2 emissions and energy use by up to 80%. A biomass boiler also heats the office and farm buildings and solar panels are on roofs of the byre. Mackie’s arboretum contains 112 different tree species, providing a beautiful space that can be enjoyed by visitors and staff. A further 48 hectares were planted to provide habitats for wildlife, and grass strips sown around fields to create wildlife corridors and help protect waterways from fertiliser. Wetland areas and a pond encourage a diverse wildlife population. Mackie’s has its own water source and all water used is recycled and reused on the land along with the plentiful fertilizer produced by the cows. In 2010 Mackie’s started making their own ice cream tubs saving some 50,000 food miles per year as the tubs were previously imported. The firm actively encourages the recycling of its tubs and recycles card, paper, batteries and plastic at the farm. Cow welfare is very important, and happy cows produce more milk. The cows are milked by a voluntary access milking system – milking themselves on average three times a day. Each cow wears a collar which also measures the cows activity levels. The cows are housed with its own lying space complete with mattress, and feed is available at all times with fresh food added twice per day. A vet visits every week and an innovative ‘Moo-sic’ (music) experiment saw country music played to the cows resulting in a positive impact on the animals’ behaviour. Participation in the TV ‘Eat Well for Less’ series allowed Mackie’s to highlight the qualities of real dairy ice cream that led to their highly successful ‘Taste the Dairy Difference’ brand message. The people Mackie’s employs over 70 staff and the company vision recognises the contribution of its loyal, flexible and energetic workforce. The company signed up to pay the ‘Living Wage’ in 2015 and also the ‘Scottish Business Pledge’. The Living Wage is set at a higher rate than the legally set minimum wage. The Scottish Business Pledge is a values-led partnership between Government and business that is based on boosting productivity and competitiveness through fairness, equality and sustainable employment. Mackie’s places staff training, youth development, family friendly shift patterns and reward programmes at the core of the business.
5 Mackie’s was one of the first food companies in Scotland to be awarded Investors in People status in 1997. This marked a big change in Management style from a ‘dae fit yer telt’ culture (do as you are told), to one of continuous involvement of all staff in setting and achieving goals. Mackie’s remains a family firm and regular consultation and discussions with employees are an essential means of maintaining its inclusive and fun company culture where all employees are valued as part of the wider ‘Mackie’s family’. Employees commonly stay for many years and Mackie’s celebrates their achievements and runs a business performance related bonus scheme. Making work fun and having happy staff is a core value and their ‘Faces of Mackie’s’ campaign was an example which showcases employees in their roles through photographs. 5 Mackie’s was one of the first food companies in Scotland to be awarded Investors in People status in 1997. This marked a big change in Management style from a ‘dae fit yer telt’ culture (do as you are told), to one of continuous involvement of all staff in setting and achieving goals. Mackie’s remains a family firm and regular consultation and discussions with employees are an essential means of maintaining its inclusive and fun company culture where all employees are valued as part of the wider ‘Mackie’s family’. Employees commonly stay for many years and Mackie’s celebrates their achievements and runs a business performance related bonus scheme. Making work fun and having happy staff is a core value and their ‘Faces of Mackie’s’ campaign was an example which showcases employees in their roles through photographs. . The Mackie’s has been committed to environmental protection for more than a decade. Analysis the reason why Mackie’s spent so much in environmental protection with the case above for 3 answers at least