The Dairy Farm Group: Giving back to communities and driving success

Catherine Sturman
|Jun 3|magazine11 min read

Since its establishment in the nineteenth century, Dairy Farm Group has been gradually acquiring a diverse portfolio, operating supermarkets and hotels, in addition to managing a number of manufacturing and building companies. A member of the Jardine Matheson Group, Dairy Farm has cemented its growth and presence across Asia with over six thousand outlets and 180,000 employees. The company consistently looks at new ways to attract customers, whilst ensuring the benefits of modern retail are enjoyed by local people.

Operating in over 10 markets and with more than 38,000 products in stock, Dairy Farm has placed considerable investment within its current IT systems to facilitate a seamless delivery throughout its supply chain. Teams are able to set up strong order parameters to support the high number of orders placed to suppliers, but also guarantees the delivery of stock to various stores which are placed on shelves. $20 million has been invested in the Group’s management systems and approximately $25 million is invested in Dairy Farm’s operational budget each year.

 

Partner collaboration

The Group places a strong focus on building relationships with suppliers to ensure effective stock control and product delivery, one such partnership is with multinational group Procter & Gamble. The duo has successfully worked together to see how Dairy Farm’s vehicles can be placed at full capacity to reduce fuel consumption in order to become increasingly cost effective within the Group’s operations. In addition, energy consumption is something the Group continually seeks to reduce, and has therefore implemented energy efficient bikes and LED lighting in all its warehouses and stores. Any savings which are made will therefore further enable the lowering of prices for customers.

Furthermore, Dairy Farm’s partnership with Unilever in Malaysia surrounding vendor management has enabled Unilever to oversee the inventory of one of the Group’s distribution centres and place an increased focus on the Group’s operations in the east of Malaysia. Whilst Unilever concentrate on 200 products, Dairy Farm has thousands under its umbrella, situated in a number of different locations. This partnership improved the Group’s sales by an impressive 30 percent and provided a reduction in inventory, while providing a platform in which Dairy Farm can engage with other multinational companies and develop further partnerships.

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Internal operations

With the aim to maintain positive relationships, Dairy Farm implements a number of Key Performance Indicators (KPIs) which measure the performance of the various divisions and places significant investment within employee development. Continuously looking for new talent, the Group operates a talent spotting programme to ensure opportunities are available for local people who understand the business and want to succeed at Dairy Farm. The Group frequently promotes from the ground upwards, with the majority of store managers originating from the shop floor. Managers are also asked to look for individuals whom they feel should become their successors and spend time ample coaching them, enabling local people to gain senior positions and provide quality services to customers.

Adopting a strong customer focus against an ever-changing consumer demand is vital. To this end, the Group has invested in a new automated order system, which removes guess work for customers and provides an increasingly attractive service.

Customers are the most valuable part of the Group’s business operations. Important feedback can be given through a customer care line which allows the Dairy Farm to adapt its processes accordingly and provide the best prices on all products.

In addition to regularly connecting with suppliers, employees, charities and placing focus on employee growth, the Group undertakes a number of sustainable initiatives to support local communities. The Group regularly partakes in direct farming and direct sourcing, partnering with local farms and building direct relationships, creating efficiencies and making a real difference for local farmers by sharing all profits equally, enabling customers to obtain a cheaper product and create efficiencies across the supply chain.

 

Increased competition

Despite Dairy Farm’s ongoing success, it only takes one company to transform the retail industry, with companies such as Amazon repeatedly placing the Group’s traditional business model under threat. Consequently, in order to remain relevant and competitive, Dairy Farm will continue to take controlled risks and remain nimble, whilst ensuring high quality of services for customers within an ever-changing market. With an invaluable history, the Group is strong in both leadership and capability, with the desire to find new ways in serving and seeking new avenues to drive further efficiencies and success throughout its supply chain operations.

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