Catalogue description Milk Marketing Board: Dairy Crest Supervisory Board and Dairy Crest Board: Reports

Milk Marketing Board had initially used the name Dairy Crest as a brand name for some of its products in the late 1960s/early 1970s but it became the name of the product manufacturing business of Milk Marketing Board in 1981 when Milk Marketing Board created a separate Commercial Division, Dairy Crest, with a Managing Director. The Division included the Milk Marketing Board's manufacturing creameries, milk retailing operations, farm milk collection business and creamery sales and marketing. Each of these operations was headed by a senior manager, and received support from central services such as Engineering, Finance, R&D, Personnel and Sales. At its peak the business had a combined annual turnover of about £900m.

Numerous operational restructurings took place between 1981 and 1986 as the business struggled to create a separate identity in the market place. In 1982 a Chief Executive was appointed by the Milk Marketing Board, and the MDs of both the Milk Marketing Board and Dairy Crest reported to him. At the same time significant technical developments within the industry and the need to create profits forced a number of manufacturing site closures and product line amalgamations so staff numbers were reduced. In 1985, for example, the EEC imposed Milk Quotas on the UK, with the result that a number of butter manufacturing sites were closed down.

In 1986, following pressure from the dairy trade and the EEC Commission, the Government commissioned Touche Ross to undertake a report to determine if the relationship between Milk Marketing Board and Dairy Crest gave the latter an unfair commercial advantage. The final report recommended that Dairy Crest should be set up as a separate commercial enterprise with the result that Dairy Crest was incorporated on 23 December 1986 and changed its name to Dairy Crest Limited on 21 May 1987.

The company had an independent Chairman and Board with Non Executive Directors agreed by the Ministry of Agriculture. On 22 September 1987 it purchased, with effect from 1 April 1987, the trading assets and certain net assets of the Milk Marketing Board Commercial Activities, which had until then traded under the names of Dairy Crest Foods and Dairy Products Transport. Further milk quota reductions in the late 1980s and early 1990s caused the closure of more manufacturing units and when, in 1989, Dairy Crest acquired five large milk bottling sites and associated milk retailing rounds from Unigate Foods, the acquisition was not a success due to the decline in doorstep-delivery sales caused by competition from supermarkets.

By the time the Milk Marketing Board was dissolved in 1994, Dairy Crest had sold most of its milk retailing business to concentrate on supplying supermarkets with milk. It remained with the Residuary Milk Marketing Board until August 1996, when it was floated on the Stock Market as a PLC.