Fresha Valley case study

From Northland farms to fridges nationwide: the growth of New Zealand’s leading independent milk producer

Background

Friends Paul Jensen and George Stoddart started working in the milk production business in the mid-1980s at the Whangarei town milk plant.

In 1987 the pair purchased a redundant milk plant in the Waikato. After a hard year spent refurbishing the equipment, Fresha Valley was born.

Fresha Valley has been producing milk at Waipu, Northland since 1988.

Nestled amongst the Jensen’s family’s 80 acre farm, the company has grown from humble beginnings to a team of 36, processing 60,000 litres of milk a day – distributed under two brands – to Countdown’s 183 stores nationwide.

The processing plant is a family business, with Paul’s wife Gay and daughter Frieda both heavily involved.

Beginnings

Processing cow’s milk was out of the question in the beginning, so Paul and George started by processing goat’s milk.

“We started selling goat’s milk in cartons throughout Auckland, Northland and Hamilton – basically wherever we could economically reach with our trucks. We did our own distribution and everything.”

Two years later in 1990, Woolworths came knocking to see if Paul and George could produce cow’s milk.

“Legislation meant we still couldn’t legally do that, but a loophole in the legislation meant we could do flavoured milk.

Fresha Valley started processing cow’s milk under what was then Woolworth’s No Frills label. Even though it was flavoured, Fresha Valley produced the very first house-brand milk in the country. No one saw it coming.

“We started distributing chocolate, strawberry, banana and a ‘milk-flavoured milk’ using flavouring we imported from Australia in Woolworths stores in the North Island.

“Our flavoured milk was what got the ball rolling for us, but consumers also benefited from better value milk.”

Growth and collaboration  

It took three years of producing milk flavoured milk before the dairy industry was deregulated and Fresha Valley could start processing good old-fashioned milk as Kiwis know it.

“Woolworths came knocking straight away. I remember them saying at the time ‘what do you want to do, how many stores do you think you can service and how can we help?’”

The small Waipu company started immediate production of four main varieties – standard, trim, light and cream – servicing all of the Woolworths stores from Pahia to Hamilton as well as all the Auckland city stores.

“We’ve just kept moving forward from that day to where we are now. The main thing about Countdown is they’ve been right there with us from day one and 28 years later they still do everything they possibly can to help us grow our business,” says Paul.

“We’ve been through several different people in the Countdown category role as well as through a change of ownership amongst other things, but over 28 years there’s consistently been someone at Countdown who has stuck their neck out for us, made sure our business was going well and that things suited both parties.

“There is no way Countdown would expect you to ever do anything that’s not in your interest – it’s a win-win situation for everybody and that’s just the way it’s always been.”

When Fresha Valley started producing its own branded A2 milk – a special variety with significant potential health benefits – Countdown was quick to stock the product.

“Countdown’s Homebrand is half our business and our own Fresha Valley A2 brand is now the other half. We are the only ones in New Zealand manufacturing A2 fresh milk which is a milk that is beneficial to people with a lot of health disorders,” says Paul.

“They have really pushed our brand for us and the result is that we have our Fresha Valley branded A2 milk in Countdown’s stores nationwide. Now we’re looking at a couple of other different products and packaging concepts in conjunction with Countdown and they will take them on for us to the market.”