From Clones to California: Ross McMahon’s life in food

Ross McMahon has spent his entire life working in the food industry and has travelled the world doing it. A native of Co Monaghan, his formative years are rooted in farming and food.

His father Billy McMahon, a drystock beef farmer, was one of the first Irish farmers to pioneer poultry farming in the 1960s. Billy McMahon also served many years as chair of the Clones Agricultural Show and represented Irish poultry farmers in Brussels.

Before leaving school to study ag science in UCD, McMahon spent a summer working for Tunney Meats (now ABP Clones), a meat processing company that gave him his first glimpse of a large-scale food business.

By the time he qualified from UCD in 1987, McMahon realised he was far more interested in working in the food industry than going back to farming.

“When I left college I went to work with Grove Turkeys in Smithboro. This was a really fantastic family business run by two entrepreneurs, Frank and Peter Cosgrove. It was the largest Irish turkey processor and operated an integrated supply chain with its own egg hatchery, turkey farms and added-value factory. It exported a huge array of products both fresh and frozen, cooked breast meat to breaded nuggets and turkey cordon bleus,” says McMahon.

International

During this time, Grove Turkeys sponsored McMahon as part of a European orientation programme, which allowed him to live and work in Heidelberg, Germany. McMahon worked in a traditional salami processor in Austria and as a trainee manager in Apetito, Germany’s largest frozen ready meals manufacturer. German factories opened his eyes to large-scale food automation.

After Grove Turkeys was sold to Kerry Group in the late 1980s, McMahon moved on to join the newly opened Rye Valley Foods, a rapidly growing company at the time which made frozen ready meals for retail customers across Europe.

“The Rye Valley Foods facility in Carrickmacross was built to very high EU standards for large-scale global production. It planted a seed for my own vision on food security and how to scale production to meet global demand,” says McMahon.

After six years with Rye Valley Foods, he spent a year working at the incubator hub at Dundalk RTC (Dundalk IT), where he researched the idea of manufacturing a frozen bakery snack with savoury fillings.

This led him to join the Campbell Bewley Group, which was building a new bakery and coffee roaster at Northern Cross in Dublin at the time. McMahon’s time with Campbell Bewley saw him move to Sacramento in California in 2003, where he spent three years as CEO of a coffee roasting business known as Java City.

After three years in California, he says the business had gone from losing $3m a year to having retained earnings of $5m after rapidly expanding its wholesale business across the US and franchising the brand into South Korea.

When he came home to Ireland in 2005, Campbell Catering had been acquired by the US food service giant Aramak and McMahon took up a position as European supply chain director with the US company.

“At this point in my career I had worked in almost every sector of the food industry including ambient, fresh, frozen and chilled. I felt ambient was the most straightforward when it came to manufacturing, storage and transport,” says McMahon.

Infant formula

“This was when I began to think that baby formula really stood out as the perfect product to begin exporting around the world. In 2010, I met some Asian infant formula buyers and they told me that European baby formula was becoming big business following the melamine scandal in 2008,” he adds.

The scandal saw six Chinese babies die and thousands more hospitalised after drinking infant formula tainted with melamine. It resulted in a surge in demand in Asia for European-made infant formula, which was seen as safer than locally produced baby formula.

Sensing an opportunity, McMahon went out on his own and began researching the sector, and travelling worldwide sourcing infant formula ingredients.

“During this time I went to Germany to see if I could find a supplier that would be willing to contract-manufacture infant formula. But I couldn’t get a supplier that was willing to pack custom baby formula recipes. I quickly realised that I wasn’t going to get anywhere in the infant formula game if I didn’t have my own factory,” says McMahon.

In 2014, an opportunity presented itself after McMahon got word that HJ Heinz, the global food giant, was looking to sell its infant formula plant in the picturesque town of Kendal in the Lake District of England.

Kendal

After a year of negotiation with Heinz, McMahon finally had secured the factory by June 2015. He named his new company Kendal Nutricare after the local town to show he was committed to the area.

Despite his experience in almost every area of food manufacturing, the Clones man says he had never worked in a dairy processing plant until then.

Realising his company needed to be different to succeed in the infant formula market, which is dominated by five global players (Nestlé, Danone, Abbott, Mead Johnson and FrieslandCampina), McMahon has taken a different approach to making infant formula.

“Dairy co-ops use all the cream and fat in their milk for processing into valuable products like butter, cheese and yoghurts. This leaves the big infant formula brands with commodity skimmed milk powder (SMP) as the base ingredient in their products, which they combine with cheaper vegetable oils like palm oil to save money and maintain profits,” says McMahon.

Working with the experienced team he inherited at the Kendal plant, McMahon says they went back to making a baby formula from the natural fat in milk, which he says creates a more wholesome, nutritious and satisfying golden baby powder.

“The model we operate at Kendal Nutricare is ‘farm to formula’. When we first started there was no pasteuriser on site since 1990 to handle raw milk, so we invested in our own pasteuriser. We now buy in standard fresh and organic whole cows’ milk from farms in Cumbria contracted to local dairies. And we recently also started using fresh goat milk,” he says.

“We take in this fresh, full-cream milk and we blend it carefully with vitamins, minerals, whey protein, lactose and skim milk to replicate the 30% fat, 20% protein and 50% lactose in mothers’ breast milk, which is naturally the gold standard.”

Unlike most infant formula powders which are white in colour, Kendamil infant formula retains a bright golden colour because the powder is made using full cream milk from grass-fed cows – the same way Kerrygold Irish butter is yellow in colour while most European and US butter is paler.

Infancy

While still in its infancy, Kendal Nutricare was recently ranked by the Financial Times as one of the 1,000 fastest growing companies in the UK.

For its 2020 financial year, it recorded sales growth of 11% as turnover hit £23m (€26m), while profits more than tripled to just under £1m (€1.1m). Operating profit margins widened to a healthy 4.1% but are below industry competitors that often take up to 30% profit margins.

McMahon sees room for continued expansion and growth. Kendal’s infant formula plant is still only operating at a fifth of its capacity and McMahon says he wants to see employee numbers get back to where they once were at over 300 – almost triple where they are now.

Although he still retains a keen Clones accent, McMahon has come a long way since he started out in the food industry at Tunney Meats. Now working side by side with his two sons Will and Dylan, you suspect there are plenty of chapters left for the Monaghan man. For the ag science graduates of today, Ross McMahon’s story is one that shows how far around the world and back again, a career in the food industry can take you.