Needham Market: Morvend diversification is full of beans
Vending company Morvend started out as a farm diversification on the outskirts of Needham Market, but has grown large enough to develop a diversification of its own. SARAH CHAMBERS spoke to company founder Eric Morton about the firm’s growth and about how MorBeans, a coffee machine company, is now shaking things up and taking the business into different markets.
ERIC Morton’s farming roots are evident in the pleasure he takes in finding out where the ingredients for his vending and coffee businesses come from.
Morvend, his original vending machine business, is based in former agricultural buildings on the family farm at Needham Market. It has grown rapidly, and now a new diversification, MorBeans, is invigorating the business by moving it into new markets.
In between running the family businesses – his daughter, Fenella, the operations manager, is the third generation to be involved – Eric has made his way to plantations where the coffee and tea he supplies is grown, and has developed real links with his suppliers.
He can be spotted in photographs of exotic lush green fields which adorn the walls of his headquarters, now being expanded to include a new �250,000 million pound 7,500sq ft storage unit to accommodate the growing needs of his enterprise. He’s visited tea plantations in Rwanda and coffee plantations in Columbia, and he’s a big fan of Columbian coffee.
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It’s fitting for a business which grew out of a diversification originally set up to supplement the small family farm’s income.
Eric’s grandfather Charles Morton bought the farm in 1938. It is now 250 acres in size and still operating as C I Morton & Son but with the work contracted out. Times have changed and the old traditional mixed farm was becomign increasingly less financially viable when Eric took the business in a new direction.
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In 1987, he decided it would be a good idea to convert some redundant farm buildings to commercial use and rent them out. At the same time, he felt an existing farming sideline, Morvend, originally a milk vending business which his father, Ian, had acquired as part of the purchase of a neighbouring farm in 1968, had potential for growth.
By 2000, under Eric’s management, it had doubled in size with the acquisition of a similar business in Hertfordshire, and, across the two depots, gave him a workforce of about 50 employees.
Then, a couple of years ago, Eric and the team decided to expand and diversify the business into the coffee shop, restaurant, hospitality and hotel market by supplying barista equipment and products, including an after-sales service, already perfected at Morvend. It took about a year of planning to get it to the launch stage.
When a tenant moved out of one of the converted farm buildings, the old dairy, his growing workforce, which was feeling the squeeze in its more cramped accommodation on another part of the old farmyard, moved in. Eric refurbished the offices, and set up a brand new barista-inspired showroom and training room displaying some of the very best commercial coffee machines on the market. Baristas, the highly skilled experts behind the bar in coffee houses, must learn how to use the equipment properly in order to provide the best espresso or capuccino, and are a key invisible “ingredient” in the production of a perfect cup of coffee.
It was a shrewd move, given that UK consumers are becoming more discerning about their coffee as global influences from both continental Europe and the United States spread to these shores.
Coffee shops have sprung up all over the UK, and, as Eric explains, even the humble vending drink is undergoing something of a taste revolution. Demand is growing for a more refined and better quality product.
He decided to take care of these two distinct strands by developing the MorBeans brand as a separate trading division. It buys and sells or rents a wide range of traditional coffee machines, along with coffee bean blends developed in-house and its own brand name under which to sell coffees in pubs, hotels and other catering establishments.
The machines are high-end, high quality, and aimed at creating the right impression and ambiance – as well as meeting consumers’ increasingly high expectations for their coffee, the basis of which is a shot of espresso, either served “neat” or with milk. Some designs, such as those from Italy, are virtually unchanged in 100 years, as Eric points out, with a high-pressure boiler providing water at the right temperature and pressure to make the “perfect” coffee.
Then there are models which take frozen coffee, which are able to cope with large catering challenges by producing large volumes of high-quality beverages.
“We are not under a franchise. We are totally independent, so we can pick and choose what we think is the best equipment,” he says.
He sells or rents these diverse machines to retailers, pubs and catering businesses, and sets up service contracts with those customers wanting one. His firm even supplies its own selection of MorBeans coffee bean products to put into the machine, leaving the retailer only to be trained in using the equipment.
There are many hundreds of different types of coffee bean, all with their own distinct flavours and attributes. Factors such as the altitude, soil and area they are grown in will all have a bearing.
“Just like wine, every bean has its own taste,” explains Eric. “Then you start blending them. You have literally got never-ending blends and tastes.”
Among the range of products the firm sells is frozen coffee from Douwe Egberts – MorBeans is its East Anglian distributor – and it was this which acted as something as a catalyst for the creation of the MorBeans business.
Sales manager James Brown, who has undergone barista training in order to better understand the market, says there is a marked difference between coffee made by a well-trained barista and an amateur.
“Like everything, it’s nice to do it properly,” he says. “It’s an art.”
Eric, whose interest in coffee intensified as he learnt more about it, is pleased they have managed to tap into this large market which they had hitherto missed out on.
“We thought there was, I suppose, a huge market out there which we weren’t involved in that was different to but related to vending,” he explains. “Fresh ground coffee is now present in vending machines and the thing that’s moved that on in the last five years is better equipment and better product. The vending market is moving upmarket. The whole market is moving towards better quality drinks.”
Products such as granulated skimmed milk instead of traditional dairy creamers are revolutionising the industry, he says.
“Everybody now appreciates a good quality coffee and when they go out at the weekends, even if they go into McDonalds or Burger King, they are getting a good quality coffee, so when they come back to work on a Monday morning they want something equally good in the workplace. That’s the backdrop of it. The vending business is still very much our core business but because we have got into these different but quality coffees via the vending, we realised there was an untapped market out there which was a slightly different market which we ought to be more involved in,” he says.
“It’s a similar concept. Generally with these free-standing machines we do the re-stocking and cleaning and hygiene aspect of it. Generally, on the MorBeans side it will be a DIY. We provide the technical back-up for it. The boilers have to be pressure-tested on a regular basis and there’s servicing to be done on these machines.”
As well as providing its own range of beans, MorBeans also provides its own branded range of coffee cups and glasses, offering a complete package to retailers and hospitality businesses.
“Service stations are more often than not providing something like this because this is the expectation now.
The MorBeans bean blends are sold in 250g packs, and Eric sees an opportunity, down the line, to sell them directly into the retail market.
“It’s very early days for us, but we can see a market and an opportunity there,” he says. “If you go into a caf� restaurant they want to sell products so we can see an outlet for them selling our beans and ground coffee in there, and for delis and food halls.”
The turnover of Morvend is now �3.5million, and it’s been pretty steady over the last three years despite a tough trading environment. MorBeans is very much a new business. They are “living with” the recession, and while his customers are making less money, they are still here. Cash flow, he admits though, can be a problem.
MorBeans and the new warehouse take the business to a new level. The warehouse will enable it to expand, and MorBeans brings it into new markets. Eric hopes this provides the business with a healthy recipe for future success.
“There are quite a lot of coffee suppliers out there because it’s not difficult to supply coffee, but where we are different is with our vending history and our technical background,” says Eric.
“We have a wealth of knowledge and technical know-how. That sets us apart from purely coffee suppliers. We can actually provide customers with everything to keep their coffee machine running and the product as well.”