Sausage maker Heck returns to profit after refocusing on core products

Bangers brand Heck has return to profitability having endured a period of extreme inflation.

Latest accounts for the North Yorkshire firm, which run to the end of July 2023, show it was back in the black as it reported operating profits of £238,753 compared with an operating loss of £327,644 the year before. Bosses say the firm – which mainly produces sausages but also offers meatballs, burgers and mince – was refocussed to concentrate on core, high margin products.

The Bedale business said it had seen margins squeezed by rampant inflation across labour, energy and ingredients during 2022 – a trend which continued into 2023 but which it successfully combatted with a streamlining of its factory operation. Turnover dipped from £26.1m to £23.8m but gross margin increased from 25.1% to 26.9% thanks to the action.

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In April last year Heck featured on the BBC ‘Inside the Factory’ programme for the second time. The show, hosted by Gregg Wallace, centred around Heck’s “sausage scientist” Calum Smith showing the Masterchef star the process of creating the firm’s vegan sausages, including achieving the correct bite using seaweed-based casing.

The appearance supported Heck’s marketing efforts, which had been hampered during the pandemic thanks to a lack of tasting opportunities that could be staged at events nationwide, but subsequently got back on track. Earlier this year the firm rebranded its packaging to pink in a bid to stand out on supermarket shelves.

Writing in a report accompanying the accounts, Heck director Deborah Keeble said: “The company’s primary focus is in sausages, but the brand is gaining traction with premium burgers, mince and other sausage formats. Our recently launched Steak and Butter Burger has exceeded expectations and further cemented Heck’s position at the top of the premium market.”

She added: “The 2022 financial period experienced extreme levels of rapid inflation across the board, from ingredients, energy, and labour as well as a squeeze on GDP which resulted in reduction of gross margins. This trend continued in the year under review. The business adapted quickly, streamlining production facilities, and focused on core, higher margin products.

“Our KPI’s are turnover and gross margin. Turnover decreased by nearly 9% to £23.8m from £26.2m in the previous
financial period because of the product rationalisation mentioned above. However, the gross margin increased to 26.9% from 25.1% as was intended.”

Original artice – https://business-live.co.uk/all-about/yorkshire-humber

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