For ambitious Irish company Lir Analytical, gaining traction for its innovative bio-security products in the dairy industry has meant having to elbow products from major global players off the shelves.
“Many of the disinfectant products for dairy farming have been around for 30 years — many of them haven’t changed in this time, although the bacteria they are designed to eradicate has,” says the Longford startup’s chief executive Micheál Savage.
Mr Savage set out in 2014 to scientifically engineer disinfectant products which would improve milk quality and reduce dairy farmers’ dependence on antibiotics.
Focusing specifically on the problem of thermoduric bacteria — a contaminant not killed by pasteurisation, which had become a major problem for the dairy industry — he carried out research and development to create a teat disinfectant called Bacto-Lac.
Three years later, the company which trades under the Lir Agri brand, has sales in Ireland and the UK, and is preparing to launch in both Germany and Denmark within the next few months.
“We doubled turnover in 2016 — and are set to double turnover again this year and hit the €1m mark,” says Mr Savage, who is now in the process of raising €1m to fund expansion in Europe.
Currently employing a staff of 12, the company plans to have a total of 18 employees this year.
It is also seeking to double its production facility, to 17,000 sq ft.
An analytical chemist, Mr Savage researched changes and growth in the dairy industry before coming to the conclusion that there was a need for industry specific disinfectants and particularly for one which would “eliminate bacteria harmful at source and reduce the need for antibiotics”.
Recruiting businessman John Noel McGivney as a co-founder, he raised €1m in 2014.
The funding included High Potential Start Up funding from Enterprise Ireland, as well as money from private investors.
This allowed him to build a new laboratory and manufacturing plant in Granard and take on five staff.
By early 2015, Lir Agri was ready for market with four products including Bacto-Lac, which is now the company’s main product accounting for 50 % of sales.
Backing up a sales drive by publishing papers on its findings in US scientific magazines, Mr Savage set out to win acceptance from both agricultural merchants and farmers.
“Getting traction at the start was difficult — sales were quite slow in 2015. As a young company entering a market where change isn’t always rapid — we had to elbow out some international brands that had been on the market for 30 years,” he says.
By the end of 2015, the company was selling to 30 merchants, mostly in the Midlands.
Developing sales to agri-distributors and merchants, the company continued its focus on R&D and worked to develop a comprehensive range of products
“By 2016, sales began to grow more quickly. We had our first exports to an agricultural merchant in Exeter in the UK and started selling in Northern Ireland,” he says.
Now offering a range of 20 products, the company sells to a network of 70 agri-merchants across Ireland, eight in Britain.
It is also finalising agreements with three merchants in Germany and Denmark.
Mr Savage’s aim is to increase exports, which accounted for 15% of sales in 2016, to a 25% share this year.
Given the size of the dairy industry in both Germany and Denmark, he sees huge potential for growth.
Although there is strong competition in these markets, he believes that Lir Agri’s industry specific products, will, as they have in Ireland, be able to compete successfully against products from major international players.
The focus now is on growing sales in Ireland and in the UK.
Mr Savage says that in the future, it will also be looking at France and Belgium, which have strong dairy industries. While the core business involves sales to the dairy industry, the company also sells to the food processing industry, which now accounts for 25% of turnover.
For the future, he sees collaboration with agri-tech as the way forward, and says Lir Agri will be exploring “the smart use of bio-security products”.