"The fact they want to buy it shows that they get genuine brand pull through with their consumers and their customers are mainly restaurants."
However, no one brand fits all with the UK a supermarket house-brand market, he says.
"It doesn't matter how flash your own brand is ... even Anchor doesn't get on to the shelf at Marks and Spencer. You are doing business-to-business branding rather than business to consumer."
It's vastly different to the Continent where consumers distrust supermarkets and prefer to buy branded products only, particularly in Switzerland, Germany and the Benelux, he says.
Partnering with Silver Fern Farms in North America under the NZ Lamb Company and joint branding with Green Farms in China prove just how flexible sheep marketers have to be.
"There is no one size fits all with branding across markets."
But for all of Alliance's partnering, the chairman says he hasn't been comfortable with progress on adding value.
"We think there is a huge potential for us to lift our game further - both onshore in our business and certainly offshore."
The co-operative has done much work in the past 12 months to identify accurately the size of the opportunity and how it goes about harnessing it.
"It goes right back to having industry best practices to earn your way. We've done a heap of work and we are confident that we are going to be in a very good space going forward."
A large part of improving farmer returns lies in continually pushing for efficiencies in processing plants, he says. To that end Alliance has invested $15 million on robotics at Smithfield and Pukeuri with other plans under way across all plants.
Exciting project
A developing project creating excitement within the co-op is research development, undertaken to increase the shelf life of its meat products. Success in this area could generate high returns.
"Sometimes you can only get a week to 10 days' shelf life when meat arrives," Taggart says.
"If we can come up with technology that gives them another week, it means it won't be thrown out or frozen - effectively devaluing the product. It removes the risk and it means we have a lot more meat falling into that really high-value category."
Mr Taggart was encouraged that none of Alliance's gains were dependent on achieving extra scale via a merger with Silver Fern Farms.
"In other words our existing scale is sufficient to go out and capture the gains we see as being able to be captured."
Co-op a bonus
While the lure of cash will draw some farmers to SFF, Mr Taggart believes that, equally, others will be attracted by supplying the only 100 per cent farmer co-operative in the market.
"There are a group of farmers who want a company like Alliance because we are the only100 per cent farmer owned business left in the game.
"But, putting all that to one side, it doesn't matter if we are a co-op or privately owned company, we still have to have industry best practice in our performance because, if we don't, people won't supply us."
However, talk of incredible returns from the injection of cash from Shanghai Maling to SFF suppliers was nonsense, Mr Taggart said.
"How do foreign investors behave when they come into this country? It doesn't matter if it's dairy, sheep or beef. The simple fact is that they act sensibly, commercially and logically. "They're there to make a dollar - not because they want to be kind to everyone. They can't afford to be ridiculous about what they pay."
Whereas every cent made by Alliance was either invested or paid to farmers, and did not go to the investor.
The "reasonable lump of capital" only gets SFF to stage one of getting banks off its back.
"But stage two still hasn't gone away. It's all very well saying you don't want to rationalise plants but at the end of the day when you've got 19 to 20 sites and a lot of them are not running full than I guess they are going to have to come up with a solution."
Mr Taggart was "very comfortable" with Alliance's plant rationalisations and through-put versus capacity.
"We've actually lifted our through-put this year. Part of that is because other players made a decision not to kill at certain parts of the year because of the difficulties particularly in sheep meat. We took the view that we are a co-op and farmers expect us to be able to kill when they've got stock to kill."
He would argue that the co-operative was the benchmark that kept everyone honest.
"It's not only co-ops that get the benefit. At the end of the day if we move our price everyone tends to follow us, which indicates we are leading."
On why Alliance didn't merge with SFF, Mr Taggart says basically it couldn't afford a merger. "We didn't have a big enough balance sheet."
However, not having a large amount of capital was not a negative, Mr Taggart said. "We think it's a plus because you look at companies that can get ready access to big licks of capital " nine times out of 10 they stuff it up and go off their core business. With a co-op you have to really treasure your capital. It makes you a lot more focused on spending on core business that actually delivers a result."
