Inner-city micro dairy brings milk to Melbourne*s cafes the old-fashioned way (ABC)

View Comments ABC Saint David Dairy started with a dream to bottle milk the old-fashioned way.

In a back street in the inner-city Melbourne suburb of Fitzroy, a small dairy has quietly opened its doors.

Saint David Dairy, named after the street in which it is located, started a year ago with no customers and a dream to bottle milk the old-fashioned way.

Today, it has more than 100 customers - mostly the inner-city cafes frequented by hipsters and coffee snobs.

Saint David Dairy is the brainchild of dairy industry professional Ben Evans, a former production manager for the big players.

"I think after a lot of years of making products and probably a lot of automation in big factories [it] means you're less and less in touch with the product," Mr Evans said.

"You see the small machinery hands on, seeing the product, feeling the product, touching the product. I really fell in love with that."

A year ago he left his job and started making his own way in the dairy industry, sourcing milk from Gippsland and choosing to hand bottle for the boutique market.

His former employers thought he was a bit mad.

"Twelve months ago, we started with nothing, no business I guess," he said.

"We just had our first run and put some milk in the truck and drove around to some local cafes. That's nerve-wracking, you know.

"We were very lucky. A lot of the cafes essentially are local businesses that need local support as well, and a lot of them are people like us who've had a desire to start a business.

"They saw what we were doing and understood that we had our hat in our hand."

Consumers are getting smarter about product

The secret, he says, is to do as little to the milk as possible, leaving in all the cream and the protein.

"Essentially the irony about milk is that the less you do to it the better it is, so the aim is to essentially bottle it as close to the way it's produced naturally as you can," he said.

Fitzroy was once home to 27 dairies but refrigeration and automation changed all that. Now Mr Evans has found a new market on his doorstep.

"Consumers are getting smarter and smarter," he said.

"The questions that we get asked now when we go into the cafes. It amazes me that the cafe owners have that level of knowledge in terms of the product - its source, the types of milk, the composition, right down to the breed of animal and its feed.

"I think the coffee craze in Melbourne has certainly helped it. The endless search for better coffee means that cafesare always looking for a point of difference as well."

One of the cafes that took a punt on Saint David Dairy is Seven Seeds. General Manager KC Reynolds says milk is an important part of a coffee.

"It makes a big difference. We do lots of tastings here, we taste lots of coffee and we've tasted lots of milk," she said.

"Creaminess is important, and it should be sweet but not too sweet," she said.

Much of the move by cafes into boutique milk is being driven by the consumer.

"I think people generally are just looking for transparent products," Ms Reynolds said.

"People are becoming more aware of where their food comes from [and] where their coffee comes from, so having a small dairy where you know where everything comes from, it's what people want."

Sold house and car to get dairy going

Smaller brands have lifted market share over the past four years from 5.2 per cent to about 7 per cent.

New research from IBISWorld market research predicts a 4.4 per cent annualised growth for milk and cream processing over the next five years.

"Australian consumers are drinking more milk," IBISWorld senior industry analyst Andrei Ivanov said.

"We're estimating that in 2014-15, an average consumer will drink up to 107 litres of milk, which is an increase on 103 litres of milk 5 years ago.

"We believe that at the micro level, you're going to see a lot of polarisation, so consumers are really kind of pushing the limits and going for the very top-notch, top-quality, boutique-type of product."

There is certainly not a fortune to be made, especially with high start-up costs for dairy equipment and complexities in regulations, but for the moment Mr Evans is happy with the living he is making.

"I'm not sure if the shareholders of some of the major companies on the stock exchange [would] be happy with our dividends, but when it's just your wife and yourself I guess it's relative.

"We sold our house and we sold our car for a refrigerated van to get it going."

And expansion could be on the cards.

"We have some ideas of either a farm-direct link or starting a Saint David Dairy in Bondi or Fremantle," Mr Evans said.

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