Milk & More encourages people to switch to online accounts to save on administration costs

An “eco-friendly” delivery company that pledged to revive the traditional “Great British milkman” has raised the price of fresh milk by 4p a pint – but only for customers who don’t want to switch their accounts online.

In a drive to modernise the business and move towards a cashless system, Milk & More says it wants to incentivise customers to switch their accounts online to allow more efficient and less costly administration and payment.

The delivery company was bought by the German-owned dairy giant Müller from Dairy Crest in December 2015 and has a total UK workforce of 1,050 milkmen and women (of whom 521 are franchisees) delivering 110m pints of milk in traditional glass bottles to customers’ homes every year. It has about 500,000 customers in the UK.

In 2017, the company was the victim of its own success, after growing consumer concern about plastic waste in the wake of the BBC’s Blue Planet TV series led to an unexpected surge of thousands of new online customers.

However, the simultaneous launch of a new website – involving the migration of 150,000 online customers – led to technical glitches that caused delivery and payment problems. Guardian Money highlighted this after being contacted by disgruntled customers complaining about poor customer service. Many longstanding offline customers are elderly and disabled and value the convenience of having grocery items as well as milk delivered to their doorsteps.

The increase will be 4p per pint for milk in glass bottles, which accounts for about three-quarters of the company’s milk deliveries. This takes the price from 81p to 85p – substantially more than supermarkets charge although delivery is free. Its last national price increase on the doorstep was in December 2014, when milk went up by 2p per pint or per 500ml.

The company said: “This wasn’t a decision we took lightly, but in order to recover increased business costs it was a necessary one. We have been able to hold the price of milk for our online customers, simply because there is significantly less administration involved when customers manage their accounts in this way.

“While we currently have customers who do not have an online account and who choose to pay their milkman directly by cash or cheque, by credit or debit card, or by direct debit, all of these payment options cost us more to process.”

In a parallel move to streamline the company’s business model but which has also stoked controversy, Milk & More is cancelling all franchisees’ contracts – with a 90-day notice period – giving them an “option” to take up an employed position or leave.

The company said online sales were growing by 46% year on year (for the last 12 weeks) while the offline business was in decline. It has pledged to continue to invest heavily in the business, after a £20m investment that saved the UK’s largest glass bottle factory from closure and purchased a fleet of electric vehicles.