Day of the locust all week long at firm that thinks bug (Video)

Livefoods Direct Limited, which employs 40 people in Sheffield, sells worms for bird feeders, crickets and locusts for snakes and mixed packs of the kind of things bats regard as just the job.

It has thrived largely un-noticed for nearly 30 years, but now two of its managers have announced they are buying it from the man who founded it, Barry Hammond.

Mr Hammond was a greengrocer until he discovered a market for mealworms.

The company now produces a weekly output of nine million mealworms, two and a half million crickets, 110,000 locusts and other species – giving a turnover of 3m a year.

Mealworms are beetle larvae which thrive in granaries in warmer climates and were required in the pet-food market when people commonly kept exotic birds.

As that market declined, people started spending more and more on helping wild birds – and mealworms make a good substitute for the larvae they need when feeding their young.

At the same time, reptile keeping began to grow in popularity and Mr Hammond started buying in crickets and locusts and finding ways to keep them alive. The Mealworm Company grew into Livefoods Direct.

There are other bought-in sidelines like grow-your-own equipment for producing insects, frozen rats for feeding to birds of prey and tinned specialties from abroad.

The home-produced insects are reared in temperature-controlled rooms in a factory with 200,000 worth of air-conditioning on an industrial estate at North Anston, Sheffield. They are sold, live or dried, to pet shops, garden centres, zoos and mail-order customers.

It takes 14 weeks to grow a mealworm and the staff work seven days a week in shifts.

The company website looks like any supermarket's except that its Special Offer On Bulk Packs applies to extra-large locusts (100 for 14.72), its Mix'n'Match offer involves a range of specialist larvae, locusts and crickets, and its no-VAT sensation is a Cano'Worms at 5.20 – an import which is apparently zero-rated because it counts as food somewhere.

The bugs are often sent by normal post, in packaging in which they can live for a fortnight. But the company uses couriers too and had to keep a close eye on the news during the postal strikes.

When Mr Hammond wanted to sell up, he consulted local financial advisers BHP Ingram Forrest, who helped two of his senior managers, Dean Jackson and Steve Evans, to raise money from the Yorkshire Bank for a buy-out.

The deal was completed last month and announced this week. Mr Jackson, a former bricklayer who came into the company as a cricket keeper in 1996, moves up from general manager to managing director. Mr Evans, who came in from British Steel, is operations director. Mr Hammond will stay in touch as a consultant.

John Longstaff, who handled the deal for BHP Ingram Forrest, said: "It is an unusual business and a sale to the management was the obvious choice. It was also what Mr Hammond wanted, so we did not bother looking elsewhere.

"We had no trouble making the case for a loan. The track record of the business is excellent and we ended up with three offers on the table from three different banks."

It has, however, been a not particularly good year so far for Livefoods Direct. The bad winter meant a lot of birds produced only one brood instead of two. So they needed to forage less and garden bird tables were topped up less often.

The company's main base is on the Worksop road out of Sheffield.

How founder got hooked on idea

Barry Hammond, originally from Worksop, used to be a greengrocer in Canada but was between premises when he came home for a family wedding and his brother, Paul, a supplier of angling baits, buttonholed him with an idea for producing mealworms for pet birds.

They started out working together but went separate ways when it became

clear that the pet-food business was completely different from the bait business.

"Once you have successfully bred one kind of insect, you at least have an idea where to start with another," said Mr Hammond yesterday. "But it was trial and error all the way"

Mr Hammond said: "I am not exactly retiring. I used to be a market trader and I will wheel and deal a bit. But I can do without having responsibility for 40 staff and 100 million insects seven days a week."