T here are times when there is nothing for it: you
Page 41
Page 42
If you've noticed an error in this article please click here to report it so we can fix it.
simply have to make a decision and follow it through, despite any dissenting voices. The new owners of Peter's Food Service were in that position four years ago. After acquiring the business in a management buy-in, they knew that the company's past did not hold the golden key to its future: continuity was not the answer to prosperity.
Peter's Food Service was formed in 1970 by the Taylor brothers to supply pies, pasties, sausage rolls and the like to fast-food outlets and pubs. Justin Griffiths jorned the company as a management trainee in 1987. He spent a year learning the trade before the firm was sold to Grand Metropolitan; Griffiths stayed with Grand Met for nine years before that life-changing decision came up.
When the chance came up to buy the firm the management buy-in team didn't need persuading. "There were no second thoughts," he says; in fact it had been mooted at various points during Grand Met's steward
D ship of the company. But the crucial difference was that Grand Met was now looking to offload the company after its merger with Diageo. The buy-in team was up against a couple of strong outside nterests, but won through on 23 May 1997,
The early days were a challenge. As Griffiths puts it: "It was interesting...it was also very frustrating—a learning curve, but a successful one. The business was at a crossroads," The dilemma was this: Peter's had run perfectly happily for nearly 30 years delivering the savoury products it produced to a variety of smaller players from one-man bands to small Chains. But, as the merger of food and drink giants such as Grand Met and Diageo demonstrated, the whole nature of the game was changing.
Rationalisation
Before the buy-M, Grand Met had been looking closely at rationalisation; pulling out of the North to concentrate on Wales, the West Country and the South-East, and closing some of Peter's 10 depots. "Our view was completely different," says Griffiths. "We had a vision of getting into total distribution. We wanted to put the quality of the products right and revisit all the customers. We also wanted to enter into composite distribution, providing a bespoke JIT operation for large industrial caterers."
The plan worked: Peter's is now a thriving manufacturer and distributor of chilled and frozen food with a nationwide customer base. At a call centre in south Wales orders are taken between 08:00-13:30hrs, Produce is delivered to distribution points during the evening for final delivery the next morning. As well as its core range of savoury goods, Peter's has expanded into short-shelf-life foodstuffs such as cooked meats, dairy products, fruit and vegetables.
In its first year Peter's was projected to turn over £38m and make a loss. Now in its fourth year, the revamped business has a staff of 1,200 (compared with the 700 employed by Grand Met) and turns over more than 2100m. It has a 22,000m7 factory, has expanded its network of depots from 10 to 14 and is comfortably in profit. But Griffiths quashes any suggestion that Grand Met might not have fully appreciated what it had. "We've had a good relationship with Grand Met," he says. "We've brought back to this business the people who understand it."
Acquisition
The company has developed a taste for acquisition, too, buying five other companies over the past few years. Three are distribution outfits—similar to Peter's; a good fit to the business—and two are manufacturers, based in Tenby and Cardiff.
Things seem to have gone rather well. "There's a great deal of satisfaction,' Griffiths confirms, but he's far from complacent "Major industrial caterers are looking for a one-stop shop: one van, one invoice," tie explains. "We've invested considerable money in IT support." That makes sense for a company which is generating 150,000 invoices a month. The technology also allows Peter's to sell itself to prospective customers on the strength of its management data.
And this company is certainly not short of ambition. In the past 12 months it has a ressively targeted markets from the Orient to the West Indies. In Antigua, for example, Peter's supplies an English-style supermarket offering own-label frozen products to holidaymakers and expats; a service it also provides in Hong Kong.
"I'm open to look at anything really," says Griffiths. It's a canny move, because there will always be consumers who want their black pudding or bait pie (a new range), however far from Blighty they happen to be. The company also serves Spain, Gibraltar, the Balearic Islands, the Canaries, Greece, the Channel Islands and the Algarve. Now it's looking at the rest of mainland Europe. "There are a lot more opportunities for the one-stop shop composite distributor," Griffiths believes. "There are going to he additional distribution sites, greater service, more products.'
The company is active in three main market sectors. First there is its core business: the one-stop shop service for large caterers. Then there are regular deliveries to °hippies, garage forecourts, corner shops and the like. Finally there is retail, where Peter's delivers own-label products direct to supermarkets, cash and carries and discounters.
Its recent acquisitions have boosted its manufacturing operation too: in Bedwas it produces savouries like sausage rolls; cooked meats come from Tenby; and sandwiches are made in Cardiff With expansion showing no sign of slowing, Griffiths can confidently say: We haven't got all our eggs in one basket" Which is certainly an appropriate attitude for a food distribution outfit.