The predicted sale of Northern Foods bakery businesses, after two recent profits warnings, has finally taken place. A sudden change in eating habits with consumers turning towards more ‘perceived healthy foods’ plus rising energy costs are blamed but the company has been a serial underperformer for some years. I remember when Paul Fletcher of Fletchers Bakeries happily informed me that he and Chris Haskins (now Lord Haskins) had got together and agreed the sale of the bakery business “over a handshake and a lunch”. He felt it finally secured the family firm’s future. But since then many companies have jumped on the bakery bandwagon. Some have had massive grants to fund expansion, others, like Northern have not managed to keep pace with change, competition or, of course, energy prices. Uncertain times lie ahead with the break up but with massive debts of around £363 million there was no choice. Indeed I am not sure even now that it has sold off enough.Meanwhile, in Scotland, at the annual Scottish Master Bakers conference, bakery education was THE topic.There are not enough skilled bakers in the UK and Ireland and it is felt most acutely by craft and in-stores bakeries. So the big news was the launch of a brand new training centre for bakers in Scotland, made possible by the generosity of Mathiesons.What impresses me most about the SAMB, apart from its finances, is its education policy. Arthur Rayer and John Livingstone, under the leadership of chief executive Kirk Hunter, are so pro-active and pioneering. Every single year they investigate the changing needs of members. Then they get down to the hard graft necessary to secure the funding, train the trainers (six) and deliver the courses – to 900 students so far!But I can’t help noticing that all this is going ahead without any input from Improve – the sector skills council for food and drink. There is a baking industry feeling that Improve cares more about big companies, which is ironic because they are normally wealthy enough to fund and put in place their own training. It is small companies that lack resources and time to train. So I find myself asking: does the SAMB really need Improve or does Improve have something to learn from the speed, care and efficiency of the SAMB?
The average customer looking at the bakery section in a supermarket, or indeed someone taking a glance at the industry as a whole, might assume that the giants are in control.In terms of turnover, that is indeed the case. But dig a little deeper and a different picture begins to emerge. When it comes to performance and profitability, this industry makes the story of David and Goliath look like a cliché. The smaller companies are pun- ching well above their weight and, indeed, could teach their larger counterparts a thing or two about how to do business.According to Plimsoll’s latest research, the emerging firms in the bakery sector are:? Increasing sales at three times the rate of their larger competitors? Delivering four times the profitability of the larger firms? Showing five times the return on investment.Why should this be? The answer is simple. The big companies pay their staff more and are less productive. Competition is dri-ving prices down in many areas of the market, but the value-added sector is surviving and, in some cases, prospering.In other words, if you are producing sliced white loaves with a huge workforce, the competition from fellow giants is intense. If, on the other hand, you are making specialist breads with a relatively small staff, your nimble, slick and efficient business model is likely to be paying dividends.In the top 100 companies, salaries eat up 9% of sales. In other words, nearly a tenth of the product on the shelves is doing nothing except paying wages. One of the reasons for this, of course, is that the baking industry has followed the well-trodden path of price deflation. The travel business, the electrical goods sector and the used car market have all been affected by it. While the baking business has had its well-publicised price wars in the past, low prices are now a way of life. And if the customer is not paying, somebody has to.That’s why 25 of the top 100 are losing money and 65 are showing what I would describe as signs of extreme tiredness.SolutionsOne of the few ways out – and it’s one that a number of companies are actively considering – is to hunt down smaller competitors and buy them out. That’s fine if you have the cash or the ability to borrow to fund your acquisitions. Sadly, in the current climate, borrowing is not a wise move for some of the firms in question.The only other option is to slim down and become more competitive. But that raises a whole range of issues – not least changing the whole culture of a staff-heavy business to produce a leaner and more efficient operation. For some, however, there is no choice. It’s a case of adapt or die.It’s worth noting, however, that there have been big changes at director level in many of the major companies. More than 700 new appointments in the last 18 months, in an industry with 2,100 directors in total, means that we could start to see fresh ideas emerging. The question is: is it too late for some firms?My feeling is that the new kids on the block will continue to snap at the heels of the major players. Some will be bought out, but niche markets and tighter business models are the way of the future in an industry that, until recently, has not been used to them. nl David Pattison is a senior analyst at market analystsPlimsoll Publishing
Coca-Cola Enterprises is to introduce an easy-to-hold ’grip” packaging design across all its 500ml PET bottles of leading soft drinks brands – Coca-Cola, Diet Coke and Coke Zero.The launch of the grip bottle marks the first significant change to the 500ml contour bottle design in 23 years. Steve Fry, marketing controller at Coca-Cola Enterprises says: “Extensive consumer tests have revealed the grip bottle is in great demand, with 83% of consumers tested preferring the new bottle. The bottle will be rolled out in the UK throughout 2008, supported by a £300k marketing campaign, which includes major outdoor advertising and POS material.”Britvic Soft Drinks has introduced a new flavour to its J20 range, to capitalise on consumers’ increasing demand for premium drinks and the growing popularity of superfruit flavours – in particular, blueberry.The new flavour, Apple & Blueberry, will be available in the take-home sector from April 2008. The Apple & Blueberry flavour will replace Orange & Cranberry flavour.Andrew Richards, sales director at Britvic, says: “Premium soft drinks have grown significantly over the last few years. The introduction of the new Apple & Blueberry flavour will ensure J20 continues to cater for a range of consumer tastes and social occasions, driving overall purchase frequency and boosting the appeal of the core range.”The launch is being supported by POS with the tagline ’Not the usual’ to prompt consumers to consider the new flavour.Sussex-based firm Southover Food Company has added Fruit Hit Long Life Smoothies from the Natural Beverage Company to its product lines.The Fruit Hit range is made from 100% real fruit, with no added sugar or artificial additives. The range includes Mango & Orange, Pineapple & Passionfruit and Black & Blueberry varieties and is available from Southover in 6 x 300ml servings. The range uses aseptic packaging, which means a longer shelf-life without the need for preservatives, says the firm.Southover has also launched a range of functional drinks under the label Before the Fall. Each contains a balanced selection of vitamins and minerals, designed to increase and maintain energy levels. The range includes: Restore, a combination of elderflower pressé and ginseng; Detox, comprising green tea and fresh lemon juice; and Anti-ox, containing pomegranates. Each drink is available in cases of 12 x 375ml bottles.
Responding to rumours that Maidenhead’s best loved independent baker of cakes is on the verge of some very exciting new developments, The Handmade Cake Company is proud to announce that May 2008 will see the budding business take up residence in its new twice-as–large bakery down the road. Although to some, popping down the road might not seem like the most audacious move, this is a born-in-Berkshire company that prides itself on its local roots and making the right decisions. This is why some twenty-five years down the line, phrases like handmade, small batches, no artificial anything and real ingredients still ring as true as ever.This isn’t to suggest for one moment however that The Handmade Cake Company is so tied to the best cake making traditions of the past that it can’t prepare for the new hot cakes trends as and when they arrive. For one thing, 2008 will be the year that The Handmade Cake Company, will finally have the space to broaden its cake horizons, no longer having to disappoint all those customers who keep asking when it will be bringing their unique brand of fresh thinking to the grab and go marketplace.According to Sales Director, Simon Law, ‘Our move to a new bakery, whilst exciting in its own right, is only the beginning of some very significant changes over the coming months.A move into individually wrapped cakes not only enables us to appease existing customers who are itching to expand their existing handmade repertoire, but also to reach an entirely new group of premium cake enthusiasts. We know there are many ‘always on the move’ individuals out there who would really benefit from a little quality cake time in their lives.’Looking a little further ahead, The Handmade Cake Company is only too aware that a historical leaning towards round cakes and traybakes means that there are a lot of cake connoisseurs out there who have enjoyed its fare, but not known the face behind the cakes. ‘Expect us to really raise the bar with regard to our customer identity and communications over the coming months,’ concludes Simon, ‘as we finalise our plans to well and truly put Maidenhead on the fine cake map.’ Editor’s NotesThe Handmade Cake Company currently makes over 40 different cakesThis summer sees The Handmade Cake Company celebrate its 25th anniversaryIn 2003 The Handmade Cake Company was sold by the Perry family to a new generation of cake-loving owners (Parry Hughes-Morgan, Michael Wheeler & Simon Law) and has enjoyed double-digit growth every year since.The forthcoming marketing communications upgrade was created in conjunction with Purple Pilchard MarketingA diverse client base includes: Café Thorntons, Digby Trout Restaurants, Blenheim Palace,Massarella Catering, The Spirit Group and Gloria Jean’s Coffee and more delightfully independent tea rooms, coffee shops and discerning garden centres than you could wave a palate knife at.The Handmade Cake Company also exports this most quintessential of English eating experiences to:Norway, Sweden, Denmark, Germany, Netherlands, France, Ireland and SpainFor all sales/product enquiries please contact Simon Law: (01628 770908) or e-mail [email protected] a PR/samples perspective,The Handmade Cake Company’s is enthusiastically championed by their friendly Maidenhead neighbours, Purple Pilchard contact Ian (0777 333 0597) OR e-mail [email protected]
Welsh bakery Clam’s Handmade Cakes is very proud of its award-winning whisky cake, but its plans for wide distribution have been stymied by clipboard-wielding officials, who have declared the confection so high in alcohol that it cannot be sold by shops unless they have a licence. But the story has made Clam’s the talk of its home town, Crickhowell, and everyone is keen to try a slice. Rumours that local police are planning to make cake-driving a criminal offence are mere speculation.
Renshawnapier is proud to continue its support of the industry by sponsoring Celebration Cake Maker of the Year once again.During this difficult financial time, celebrating the best in the industry is more important than ever, says the company. Open to everyone, ranging from small cake-making specialists right up to celebration cake manufacturers, this award aims to search out those highly skilled individuals that make celebration cakes such an exciting and innovative sector. Entrants do not have to be a customer of Renshawnapier to enter the award.”I am delighted to be able to support this prestigious event for the industry and offer cake-makers the opportunity to demonstrate their immense talent in this area,” says Stephen Heslop, CEO of Renshawnapier’s parent company the Real Good Food Company. “The designs and concepts I have seen in the previous four years we have supported this award have been amazing and a real credit to individual finalists and their respective businesses. As a business, we are very clear about our innovations agenda and we hope this will inspire others to achieve similar success.”Judges will be looking for entrants that truly excel in their craft and can demonstrate creativity and individuality in the field of celebration cakes. Key trends in the market include good use of colour and modern, simple designs. Whatever your inspiration, the key to success in this category is being able to translate ideas into vibrant and imaginative cakes.”Companies and individuals should enter to demonstrate their skills and individual flair,” says Nicola Hemming, business development and technical sales manager at Renshawnapier. “Being recognised for the quality of your work provides a great sense of achievement. The feelgood factor is something to be personally very proud of and your business will also benefit. This award raises profiles and highlights the achievements of you and your company across the entire industry.”The Real Good Food Company consolidated Renshaw and Napier Brown Foods into one business unit, renamed as Renshawnapier, in January 2009. The business supplies a wide range of sugars, marzipans, ready-to-roll icings, caramel, mallow, baking chocolate and jam to major cake manufacturers, high street bakers and retailers.—-=== Leanne Tang, cake decorator, Terry Tang Designer Cakes, Liverpool, who won last year’s award. ===”I hadn’t seen the cakes from the other finalists until the awards night. When I saw how good they all were, I was a bit unsure about how I would do. It was such a lovely surprise to win. The whole night was brilliant fun and I was on a real high after winning the award. We highlighted it on our website and have put the trophy and certificate up in the shop. Customers are always asking about it. My dad (Terry Tang) won the award in 2007, so it means that as a business we’ve won it two years in a row. It all adds to the reputation of the business and, on a personal level, it’s nice to be recognised for your work.”
Kingsmill is to partner Aardman Animations, which produced the bakery-themed Wallace & Gromit film – A Matter of Loaf and Death – to mark its release onto DVD.The brand will be offering an on-pack token collect promotion, which will be available from 23 March across its Kingsmill Great Everyday, Love to Toast and Crusts Away sub-brands, as well as Kingsmill Tasty Wholemeal, 50/50 and Soft White Rolls and Kingsmill Love to Toast Crumpets, Muffins and Pancakes. The Easter promotion will run across 60 million packs and offers consumers the chance to win a range of branded collectables, such as a limited-edition Kingsmill turbo-matic toast rack. “Following a successful partnership with Wallace & Gromit at Christmas we are making the Easter activity bigger and better to extend consumer exposure,” said Kingsmill marketing controller Michael Harris.
Bread is one of the most commonly bought items from local stores, but shoppers are often disappointed with the shops’ quality and choice, according to a new report from YouGov SixthSense.It revealed that 60% of grocery shoppers use local shops once a week, with 68% purchasing milk and 55% intending to buy bread. However, 30% of those shoppers polled said they were “dissatisfied with the choice of products offered”. The Co-operative came out as the most widely used local store brand, with 24% of respondents, visiting a shop once a week. Tesco Express came in second with 16%; 11% visited Spar once a week; and 7% went to Sainsbury’s Local.The report notes that it is the “typically less well-off consumers” who are the key customer base for convenience stores. James McCoy, research director for YouGov SixthSense says: “While most consumers accept that convenience comes at a price, smaller shops need to ensure that this typically price-sensitive group of shoppers is being catered for with carefully-targeted promotions and special offers.”The online survey was carried out on 1,469 ‘main shoppers’.
North-west bakery chain Sayers is counting on shopper feedback to give it a competitive edge.The company has just finished an analysis of shopper behaviour with retail marketing consultancy Market Creative, which involved interviewing hundreds of customers as they left its shops, as well as competitors’ stores in the vicinity.Questions focused on how Sayers could tempt them when money was tight, as well as asking why they had chosen to visit the shop, how often they shopped there, and what they had bought.This is the second time Sayers has conducted customer behaviour research in this way; a study three years ago resulted in a company reluanch and rebrand in 2008.Sayers commercial director Mark James said the results had been enlightening. “It was very interesting to see how views have changed since the last time then, they wanted a more traditional bakery.”It gives us a good steer, because we interview shoppers of all ages and demographics, and particularly focus on those who don’t use Sayers as their primary shop.”Customers are encouraged to take part with the lure of a free sandwich. “In these competitive times, it’s important to find out what they are saying and why they are not shopping with you,” added James. “The result will hopefully be that we get more shoppers who will spend more money with us.”
Father and daughter team, Peter and Sarah Wenzel, from Wenzel’s the Bakers in Pinner, Middlesex, spoke to British Baker at the first BB75 Lunch. They discussed the company’s plans to open 10 new outlets in 2012, looking at new avenues and working with Transport for London to operate in train stations.Music: Pasadena by Emerald Park (Creative Commons licence)YouTube link: http://youtu.be/CT8MTiPvbe0