Big appetite

IN PROFILE
Big appetite
David Salkeld, CEO
of Symington’s
Q
David Salkeld, CEO of food producer and BVCA Management
Team Awards 2012 winner Symington’s, on the company’s bid
to take a larger bite out of the global market
Who are your main customers?
We sell own-label and branded
goods such as Ragu, Aunt Bessie’s
and Chicken Tonight to all retailers,
whether they happen to be Marks &
Spencer or a chain of pound stores. We
have 1,250 product lines in 23 different
categories, but no one of them accounts
for more than 1.5% of the total business.
A
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Are your customers UK-based or
located around the world?
export to about 35 countries,
A We
including Australia. Last year,
we set up Symington’s Australia PTY
to relaunch the Chicken Tonight and
Ragu brands for the consumers in the
Antipodean market. The Australian
venture is alive and well and making
fantastic progress in Melbourne.
Q
33
IN PROFILE
Which markets contribute
most to your business?
UK accounts for about
A The
80%, while the rest of the world
makes up 20% of our business. We
sell products to South Africa, Canada,
Eastern Europe and Scandinavia, and
we’re a key challenger to global food
companies such as Heinz, Nestlé, Mars
and Unilever.
Q
How, in your view, is the UK
food industry performing?
market dynamics in the
A The
UK are unprecedented. For the
past 30 years, the big players in the
market have enjoyed sales and volumes
growth, although both have dropped
in recent years. You have growth at
both ends of the market, from budget
retailers such as ALDI and Lidl up to
a company like Waitrose. Consumers
are changing and the global financial
crisis has put pressure on households,
leading to savvier shoppers. I’m the
same; I’ll use my 12p off a litre of fuel
at Sainsbury’s voucher and look after
the pennies, which is how consumers
are today.
Q
How did the management buyout
(MBO) that you carried out in
2007 come about?
was at an event near York and
A Ithis
guy, Andy Micklethwaite,
tapped me on the shoulder and said,
‘You must be David Salkeld. I think
you’d be a good buyer
and leader of our
business.’ He told me
about Symington’s and
mentioned that I knew
his son, Danny, who
was brand manager
for Lurpak. I rang
my pal Henrik
Pade (now business
development
manager at
Q
34
“
We’re looking at
entering more markets
and launching new
brands this year
Symington’s) and we found that the
company’s categories were primarily
branded and capable of adding value to
the business, so we put a plan together
in the summer of 2007, talked to a
number of people and went ahead with
the deal.
was your immediate
Q What
objective when you bought
the business?
Andy and his partner, Tim
A Robertshaw, had bought Brand
Partnership in 2000 and led the
takeover of Symington’s two years
later. When buying Symington’s, they
acquired Ainsley Harriott’s brand of
dried foods, which was quite successful.
But Andy and Tim weren’t sure how to
protect the value, because they hadn’t
worked with brands before. Henrik and
I had run three of the top 50 brands in
the UK. When I was CEO of Arla Foods,
I bought Anchor Milk from New Zealand
Milk in 2000 and relaunched it in the
UK. I also launched Lurpak spreadable,
in 1994, and branded Cravendale Milk
when everyone told us that we couldn’t
brand milk. When I bought Symington’s,
it was 30% branded and 70% own-label
– today, it’s the other way round.
was your strategy when
Q What
you bought the company?
The aim was to grow the business
A and add value to each category,
while keeping costs low. We don’t have
a pension scheme, let alone a pension
deficit, and all our offices are in factories
and warehouses, so we don’t have glass
atriums like some of our competitors.
I don’t even have a PA; my receptionist
handles everything for me, and I share
my office with the finance director.
Q
A
How big was the company when
you bought it?
We had 260 people and six units
on one industrial estate in Leeds.
”
We now have eight units at the same site
and about 800 staff in total, two factories
in Bradford and one in Barnsley, and
a warehouse in Leeds that we bought
when the previous owner went bust.
The company recently achieved sales
and earning growth for the 22nd
consecutive year, seven of which we’ll
take credit for. The business’s turnover
was £47 million when we bought it and
now it’s £230 million.
How have you turned the business
into what it is today?
had a business plan, we knew
A We
the categories we wanted to go
into, we’ve built strong relationships
with the consumer and have a great
insight into the market. We kept costs
low and sold products and brands that
consumers love to our customers,
driving growth in the business.
Q
Q
A
Which categories did you focus on
to drive the company’s growth?
We focused on soup, rice, pasta,
couscous and home baking products.
SYMINGTON’S
IN NUMBERS
1827
When William Symington founded
the company
£270 million
The company’s turnover in 2014
– a substantial increase from
£47 million in 2007
700
The number of jobs created since
the management buyout seven
years ago
20 tonnes
Symington’s production facility in
Leeds produces, on average, this
amount of noodles each day
£2
The average cost that consumers
pay for Symington’s range of
convenience foods and sauces
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35
“
The global financial
crisis has put pressure
on households, leading
to savvier shoppers
”
Everyone’s leading busy lives and people
want great-tasting convenience food
that is ready in 10–15 minutes for £2,
which is what we offer. To work out
which categories we’d go for, we carried
out research, talked to consumers and
walked supermarket aisles. Our products
cost £1 to £2, and with the development
in ingredients and recipes, you can get
fantastic tasting food from a packet or jar
for that price.
Hermes financed the MBO in
2007 and was later taken over
by Bridgepoint, so how have they
contributed to your growth?
doesn’t generally
A Bridgepoint
invest in food manufacturers, so
we thought about the best investment
opportunity and that led to an MBO,
involving ICG, two years ago. We met
a number of people at ICG, liked them,
thought we could work with them
and did the deal. We own 51% of the
company, while ICG has 49%. We’ve
done a few things with them, such as
opening an office in Melbourne after
signing a licensing deal with Unilever
to sell Chicken Tonight, Raguletto
and Five Brothers sauces in Australia
and New Zealand. We’ve also bought
Victoria Foods, which was a familyowned baking business, and opened a
noodle factory in Leeds.
Q
What prompted you to open a
noodle factory in Leeds?
came about from one of the
A Itbigallcrises
that we’ve had since
buying the business. Not long before the
ICG deal, our noodle supplier in China
gave us four weeks’ notice to end the
relationship. We tried to find another
Q
36
Chinese supplier, but saw the prices
and thought, ‘Bloody hell, we need to
do something about this’. We went to
China, bought a production facility and
decided last year to move everything
to Leeds, as it was taking 10 weeks to
get noodles transported from there to
here. We now have a £15 million, 72,000
sq ft facility that produces about 15–20
tonnes of noodles a day.
What is the strategy going forward
for you and ICG?
looking at entering more
A We’re
international markets and
launching new brands this year,
including Kingsmill, Thorntons,
Diet Chef and Robinsons. We’re also
investing more in our factories and in
new product development.
Q
£15m
The cost of building a
noodle factory in Leeds
22
consecutive years in which
the company has reported
sales and earnings growth
What has been your biggest
achievement since buying
the business?
nearly 700 jobs in the
A Creating
heart of Leeds is the biggest one.
We’re in the centre of the city and
to provide that many jobs in seven
years is quite an achievement. Most
governments would pay a fortune for
that level of job creation.
Q
Looking back,
what is the
biggest lesson you’ve
learned throughout
your career in the
food industry?
had the
A I’ve
privilege of being
the country’s biggest
butcher and its biggest
milkman, and it’s the
same wherever you
are in the industry:
you have to set the
direction and get
the best people
around you. Get them
engaged, support
them, motivate them
and let them go.
Q
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