15 December 2014

Garvin Darby article for The Grocer on Saturday 13 December

Following the extensive media coverage of our 'Invest for Growth' programme over the past week, CEO Gavin Darby has written a piece for The Grocer magazine.

Following the extensive media coverage of our 'Invest for Growth' programme over the past week, CEO Gavin Darby has written a piece for The Grocer magazine, published on Saturday 13 December.

 A salutary lesson for all of us

Having your business ethics challenged in the court of public opinion is never a comfortable place to be. The events of the past few days are clearly a reminder to all of us to be constantly aware of the environment in which we operate and conscious of how one’s business practices can be perceived by others. 

Of course, it shouldn’t be a big surprise that businesses seek to get best value from all their commercial relationships. Indeed, we have a duty to our employees, customers and shareholders to be as competitive as we can. In today’s grocery market consumers are looking for the best bargains and are increasingly prepared to shop around. The whole supply chain, including retailers, manufacturers and suppliers, are very conscious of the need to give consumers good value.  This was the context for our ‘invest for growth’ programme.

We communicated openly about the programme over the past 18 months in supplier meetings and conferences and also to investors. The programme was based on our belief that it’s reasonable to ask our suppliers to invest in a growth journey from which we would both potentially benefit. This has helped us invest in new products, marketing and promotions. And in return, many of our suppliers have gained a larger slice of our business enabling a good proportion to grow their own businesses and take on more people - a fact that several have been willing to endorse publicly.

While the programme has operated successfully for some time, it’s clear we made mistakes in how we executed some elements. However, we have learned from this experience, taken rapid action to modify our programme and we’ll do better in the future. 

The reality is that we are passionate about our supplier relationships and hugely appreciate all that our suppliers do to support our business. In a recent survey of our suppliers carried out anonymously by an independent company, the vast majority said that their relationship with Premier Foods was ‘good’ or ‘very good’, the highest rating amongst our benchmarked competitors.  And we’re also a big supporter of small businesses. Over one third of our top 250 suppliers have less than 250 employees and, of our total procurement spend, around a quarter  is with small businesses, the same target the Government aspires to for public procurement.  

We have lots of great stories to tell about how we work with our suppliers as well as our commitment to supporting British agriculture, skills for young people and what our 4000 dedicated employees do to support their communities across the country

My hope is that recent events won’t detract from what we do every day to be a decent and ethical business partner.  We’ve had a strong reminder how critical perceptions can be and the importance of executing one’s business practices consistently and in line with society’s expectations. This is a salutary lesson for all of us.

12 December 2014

The facts about Premier Foods’ support for UK small and medium size businesses

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