Switching from overseas suppliers to UK-based equivalents was “really hard work”, but “definitely possible”, according to Darby, and could be turned into an opportunity with the right approach.
Speaking at last month’s ‘Exiting the EU’ conference in London, held by the Food and Drink Federation, Darby suggested there were genuine examples where substitutions could take place.
Currently, 95% of Premier Foods’s products are made in the UK using local ingredients and suppliers.
“This is entirely hypothetical, but if there’s a category in a supermarket where one supplier is manufacturing in the UK, and a competitor supplier is bringing the product from continental Europe – if everything else is even and equal, that supermarket will receive very different price increases from those two suppliers,” Darby said.
‘Turn this into an opportunity’
“On the Monday after the Brexit vote, I sat down with my procurement director and told him to turn this into an opportunity,” he added.
Darby cited an example where a domestic supplier had lost out in a competitive pitch to a supplier from the Benelux region a couple of years ago.
He suggested that in the new climate, there was the opportunity for a manufacturer to go back to the UK supplier and offer it the opportunity of a new pitch.
“Then, there is the potential of going back to the Benelux supplier telling them ‘if you want to retain your business, you’re going to have to invest in it’,” he explained.
‘Reformulate some products’
“So, there are genuinely very real examples – but they don’t tend to be quick and easy. You have to look quite hard at them, and you may have to reformulate some products.”
Adam Sopher, director at London-based Joe & Seph’s Gourmet Popcorn, told conference delegates that inflationary price pressures could result in more innovation and differentiation within categories.
“We launched about six years ago, in a recessionary environment that brought its own challenges. And at that time, the businesses that were successful were the ones that differentiated their products,” he said.
“I believe what will come now over the next year is a lot more of the same.”
Gavin Darby revealed as next president of the Food and Drink Federation
Premier Foods chief executive Gavin Darby is to become the next president of the Food and Drink Federation (FDF). Darby’s appointment was revealed at the FDF’s President’s Reception last week (December 7). The president elect named his top twin priorities as: helping to remedy the nation’s obesity epidemic and ensuring the sector has a “strong plan” to thrive after Brexit. Darby will take over the role from Fiona Kendrick, ceo and chairman of Nestlé UK and Ireland, in January 2017.