Growing up in Cardiff, I became accustomed to stag and hen dos from all over the UK flooding into Wales’ capital at the weekends, as well as the raft of major sporting events the city regularly hosts.
Delivered wholesaler and cash & carry Global Foods, based just outside the city centre, has been one of the businesses to have reaped the rewards of Cardiff’s status as a destination for a ‘good night out’. It’s therefore little surprise that the firm – which also serves c-stores, caterers and restaurants – is eager to further grow its customer base of pubs and clubs.
The business’ current split between on-trade, foodservice and retail is 40%, 35% and 25%, respectively, according to director Qaiser Aziz, who adds: “Over the next few years, we expect to see the on-trade side of the business grow. But the retail side of the business will probably come down to maybe 20%, given the margins on that side of the market. Retailers can’t compete with the silly stuff the major multiples do or the way they run their promotions, so they are losing out.”
The history of Global Foods
Despite this shift, Global Foods actually began life as a corner shop in 1964, before diversifying into catering supplies and the on-trade in the 1970s. In the 1980s, the business became one of the first members of the Today’s Group.
It was founded by two Cardiffians of Pakistani origin – Mohammed Yaqub, who is known in the industry as ‘Mr Kriss’, and his nephew, Mubarik Ali. Yaqub’s daughter Sophie and Ali’s daughter Nina are also directors.
Global Foods’ USP is pretty simple, according to Aziz: “We offer a quality service with a personal touch. We work with our customers closely, especially the restaurant industry. Our business is based on loyalty. If you provide that, along with good customer service and availability, your customers will stick with you, and we have seen that.”
Although the two founders set up a cash & carry to help supply corner shops like their own because Cardiff “didn’t have many cash & carries at the time”, South Wales can be a cut-throat market for wholesalers these days.
The change in the market
Aziz notes: “Customers are in a position where if you’re 20p out on a product, they can leave and go elsewhere. In Cardiff, there are two Booker depots, Bestway, Blakemore, Makro and Costco, and they’re all within half a mile radius of us. People can drive round to all the depots in 20 minutes. It was different even just five years ago – there was less competition. And it’s a city of just 341k people.
“As well as that, in Cardiff, a lot of businesses now also come from places like London, Bristol and Birmingham to deliver here, so we have to work extra hard to stay on top of that. It’s vital that you keep focusing on service and loyalty.”
Currently, 40% of Global Foods’ business comes through the cash & carry, and the rest from its delivered wholesale operation. The company delivers daily to Cardiff customers, and offers same-day delivery to those ordering before 2pm – a service that sets the business apart from some of the UK’s larger foodservice companies, which don’t have the same reach in the Welsh capital. Meanwhile, its online ordering system is due to be in action in six months’ time.
The company has a broad product range: wines, spirits, and beers, including keg beer, along with soft drinks, confectionery, spices, tobacco, and fresh and frozen produce, the latter of which tends to be imported. Given the recent weakness of the pound, this area has presented a number of problems to the business.
Aziz says: “It’s really affected us badly, along with everyone else. The Euro is now €1.13 against the pound; six months ago, it was €1.40. So it’s really hitting the prices on the lines we get from outside the UK.”
Such disruption has made the business consider increasing its supply options in the UK. Aziz adds: “We used to get soft drinks from abroad, but now, GB stock is cheaper. We also saw logistics prices rise a few years ago, but since then, petrol and diesel costs have come down, yet we haven’t seen a decrease in the logistics prices. So the transport companies need to look at their costs and adjust accordingly. They’ve not even come down by a penny.”
The impact of the National Living Wage
Despite this, Aziz claims that the biggest challenge facing Global Foods is the National Living Wage: “Expenses are going up slowly because of this policy, so it’s a big challenge, especially when you have the problems with currency and the fact there’s so much competition out there,” he says.
“This market has gone to full-time EDLP (everyday low prices) now. The idea of on promotion, off promotion, on promotion no longer works.
“People are going to the lesser margins, and for a business like us, with 125 staff, we have to make decent margin to keep everyone happy.”
As for another issue hanging over the trade, Aziz says he doesn’t expect the incoming sugar tax to change the consumption habits of the Great British public, but he notes that sugar prices from Global Foods’ UK suppliers recently went up by 50%.
Aziz’s own story, meanwhile, attests to the virtues of succeeding in a meritocracy. Having moved to Wales from his native Pakistan nearly 17 years ago, Aziz began life at Global Foods helping the delivery drivers, before working on the checkouts. Stints as a delivery driver and a buyer followed, and eventually, Aziz had worked his way up to join the company’s quintet of directors.
His accent now peppered with a distinctly Cardiffian twang and an affiliation to the local football club, Cardiff City, Aziz has no regrets about his decision to move to the UK and join Global Foods: “It’s a great atmosphere and a friendly environment here, and because it’s a family firm, they really look after the staff.”