Despite numerous departments, Blakemore tries to avoid complexity, Tan Parsons discovers.
- Number of stores
- Expected turnover for 2015/16
Wholesale, cash & carry, delivered, foodservice, retail
- Buying group
Landmark and Spar
- Number of distribution depots
- Number of cash & carry depots
AF Blakemore is about to get bigger. The largest Spar wholesaler is projecting that its turnover will hit £1.35bn in 2015/16 and has set its sights on exceeding £2bn by 2020.
The group has a history of acquiring other businesses: Capper & Co, BA Cash & Carry, Lowries Wholesale and Tyne-Tees Cash & Carry to name but a few. But the next five years will see a big drive to grow by better using the resources already available across the group, says James Russell, managing director of Blakemore Wholesale Distribution.
While it will still look to acquire where appropriate, Blakemore’s organic growth will be driven by multi-temperature distribution. “We are expanding our offer significantly to leverage the assets we’ve got in the group to offer chilled and frozen distribution nationally,” says Russell. “We know that over the past five years or so, the rate of change in convenience retail has been vast, with the explosion of food and coffee to go, and consumers’ expectation that they’ll find the same fresh and convenient meal solutions that they can find in a multiple.
“From that perspective we see a significant opportunity for growth, while adding value upstream to suppliers.” Blakemore has a multitude of departments, covering cash & carries, 300 company-owned stores and a fast-growing foodservice business, not to mention the wholesale distribution arm and countless other sections. But if there’s one thing Russell has learned in his career, it’s the benefit of not getting too complex: growth will come from simplifying things.
“We’ll succeed by being able to demystify and simplify the way that we work relative to our opponents,” he says. “There is a whole range of different national businesses that outsource their supply chain and are looking to improve the quality of their chilled offer and their meal solutions. “We’re well placed to leverage the knowledge we’ve developed, both as a retailer and as a distributor for our Spar stores, to offer a significantly enhanced offer. But we can also offer nationwide distribution by using our supply chain. That’s a space we traditionally haven’t played in particularly hard.”
As the strategy develops, Blakemore’s target market will shift from independent retailers to any regional or national group looking to enhance its offer by taking advantage of national suppliers. But that’s not to suggest the group is ignoring its traditional heartland. “Blakemore has got a great heritage in supporting small business and small business is absolutely our target market. But we are looking at an enhanced offer for an enhanced customer base.”
As the former commercial director at discount specialist Rowan International, Russell is well placed to judge the impact discount retailers such as Aldi, Lidl and 99p Stores have had on the market.
These businesses have reset what the high street looks like, he says, and changed the way consumers shop, creating what he describes as a ‘disc-venience’ opportunity. “What we’re seeing is the enormous potential and capacity in the market for impulse. We’re working with leading suppliers, taking products into different outlets.
To that end, we’re seeing great incremental value by getting sales in outlets that wouldn’t normally sell those products. “Even in builders’ merchants, the contractor buying nails and fixings will now pick up an outer of chocolate bars and energy drinks to consume with his crew throughout the day. So you’re putting products into places where the consumer wouldn’t expect to see them but in the future they will probably demand it.
”Everybody is looking for new points of distribution and distribution chains, he says, and Blakemore is in a unique position. “We supply customers, from large motorway outlets through to operators servicing small offices that are carrying an honesty box for products, which makes our distribution footprint vast. It’s critical for us to continue to develop them and develop economies of scale in the way that we supply them. It’s certainly a big opportunity.”
One exciting aspect of wholesale distribution at Blakemore is the exports business, where the group is using its Fine Foods portfolio to develop a market in Asia and the Middle East. “Long term, we’re looking at alcohol – probably not so much whisky as some of the Scottish wholesalers have got that pretty well covered,” says Russell. “But the focus up to this point has been very much around typically British products – preserves, biscuits, chutneys and so forth.” He says customers abroad tend to be good at spotting niches in their markets where they can drive distribution of UK produce.
“That’s great for us, it’s great for the Fine Foods business and it’s great for Britain that we’re supporting great British products abroad.”