The Publication For The Grocery Trade

Jenks - The Interview - The outsourced sales and marketing experts

Jenks is the UK's leading sales channel and brokerage company, with over 40 years' trading experience. Jenks provides across the board sales channel expertise for major brands and works on behalf of consumer goods companies to improve their product availability and sales within the UK grocery, pharmacy and convenience trade channels. In the last few weeks Jenks has launched a major initiative to expand its UK operations over the next five years by increasing the use of outsourced sales and customer marketing expertise by major UK and international brands. Jenks' current business adds up to more than £130m in sales annually but now, under the joint leadership of ex-Abbey National MD Ambrose McGinn and Ross Beattie, the team believe they can significantly increase the use of specialist outsourcing for all aspects of the sales channel, thereby taking the Jenks business to a new level. The Grocery Trader went to Haddenham in Buckinghamshire to meet Ambrose McGinn, Joint MD of Jenks. The Grocery Trader - Ambrose, I know it's a cheeky question but how are you qualified to be joint MD of Jenks? Isn't FMCG sales brokerage a long way from the world of banking and personal finance that you're used to? I wasn't always in banking! I started my career in the grocery industry in 1981 with Grand Met in their Express Dairies and Eden Vale business. I worked on a number of brands - Ski Yogurt, Eden Vale, Express Foodservice and Cuisine. I then went to Unilever's Mattesson's Walls business, where I was Marketing Manager, and after that to Abbey. GT - Why did you go there? I was interested in working for a 'manufacturer and retailer' that made their own products and sold them through their shops, which Abbey does. It was an exciting time as they were moving from a building society to a bank, the first to do so. Another attraction for me was that Abbey was a creative, marketing-focused business, headed by Gillette's former head of marketing. During my time there, I joined Abbey's UK board as Marketing Director. I also held the post of E commerce Director and was latterly MD of their Intermediary Products Division, offering mortgages, life assurance and pensions. It owned various financial brands and was very much a B2B environment. My roles combined my FMCG experience into a high profile Marketing Director's position, with latterly responsibility for my own division. We sold multiple brands to a diverse customer base - exactly what we do here at Jenks! GT - How did you get involved with Jenks? In late 2005 I was looking for suitable investment opportunities, when Ross Beattie approached me. I remembered Jenks from my grocery days, and had been impressed by their business proposition. Jenks came to the fore out of the other options I was considering. It fitted the profile and size of business I was looking for. I liked the shape of the company, and could see there was a clear opportunity for the business to grow. Also, I liked their culture and values. An important part of working is being somewhere with the right values and beliefs, and having these written down, as Jenks does, helps people believe in and understand them. There's a great team spirit here: 20 of us recently took part in the Blenheim Triathlon at Blenheim Palace. It involved an 800m swim, a 20km bike ride and a 5km run, and we raised £20,000 for the Radcliffe Hospital in Oxford. GT - Have you taken a personal stake in Jenks? Yes, I own fifty percent, with Ross owning the rest. There are no institutional investors, but we still get tough on KPIs and operate at PLC levels of transparency, which our principals expect from us. We maintain the highest degree of professionalism - it adds credibility in the eyes of multi-national companies, and above all is good business practice. GT - When was Jenks founded? Jenks was founded 46 years ago by Dennis Jenks and handled McCormick's UK sales in the early days. It became Patterson Jenks, manufacturing products. In the early 1980s McCormick took it over and brought it into the fold, and it remained part of McCormick's UK operation for over 20 years. Eventually Jenks outgrew McCormick, and Ross Beattie and Mike Timms took the company private in 2003. McCormick is in the same business park as us: we've not lost touch with them, but we've gone from strength to strength with refocused ambition now we're not a small part of a large multi-national. GT - Who else is on the management team? We have Directors of Sales and Marketing running the commercial areas with their own margin and profit accountability: Andrew Macdonald leads Grocery, Guy Harris, Confectionery, Drinks and Snacks, Chris Webster, Health & Beauty, Non-food and Chris Haddy, Foodservice. There's also David Louis, MD of Blue Water, our recently acquired field marketing business. Heading our Central Services are Karen Fullick, Financial Controller, Colin Bendel, IT and Transformation Director, Claire Vear, HR Manager, and Jon Stowe, Supply Chain Director. GT - How is your sales and customer marketing organised? Each category has a dedicated sales and marketing team, including national and regional account managers, supported by UK wide territory business managers. GT - Why is your retail business broken out into these areas? It's how the trade sets itself up: we align to the customer. We have three NAM's calling on Tesco, coordinated by a lead relationship manager across the account, ensuring a consistent approach with focus in a particular category when required. It's the best of both worlds. GT - Which of these areas is growing fastest? Health & Beauty is growing the fastest, as a result of bringing on new principals in recent months. It's an area of strong opportunity. GT - What does Jenks offer its principals that companies and brands can't do themselves? People appoint us for various reasons. We might act as the UK sales and marketing arm for various overseas manufacturers; other companies may prefer doing the multiple side themselves, and buy into our proposition to get into the convenience sector. People use us for focus and expertise they may not have in-house in particular markets. Ultimately we provide feet on the ground and real sales capability We help businesses drive additional revenue from accessing channels that are either hard or costly to enter or, if it's a cost saving exercise, then we can turn fixed costs into variable costs so you pay for what you get. GT - The other big question: why pick Jenks as a sales and distribution broker? Basically, we deliver. We have an unbeatable list of blue-chip clients and brands, a long track record and a stable management team. Ross has been here six years, and many others much longer. Jenks also offer the scale and critical mass to take on significant portfolios. GT - You've set yourselves the challenge of 'significantly increasing the use of specialist outsourcing for all aspects of the sales channel.' How achievable is that ambition? Eminently achievable! The strategic drive for Commercial Directors and CEO's in most businesses is to look for added value in their sales capability and find revenue from new channels, while finance directors want to drive down the cost of sales. At a global level we have the skills and ability to match this outsourcing agenda. Because we're using teams in dedicated sectors we are experts in these areas, not a 'jack of all trades.' GT - How do you propose to do this? Firstly, we get regular approaches from multi-nationals who want help in the UK, often through a recommendation from a Director level person who has used us previously, understands how we work and has witnessed our service delivery. Secondly, we're actively talking to appropriate FMCG companies at board level about developing strategic opportunities. Increasingly our trade customers are recommending us too as they seek to reduce the number of customers they deal with and find our consolidated approach attractive. GT - What is your wider vision for Jenks as a business? We want to build on our core business with organic growth from existing and new principals, but also start up new teams for new markets, based on our current model. Additionally we plan to significantly build our foodservice business. Foodservice is still highly fragmented in the UK, and no one offers the proposition that Jenks has. The third leg is to build our field marketing capability- hence acquiring Blue Water is a natural move. GT - How big is your UK turnover? How fast are you growing? Is your business confined to the UK? We're responsible for around £130m in turnover, which has doubled since 2003. This growth will continue to accelerate. Our business is mainly based here in the UK, with a certain amount in Ireland. We have a watching brief on Europe through our membership of the European Sales and Marketing Association, run by Richard Onions, a former Jenks person. GT - How many principals do you have? We have around 30 principals. The list includes Bayer, Pfizer, Akzo-Nobel, Jeyes, Johnson & Johnson, McNeill, Energizer, Combe International, Kikkoman, Lo Salt, Campbell's US, Kerry, Ryvita, Hermesetas, Meroso, Mars, Ritter, Fisherman's Friend, Topps, Perfetti Van Melle, Del Monte and Strawtech. GT - How many of the principals are UK-based? Around two thirds have UK offices or are UK companies. The rest are overseas-based. GT - How many brands in total do you represent? We act for 60 to 70 brands. In grocery they include Del Monte, Campbells V8, Home Pride, Greens, Whitworths, Mars, Galaxy, Starburst and Ryvita. In other sectors they include Rennie, Nicorette, Listerine, Just for Men, Calpol, Benylin, Parazone and Energizer. GT - How big in turnover terms are the brands you work on? We look to take on brands with a minimum £1m of turnover, but that doesn't mean we won't take them on below that. In such an instance our fee is based on the amount of time and resource needed to manage the brand. Above the £1m turnover level, we negotiate a commission. GT - What other criteria do you have for taking on brands? A brand must be supported above and below the line and be invested in so that we can grow the sales revenue. GT - Do you only handle established products? No, we've taken on many fledglings. A current example is Sippah from Strawtech, a flavoured straw. They had some business in UK multiples and approached us to take over the account management and grow further distribution - it's really taking off now. GT - Would you undertake to launch a product that hasn't been sold anywhere else in the world into the UK market? Yes we would, but first we'd want to be sure through consumer and trade research, carried out in conjunction with the client, that the brand is likely to succeed. The vast majority of our business is established brands seeking additional distribution or turnover, or wanting to turn fixed costs into variables. GT - How many approaches do you get every week from companies wanting you to represent them? We get one approach a day, but only take on a small percentage. Most of the approaches we get are speculative, many from abroad. At any one time we're progressing half a dozen, increasingly major opportunities, which require research and analysis into routes to market and working relationships with the principals. We handle these approaches on a one-to-one basis, in confidence. We need to work together with clients for some time before we go public: it can be as much as three months before we see the first buyer, but then we can move quickly, because we have a business model that is well proven. GT - Do you 'hot house' existing but small brands and bring them on? Yes, we've just done this for an existing customer moving into a new sector. We've developed the consumer proposition, brand, packaging, trade approach and pricing. We could offer similar consultancy for other clients if required. GT - Do you offer a specialist service for small, niche companies? No. We're always looking for good ideas that will grow and which offer the opportunity for significant turnover, but we're not here to support niche products. We're essentially a scale business, offering opportunities to other scale businesses. GT - Do you take a financial stake in any principals' brands? No, not at the moment. GT - At what point in a brand's growth would you advise principals to take over the sales and marketing? We have clients for whom we handle all their business and have double-digit sales growth. It's not clear that doing this themselves would deliver that return. If it was a strategic imperative to outsource initially, why change because turnover has gone up?! People stay with us because we continue to grow their business. GT - You clearly do the trade marketing for your clients in the channels where you represent them. But do you also look after the consumer marketing and brand management for your clients? Do you get involved in NPD? Yes, we have various clients where we do the whole piece. These tend to be major companies. We're currently working with one major client's NPD team and their advertising and promotional agency. Typically we work with the client's brand marketers at their HQ. Our product managers liaise with the client's NPD team: we provide trade and consumer insights and research. GT - How do you work with principals - do you take total responsibility for their sales and supply chain in the agreed channels? Yes, for many we do exactly that. For others requiring a more partial solution we offer a full distribution model, or components. GT - Do you have title to the goods? We have a mix of consignment and non-consignment, but title always passes to us before we sell it on. In the event of a recall we get the product back: traceability is down to us, and is a very important part of our offer. GT - Do you organise shipping to the UK for the imported products you sell? Shipping is a mix of the suppliers' responsibility and ours - we work as partners in every respect. GT - What is your commission or other share of the proceeds of your sales on behalf of your principals? It varies by market sector. We offer market-competitive rates and typically negotiate a commission structure which incentivises significant growth. GT - Taking grocery, pharmacy and convenience as a whole, which outlets do you sell to? We sell to all the UK's major national and regional multiples and the wholesalers, cash 'n' carry groups and buying groups. In the pharmacy sector we sell to all the major players and have relationships with the specialist wholesalers. We can also supply van sales as required, or set up bespoke van sales drives using Blue Water. GT - Who are your foodservice principals? They include Campbell's, Mars, Ryvita and Meroso. GT - Have you taken any foodservice brands into retail? No - we're focusing very much on building the foodservice business. We have plans to grow this area into a scale business over the next few months, involving major investment. We're not developing any of our foodservice brands for retail at present. GT - On the logistics side, how do you handle customers' orders? We manage all order taking here at Haddenham through a specialist team. The vast proportion of orders comes through EDI, the rest by fax or phone. We're also developing a web capability. GT - Who handles your distribution? We currently have a partnership with a leading 3PL. We have an initiative running to move to a dedicated Jenks depot in early 2008, to consolidate all goods together in one location, but will retain outside logistics support. GT - Where are your goods held before they go into the supply chain? They're held in Leighton Buzzard, serving the cash 'n' carry and wholesale sector, and Warrington, serving the multiple retailers. GT - Acting for so many principals, how do you ensure their products comply with UK and EU legislation? Our dedicated technical manager, Gill Cox, manages various accreditation schemes and liaises with principals on all technical aspects. We hold a Wholesale Distribution Licence on the pharmacy side. In foodservice, the NHS has recently audited us. Gill is our technical focal point for ingredient labeling and bar codes. GT - What's your approach to IT? We spend an average £100,000 annually on our IT. However, we're currently investing £350,000 in a new IT system, based on Microsoft Dynamics. This will build on our current web-based management information to our principals, and is due to go live in spring 2008. It's a major investment in the infrastructure of our business to provide a strong foundation for growth. GT - How are you equipped to handle the finance and admin side of your principals' business? Once we have delivered the goods and have proof of delivery, we issue the invoice to customers and then follow up payment. We carry out credit control and cash collection and so are responsible for customer debt should this occur. We have commercial agreements with the principal and the customer, and seek to find a neutral cash position between the two. GT - Have any products you represent won Product of The Year awards or similar honours? Awards aren't an area we're looking at the moment - we're more focused on sales! GT - You recently acquired the field marketing company Blue Water. What was the story there? We completed the deal to buy Blue Water in December. We see field marketing as complimentary to our brief, and many of our clients want 'FM' solutions. Often we can combine field marketing on commercial terms within a broader contract. Blue Water offers scale, experience and a reputation for high quality. They provide sales drives, merchandising, compliance and audit, recalls, in-store and experiential activity. Blue Water can deploy up to 1,000 field staff if needed, and bring a wide range of clients of their own, including Philip Morris, Sky and the Post Office. GT - What is Blue Water's turnover? Will it be run independently from Jenks? We aim to significantly increase Blue Water's turnover and make it a top ten field marketing business. The plan is for the Blue Water brand to continue in its own right, while supplying services for Jenks' customers as required. We're currently recruiting new colleagues to expand the business and investing in its web-based field reporting and MI system, Condor. GT - Looking forward, how will Blue Water strengthen your client service proposition? We will market Blue Water alongside our core business proposition. We're already seeing the benefits in both retail and foodservice. GT - Jenks sounds an exciting business to work for. What are the prospects for internal promotion and career development? The prospects are superb! We want to recruit people who are entrepreneurial and inspirational and have the drive and ambition to grow and develop with the business. They must be willing to challenge the norm, coming up with different ways of achieving things, not accepting the status quo. We've recently taken on some great new people from a wide variety of backgrounds, and Jenks has a distinct vibrancy at the moment. GT - Finally, where do you see Jenks going from here? We're looking to grow our turnover significantly. Our new business is increasingly coming from national and international brands committed to investing in supporting their products, and we are targeting significant double-digit growth year on year. Jenks has a fantastic heritage and is well known across the trade, but we're not stopping there. Looking forward, we expect to become the first choice for major organisations who are considering outsourcing their sales and marketing activities. We are totally focused on growing our principals' brands, and that will not change. Jenks Tel: 01844 293600 www.jenks.co.uk