 All change at the sandwich chain |
Meet Ian and Emma Rickwood, the husband and wife team who own and run the Benjy's sandwich chain.
The couple bought the business three years ago; they'd previously been franchisees of a rival sandwich chain, but having got to know the industry, they wanted to be in total control of their own operation.
A venture capital company helped them raise the �20m required to buy Benjy's and they established a new management team to run the company and initiate a series of radical changes.
"What we tried to do was bring the business under one identity, so people would know what we stand for which is value, quality and variety," says Emma.
Benjy's had been established back in 1989; it was profitable and had potential to grow, but there were problems;
Out-of-date
The head office consisted of just three people, with no infrastructure or control over the business.
 Identity is important, says Emma |
There was no unified Benjy's identity, and an outdated system of dealing with suppliers. The Rickwoods commissioned a research programme to understand what customers wanted, and began an aggressive marketing campaign.
A new logo and look for the stores was introduced in 2001, and the range of products on offer was expanded.
Three years ago when Ian and Emma took over the business they inherited 32 stores in London and that's grown to 57.
There are now plans to open a further 30 in the rest of the UK.
Factory production
But perhaps the most dramatic changes the Rickwoods brought about was to their core business - food manufacturing.
The factory they bought was run by a small underskilled team, making it a low quality facility.
It required massive investment to turn it into a state of the art operation, with an efficient in-house delivery system.
 Ian: Not much food is wasted |
Many of the shops were producing on site, and were reluctant to make the move to central production. The management team was strengthened with food industry specialists and over �1,250,000 was spent improving the fabric, layout and capacity of the site.
By the end of May 2002 the final phase of factory development was completed giving the site the capacity to service almost double the number of stores that it does at the present time.
Dramatic changes
The production volume capacity is now more than 150,000 units per day.
"I've never seen a change programme as significant as this business had to go through in the past three years," says Ian.
But fix it they did.
 Keeping a very tight control on costs is essential otherwise we wouldn't be able to charge the prices we do and make any profit  |
Production has rocketed from just 10,000 items a day when Ian and Emma took over to 75,000 and the new factory has the capacity to double this amount of output in the future.
Each week 40,000 loaves of bread and two tonnes of tuna is delivered into the factory and turned into sandwiches for the company's stores.
Tight controls
But when dealing with this amount of food how do they know how much food and ingredients to order?
"Keeping a very tight control on costs is essential otherwise we wouldn't be able to charge the prices we do and make any profit," Ian adds.
Overhauling a business is an expensive and risky tactic and not suitable for every enterprise of course, but for Benjy's the changes do indeed seem to have paid off.
The Rickwoods' plan was to turn a small player in the sandwich shop industry into one of the country's leading food brands, and this year the firm has announced record profits of �3m and a new �4m expansion plan.
The Student Guide
Three years ago Benjy's sandwich shops were very different places.
The shops were dull, quality was unreliable and most people chose to buy their lunch elsewhere.
Ian Rickwood then led the management in buying the business and set about making changes that would turn it into everyone's favourite sandwich store.
What was wrong?
Shops were dingy Management was poor Product range limited Products varied in quality Cheap products at low prices Some stores made their own sandwiches Health and safety rules were scarcely met Low staff morale No strategy Not much was right!
Just think...
Work out the effect of each of these problems.
Putting it right
Ian's first move was to appoint an effective management team.
He brought in people who knew about the food industry, had plenty of practice in distribution and could sort out the finances.
They set about creating systems to make the business run efficiently.
Cash was no longer collected at the end of the day and taken away in the back of a Jag!
Just think...
Why do experts make a difference?
A strategic vision
The team knew what needed doing. They had to find things out and make some decisions.
Who are the customers? What do they want? How to meet health and safety rules. How to motivate the staff. How to make the business more efficient. How the business should develop. Just think...
The answers to the questions and the decisions needed turned out to be connected.
The business had to update the factory where the sandwiches were made.
How do you think this relates to the other points?
Customers
No one had ever asked the customers what they wanted. Benjy's was viewed as a cheap sandwich shop with a narrow selection and uncertain quality.
Ian's team started asking them what they wanted. This led to a wider range and new lines including a gourmet range, healthy eating and lite bites.
There's also hot food, fresh fruits, desserts and cakes - all at very good prices.
When new products are introduced, Benjy's has found giving samples is the best way to tempt people to buy them.
The stores have also been revamped to give customers the delight factor. It's a cheery place to be so customers come in happily.
Buying lunch isn't just a chore. In just three years 70% of the shops have been revamped and the rest will be done by the end of 2003.
Just think...
Why is it important to find out what customers want?
Why are free samples a good way of persuading customers to buy new products?
Why is the sandwich business a good one for giving free samples?
Why is the shop environment important in a business like this?
Health and Safety
The old factory was sailing very close to the wind.
Health and safety is critical in this sort of business. A bout of food poisoning can quickly wipe out a chain like this.
Ian's solution was to work very closely with the Environmental Health Officers and make sure they got it right.
The factory needed work to make it efficient. Shops stopped making their own sandwiches - so everything was done in one place.
The factory is now a star performer and has become a centre of excellence and the Environmental Health Department in Tower Hamlets, the part of London where it is located, want to use it for training its staff and guiding people who want to start in the food business.
Just think...
Why was it more efficient to make all the sandwiches in one place rather than letting shops make their own?
Why is it a good idea to work with organisations that inspect you - instead of waiting for a nasty surprise?
Happy staff
Most of Benjy's staff were casual labour. This gave them little commitment to the organisation.
Ian's team set about creating a more effective workforce.
There are proper selection processes. Staff are now employed on proper contracts. English lessons are given to those who need them. There are salary review processes and career development plans. This has led to a winning culture based on teamwork and integrity.
Just think...
Why are happy staff critical to a business's success?
Why is it important that staff can be trusted in business like this?
Why do people feel better about their job when they feel they are trusted?
Why is teamwork important in a sandwich shop?
Into the future
The secret of success is not standing still. The factory and the shop chain have been revamped.
A catering and delivery service have been introduced.
Twenty more shops have been opened and there is a plan to roll out across the country.
Ian has looked at the future and made plans to grow. There is plenty of potential now that Benjy's has created a new image that attracts customers.
Just think...
Why is development important in a competitive business like this?
Can you think of anything else the business might do?
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