PROBLEMS caused by the NA’s declining membership were highlighted at the conference. Chairman Noel Grout told delegates the NA currently has 804 members, down 51 on the same time last year. The NA is weighing up the future of its bakery training operation due to falling demand, he said. It is currently training 91 bakers with 36 employers, down from 124 trainees last year. Mr Grout said: “The board is committed to training, but if it goes into a loss the board will pull the plug.” Training made a £19,000 profit in 2005, but Mr Grout said various running costs had not been deducted. Mr Grout also told delegates that two staff had been made redundant due to falling membership numbers. And the board will have to consider the future of its headquarters in Ware, Hertfordshire over the next year. Over the year to December 31, 2005, the NA made a £48,362 pre-tax profit, on income of £562,205.
London chain Coffee Republic has cut costs at its head office by 25%, after reporting that the value of its net assets had fallen below half the value of paid up share capital.At an Extraordinary General Meeting on 8 February, a statutory requirement under the Companies Act 1985 when this situation occurs, the 42-shop coffee chain said that costs will be reduced until it has expanded its portfolio.Chairman Peter Breach said: “Interest in the brand remains encouraging and the pipeline of franchisees is strong. I remain confident that over the next year the domestic portfolio will almost double in size and overseas Coffee Republic outlets will start trading.”
British bread prices have risen by between 15 to 20% in the past year as commo-dity and fuel costs bite, but a loaf of bread is still cheaper here than in most of the rest of the world.These are the findings of the Economist Intelligence Unit’s (EIU’s) latest Worldwide Cost of Living Survey (BB, 18 January, pg 4) which found that the average price of a kilo of bread in London rose from £1.09 in September 2006 to around £1.45 a year later. In Manchester, prices rose from 88p to £1.11 in the same period. The EIU said that rises in the UK had been compounded by the strength of sterling and weakness of the US dollar. “This has seen the relative cost boosted further compared to countries with weakening currencies or those linked to the dollar,” said Jon Copestake, food and drink analyst and EIU survey editor.Despite the price rises, London ranked a lowly 70th place out of 130 cities around the world researched by the EIU, with Manchester coming in at number 93. Bread is more expensive in cities includng Warsaw in Poland, Istanbul in Turkey and Madrid in Spain. The most expensive city for bread remains Vienna in Austria, with bread prices averaging £4.22 per kilo.”Bread prices in the UK have risen as rising commodity prices have been gradually passed on to consumers,” said Copestake. “In Manchester, prices surveyed rose 15.2% in the last year, although only 1.2% in the last six months. In London, bread prices rose 20.1% in the last year, 13.6% of which came in the last six months.”Huw Edwards, Asda bakery director, backed the assessment. “Rising ingredients costs, particularly flour and fat, are by far the biggest factors for price rises, but high fuel and energy costs have also had a big impact.”Commenting on the different average bread prices in Manchester and London, Edwards added: “Asda has a national pricing policy and, as far as I’m aware, so do the other big supermarkets. I put the price differences down to local bakeries charging more in the capital, as they have larger overheads.”Joe Street, MD of plant baker Fine Lady Bakeries, said he attributed the price difference between north and south to an increased presence of premium breads in the capital. “It has to be down to product mix, with fewer premium breads up north,” he said, adding that soaring flour prices were the biggest cost pressure to face bakers.The EIU compiled the data via an international network of mystery shoppers. The three categories – low, medium and high – relate to different types of retailer. ’Low’ covers supermarket chains, such as Tesco, ’medium’ equates to top-end supermarkets, such as M&S, and ’high’ comprises craft shops and department store food halls. The research found that low-end bread had risen steeply in price, up from 61p per kilo in London in 2006 to around £1 in 2007.Copestake said the UK’s low position on the bread price list could be explained by the fact that 800g loaves dominate in Britain compared to 400g in many other countries. “Bread in the UK is seen as much more of a staple than in other countries and, as such, production is highly developed and commoditised compared to other markets,” he said.”Large-scale consumption allows companies to exploit economies of scale and the market is also highly competitive.”
One small step for bakers (or a few steps upstairs to the conference rooms at Baking Industry Exhibition), one giant leap for baking kind. What last year appeared a challenge at one time as unlikely as putting a man on the moon – getting the baking industry to speak with once voice – last week came a significant stride nearer.With the establishment of a National Skills Academy for Bakery on the agenda at the One Voice for Training conference, a packed room of industry stakeholders gave a near unanimous show of hands in favour of setting up an academy. Phew!With rocket fuel now in the tank, a steering group will hopefully be established within the next few weeks to consult and hammer out what’s needed for the industry; the brief is to appoint a group that equally represents all the disparate parts of the industry – from craft to plant to supermarket. And if it’s successful, bakery could soon join the 14 academies already in place, within a year.There’s no greater incentive than the sword of Damocles hanging over the industry – otherwise known as the Leitch Report, the key policy driver on workplace skills, that threatens to impose a training levy if employers do not meet exacting skills targets.The initial funding for setting up the academy will come from the Learning & Skills Council; this means there is government funding – on a reducing level – for three years for creating the academy’s infrastructure. The idea is to establish a strong training provider network, if only to clear any confusion about what training is available. “There is a strong training base. A number of employers are already making use of that,” said Justine Fosh, director of the National Skills Academy. “But some employers may not be aware of the training available. If we have somebody who wants to do a course with three people down in the south west, very shortly we would have provision for that. That’s what has been missing from the industry – a network operating geographically to make training available.”If the qualifications available are not suitable – for whatever section of the industry – then qualifications can be rejigged as the dairy industry has done. “I don’t think we’re talking about nuclear physics here; a large part of it is having a sectoral focus saying, ’Here’s what you have, and if it still doesn’t meet your needs, then let’s move on and get something else that does’,” said Fosh.There will not be one single central location for the academy, but it is likely there will be around six training providers, one of which will be the champion of that network. The steering group will seek to identify that champion as well as a five-year training needs strategy.The critical outstanding question is how will it be funded? The government wants the academies to be self-funding and the suggested options for generating funding include an industry-wide levy, a membership scheme or supplier sponsorship. One of the delegates, Dave Brooks, MD of Finsbury Food Group, argued that retailer support would be fundamental. “Firstly, they’ve got quite significant funding available, and secondly, they’ve developed training plans for their in-store bakeries, which the sector skills council Improve could benefit from, rather than trying to reinvent their wheel,” he said.Two supermarkets have already expressed an interest in getting involved, said Fosh: “If organisations are willing to share [their training plans] – and that’s a big if – that is exactly what we aim to do, to reduce duplication.” A number of firms and associations have also pledged their backing, including the British Confectioners’ AssociationBut, as Paul Morrow, MD of British Bakels noted: “The key thing will be that sector organisations are willing to put forward representatives on their behalf and caring employers are prepared to engage.”
The steering group of the National Skills Academy (NSA) for Bakery has achieved its first six-month target, said Jonathan Cooper, business development manager of the NSA.Its aims were industry representation, agreeing the training needs of the industry, and identifying a bakery champion, named as Campden BRI, to co-ordinate the development of a new course for the industry, with Leeds Thomas Danby College acting as lead college.Justine Fosh, director of the NSA, praised outgoing steering group chairman Dave Brooks of Finsbury Foods for driving the group to achieve its six-month goals. She told British Baker: “Dave agreed a tenure until Christmas and set challenging goals, which we could not have achieved without his leadership.We look forward to setting an equally challenging agenda with the new chair when appointed.”The steering group comprises representatives from companies as diverse as a craft baker, Warburtons plant baker, Morrisons supermarket and Odlums Mills, as well as the main trade and member associations.Its aim is to speak with a united voice about the training needs of the industry.l For a fuller report see next issue.
Aryzta has announced a healthy performance in its half-year results. Adjusted profit rose by 14.6% within its food division with underlying revenue increasing 6% for the six months to 31 January 2009.The global specialist bakery company saw operating profit grow 11% to E64m in its Food Europe division, which includes the Delice de France, Cuisine de France and Heistand brands.Operating profit was up 25.9% to E34.3m in its Food North America division, which includes the La Brea Bakery and Otis Spunkmeyer brands, and up 50.9% to E0.9m in its Food Developing Market division.Chief executive officer Owen Killian said that the business had “displayed excellent defensive characteristics in the current challenging economic climate”, adding that it remains focused on cash and continued earnings growth.Aryzta also confirmed that its Grangecastle bakery, distribution and R&D centre in Dublin are fully commissioned and on budget.
The UK arm of Irish sandwich chain O’Briens’ has been bought from administration by a newly formed company.O’Briens Irish Sandwich Bars (Franchising) UK now operates the brand in the UK, supporting the chain’s 101 franchise stores in Great Britain and Northern Ireland. The Irish company’s UK operation was put into administration last June in an effort to renegotiate rents and restructure the business across its 109 franchise outlets in the UK. It was subsequently bought by the new company.The O’Briens brand and intellectual property is owned in the Republic of Ireland by Impless, a newly formed subsidiary of fast food group Abrakebabra Invest-ments, which bought the Irish business out of liquidation before Christmas. In other news, TV chef and author Rachel Allen is to front an O’Briens TV and radio advertising campaign in the Republic of Ireland for Impless. “Rachel will be retained as a creative consultant to O’Briens and, across the year, will create delicious ’Signature Sandwiches’, which will be on sale from January 2010 in O’Briens Irish Sandwich Cafés in Ireland,” said the company.
By Max Jenvey of Oxxygen Marketing Partnership, a strategic business accelerator specialising in foodservice, bakery and convenience retail sectorsAs you know, when the sun shines our sales are often negatively affected. So, in order to protect ourselves what factor sun-screen do we need to slap on?The answer is simple: keep it light, healthy and above all appetising. These rules apply to our entire range of products, from breads and sandwiches to cakes and pastries, sweet treats and snacks.What do our market research specialists at him! say? They told us that 22% of customers entering our shops intend to purchase a bakery product. The reality is that 25% of café customers, that’s a quarter of your market, actually purchase pastry items (FTG report 2009). Interestingly 72% of the market is made up of food-to-go customers the real question is how do we maximise this selling opportunity?Let’s explore some ’weather friendly’ alternatives to capture sales. With temperatures rising, most of us are looking for something fresh, light and if at all possible healthy. So why not combine fresh fruit with delicious cakes and pastries? A summer berry cake not only tastes good but also taps into people’s perceptions of five a day.Have you noticed how popular cupcakes are at present? Develop a ’sun-sational’ range of two or three new cupcakes. Think mandarin oranges, plump blueberries or why not try a raspberry ripple. Alternatively try fig, kiwi and dates. If all else fails use pineapple for an upside down cupcake! Remember to bundle up for link sales & promotions.Sun-sational offers should extend into your sandwich range too; who can resist a seeded roll, granary or wholemeal bread with a mozzarella, tomato and basil filling, drizzled with an extra virgin olive oil & balsamic dressing we even please the veggies with this one! Play with your sun-sational theme with the introduction of freshly squeezed juices or smoothies.Display and customer communications are key; your displays and front counter should shout about what delights are in-store for your customers.Turn down the heat on your coffee offer with iced lattes and frappes as we know coffee is still the number one destination purchase for morning commuters and travelling public (him! coffee report).Remember small is beautiful so merchandise sweet indulgent mini bites, cakes and pasties for sharing ideal for grab and go customers in multi bags near the till. This is your sun-sational sales season!
Alliance for Bakery Students and Trainees RepresentativeAs I write this article, final preparations for the annual conference of the Alliance for Bakery Students and Trainees (ABST) are being made. The conference is being held at Alton Towers from the 10-12 June and to date 300 delegates will be attending the event an increase of 60 on last year’s numbers.So what can be expected during the weekend? Well, for the 230 students and trainees attending they can expect to meet peers from colleges and training establishments across the UK and the Irish Republic, as well as representatives of the baking industry. Through the competitions held during the event, they will showcase their skills to potential employers and will be able to learn new skills through the numerous demonstrations and advice freely given by the team of experts who judge the competition classes both domestic and international industry representatives from the Russian Guild of Bakers and Confectioners and Italy’s Club Arte e Mestieri.Industry representatives can expect to meet enthusiastic and passionate learners. By viewing the competition entries, they can see at first-hand the craftsmanship that will be making its way into the workplace as these students and trainees join the wider industry; they also have an opportunity to place their respective organisations at the forefront of the minds of future buyers or bakery managers. In ABST they can expect to see an organisation that focuses on the future educational and training requirements of the industry and, finally, they can expect to see that the money they graciously donate to sponsor the event is gratefully received and put to good use.
Craft bakers hit by tough new fines are being urged to take their case to Chancellor George Osborne.HM Revenue & Customs is calculating penalties for firms that paid PAYE/NI late during the 2010-11 tax year, and one craft baker believes the penalty does not fit the crime.PAYE has to be paid by the 19th of the month following the month in which the deduction was made and fines were brought in so businesses don’t gain a financial advantage in paying late.However, the baker, who doesn’t want to be named, said if a company had a very small PAYE scheme and was paying on average £500 per month but paid two days late every month – probably because its customers were slow in paying – they would receive a £220 bill.“The benefit to the company in the saving of overdraft interest is approximately £14. So, in this instance HMRC wants about 16 times in penalties to the amount of the advantage.”For a larger company paying an £15,000 PAYE bill monthly, but paying 20 days late each time, its annual advantage would be about £345, while the actual penalty would be £6,600 – 19 times the advantage.He believes that to improve cash flow, businesses will look at redundancies so they can meet their liabilities and avoid the penalties. “I’ve got no problem with them bringing in a fine but the Revenue makes loan sharks look positvely philanthropic.”Gill Brooks-Lonican, CEO of the National Association of Master Bakers, said it was prepared to campaign on the issue if other bakers came forward with the same problem. “Some people might not even be aware of the fact there are penalities because it’s new legislation, so if we get more information, we can write to the Minister,” she said.An HMRC spokesman said the amount of PAYE paid on time in the last tax year was up on previous years.“The penalties were consulted on extensively with relevant stakeholders and representative bodies. As well as a late payment penalty being issued, interest will also be charged. This is to ensure that HMRC and customers are recompensed for losses of funds.”