Scale and segmentation are the keys to success in the drive to “go local” with public sector procurement contracts, according to Kent farmer and successful food distributor Doug Wanstall.
In the past four years Mr Wanstall has expanded the family farm from a traditional mixed unit with an annual turnover of £250,000 to one with a turnover of £2.5m, the bulk of which is generated by the distribution of locally produced food, to hotels, restaurants, hospitals, independent retailers (including two of their own farm shops) and 10 Asda stores in the county.
Bank Farm currently lists 1200 products, of which 900 are produced in Kent. But he confesses that there was no grand plan at the outset. In the early years, Mr Wanstall’s egg distribution business lost money.
The breakthrough came when customers started asking if he could supply a wider range of local produce, of similar quality and with the same assurances of provenance and traceability.
It was the addition of lighter and higher value products to his distribution vehicles and the steady addition of customers on route that transformed the economics of the business.
Andrew Fearne, director of the centre for supply chain research at Kent Business School, is in no doubt about the keys to the success of Mr Wanstall’s business:
- The fact that he is a farmer adds a degree of authenticity and integrity to the local/provenance story that is highly valued by his customers.
- That he can source such a large number and wide range of products provides his customers with convenience – dealing with multiple suppliers of specialist products adds cost and is time-consuming for his customers.
- That he supplies multiple channels (retail, catering, public and private sector) enables him to use more of the crops and carcasses that his produce and meat suppliers have to dispose of.
The challenge Mr Wanstall now faces is maintaining the growth of the business. He plans to double the turnover of Bank Farm over the next two years and is very clear about what he has to do in order to achieve that.
“Volume is the key to stepping up from where we are now to where we want to be in two year’s time. We need fewer, larger, customers taking more products,” he says.