With buying consortium Cedabond celebrating its 40th anniversary, Catering Insight caught up with chairman and executive director, Phil Martin, to get the latest on the group:
How do you think Cedabond has progressed in its 40 years in business?
In the beginning, membership of Cedabond was conditional upon prior membership of CEDA with suppliers asked to provide members with preferential trading terms and a retrospective rebate in return for advantageous payment terms. The main benefit to Cedabond members was a central payment system which would guarantee prompt monthly payments to all suppliers on behalf of its members. Cedabond’s standing within the industry grew rapidly and very soon membership was opened up to any distributor company who met its very strict conditions. Thanks to these conditions, its integrity, and the mutual benefits to both members and suppliers, Cedabond now has nearly 130 members and an annual turnover in excess of £75m, with all profits returned directly to its members.
Over the past 40 years we have constantly looked to improve the service we provide to our members and suppliers. For example, we have simplified member and supplier reporting, created the annual workshops that allow members to interact with up to 30 suppliers all in one day, and given suppliers direct access to our website so that they can upload promotions directly to it. At the same time we have helped them to reduce their business costs too – the deal we struck with a utility management company is a good example of this.
What do you believe is the key to its longevity?
Integrity and transparency. We won’t take on too many suppliers operating in a particular category and every member knows exactly what their deal is with a supplier because the contract is freely available for them to see. And it doesn’t matter what size their business is, every member benefits regardless.
How will you be celebrating the 40th anniversary milestone?
To mark the occasion we held a celebratory gala dinner on Tuesday 26 September. The dinner took place during Cedabond’s annual Product and Equipment Awareness Forum which this year was held at Whittlebury Hall on 25-27 September. Amongst the people we invited to attend the event were a number who have played a significant part in Cedabond’s development since its creation in 1977. And, during the course of the evening, we honoured members, suppliers and business partners who have been with Cedabond for 40 years.
What do you think Cedabond uniquely offers to distributors and suppliers?
Cedabond has always been a not-for-profit company, so 100% of the benefits and rebates are paid back to the members.
Our members work in a very competitive market where margins are tight, but being a Cedabond member means they have the advantage of an increased margin from the best suppliers and at the year-end the dividend paid back to them is excellent. Suppliers like Cedabond because we monitor our members to ensure that they comply with strict financial criteria. That means that suppliers can check their bank accounts on the 7th of every month safe in the knowledge that all invoices from Cedabond members will be paid in one transaction.
What are your most recent developments?
We have introduced new financial and energy management support and will shortly be announcing details of new invoice financing and capital funding opportunities, for members and suppliers, thanks to a partnership agreement with Lloyds Bank. We have a 3 year plan to upgrade our accounting and information reporting system with the aim of becoming a paperless operation by 2020. Stage one is working on the internal system and this will be in place by the end of the first quarter of 2018. This will dramatically reduce the time and effort required by members and suppliers when it comes to uploading reports and will feed into our own accounts package, giving even greater costs savings. In addition, we will be looking at a car/van leasing opportunity next year.
How do you ensure your members and suppliers remain financially sound?
Cedabond has a live credit checking system which flags up any potential problems. We are very strict on terms so any potential problems become apparent very quickly. And, whilst this monitoring is ultimately there to safeguard members and suppliers, it also means that we are in a position to offer help before the situation gets out of hand.
What’s your strategy regarding adding members and suppliers?
We are always looking for new members and we get enquiries every week. We support CEDA, CESA and the FCSI, all of whom have brought new members to us. Our suppliers are our best salespeople, they bring us lots of enquiries.
What direction can you see Cedabond going in?
The foodservice equipment market has changed over the last few years. At Cedabond we have to look at the market to see how trends are moving and work with our manufacturers to maximise their opportunities with our members. We have a strong UK manufacturing base at present but it remains to be seen what impact Brexit will have in the years ahead. Whatever happens we will work with all parties to help them.
What will ensure that Cedabond remains in business for another 40 years?
Cedabond has changed since I took over in December 2012. It has become a better business in that time due to the commitment of its board members and the communication between Cedabond and its members and suppliers. Of course it will have to evolve, as it has done over the past 40 years, but if it keeps adhering to its principles of integrity and transparency then I see no reason why it won’t still be here in another 40 years.