Growing Hart underlines innovation focus

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MD Paul Nieduszynski reported a very successful year for Bunzl Lockhart.

Innovation seems to be the buzzword at Reading-based distributor, Lockhart Catering Equipment. “Our strategy is very much about innovation and supporting customers,” MD Paul Nieduszynski told Catering Insight. “We also work really hard with our supply partners to be the first to market on new innovation.”

Marketing is another area where the company feels it is ahead of the curve, as it publishes its own Trend Set magazine, exploring the latest food, drink and restaurant trends, plus it produces lookbooks, brand catalogues and has invested heavily in direct and digital marketing to end users.

One of its newest innovations for operators is the i360 offering. Nieduszynski explained: “It’s a diagnostic process for a customer where we analyse what they are doing, including taking photographs of the food they are serving on the tableware.

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“We come back to base and evaluate that, and then we create a set of suggestions for them around what we think they could do if they worked with us. It’s fairly embryonic but I think it’s one of the things that really underpins our business as the innovator and the specialist in the market.”

Bunzl Lockhart even has its own Innovation Centre in central London, which it opened in January 2016. This houses 60metres2 of light equipment plus a bar and a working demonstration kitchen equipped with plug and play appliances. “It’s been absolutely fantastic for us for us,” commented Nieduszynski. “It’s somewhere we can take customers to really show them the products.”

The firm has already had celebrity chefs holding launches there, as well as many visits from major restaurant chains, contract caterers and potential clients. “It gives them a bit of inspiration to look at how they are preparing or presenting their own food,” Nieduszynski added.

Another Innovation Centre benefit for the distributor is cross selling the three parts of its offer: heavy equipment, light equipment and its Bunzl Lockhart Catering Design Services proposition. This is something the company considers in its whole operation. “It’s all closely linked. If a major customer buys into all three channels then there’s some commercial leverage for them to gain an advantage,” said Nieduszynski. “The ultimate example is Compass. We won a contact with them last September and this enabled us to do an all-encompassing deal which has been really good for both organisations.”

The firm recognises the importance of the online channel too, with Nieduszynski detailing: “As a large national player we have the resources to invest in a good digital platform, so in November last year we completely overhauled our website.” A couple of years in the making, the move is paying dividends. “We have seen over 50% growth in our digital channel thanks to the new website, and that’s from a significant base to start with,” he added. Earlier this year the firm also launched a mobile version.

And for those distributors reluctant to embrace the digital world, he cautioned: “You’re swimming against the tide. About 50% of b2b buyers are millennials that want to trade on the internet, and then the even younger Generation Z are digital natives.

“I think there will always be a balance of channels used, but we certainly see a massive increase in the amount of people who want to trade online. Internet is just one of our routes to market and having that multi-channel approach is really important, because someone might arrive on the internet with a question and end up talking to one of our design consultants.”

He feels that compared to Bunzl Lockhart’s national competitors, the company is a catering equipment specialist. “Some predominantly sell food and then tack tableware and catering equipment onto it, but we are genuine specialists. So if a client needs consultative advice we tend to be more successful in those areas.”

One way in which the business is working with major operators is to develop bespoke tableware. It can do this as it provides its own exclusive brands, which comprise between 20-25% of overall sales. Nieduszynski reported that light equipment trends are focusing around multiple colours, materials and shapes, so that tableware doesn’t have to match.

In terms of heavy equipment he noted that smaller, multi-functional, energy efficient and more automated appliances are still proving popular. “We are starting to see more digital connectivity too, and I think we will see more integration and transparency. At some point there will be a portal to connect all equipment. The brands that get onboard with that faster will benefit more in the long run.

“The next generation of end users has a high expectation level that the equipment will be easy to use – it needs to be so easy that operators virtually don’t need to train their staff on how to use it.”

Looking at various market sectors, he feels performance has been quite polar. “There are certain brands that are very successful and are continuing unabated with their roll-outs. Others are finding the market a bit tougher.

“Certainly last year we saw an immediate cut in capital investment, thanks to the uncertainty after the EU referendum. Our design and heavy equipment business found some investment reductions in most sectors, but we have been quite successful in taking some market share, winning a number of prestigious brands over the last few years.”

These include signing a deal with Prezzo this year, and also picking up contact caterer CH&Co and Hilton Hotels, as well as contract extensions with KFC and Pizza Hut. “If you are winning share then you can continue to grow despite a tough environment,” he added. He believes that Bunzl Lockhart has a strong share of the market in the QSR, restaurant, hotels and contract caterer sectors but that its share starts to drop away for independent outlets. “However, that provides us a long term opportunity to continue to grow,” he believes.

Back in 2014-15, Bunzl Lockhart had two successful years of growth, according to Nieduszynski, though he acknowledged that 2016 was a “relatively quiet year”. Nevertheless, this year the figures look to be back on track. “We’ve seen some more capital releases and some good levels of revenue growth in our business. We helped to open nearly 500 restaurants in the last year.

“Given the amount of investment we have put into our innovation and own brand propositions, we can get on the offensive and mitigate costs for operators. We can move their commodity lines into own brands or look at re-engineering a piece of equipment.”

He praised the distributor’s staff as key to this growth. “I can’t emphasise enough how good our team is. That makes a huge difference to us. Our team are specialists and our customers are reliant on the quality of our people.”

Overall there are now 290 people at the company, with that figure growing from just over 200 around 4 years ago. “We have been able to promote a lot of people through the business thanks to our success through the last 4 years,” said Nieduszynski.

Bunzl Lockhart has spent time training its sales staff on how tackle the market this year, plus product training for sales staff, including support from its suppliers visiting its offices to deliver guidance. It also has a digital platform where its staff can access thousands of courses.

Furthermore, the day before October’s Restaurant Show at Olympia in London, the whole Bunzl Lockhart sales team gathered for a training day on new products. The distributor has been in partnership with show organiser William Reed for the last 2 years, running the Catering Equipment Show within the overarching exhibition.

“We used to run our own events in Manchester and Wembley, showcasing our suppliers, which attracted around 500 customers,” recalled Nieduszynski. “We reviewed the format and wanted to move it on to attracting thousands of visitors, including non-customers, so we partnered with The Restaurant Show and it’s been fantastic – we’ve taken away a significant number of leads.”

While Bunzl Lockhart always considers working with new suppliers, it is quite selective about who it partners with. Currently there are around 12-13 key partners, with Nieduszynski commenting: “We have got very long-established and good relationships with our supplier partners. Strategic supplier partners get more access to our sales team and a higher profile within our marketing literature. Everything we do is geared around driving support towards those key partners.”

Looking ahead, he predicted that digital channels will become ever more important to the business, with another website upgrade scheduled soon. Furthermore he underlined: “A key part of our parent company Bunzl’s growth strategy is acquisition and we are keen to continue that. We will keep getting the message out there that we are interested in talking to people.”

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Clare Nicholls

The author Clare Nicholls

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