Croydon-based dealer International Food Service Equipment (IFSE) feels it is in the best position to take advantage of new market opportunities as it emerges from the pandemic period.
The firm swiftly pivoted its strategy when Covid first struck, and this has limited the impact of its travails.
IFSE’s latest annual report, just published on Companies House, shows that in the 12 months to 31 March 2021 the distributor generated £5.2m in turnover, 29% down on the previous year’s £7.4m.
The impact on operating profit was less severe however, with a year on year drop of just 5% from £123k to £117k.
Group MD Andrew Fordyce analysed: “Covid-19 produced the most challenging trading conditions in IFSE’s 30-year history. The government instruction to work from home if possible and the subsequent lockdowns had a major effect on our customer base. Business and industry catering drastically reduced operations overnight and high street restaurants, visitor attractions and hotels were all very badly affected.”
He underlined: “Throughout the year we placed the welfare of our staff at the top of our agenda. As well as pastoral care and regular informal contact with those living alone and working from home, this was also about ensuring we kept as many staff as possible in employment so that we had a full team ready to go when the market recovered.”
During this period, IFSE immediately started a major marketing strategy to penetrate new market areas. Fordyce commented: “This proved to be highly successful and has led to new entrepreneur led projects geared to take advantage of reduced cost rental opportunities in the high street.
“It allowed the team to partner with multiple independents and small chain operators to design, build and fit-out new food and beverage concepts on the high-street. This includes designing and developing a new pizza concept in Leigh-on-Sea, a new community kitchen and café in the heart of Thames Barrier Park, a new family-run restaurant in Reading and a grandmother-granddaughter delicatessen partnership in Tring.”
The IFSE team also designed and delivered a new state-of-the-art development bakery kitchen for The FoodWorksSW, providing specialist development space for local businesses to try out new recipes.
With regards to the new trading relationship with the EU, Fordyce said: “An effect of Brexit has been the difficulty that construction companies have encountered in finding and hiring suitably trained staff to work on their sites. Many projects where we were due to fit out the catering areas went into serious delay as a result, leading to projects being pushed out of the trading year in to 2021/2022.”
Nevertheless, he reported that at the year-end there were clear signs of market recovery with a surge of enquiries in Q4.
In terms of the group’s servicing arm, Romann Catering, Fordyce detailed that lockdowns and work from home instructions also had a major effect on this division. He said: “Many sites were closed and those that were open were only using their equipment lightly. Covid-19 restrictions meant that our engineers were not allowed to enter many sites to carry out maintenance. Turnover reduced as a result and only began to return towards more normal levels in Q4.”
Nevertheless, across the whole business, every aspect of its overhead was examined, and it was able to reduce its operating costs when its lease came to an end in Q2. According to Fordyce: “We invested in re-fitting parts of our office to make them more suitable for the revised level of office attendance combined with the working from home regime that will be the new norm after the pandemic is over.
“All these measures meant that we finished the year in profit in both operating companies with lower overheads going forward in to 2021/22 and office facilities that suit the new post pandemic employee working model. The projects delayed from 20/21 have given added strength to our recovery in 21/22 when layered on top of the general increase in market activity. We are confident of a strong performance this year with full recovery to post pandemic trading levels expected in 22/23.”
He concluded: “The team are excited to be working on major projects such as M&S Cafés, University of Football Business, and LSBU as well as multiple design partnerships for new and emerging high-street concepts.
“Our staff strategy has paid off and we have maintained our highly experienced project team with no losses. This has put us in the best position to take advantage of the many new business opportunities currently appearing in the market.”