Parfetts – Growing business

Guy Swindell became joint Managing Director of Parfetts alongside Noel Robinson in 2021.

The business, which is employee owned, has enjoyed a period of growth on both the cash & carry and delivered side of the business.

It’s Go Local and Go Local Extra symbol groups are also growing in number and are set to hit 1,000 stores in the near future.

Guy Swindell tells Wholesale Manager what makes the business unique and why the Parfetts Go Local Ball is so important.

How has being employee owned helped grow the business?

It has helped massively. From a customer point of view, when they see and find and experience the fact that we are employee owned, that resonates. People can see we have no family that take money out of the business. We have no City to answer to or pay dividends to. All we can do as a business is grow. We reward our colleagues. The prime example would be, when we went into the early stage of lockdown, we maintained our pricing model, we maintained our promotions, we were doing really well. We didn’t need to profit. Retailers see that. Retailers say to me you guys are great, I love Gareth when he comes round, I love Tom when he comes round. Those people who engage with retailers are part owners. We have got 800 members of staff. The majority of them feel like part owners and are rewarded as such, not only in monetary terms but they have a say in the business. In monetary terms, they were awarded a 14% tax free bonus last year. So if you are a member of staff, you are thinking the better I do, the more potentially profitable the company is, the more sales we achieve. I think that will permeate through to when you are in front of a customer. From a customer point of view, the employee ownership is our real USP. That for me is the umbrella and everything else sits underneath that. It explains why we are so good elsewhere. We have just recruited an Employee Voice Manager. That is a full time individual whose job is to champion and push employee ownership in our business. They will be out in depots, engaging with people, making sure the voice council (each depot has their own voice group of employees) has an agenda, a structure, that their ideas come through to the management. They can also communicate anything from the management down to the staff. For me, employee ownership is absolutely key. It’s also a tool to galvanise the workforce – the more they put in, the more they get out. It helps engage the guy on the checkout. I have done that job for 8 hours a day. You can start to think do I want to do this? But if you know that what you are doing is actually making a big difference and the more work you do and the quicker you do it the more you benefit, that will motivate you.

How big is Parfetts’ product range? Are there any particular product categories that Parfetts specialises in?

We have somewhere between 12,000 and 14,000 lines. We are and have always been really strong on the alcohol side and the impulse side, on soft drinks. We have got work to do on the grocery and chilled side. Tobacco is still massive within the business. Vape is a focus of a lot of suppliers so it becomes a focus of ours. It will all end up being vape one day. We need to get ahead of the curve and most importantly to get our retailers to see the importance of it. It’s about having vape sections whenever you have a store refit and educating the retailer, getting them in front of the supplier. Vape is important but tobacco is still massive. We saw that in the Budget.

What makes Parfetts unique compared to other symbol groups?

The employee ownership is what makes us unique. There are good businesses out there, people like Dhamecha and United, Filshill. I really like where those guys are at. I’m not sitting here thinking we are the only good wholesalers. But the businesses I have just listed are family owned. We are employee owned. That has got to resonate and mean something. I don’t know of any other employee owned businesses in the retail wholesale sector. We were previously owned by the Parfett family so there was a trading culture that has existed since that time and it was always about passing the margin on to the retailer. We have continued that. In terms of Go Local what makes us different is that we are incredibly close to the customers, we listen. We try to work incredibly closely with suppliers. For us, we think about the consumer and we put some great deals on.

How are the Go Local and Go Local Extra symbol groups performing? What plans do you have for the symbol groups?

We launched our first fascias in 2012. We didn’t have delivered or online sales. We recruited customers from our immediate area. Fast forward to now and we are about to approach 1,000 stores from North Wales to the North East to the Midlands to everywhere in between. 40% of our business is delivered. We have just introduced a new brand called The Local. The Local is a whole new off-licence symbol fascia launched this year. We had always done very well in recruiting customers apart from Bargain Booze guys. They were very cautious about moving away from an off-licence to a Go Local convenience store. They thought the consumer will think it’s not an off-licence any more, I’ll go somewhere else. On the back of customer feedback, we launched The Local, which is an off-licence offering with the same level of margin a Go Local store gets, the same service, the same rebates, all the plus points of Go Local, which has obviously got the attention of retailers. The Local is in its infancy – we only have about 10 stores so far – so we will be pushing on with that next year. I have seen new symbols launched before and then never heard any more from them. The Local has ruffled a few feathers. It has been very successful for us as a business and importantly I’m told it works for our retailers. So we want more. It’s important that we continue to develop the stores. It’s not just a numbers game. We are really relaxed now in terms of numbers. It’s really about improving that store. I want consumers and suppliers to go in and think what a great store. They have this, they have that. It’s not just about numbers and sales. As ambitious as I am to grow the brand and become national, I don’t want it to just be a race to numbers. We have seen other people fail. To make sure that doesn’t happen we are putting more people out on the road. We are up to 30 people on the road. We have recruited Steve Moore and Antony Downing from Costcutter. At a time when other companies like Bestway and Booker are taking people off the road, we are massively investing to put more people on the road. It works for our retailers and it works for us. We are ambitious, we want to grow, the next target is 2,000.

Do you have plans to expand your delivered offering?

Delivered is the future of the business. The growth is going to come from delivered. Cash & carry has had a massive shot in the arm. The growth on the current estate will come from delivered but if we ever open up a new site, then cash & carry would be part of that. We are now attracting retailers out of competitor symbol groups that have been delivered to so they don’t own a van. They are not geared up for cash & carry. Where our cash & carries are, we are the king of that area. So every single retailer in that area comes into our depot. So for us to grow we have to go outside that area so then we would be too far out for some of them to come in. We are growing cash & carry year on year but not at the level of delivered.

How is the Go Local own label range performing? What activity is in the pipeline for the range – will it be extended?

Go Local own label will be extended across categories. There are some obvious gaps in there, crisps being one example. Our customers were having to go to Booker for their own label crisps, that was a big gap. We have plugged that gap with our own label. I think it will be our USP. What do retailers want? Margin. What do consumers want? A great looking brand that they are not ashamed to put on the kitchen table. That’s what we are looking at doing. It’s exciting times. We have rolled out over 100 own label products now. That will be a key strategy and focus for us.

What are your plans to grow the business in 2022?

We have immediately invested in our existing sites. That will increase capacity levels so we can go out and recruit. I am challenging the team, Steve has come on board now. In previous years we have grown by 170 or 200 stores. I am challenging Steve to get 300. We have got own label. Because of the challenges around availability from suppliers, it has been very hard to do things like trade weeks and really promote. We did a trade week in December so we have seen some availability come back on the beer. We just want to push on. Since Noel and I took over, the business has had renewed vigour and drive to push on. We certainly don’t want to go backwards.

Are there any plans to expand the number of depots?

We are talking about it. The location has got to be right. The facility has got to be right. We have got to tick a few boxes. We won’t rapidly scoop places up. We want to continue to grow and we will inevitably look at another site at some stage. That could be in one year. It could be in three years. The furthest south we are is around the edges of Birmingham. We deliver into Birmingham out of our Derby branch. Birmingham is the next target. We also then get requests from customers saying can you service me, I’m in Shrewsbury and we go there. We have done incredibly well in the North-West and Yorkshire areas and now North Wales.

We don’t want to saturate and we need to expand out. Our Aintree site tuns over nearly £3m a week. So at what stage do we need to look at avenues to increase capacity and open a new branch? But we have invested in the branches, we have invested in Middlesborough and Aintree to increase the capacity, improve the facility in terms of distribution. We would buy another depot if the right opportunity came along. In the meantime, we are not sitting still. We have learned so much about logistics and deliveries. We can still improve and go into new areas. The last 18 months has been a mad time. It has been very much let’s see where things land and then think about the next 3-5 years.

Does Parfetts have sustainability targets – for example to become carbon neutral?

Being honest, it’s not something the previous leadership team focused on. But it’s certainly something we need to address. It starts with little things like a lot of our colleagues are switching to electric cars so we have charge points. In terms of lighting, you can now get smarter systems that use less electricity. We have got one depot with solar panels. Unfortunately it’s not very sunny up north. We will work with suppliers on things like carbon. It needs to become a more prominent focus in the business and we will absolutely do that.

What was the Parfetts Go Local Ball?

It is an awards dinner for retailers and suppliers. It is our top 100 stores and our key supplier partners. It’s about recognising the hard work of our retailers and suppliers. Suppliers get a hard time all the time down the phone. They do work for us, especially some of our account managers. It’s the end of a calendar year, it’s a reflection and it’s thanks. It’s just getting people together to thank them. I’m glad we can do that because retailers don’t get to many awards dinners. They are in the store 16 hours a day. Many retailers live on the premises or they are in the cash & carry. So the Ball is just a big thank you to say we appreciate them. We want them to have a good night, the suppliers as well. It’s a relaxed evening. We want them to enjoy it and come away from it thinking I really like Parfetts, its a great business, great people. I love nothing more than seeing those people mingling and having a laugh. There is no big strategy around it, just thank you.