Booker re-energises UK wholesale business and expands

November 1, 2009

Charles Wilson, chief executive at Booker, told delegates at the 2009 IGD Convention how the wholesale business had been re-energised.

Booker is the UK’s largest wholesaler to small business, operating 173 branches throughout the UK, serving 72,000 independent retailers, with sales of £3.2bn. Wilson said five waves of adversity had hit UK businesses:

• bank crisis
• commodity volatility
• consumer spend
• trade credit
• government finances

These waves have had a big impact on trade for the last couple of years, he said.

Wilson presented a ‘spiral of distress’, which had caused many businesses to collapse in a short space of time.

In 2005 Booker was in its own spiral, Wilson said. It had £361m of debt. He revealed the company’s strategy for recovery was focused on three stages: focus, drive and brand. Wilson said it took six months to focus the business concentrating on cash, costs, customers, concept, culture and crises.

“We hit it hard and hit it fast,” he said.

In the drive phase Booker listened to customers to give them what they wanted, added new ranges including the Euro Shopper brand, brought prices down and improved service.

Like-for-like sales to retailers were turned around to 5.5% (-5.6%).

Branding was addressed with a smart new orange and white fascia, winning pay back in 12 months, said Wilson. New accounts were opened in the leisure and public sector. Internet sales have also been expanded from £15m in 2005 to £155m in 2008 and £330m in the year to September 2009.

Wilson said the internet changes the way small companies work.

“Small and independent business can have as good IT as Tesco or Sainsbury’s,” he said. “It puts new energy into the business.”

Wilson said Booker put sustainability at the heart of its business. It has been awarded the Carbon Trust Standard for its commitment to take action on climate change and recycles used cooking oil. The internet, meanwhile, is viewed as an environmentally sensitive way of growing the business.

Booker has expanded in India too with the opening of its first cash and carry in Mumbai in September. It supplies kirana stores, food stalls and restaurants.

“It will take us a few months to see what the demand is,” said Wilson but the company was "learning a lot" on areas such as sustainability.

Wilson said that in September 2009 company debt was reduced to £4m and like-for-like sales were up 7.7%.

Critically, the company’s Dun & and Bradstreet failure score had moved from 13 to 98, where one indicates a good chance of a company being declared bankrupt.

Charles Wilson: re-energised