David's Keeping His Eye on the (Dough) Ball
Management buy-ins, raging factory fires and million-pound investments. Running an artisan bread bakery is no run of the mill job
David Rixon, MD, Giles Foods....(Me and My Factory)
I come from a food and farming background so it's no great surprise I ended up working in food production. I never really dreamt of doing anything else: food is in my blood.
But my focus hasn't always been on bakery; I was running the family wholesale and retail meat business back in the 1970s and at one point we were employing almost 600 staff. But by the 1980s I was starting to become a bit disillusioned with the meat industry and was looking for something new. I did a whole variety of things over the next few years, including running this very factory in Milton Keynes, which was later sold to Northern Foods.
The next key date in my career was probably 1990, when I led a management buy-in with some venture capital backing at Farmer Giles Foods, which was based in Aylesbury. The business grew very successfully until 1997 when I got the call that is every manager's biggest nightmare: the factory was on fire. I drove over there and the plant - all 4,645m2 of it - had burned to the ground. Although something like 80% of businesses destroyed by fire fail to get back on their feet afterwards, we managed to keep things going as our customers supported us. We explored a lot of options, but in the end we switched production to a site in Telford.
We had also bought a small facility in Warminster to produce pastries, but by 2004/5 the bulk of sales came from our quiche business - also based in Milton Keynes.
At this point, we were in a position where we were growing sales in quiche but profits were not growing at the same rate - the category was becoming pretty commoditised. It was a bold decision, but we decided to exit quiche and focus instead on artisan bread - which at the time was a tiny part of the business, but one I had become passionate about.
About a year before we'd taken over this site in Milton Keynes [Pain Artisan] to produce artisan bakery products as Northern Foods had switched production to a site in Sheffield - we also transferred production from the Telford plant to here - and have been growing strongly ever since. In 2005, the combined turnover of Pain Artisan in Milton Keynes and Warminster was only about £8M. Today, it's around £20M; £17M from here and £3M from Warminster.
We've been investing about £1M in this plant every year and in the next 12 months we're spending £2-3M on fitting out a second unit adjacent to this one that will effectively double production. With both units, we will have 9,290m2 of space and ultimately we will have capacity for about £30-40M in sales.
We've got a fair amount of automation here but there is also a lot of hand-crafting. The key is flexibility, both in terms of the equipment and staff. Having multi-skilled staff is also essential because we could be producing up to 40 different products a day and launching three to five new products a week. If you're producing 48,000 identical burger buns on a line you can run it with one guy and a computer; what we're doing is completely different. We're even heading towards the point where we will make all our own yeast.
But we've also got incredibly flexible equipment and a superb in-house engineering department - nothing is off the peg. Our engineering manager has put a computer on every piece of equipment; he could probably write a programme to send a rocket to the moon if he put his mind to it! There is also a culture of ownership from all the operatives. If they hear a squeak, they look into it and the issue is addressed there and then; they don't just ignore it and wait for the engineers to discover there's a problem later on.
The challenge for our business is making high-quality, authentic and artisan products - which typically require longer fermentation times - using modern manufacturing techniques that make this commercially viable. One of the key ways we have achieved this has been through 'stress-free' processing. Basically, this enables you to mechanically produce bread with the same qualities as if you had made it by hand because they don't apply the same stresses to the dough that destroy its structure and elasticity. It also produces a bread with more taste, better eating qualities and a longer life. We've got one stress-free line from a Japanese manufacturer called Rheon and another from König here so we have invested very heavily in this.
But you can't always make something to the price point customers are looking for without compromising quality standards, and we have had to turn business away at times. However, because we have such a great engineering capability, we can sometimes come back to a customer and say we've found a way of producing your product that's commercially viable and achieves the quality standards.
I'm incredibly passionate about bread. You can be so creative with it, whether you're making a French baguette that will go stale in a matter of hours or a dark rye bead that will keep for weeks. We make a wide range here: the inspiration is mainly French and Italian, although increasingly Eastern European and Arab influences are coming in as well.
But it shouldn't just be 'speciality' products that taste good. If you could just try an 800g sliced loaf made in Japan with dough fermented for eight hours, you'd know what I am talking about. It is fantastic.
Through a lot of travelling, I've learned an enormous amount about bread, but I've never stopped learning from other people. One of the bakers that initially inspired me was Peggy Dannenbaum, who founded the La Fornaia artisan bakery. She introduced ciabatta to the UK. The other is Nancy Silverton, who founded La Brea in California in the 1980s. I remember visiting her in Hollywood and sitting in the restaurant adjacent to the bakery where all these film stars were chewing her bread. It was amazing - it's really inspirational what can be done with flour and water!
Like all manufacturers, we're constantly exploring ways to cut costs and reduce our environmental impact, so we've devoted a lot of energy over the last 12 months to exploring everything from treating waste oils and fats to heat recovery systems, capturing rainwater, and generating energy from solar panels.
We've also been working hard on driving operational efficiency through techniques such as 5S as the pressure to cut costs has become more intense. But I still feel very confident about our prospects; while the recession has dented sales of premium products and people are eating out less, we have a solid footing across retail and wholesale as well as catering markets, so we are in a good position to weather the storm.
As for currency, the weakness of sterling has had a mixed effect in that it's increased raw material costs, but it's also made us more competitive in export markets. As we're competing with Continental European manufacturers to supply products into the UK, a weak pound also makes us more attractive to some domestic customers.
There is a lot of re-ranging going on in the supermarkets to adapt to the recession, but artisan bread is still a big growth area. There is also a lot of business to go after more generally - we're just a speck on the horizon in the scheme of things - we could double our business in any of the areas we're in.
As for the longer-term future of the business - I'm optimistic. Will my children take over? As they are only 11 and 13 that's probably a bit premature, but the elder one is already talking about putting the younger one on the flapjack line at our Warminster factory, so we'll see!
FACTORY FACTS
Location: Pain Artisan, 15 Tanners Drive, Blakelands, Milton Keynes MK14 5BU Tel: 01908 619500
Products: Artisan and speciality breads, including French and Italian breads, garlic bread, dough balls and flatbreads
Capability: Latest injection, flow-wrapping, mixing and freezing facilities, two stress-free dough lines. Plant is about to double in size
Growth: "We have been growing at about 20% year-on-year. With the second unit, the site at Milton Keynes could turn over £30-40M."
Turnover: "This site turns over about £17M; the second Danish pastry site in Warminster turns over £3M."
Customers: Fairly even split between foodservice, wholesale and retail customers
PERSONAL
Name: David Rixon
Age: 59
Career Highlights: "It's pretty hard to pick out a highlight because I've enjoyed every minute of it. The important thing is to keep on learning."
Domestic: Married with two children aged 11 and 13
Outside work: Spending time with the family, shooting, golf
Source: www.foodmanufacture.co.uk - 28th August 2009
