By Sustainable Scale Up Cluster Programme Manager, John Taylerson.
On 24th March I attended the Sustainable Scale Up Cluster’s first annual conference at the Royal Mint with a large group of food and drink business, banks and financiers, non-executive directors and professionals from the industry to highlight what food and drink manufacturers can do to scale, whilst hearing about financial support from the finance professionals.
We kicked off with the three Cs of scale up challenges: Capital, Capacity and Competencies; and Will Jennings, UK CEO of Rabobank and our keynote speaker added a fourth one, ‘Collaboration’. Will highlighted the scale and scope of Rabobank’s international and UK operations, but stressed that, as a farmer created cooperative, collaboration is deeply rooted in Rabobank, and never more so than in these uncertain times.
The agenda then moved on to money – how much it costs and how to access it. The banks suggested there is plenty of it available, even if many of the producers seemed less certain of this, and, from their perspective, that the sources of available finance are not really offering much help for smaller transactions. Scale is important for banks as well as food and drink manufacturers. A key theme of the day was that to achieve scale, careful planning, budgeting and forecasting needs to be done sooner rather than later in order to secure capital at a sensible cost.
James Walton, Chief Economist from the Institute of Grocery Distribution (IGD) kicked off the discussions on food manufacturing capacity, highlighting the productivity gap in the UK generally, as well as the likely impacts of the inflationary pressures facing our sector. Pete Robertson (FDF Cymru/AMRC Cymru) and Richard Elmitt (SSU Cluster) highlighted the importance of production planning and implementation to ensure any existing but hidden capacity is unlocked before jumping to investment in new kit.
A personal highlight was hearing from two Cardiff Business School students, Ellie and Joseph, who were part way through their 20-week placements with Welsh food businesses as part of the Sustainable Scale Up Cluster’s Student Placement Programme. Both Ellie and Joseph talked confidently and eloquently about how the programme has opened their eyes to opportunities for business graduates in the Welsh food and drink industry. Bringing talented young people into the industry will be critical for the sector’s future growth and resilience.
The conference was the perfect opportunity to launch another of the Cluster’s programmes, the Non-Executive Director Programme. We heard from Mike Woods, Managing Director of Just Love Foods, who has recently secured investment and a new Non-Executive Chairman, George Adams, into the business to support their growth. If you missed this session you can listen to my interviews with George and Mike where they expand on the benefits that NEDs can bring to businesses from both sides of the board table. The programme aims to match suitable NEDs with Welsh food or drink businesses who can benefit from the experience and skills a NED can bring to their business and accelerate growth.
Bernie Davies and Maggie Ogunbanwo from our Bridging the Gap special interest group shared their insights on the importance of diversity in Wales’ food and drink sector and the role it plays in driving innovation, whilst acknowledging some of the challenges facing new businesses and entrepreneurs from diverse backgrounds when scaling their businesses.
The afternoon’s breakout sessions were opportunities to look at finance for sustainability with HSBC’s Sian Williams and offered a deeper dive into equity finance, looking at crowdfunding versus angel investment.
Overall, the feedback we had from attendees was that the conference had helped to re-set their views on the availability of capital, capacity and competencies, how these factors can be harnessed and who to collaborate with on their scale up journeys.