How a bakery sliced through supply challenges

How a bakery sliced through supply challenges

Jacksons Bakery supplies most of the UK’s major sandwich makers and food service companies from its Hull base. It is part of the William Jackson Food Group (WJFG), a diversified business employing 2,000 people.

Recipe for survival

Like most food and drink producers, Jacksons Bakery has found it harder to source critical ingredients in recent months, while also being faced with rampant inflation. Managing Director Owen Elliot told us about Jacksons’ response to turbulence in its supply chain.

Sudden sourcing pressures

Among the many knock-on effects of the Russian invasion was disruption to the supply of food ingredients grown in Ukraine for export. The oil and seeds market came under heavy pressure, compounded by the closure of ports and other infrastructure. 

These hit the Jacksons business, alongside other, indirect effects, Owen explains. “While we don’t source flour from that region, the impact of the war saw prices rise seismically. ‘Grain corridors’ did eventually open, but insurance remained a key factor for vessels entering the region.”

Finding alternative suppliers was challenging for Jacksons, as many key ingredients aren’t grown in friendly nations. Instead, the business focused on carrying higher inventory levels to mitigate further disruption, while working closely with suppliers on contingency solutions.

Keeping the ovens hot

Bakeries are high-energy production environments, so soaring gas and electricity costs have been a headache for Jacksons. Prices for raw materials, and for recruiting and retaining employees in a challenging labour market, have also taken a toll.

The company has been in constant discussion with customers and has been able to pass on inflation costs. The unprecedented challenges saw Jacksons seek further help from some clients: “We have had to work with a small number of suppliers to support us with soaring energy prices and to ensure no disruption to supply,” says Owen.

Jacksons benefits from its parent group’s hedging policy for utilities to ensure security of supply. For other products, it has found fixed price deals being replaced by shorter-term contracts of clear pricing mechanisms.

Mother nature as stakeholder

Despite the intense challenges, Jacksons remains committed to becoming a more sustainable business. It has recently appointed a dedicated sustainability manger.  Jacksons is committed to the group’s targets, which include halving food waste and achieving 100% traceability of directly-controlled ingredients by 2030.

This extends to Jacksons’ supply chain too. “We are now using Authenticate as a software partner to help us get full visibility across our supply chains. We are using the tool to assess risks of supply – not only for technical issues, but also ethical and environmental aspects,” says Owen.

“We are starting to adopt the philosophy of using Mother Nature as a stakeholder in all our business decisions, including material sourcing, product development and capital decisions.”

Well-being: a key ingredient

As the cost of living crisis worsened, Jacksons introduced distribution of free vegetables for employees during the colder months. It’s just one way in which the company seeks to look after staff and to ensure it retains valuable skills in a challenging labour market.

“Labour challenges are not new to our industry, but they were made worse by the pandemic” says Owen. “We’ve reviewed pay and benefits to ensure we remain competitive.

“This year, we have also introduced a new reward and well-being platform. We’re boosting leadership capability to underpin our values, helped by a new Inspiring Leaders course. And we have annual engagement events across all sites, to update colleagues on our performance and celebrate success with a barbecue.”

Upbeat outlook

In 2021/22, Jacksons delivered £96m revenue, around a third of the group’s business. This year has inevitably been more challenging, but Owen is confident that the measures taken by the bakery and the wider group will sustain its progress.

The bakery sector remains a tough one, but we are optimistic for the future, given that bread is a key staple that consumers will continue to buy during tough times,” he says. “We remain well placed as a business, given that we have multiple routes to market, and we believe there is headroom to further grow our Jacksons of Yorkshire brand.

Working with Barclays

To ensure the bakery can meet its objectives, Owen says it is important to have a banking partner that understands them and can tailor services to their needs.

The business moved to Barclays in 2020, at the height of the pandemic and benefits from cash management solutions, debt finance and specialist FX services to help it address the current challenges to support operating efficiencies and optimise liquidity.

Where to next

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