Pub chain is first to sign up for procurement system
Wetherspoon raises the bar
Whitbread axes 20 jobs in supply chain division
Message in a bottle Two alcopops and a sun-dried tomato salad, please
21 April 2011 | Lindsay Clark
Fancy setting up an entire supply chain, hiring a team and buying all the IT you need to run the operation in just seven months?
This is the question David Loseby, procurement director of pub firm Stonegate said “yes” to.
In August last year, Stonegate acquired 333 pubs from Mitchells & Butlers for £373 million. Unfortunately, they came without a business infrastructure to support them.
Hired just before Christmas, Loseby has until the end of July to complete the huge task of putting in place the essential pillars of procurement.
“The brief that I had when parachuted in was to procure a new IT and till system, build a procurement team, and then put in place a whole new supply chain and all the contracts necessary to run this entire group,” he told SM.
“We’re on track at the moment, but there have been some long hours and tough challenges along the way,” he said.
Since joining, Loseby has put together an eight-strong procurement team and bought all the IT and till systems, which are now being installed. The team has also redesigned supply chains and put in place a category management system to control spending of more than £100 million.
It was vital that the pubs remained open during the move from one owner to another, so transitional agreements were put in place with existing suppliers. Another challenge is that the procurement team has not been given sight of previous commercial arrangements with vendors, which means it has been unable to assess whether has saved money with its new contracts. Instead its success is being assessed using business measures such as gross margins and profitability.
Testament to procurement’s achievements so far is that within a month of joining, Loseby was invited to join the executive board of Stonegate, which is owned by TDR Capital. “There has been a recognition that good strong professional category management has not used before in this type of business. They have been quite positive and supportive of the results that we have delivered because of the way in which we have approached it. They are converts to what professional procurement can do.”