Viewpoint

07 July, 2006
Sylvia Macdonald
Page 10 

Sylvia Macdonald

It was a marvellous summer’s day. The sun shone, the Champagne flowed, London landmarks such as the dome of St Paul’s Cathedral and the portals of the National Gallery shimmered in the bright light.
A group of partygoers gathered on the roof of the Trafalgar Square Hilton to celebrate Warburtons’ 130th birthday. It was so hot the press drank more water than Champagne – for once! We were there to celebrate a landmark, well two actually, because with immaculate timing Jonathan Warburton announced that Warburtons had gained national distribution for the first time in its 130-year history.Jonathan told me the deal had been brokered with Tesco’s bakery team. In addition, Asda, Somerfield and Sainsbury’s will also be receiving nationwide deliveries.There have been industry rumblings for years along the lines of ‘when will Warburtons achieve national distribution?’But as is so often the case, one company’s downfall is another’s opportunity. So when New Rathbones finally keeled over, after months and months of dizzy spells, doubtful deals and finally death, Warburtons dashed in, demolished other bids and bought up the Stockton bakery plus, more strategically for the south west, the Newport bakery.Combined with massive extra distribution offered by its Enfield site – and a new plant being built alongside – it must have been like gaining the keys to the (whole) kingdom at last.Where has much of the money for investment come from?From holding the price of its bread, of course! By refusing to compromise on quality or cost! “Economy loaves? – not our style,” they said! With economy loaves Kears alone had led the way; others were mad to enter the fray. But that is hindsight. For years Warburtons refused to join in. It held its nerve against huge pressures. It was a General de Gaulle style ‘non!’ And said with conviction andconsistency.But while the rest of Britain’s plant baking industry has been largely littered with casualties, closures and consolidations, Warburtons just went on opening new plants – from eight to 14 in the past 10 yearsAnd so, in great Machiavellian style, Tesco, the supermarket that had led the ‘economy’ price war with the 17p loaf, turned round and rewarded the one company that had refused to join the battle.That is the irony of the price war.



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