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Brand at 50 – the Next 10 Years
With a goal of becoming 'The nation's favourite caterer' in the not too distant future, Host Contract Management are aiming high. Having celebrated several new contracts in Scotland, including RSMAD, Tesco, and Baker Hughes in Aberdeen, the company now boasts around 80 managed operations throughout the UK after only three years – and they have many more in their sites.
Led by the inimitable Jerry Brand, the self-styled enfant terrible of contract catering who is as controversial as he is charismatic, Host have a steadfast commitment to the use of high-tech IT systems, fresh, locally sourced food and innovative business models for transparent purchasing. And, as Brand nears the grand age of 50 – the 'halfway mark', as he calls it - Host are hell-bent on tackling the 'backdoor backhanding' of client contracts by the major names, and on launching a new era in contract catering.
Catering in Scotland meets the man with the plan…
It was 1996 when Brand made his first fortune at the age of 39, selling his contract catering business Russell & Brand to Marriott. Effectively forced out of the industry for the following five years he followed various career paths, including non-executive consultancies with RBS and a less successful venture into restaurants with Brian Turner, before entering back into scene with a bang in 2004 when he established Host Contract Management.
The company's philosophies certainly divide opinion. Some industry commentators say Brand is the best thing to have hit the industry in years, a "heavyweight who confronts the major companies head-on and changes the goalposts while he's at it". There are also some (principally from those major companies), who consider him an "irritant who is capable of bringing the industry into disrepute," largely because, as Brand puts it, "I'm not afraid to air the discount argument in public."
Host's policy on net purchasing, which, in some cases according to Brand, makes them cheaper than the UK supermarkets by some 15% to 20%, attracts considerable interest from companies when reviewing their budgets: 'When clients wonder why their employees are having to pay more for a Muller yoghurt in their subsidised catering facility than they would in a supermarket, they understandably demand answers,' he says. "I am not in the slightest bit interested in making money out of my clients when it has not been agreed in advance. It comes down to old-fashioned business requisites of openness and trust. What is really hurting this industry is the mistrust that the major companies have fostered by this underhanded practice of inflating the food price at the kitchen door."
To some people, Brand is still known as the 'Egg Man' following an episode in the mid-1990s: "The whole contract catering industry stopped for a day after I sent a mailer to the oppositions' contract units, asking their clients why it was that we paid 6p for an egg (the simplest thing I could think of), while their caterers were charging them upwards of 12p."
The mailer caused more than a mild stir at the time: "I had threatening letters from the managing directors of the major companies, but they couldn't do a thing about it because we had proof that they were overcharging their clients. They were more expensive than the supermarkets and we were cheaper, simple as that.
"Area managers across the nation spent months explaining to their clients why their eggs were in some cases twice the price that we at Russell & Brand were charging.
He grins, broadly: "That's when I got tagged as the 'Irritant of the year.'"
Despite being a nice guy, you get the feeling Brand loves to be a fly in the ointment of his competitors: "What I find really sinister nowadays is that the word 'discount' has been replaced by 'mark-up. Not only do the companies get a reduction in cost from their suppliers, but before that discount is actually applied they persuade their suppliers to increase the prices (in some cases by 100%) before the raw materials are delivered. The contractors who do this then claim a smaller management fee and the client thinks that they are getting a good deal. Most clients simply have no management tool by which to identify this underhanded approach."
Loved and loathed in equal measure (depending on whether an individual has been successful with him in the past), Brand could never be accused of withholding opportunities from people: "When we float, 35% of the business equity will be in the employees' hands. In my opinion, business is about strategy and people; get them both right and you have a winning partnership, so why include emotion? I have always been alone in business, in terms of leadership. Many people create partnerships but I believe in one leader, working people hard but treating them fairly and allowing them to use their talents to make the company stronger through teams, and in so doing providing them with some ownership.
"I also believe that the future of the industry is through 'self-operation'. The contract catering sector is stagnating and the competition is fierce, as the larger companies lose market share and the smaller independents grow to a size where the big guys buy them back in again."
So, it appears the final leg of Brand's career is about to be played out. Some industry commentators claim he is a visionary with a clear strategy and the cash to invest in what he sees as the future of the contract catering business. Whatever his competitors think of him, he is clearly an insidious force against the more mainstream caterers in the business. The question is, will he succeed in highlighting others' failures, or will he merely continue to be the irritant of the decade? His exit strategy with Host is a market float by the time he is 60 and, from the sound of things, he has no plans to go anywhere until then. For now, at least, Brand shows few signs of slowing down.
Host Contract Management Ltd
Kemps Place
Selborne Road
Greatham
Liss GU33 6HG
Tel: 01420 538300
www.hostmgt.com
This article has been edited from its original version. For the complete feature please see Catering in Scotland magazine May/June 2007.
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