Over 110 members made their way to the Cholmondeley Room of the House of Lords to enjoy a fine meal in unparalleled surroundings, courtesy of our host the Duke of Montrose. Before lunch the Farmers Club Cup was presented, and afterwards members heard a profoundly insightful address from Charles Wilson, Chief Executive of Booker Group.
The Farmers Club Cup is awarded each year to the person who, in the General Committee’s opinion, has made an enduring and significant contribution to the agricultural sector. This year’s recipient was entrepreneurial Cumbrian farmer and Farmers Club member John Dunning.
Tim Bennett, chairman of the Farmers Club, highlighted John’s background as a hill sheep and beef farmer and his considerable foresight in developing the farm-fresh motorway retail concept at Tebay Services on the M6 in Cumbria, now expanded to Gloucester Services on the M5 too.
“Quite apart from recognising the innovative and diversifying nature of John’s business, the award reflects the support it renders to the wider agricultural community in both these geographical areas, in terms of food production and its provenance and quality, plus support to small business suppliers, including over 200 local farmers who supply the businesses, employment in the local communities and investing large in charitable works locally,” Mr Bennett commented.
“The pillars of business innovation, support of agriculture and the wider community are exemplars that have been nurtured, developed and championed by John over many years – his contribution to the wider sector has been outstanding and has included his past association and service on many committees from CLA, NFU, National Park and Countryside Commission, amongst others, and this award rightly recognises that contribution”.
Accepting the award Mr Dunning noted DEFRA Secretary of State Michael Gove’s intent to manage farming increasingly strongly for conservation purposes, especially in the uplands. “I agree with that, in principle, but the uplands need to be managed for the development of a broader-based economy too,” he said, “or else it will fail.”
Mr Bennett also paid warm tribute to Lord Henry Plumb, who recently retired from the House of Lords, thanking him for all he had done for the industry over the years, to warm applause. “It is salutary that Henry was the UK’s first President of the European Council, and was probably its last,” Mr Bennett noted.
After lunch Charles Wilson, son of former Farmers Club chairman Eric Wilson, provided a fascinating insight into the future of the UK food supply chain, speaking on the very day the proposed £3.7bn merger between Tesco and Booker gained provisional regulatory approval.
“I have been a member of the Farmers Club since I was 12 years-old, and used to work on my uncle’s farm, and I have to say working at Booker is not as hard,” he commented.
Booker had been in the food supply trade since 1835, so had seen many changes, most recently reversing a decline in sales to post a £5.3bn and rising turnover, ranking it 120th on the FTSE 100.
Local sourcing was a matter of principle, with 70% of all beef and lamb sourced within the UK, and almost a third of the UK’s master butchers employed within the business. “We really do believe in a strong relationship with the producer.”
He acknowledged the global economy’s huge success in lifting 120m people out of poverty last year, more than in any previous year. That was helping to drive global demand for food, and explained some price rises, for example, butter.
In the UK the consumer landscape for food was fragmenting, as individuals pursued their own agenda on choice, price, quality and service – one family member seeking a high protein diet, whilst another was vegan, for example. “Trade channels are changing as customers fragment.”
Policy priorities were shifting too, not least to reflect the fact that globally 3 million people died of obesity-related illness last year, far out-stripping the 1 million who died of starvation and malnutrition. Government would address such issues through policies applied to the food industry, he noted.
Technology would play a huge role. Artificial intelligence was just around the corner, promising smarter robotics, as well as producing burgers in petri dishes and human-consumption insect protein at affordable prices.
Environmental sustainability was important too, with Booker being the first business to comply with all four of the Carbon Trust’s standards for reducing carbon emissions, waste output, water use and zero waste to landfill.
He felt Booker’s wholesale skills, combined with Tesco’s retail strength, would give consumers the choice, quality, price and service they sought, and provide huge opportunities for suppliers.
“But there is huge change coming in the trade over the coming years, and Brexit only exacerbates that.” Speaking of which, he noted Booker’s view of the future was that the UK remaining in the EU was a 33% likelihood, a hard exit to WTO rules was also 33%, and so was a soft exit. Plenty to ponder.
- Tesco has 3,200 UK stores and Booker supplies 117,000 independent retailers, including 5,500 retail stores under its group brands of Premier, Londis, Budgens and Family Shopper. If the deal gets formal clearance in December it will create a grocery business with annual turnover approaching £60bn. However, wholesalers representing 60% of the market told the Competition and Markets Authority in October the deal would hand Tesco “incontestable power over the procurement of all grocery categories in the UK”, according to The Guardian. Final approval was awaited at the time of publication.