Konditor & Cook
Company Name: Konditor & Cook
Sector: Pastry and Savoury retail
Owner Type: Management
Background Information
The company is a bespoke luxury pastry and savoury retailer, founded in 1997. It has six outlets in central London.
The main activity is manufacturing and retailing. In addition, there is some wholesale activity to selected clients including Selfridges and Fortnum and Mason's. Konditor & Cook also operates its own cafe-bar concept.
The management wished to have the option to eventually sell the company but had an unclear vision for its future and no clear exit strategy.
In order to facilitate a sale to private equity investors, Konditor & Cook needed to quickly increase their number of stores.
The company was in a weak financial position in 2008 due to an expensive store opening, with an EBITDA down to 2005 levels. With such a low EBITDA the selling value of the company was also low.
Causes
The departure of founder Gerhard Jenne would have significantly reduced the value of the company as no succession planning had taken place.
Konditor & Cook had low employee engagement and a lack of consistent systems and processes. For instance, there were no clear performance programmes for staff.
The company lacked the competencies structure to reach its strategic objectives.
The opening of the Gherkin store in 2008 came with high operating costs and had a significant impact of profit.
Turnaround
GBI defined a 5 year strategy with an exit plan.
The key systems and processes designed and built to deliver the turnaround were as follows:
Talent Selection Process: a proven interview process was designed and implemented in order to find the right people, with the right skills with the right culture for the right jobs. An area manager and a head of savoury production were hired.
Leadership Development Programme: was created and filtered down to the rest of the business through the senior management teams.
Customer Excellence Programme: was also set up to ensure Konditor & Cook delivered the best customer service and journey possible. We continue to consolidate ways of working across operations to drive consistency throughout the business.
Balanced Scorecard: used to measure site performance against measured business objectives under people, product, customer and profitability headings. Example targets include annual staff retention, customer satisfaction (measured by survey), increase bill spend, repeat customers and waste target.
Corporate Communications Programme: to facilitate effective execution across all sites. This included assigning and measuring marketing activities to drive bill spend and customer volumes.
Training: with particular emphasis on the development of management with an aim to develop and retain the best people. Specific programmes include The People Development Programme, The Managers Development Programme and the Kitchen Development Programme.
Operational Structure: creation of a new, clear operational structure across the business. For each site a ‘family tree ’ (or an organisational structure) was developed to support recruitment and succession planning.
A post-restructuring private equity fulfilment (Investor Prospectus) was also created in order to finance expansion or management buy-out.
Outcome
Konditor & Cook have since increased the average bill spend and the overall number of transactions. Mystery shopper satisfaction results are at its best, and Konditor & Cook are now being courted by multiple PE firms which GBI is managing and negotiating on behalf of the client.
