17 / 170
South African pride
A JSE listing was a logical step for us. We treasure our South African
roots. This is where the Bidcorp story began, where the initial base
was built and where our reputation for delivering shareholder value was
first established.
It was not until 1995 that foodservice began the process of
international expansion.
Today, 8% of revenue is attributable to our South African operations.
This does not mean they are marginal or incidental. We are extremely
proud of our South African businesses and continue to invest in their
growth in 2016. We see opportunities for sustained expansion in
South Africa and further afield in Africa, and that investment will be
maintained.
Enduring values
Our status has changed. We are now a separate listed company,
but we have made no effort to distance ourselves from our Bidvest
heritage.
Our growth has always been driven by entrepreneurial managers in
autonomous operations who take personal responsibility for identifying
and pursuing growth. These operations and their leadership teams are
deliberately lean. They avoid complexity and stay close to their people,
customers and markets.
This business model was put in place when the first foodservice
business was acquired in 1989. It is still relevant today. We see no
reason to change it.
Local listing
It is perhaps understandable that some commentators have
speculated about a future listing outside of South Africa. After all, most
of our earnings are denominated in foreign currencies and our global
reach is likely to increase in the years to come.
However, we see no benefit at this time of a move to any other financial
centre. Bidcorp therefore has no current plans to list in London or
on any other stock exchange, but we will continually reassess this
position.
The best interests of our investors is always the key driver of corporate
decision making at Bidcorp.
At some stage in the future, a major transformational transaction might
induce senior management and the board to consider an alternative
listing, if this were felt to be in the best interest of our shareholders.
This is a possibility at any global company with long-term growth
ambitions.
No such trigger event is on the Bidcorp horizon and we are happy to
call Johannesburg home.
Inner excitement
Our recent listing not only unlocked value, it triggered a wave of
excitement across Bidcorp businesses.
Every business in every national market reacted with enthusiasm to
these developments. Single-minded focus on foodservice enables
every team to achieve objectives without distraction.
Pre-listing, senior management devoted a lot of time to communicating
the vision and sketching out the Bidcorp future.
Our intention is to become one of the world’s foremost foodservice
businesses. Increased scale may result, but bulk is not the primary
objective. We plan to become leaders in terms of innovation,
customer-friendly solutions and quality service delivery.
Strategic vision
The year not only witnessed our unbundling, it also proved to be a
watershed year for the strategic rollout of our long-term vision.
Historically, foodservice businesses have complemented their services
to hotels, restaurants, caterers and institutions with logistics. Logistics
contracts are big on volumes, small on profits.
Real value in foodservice is found on the plate not on a warehouse
loading bay.
Strategically, the choice is clear: do you move boxes on the back of a
truck or do you add value on the back of smart foodservice solutions?
Some years ago, the decision was made to scale back low-margin,
big-contract logistics operations and build momentum as a focused
foodservice business that can protect margins through value-adding
services.
The customers that benefit most from value add like this tend to
be small to mid-size independents as we can assist them with
their product and menu development while using technology and
e-commerce platforms to deliver ordering efficiencies.
Our ability to extend the range into the fresh produce, meat, fish and
speciality categories also bestows competitive advantage at attractive
margins.
Leadership review
Bidcorp Limited Annual integrated report 2016 |
Page 13