Europe

New Kaunas warehouse, Bidfood Baltics  

Bidfood Europe is the consolidation of eight operations, spanning thirteen countries across western and eastern Europe. Through strategic acquisitions of catering wholesalers, food manufacturers and fresh producers since 2006, Bidfood Europe has grown into a significant foodservice player in this market.

Bidfood Europe benefits from being a part of an international foodservice group having access to a wide range of products and best practices to position each business ahead of their competition. Each business retains control of its day-to-day management and decision-making systems in order to be able to respond flexibly and independently to the specific needs of its customers.

New Kaunas warehouse, Bidfood Baltics.    
Food truck, Bidfood Netherlands.   Chefs Farutex Culinary Academy, Bidfood Poland.   DAC truck Montecarlo, Italy.   Culinary School, Bidfood Czech.
Food truck, Bidfood Netherlands.   Chefs Farutex Culinary Academy, Bidfood Poland.   DAC truck Montecarlo, Italy.   Culinary School, Bidfood Czech.

 

Human capital

Each entity, supported by their own management team, is guided in responding to the needs and requirements of their chosen market place. With nearly 8,000 staff in Europe, our management team is properly supported and equipped to achieve even more in the year ahead.

Bidfood Europe is all about their people – not only those in employment, but also those that are involved in the supply chain, the customers served and the communities that are touched by the day-to-day making, buying, delivering, serving and eating our food.

Europe has experienced labour challenges over the past year, in particular in sourcing staff for the warehouses and driving the trucks, but also with low unemployment rates, individual expectations for wage increases and career progression.

Each business has applied their minds to motivate their teams and navigate this challenging time. In spite of the successes achieved to date, the increasing expense of training new staff, using temporary staff for some roles, accommodating wage increases and long-term career development opportunities has been significant.

The lack of truck drivers across many of the European jurisdictions is causing higher operational costs and pressure on the teams. Hiring external drivers and transport may be at higher prices. Managing our labour force remains high on the agenda and focus for the coming year, identifying logistic efficiency improvements to be able to respond to this challenge.

 

Financial capital

 

Europe continues to perform well, with most businesses delivering higher revenues and solid trading results. Our eastern European businesses have shown record revenue growth but have experienced wage pressures throughout the region. Revenue rose 12,7% to R43,7 billion (F2018: R38,7 billion) while trading profit rose 15,0% to R1,9 billion (F2018: R1,6 billion).

Netherlands continued to improve despite a tightening labour market. Trading profit growth and margin improvement was pleasing. Its business simplification journey with product range rationalisation and IT infrastructure reconfiguration is starting to benefit the overall cost base.

Investment into future capacity will be undertaken.

Further gains in the horeca channel more than offset a slowdown in other areas of the business, notably the health and care and catering sectors. Focus on the freetrade sector is being supplemented by import activities and delivering increased customer value.

Belgium performed well in both the horeca and institutional segments. Sales were above budget and F2018 and gross margins improved. All customer segments showed growth, except the catering channel. Own brand product development continues and the roll-out of our ecommerce customer offering is ongoing.

Italy performed strongly despite macro-economic uncertainty. The integration of the D&D acquisition made in F2018 continues. Growth in the freetrade sector supported pleasing sales and trading profit. Sales within the group continue to grow.

Czech Republic and Slovakia delivered another excellent performance. Increased sales, higher prices and better margins offset significant wage pressures, driven by labour shortages. Timeous investments in distribution and production facilities were beneficial to ensure we can effectively service our growing customer base. The Czech economy is influenced by greater Europe, whose growth is slowing but we are confident we can maintain momentum.

Poland continues to go from strength to strength, registering record sales. Strategic investments in infrastructure in previous years and managements' portfolio focus on the freetrade sector provided the base for the excellent performance. The National Accounts segment improved margins through dedicated contract management. Wine is growing into an important category and is expanding into spirits. Smart Food, the subsidiary that serves Asian restaurants, is expanding its geographic reach.

Ecommerce initiatives are developing and are expected to assist further growth going forward.

Iberia’s overall performance was poor. Frustock (Portugal) was good, however, Guzmán (Spain) underdelivered. Progress in Spain is being made internally on improving the business platform and IT systems. Barcelona as a region is still economically “soft’’, offset by good growth in Madrid and Lisbon. Management’s focus in F2020 will be on IT systems stabilisation, growing the independent customer base and cost reduction. Igartza, acquired in August 2018, performed well.

Baltics achieved double digit sales growth, driven by a strong foodservice focus. Completion of the new depot in Kaunas provides the base from which to grow. Both Latvia and Lithuania recorded a trading profit.

Germany remains a business in transition as we structure the platform ahead of any regional expansion. Sales ticked up, gross margins were maintained but expenses remained too high.

Additional management support has been deployed to assist our local operators. Germany remains a medium-term market opportunity for us.

Investment into depots

  • Mallorca branch opens and streamlines the old Food4 network, Spain
  • 5th depot opens in Chulmec, Czech
  • 17th branch in Hardewijk, Netherlands
  • New factory for portion control beef, pork and game opened in Opava, Czech
  • New purpose-built depot opens in Kaunas, Baltics

Manufactured capital

Bidfood Europe boasts an impressive 508 020sqm of depot space; supported by a fleet of 2 828 vehicles to deliver 145 907 product SKU's, sourced from 7 190 suppliers to serve our 137 021 customers!

Capex investment of R813,3m in 2019 includes investment into a new state-of-the-art construction and automation project in the Netherlands. Production will be relocated to the new, almost fully automated warehouse. The first delivery from the new warehouse is expected to happen in November 2019.

The new Baltics depot is functioning well, presenting great opportunity to expand the product range in the next year. Investing into a gastro studio, operational from September, should bring suppliers and customers to our premises for demonstrations, training and events.

Iberia has focused on their own internal transformation, moving from a local produce supplier to a national multi-category partner to the Iberia horeca market. There has been significant investment to drive this transformation and the business is in a good position to grow.

Czech has invested in more capex than in comparative periods to match the growth trajectory achieved over the recent history. Investments into machinery and distribution trucks has equipped this business for growth.

In Germany, occupation of the new warehouse is planned for early in the new financial year. The increased depot capacity, and accommodation of multi-temp facilities, will be a big step forward in simplifying some of the logistical challenges currently occupying managements time.

     

Records achieved

  • Highest ever sales month for Frustock Portugal
  • Highest ever sales records broken in Lithuania and Latvia
       

Intellectual capital

Embracing the benefits of a market leading ecommerce tool, the Bidfood Europe businesses are setting themselves apart. Both in terms of diversity of product range, and also in the ability to deliver that extra-service element to their customers - be it short turnaround on deliveries, substitute products at a range of qualities and pricing, or recommendations of recipes and new products.

Global trends in this segment show that traditional key players in the foodservice market are experiencing challenges as a result of the low barriers to entry in this market. The entrance of smaller, localised players offering new catering concepts and creating diversification through alternative or healthier food offerings have upped the standards that customers have come to expect.

However, we have a strong position in the traditional markets and are experiencing growth in all our market segments. Owning the supply chain in some products, sourcing from other Bidfood businesses and using the best in market ecommerce solutions has positively and solidly positioned Bidfood Europe to embrace the growth challenge of the year ahead.

The online ecommerce solution, "myBidfood" is being rolled out across the European businesses, with immediate sales results. Over 41% of total European revenue is now channelled through the ecommerce tools implemented.

 

* Hardware includes IT and office equipment.

 

 
Product portfolio
Customer mix
Customer mix
Customer mix

Natural capital

Consistency in sustainability activities have been achieved across our European geographies.

 

Europe’s carbon
emissions
(tCO2e)

137 162  7%
2018: 128 286

 

 

 

Scope 1 emissions (tCO2e)
(excl refrigerants and aircon gases)

43 762  3%
2018: 42 380

Scope 1+ emissions (tCO2e)
(only refrigerants and aircon gases)

42 588  36%
2018: 31 432
       
Fuel (kilolitres)
2018:
14 536 15 137
Gas (tonnes)
2018:
1 132 1 344
Aircon gas (tonnes)
2018:
9 13

Scope 1 emissions have increased due to bolt-on acquisitions in the year and better reporting from all entities in the division in 2019.

Fuel efficiency efforts are a priority for all Bidfood operations. LNG trucks introduced in Barcelona are more environmentally friendly. Three electric trucks introduced in Amsterdam, emitting low noise and exhaust-free.

Water (kilolitres)

232 299  3%
2018: 226 305

 

Scope 2 emissions (tCO2e)

49 840  7%
2018: 53 644
       
Grid Electricity
(kWh)
2018:
100 692 114 106 241 885
Non-grid Electricity
(kWh)
2018:
895 591 2 913 319

Solar panels, DAC Italy.

Bidfood Europe is committed to building energy efficient and economical buildings. The new Baltics depot, achieved the highest rating class A+, using a low emissions freezing aggregate and heating office space using the energy emitted from refrigeration compressors.

Bidfood Belgium and DAC Italy have installed solar panels which have contributed to the reduced usage of non-renewable power and improved carbon emissions disclosed.

Solar panels, Bidfood Belgium.
 

Scope 3 emissions (tCO2e)

972  17%
2018: 830
   

Food waste (tonnes)

420

Waste recycled (tonnes)

2 517

Waste to landfill (tonnes)

1 566
2018: 4 849 tonnes

Bidfood Netherlands raising awareness of the plastic environmental issues, the Dutch go 'plastic fishing' in the famous Amsterdam Canals with customers. It's a client relations event, as well as an opportunity to share our sustainability strategy and efforts.

Bidfood Europe works closely with the local Food Bank entity in each country. The food surpluses from various locations throughout the country are donated to the regional Food Banks. These products are still good for consumption, which means that the Food Banks can supplement their food packages. In this way Bidfood not only contributes to fighting poverty, but also to combating food waste.

Bidfood Europe has committed to making packaging in foodservice more sustainable, developing ambitious goals to reduce packaging and make packaging within the foodservice industry more sustainable.

Bidfood Netherlands has started to adjust their own brand products to a recyclable and reusable packaging. They have also chosen to approach packaging to ensure that its fit-for-purpose. Packaging's main function is in transport, therefore the opportunity is presented to optimise packaging in terms of functionality and suitability, with sustainability in mind.

 

Social and relationship capital

Bidfood Europe strongly believes in collaboration with our communities. We are involved in various initiatives to pursue our sustainable objectives. Sometimes we act as a knowledge partner and in other cases we use our role as a chain partner. Always with the philosophy: ‘you only go faster when you move forward together’.

‘Healthy Nutrition at Schools’ – Netherlands

The Dutch school has a major impact on the lives of young people in Holland.

A healthy supply of food in schools can therefore provide an important basis for a healthy lifestyle for these young people. To achieve this, Bidfood Netherlands is a signatory to the Healthy Nutrition at Schools Agreement, managed by Youth At Healthy Weight. With this agreement, caterers, vending machine suppliers, producers and other suppliers jointly take responsibility for healthier food in schools. We have set the goal of facilitating and achieving a healthier meal offer at schools.

 

Guzmán Gastronomia, known for their community spirit engaged with the local community. Projects such as the collection of toys, food and clothes for local charities; as well as office-wide blood donation drives. Fresh produce is donated to “Banc de aliments”, a Barcelonan programme to assist the homeless.

   

   

 

Bidfood Czech Republic and Slovakia are engaged to identify and step-in to assist in various areas of need. Czech Republic has adopted the national "Lunches4Kids" project, ensuring children from low-income homes receive filling, nutritional meals in their school canteens.  

Cultural support is also an area of focus with the Czech business proudly being a long-time partner of the National Theatre in Prague. Bidfood Czech, in the interests of embracing the multi-cultural and lingual European environment, have engaged weekly one-on-one English language lessons, for their staff.