The Bestway Wholesale MD discusses the challenges of evolving amid the Covid crisis, and championing the cause of the wholesale sector
Dawood Pervez is not easily fazed. As the youngest son of Bestway founder Sir Anwar Pervez, the family business was part of his life even before joining in 2002. But even for a seasoned pro like Pervez, the Covid-19 crisis has posed fresh challenges.
This month marks the second anniversary of his time as MD, after taking over from long-time incumbent Martin Race. To say those two years have been a whirlwind is something of an understatement.
Pervez’s first year was dominated by the company’s transformational depot hubs project, which looked to fundamentally change Bestway from a national cash & carry business with a bit of delivered, into a fully fledged delivered and cash & carry operator. Alongside that project, there was a huge amount of work to be done on the Bestway Retail side of the business.
Year two has, of course, all been about Covid-19. It has been undeniably disruptive for the entire industry – but Pervez is happy Bestway was able to make structural changes ahead of the pandemic. For him, the equal emphasis on delivered and cash & carry means the business is better placed to cope with upheaval. “The pandemic has brought a lot of customers back into cash & carries, but who is to say that in a year or two the trend for delivered won’t be dominant again?” he asks.
“Before Covid there had been a long-held notion in the industry that cash & carry was an outdated concept. But for us, it’s not about just winning in delivered or winning in cash & carry, we want to do both, and that’s what the depot hubs project was about.”
Granted, the project wasn’t without its teething problems. Some customers didn’t react well to the changes, while there were also issues with service levels. But Pervez insists that in the heart of the coronavirus crisis in March, when orders from independent retailers were going through the roof on the delivered side, it was able to work much more efficiently.
Crucially, it was able to make single-person deliveries, rather than needing two people for the job. That enabled it to make more deliveries while also seeing big volume increases through the cash & carries.
This strong focus on efficiency has continued during the Covid crisis. Pervez points out the business has become more flexible and willing to make tough decisions. For example, in June it confirmed the closure of its Plymouth depot, with a plan to service customers in that area from its delivered hub in Exeter. “We had spent 15 years worrying about what to do with Plymouth as it wasn’t making any money,” he admits. “It’s sad to lose those jobs but it just wasn’t working.”
Moreover, the crisis has made Pervez think about the sector as a whole and Bestway’s position in it. Wholesale is a broad church, encompassing a wide range of sectors with vastly differing fortunes. So while shoppers flocking to convenience stores has been a boon for traditional grocery wholesalers, counterparts who mainly service hospitality have been fighting for their lives during the pandemic.
This, says Pervez, made him initially hesitant to voice concerns about not getting enough stock from suppliers during Federation of Wholesale Distributors meetings. It seemed a tricky point to raise at a time when other wholesalers in the virtual room had seen their business fall off a cliff.
“I think this crisis has shown two things. One is that some suppliers when they come under pressure will yield to their biggest customers”
However, as the shortfalls of stock into the wholesale and convenience sector continued, Pervez started becoming far more vociferous on the issue of fair allocations. Working with the FWD, this resulted in Defra pressing suppliers to ensure wholesalers were getting enough stock, a move that did lead to significant improvements. “I know this was massively appreciated by retailers,” says Pervez.
Arguably, he is the one that should be taking the lead on these issues. The completion of Tesco’s takeover of Booker in March 2018 leaves Bestway as the UK’s largest independent grocery wholesaler. This year also saw the retirement of legendary Booker CEO Charles Wilson. Pervez doesn’t say it, but there is a sense he believes the wholesaler sector needs more champions.
“I think this crisis has shown two things. One is that some suppliers when they come under pressure will yield to their biggest customers, hence our call for a fair distribution for all.
“The other learning is how the government collects its information or creates policy,” he adds. “It does engage with businesses in order to base its decisions, but only the largest businesses have well-resourced corporate and legal affairs teams, and they can influence policy to a significant degree. More fragmented sectors don’t have a voice.
“Our trade bodies, FWD and ACS, have done a remarkable job,” Pervez continues. “But many key decisions were made in that first week of lockdown and the ramifications are still being felt now – such as giving the multiple retailers business rates relief and not the wholesalers.”
While he clearly feels strongly on these issues, Pervez is also determined to look beyond the pandemic. He says the business is making good strides in other key strategic areas such as its Bestway Retail business.
“We are happy to work in partnerships as long as it works for our customers and makes sense”
The £7.25m acquisition of Conviviality Retail in April 2018, which included Bargain Booze, Wine Rack and Central Convenience, saw it take on a company-owned stores division and a franchise operation that had been struggling for months with suppliers not supplying. When Bestway took over, says Pervez, the key was working with suppliers to rebuild availability, but during this time it lost about 30% of the previous Conviviality customer base.
“It was a really big challenge to get availability back and our teams worked tirelessly to make it happen,” he explains. “But obviously that model was based on a higher throughput and now the pandemic has provided that, as local off-licences suddenly regained a massive relevance in the marketplace. Even at the height of the crisis I don’t think availability to Bargain Booze retailers dropped below 90%.”
The acquisition has also been beneficial for the wider business, too. The capabilities of the former Conviviality DC in Crewe, for example, provided lessons for its delivered operations. So with that side of the business stabilised, Bestway is ready this month to come to the market with two new formats. The wholesaler has developed BB’s and Tippl as extensions of its Bargain Booze and Wine Rack brands respectively, adding the new fascias under its Bestway Retail arm.
The new formats give an indication of Bestway’s future in terms of supporting innovative and entrepreneurial operators. However, Pervez also quashes industry rumours about potential bidders for Bestway or any plans to sell up. Instead he points to recent partnerships to supply retailers such as Iceland and Poundland. “We are happy to work in partnerships as long as it works for our customers and makes sense,” he says.
In a year such as 2020, making sense is an achievement in itself. But somehow, you get the sense that Pervez has got things figured out.
Name: Dawood Pervez
Status: Married to Clare with daughter called Laila and son called Zain
Lives: Gerrards Cross, South Buckinghamshire
Education: Eton College, University of Manchester BA (Hons) Politics and Modern History and Oxford University MA (Oxon) Jurisprudence. Qualified solicitor
Career: Started out at Linklaters and joined Bestway 18 years go
Best book: Ayn Rand, The Fountainhead
Favourite movie: Withnail and I
Favourite album: Very hard to choose… Pink Floyd, Dark Side of the Moon
Last meal: My mother’s cooking