This could be 3663 First for Foodservice's year. While its main rival Brakes is busy dealing with a transfer of ownership, it has a real opportunity to nick the number one spot and become the UK's largest foodservice operator.

It's already number two and, with a turnover of £1.42bn, is the UK's sixth-biggest wholesaler, sitting just behind Brakes in fifth spot, with £1.63bn.

If it does pull it off it will be a great achievement after what chief executive Fred Barnes admits has been a year of mixed fortunes for his team.

The financials have been impressive - especially compared with Brakes. In the past year, 3663's turnover has grown by 12.3% compared with Brakes' 3.9%. Its pre-tax profit stands at £51.5m compared with Brakes' £50.6m and, at 3.6%, 3663 also has a better profit margin than its rival's 3.1%.

But, the company lost a £130m-a-year MoD contract to Woodward Foodservice a year ago, and, more recently, it has faced criticism from farming group Sustain over its treatment of suppliers.

The environmental lobby has also singled out the company for generating unnecessary food miles because it distributes products to some 50,000 outlets throughout the UK.

Barnes is now fighting back. The business has just launched the second phase of its local sourcing project in East Anglia by showcasing 200 new products that are available exclusively to its customers in the region. It has already set up similar projects in the south west and Wales and is working on introducing more schemes in other parts of the country.

So far the strategy seems to be working. Former National Farmers' Union spokesman Robin Tapper praised 3663 for its local sourcing initiatives and building partnerships with local suppliers.

"Consumers are becoming more concerned about food miles and the impact of the food they eat," says Barnes. "Local sourcing is an exciting move for 3663. We care about our suppliers and their products. We also pride ourselves on maintaining the highest levels of due diligence and traceability."

Barnes isn't stopping there. The company is also attempting to address the wider green agenda. Its fleet of lorries is washed using recycled rainwater and the company recycles all the plastics and cardboard it uses.

"We are working to minimise our environmental impact, but it is an ongoing issue and one that we have to keep working on," says Barnes.

Despite losing the contract to Woodwood Foodservice, Barnes is confident 3663 can put greater distance between itself and the number-three foodservice company, especially following Woodward's cashflow problem following its acquisition of DBC Foodservice last October.

Barnes is satisfied with progress so far. "We are actively competing for business as you would expect," he says. "At the moment things are moving in the right direction."

However, he says, it is vital that the business pursues an active programme of innovation to meet the needs of its existing customers and attract new ones. With more meals being eaten out of home than ever before, the company is increasingly targeting pubs and restaurants. It is expanding its premium brand Whites to include new lines such as prawn and crab bisque and pork hock with vintage cider and apple sauce.

It is also improving its service to traditional customers such as schools, hospitals and prisons. For example, the company has introduced micro-nutrient information for all 762 of its own-label products so that customers have access to the vitamin and mineral content of their purchases as well as the standard allergy and diet information.

"We are committed to giving our customers choice and we want to be proactive in providing detailed information so customers know our products meet their needs," says Barnes.

With 3663 really raising its game, Brakes will need to watch its back.

Meanwhile, Barnes says he is more concerned about keeping 3663 on track than what his competitors are up to. The rest, he says, will look after itself.n