Food co-op Produced in Italy is gunning for a four-fold increase in sales this year, despite the difficult market. Rob Brown talks to MD Mike Slegg about how he’s making the business work
As global stocks dive off the cliff in unison like lemmings and the Euro debt crisis creeps into Spain and Italy, there seems to be little reason for cheer. But the economic gloom hasn’t dampened the spirits of one co-operative of Italian and British food manufacturers.
In fact Mike Slegg MD of Produced in Italy (PiI) is positively upbeat. “At the end of 2011 we’re going to end up four times what we were when we started the year,” says Slegg.
He’s projecting an increase in annual sales of £4.3m from £1.2m at the start of the year to £5.5m at its close. So how exactly will he pull off this doom-defying feat?
The diversity of the business, illustrated by its unusual ownership structure, will be key. The company’s major shareholders include Slegg, who’s worked for giants including Bakkavör and Northern Foods; former Unilever Italy executive Giuseppe Casati; Rosie Haywood, founder of free-from cereals producer the Groovy Food Company; and Italian cereals producer Molino Nicoli. A number of smaller companies have bought stakes, of as little as 1%, in the co-op, which also owns cereal brand Pertwood Organics.
In return, as Slegg explains, shareholders get access to British supermarkets. “We found a number of third, fourth, fifth-generation family Italian businesses with absolutely zero profile in the UK,” he says. Much of their failure to break into Britain is down to their reliance on agents and distributors, which has deterred supermarkets who want to avoid lining a middleman’s pocket. “PiI has been incorporated to provide a solution for grocery multiple buyers who want to deal with manufacturing companies directly,” says Slegg.
The collective’s British members are also benefiting from its Anglo-Italian connection. The Groovy Food Co manufacturer of gluten-free cereals, cold-pressed oils, agave nectar and now agave sweetened cereal at Molino Nicoli’s brand new 22m free-from manufacturing plant in Milan.
“We intend to be market leader in free-from foods,” says Slegg. “It’s the only market to be showing consistent double-digit growth year-on-year.” Indeed, the category was up 14.5% to £199.5m last year [Kantar Worldpanel 52w/e 17 April 2011].
Next for PiI, though, is a venture that seems a world away from Italy. To cash in on the growing demand for products rich in heritage and provenance, the company is launching a range of Scottish oats and cereals produced in a mill dating from 1840 and fronted by chef Raymond Blanc.
That’s not to say that PiI will forget its Italian roots, insists Slegg. “Eighty per cent of our business will continue to come from Italy. That’s where we started and where we’re from,” he says. Indeed, PiI has teamed up with family restaurant and cookery school business Caldesi, which has put its name to a range of PiI products will soon be hitting the supers’ shelves.
“Everything they do is exquisite quality or they just don’t do it,” says Slegg. “This is about bringing the best Italian food to the British public.” And nothing defies doom and gloom like quality Italian food.