Warburtons focuses on future beyond bread dependence

New products, such as Warburton's Thins range, are making a bigger contribution to the baker's profits

Innovation to keep pace with Britain’s fast-changing bread market is vital to Warburtons’ success, the firm’s chairman told the Openfield’s Farmer Conference at Towcester Racecourse last month.

“There will be 1M fewer loaves of bread eaten this week than there were this time last year,” said Jonathan Warburton. “So, unless we are making the market by innovating, our market is disappearing.”

That meant the baker had to grapple with the twin challenges of making top quality white bread while also serving up innovative products to ever more demanding shoppers. “We still have to strive to make the highest quality white sliced bread, which has been our very backbone, but we also have to be able to invest and to innovate,” he said.

A measure of Warburton’s commitment to innovation was revealed by the falling contribution of bread to total sales. “I’m old enough and wise enough not to discuss my competitiors,” quipped Warburton. “But in the case of one of our competitors, 97% of all they make comes in a loaf of bread. Ours is now is late 50% range – that’s how significantly the market has changed.”

Innovation

The shifting nature of Warburton’s product offering was also influencing the baker’s investment in new equipment. The firm was unlikely to build more bread plant to make large white loaves after a refurbishment programme about three years ago.

“We will probably never build another big bread plant – we have got lots of very good and very modern ones. We won’t build another one of those because the market is changing at such a rate,” said Warburton.

As an alternative to white loaves, the firm is focusing investment on the production of alternative sandwich lines, such as Wraps and Sandwich Thins. In March it won planning permission to build a £20M factory in Burnley, Lancashire to produce both product ranges.

The new plant – which is expected to become operational by January 2015 – will create up to 60 jobs.

Wraps and Sandwich Thins are currently produced at the baker’s plants in Bristol and Bolton, which together produce more than £1M both products each week.

Gluten-free

The firm is also exploring the potential to develop products in its gluten-free and wheat-free ranges, branded as Newburn Bakehouse.

Warburtons operates 13 manufacturing bakeries and a dozen distribution depots dispatching about 1,000 vehicles every day. In total the business employs about 5,000 people.

“We have only been able to be successful because we have spent our whole lives driven by complete and utter fanaticism to make the best quality bread that we can, charge a fair price for it and continue to invest in the business,” said Warburton.

Listen to our exclusive podcast interview with Warburton, where he explains more about the firm’s passion for innovation.

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