BIG INTERVIEW: Michael Saunders – Team Player

After just one year at the helm of Bibendum, Michael Saunders has overseen rapid growth and a massive leap in turnover. Charlotte Hey discovers his simple, uncompromising vision and the sheer dedication he brings to the company

On being asked whether he would like to be the interviewed for the drinks business, the initial response of Michael Saunders, managing director of London-based wine distributor Bibendum, was to ask whether it could be about his whole team instead of just him.

Self-effacing, passionate, proud and dedicated to his company, Saunders reckons that if you cut him he would bleed “Bibendum not blood”. Perhaps wine would be more accurate, or at least it would be Bibendum wine.

“I see my job as facilitating people to do their jobs well and I’d like to think that is something that runs through the company,” Saunders states. “Individual responsibility is what we are about – it’s a fairly holistic approach and part of that is trusting people. I trust my team and that’s why I wanted to talk about the whole company, not just me,” he smiles.

And so I find myself sitting in a Bibendum company sales and strategy meeting, which is very trusting of Michael considering I’m not part of the team. From the outset the enthusiasm of the sales and buying team is apparent. Saunders’ passion for Bibendum has rubbed off it seems and I can tell it’s not just for my benefit.

After the morning’s presentations on new listings, mobile phones, call centre response rates, fine wine and logistics, Saunders comments: “My approach is that the more the people who work here enjoy it, the more we are going to get out of them. I live by the values of quality, value, trust and openness and however much people criticise us they cannot say we are not trustworthy and pretty bloody good at what we do. And I think it is important that we share information with the team in the way other companies don’t.” His approach seems to be working.

Just over a year ago Michael Saunders took the reigns at Bibendum Wine as managing director, having previously shared the role with Dan Jago, now at Tesco. In retrospect the appointment of a COO in the shape of Jeremy Young signalled that there would be changes to the Bibendum business, while Simon Farr subsequently coming back into the business to work with the buying team confirmed that things would be shaken up. “Simon’s reputation was challenging to a number of suppliers, opening up all sorts of debate as to what we were able to do with their wines in the UK market. He has also fired up the buying team,” says Saunders.

“We have spent a lot of time agonising over whether we are as good as we think we are. As a result we undertook a marketing review. What that did was give us an understanding about how we put ourselves across. We have been tarred with many different brushes and the whole exercise has given us the greater clarity we needed in order to deliver the messages we needed to relate.”

Changing the rules
Bibendum has moved from being a £10 million business to having a turnover of £96m to the end of March 2007. This year’s figure represents a 29% increase in turnover compared to the previous year, with a pre-tax profit of £3.6m. Not bad for his first year at the helm, but then Saunders is a salesman first and foremost. He freely admits that this rapid growth – added to the fact that company employees now number 170 – has forced change when it comes to the company’s internal mechanics.

Bibendum’s income is split, roughly speaking, between private clients (10%), on-trade (60%) and off-trade (30%). And plans for further expansion in existing markets and into new ones are afoot. But Saunders is more keen to talk about his board and in particular one new board member and company shareholder, Roger Gabb.

“We now have five non-executive directors, each of whom brings something unique to the board,” he enthuses. “Roger was invited onto the board as he has great experience in building a brand and in selling to the off-trade. Add to that the fact that he has been unbelievably successful, and after all there are not many people who have succeeded in the wine business like he has and we believe his overall experience will be of great benefit.”

With the board in place, Simon Farr back in the business and the operations side well looked after by Jeremy Young, Saunders feels that the key now is to get the balance right. “We have to find the right formula and find the equilibrium between the changes in the range, the buzz in the trade and our positioning as a company. Over the past two years we have done an awful lot of brand work for Bibendum as a company and now it is beginning to slot into line.

“We have debated the fact that we were becoming bulk oriented and moving away from our natural habitat in the world of wine in the broadest sense. The whole point really is to get our listings to sell in – even if the wines are challenging.”

Saunders sees Bibendum as very much moving back to basics, to the core values of what the company was founded upon but within the climate of the market moving towards discovering points of difference. “Looking for points of difference is a natural area for Bibendum,” he says. “Take wines from China for example – I would say that we are probably first to market with these listings. And so far it is fair to say that the response has been positive. Historically, you can see that Bibendum has been the first to market with areas that are now well established, I hope that China will follow the same path.”

Saunders is acutely aware of Bibendum’s fortunate position in being an independent company, which affords them the luxury of being completely customer centric. He says the team intends “to motivate ourselves to expand market share. We want to create a much broader base for our business even if it’s a slow-burn. Today you cannot afford to be reliant on one retailer in order to get your brand into the top 50 listing”.

Industry view

When it comes to broader industry issues Saunders is incisive in his analysis. “The on-trade is very interesting at the moment, it is a changing marketplace. It is dominated by two large operators, but having gone through a phase of consolidation and been very margin driven, it is now looking like the on-trade sector is going towards being more value driven from both a supplier and a customer point of view. We have a head start because we are in a position to respond to either way the market goes at the moment.”

As for the off-trade, Saunders sees the retail buyers in the UK now showing interest in changing their ranges. It seems to him that the buyers are just as interested in volume deals as they are in finding points of difference and a value driven offer. One important factor he feels in the future is that, “The off-trade cannot deal with lots of different suppliers anymore. It is no longer sufficient to go to them with wine, you have to go to them with solutions. If you want to win the business you have to offer some very interesting propositions. It’s so much more intellectual – we are expected to do the analysis on our customers’ behalf.”

And this for Saunders revolves around the role of the salesman, especially given his sense that the off-trade is now moving away from its traditional format. “The role of the salesman now in the off-trade is similar to that of a business analyst, you have to be able to deliver a robust argument in order to get the business. It’s all about being able to use your brain not just making the sale.” He adds, “Before we suggest anything at all we have to be sure that the offer matches the requirements of the buyer.”

He is pragmatic when it comes to the future of the business. “We have a vision for the business which is quite simple, to keep increasing market share. There is a demand for our services and products and as long as we are motivated to flog our guts out there is no reason why we cannot continue to do that.”

He is also determined. ”What I am not going to do is lose our position by selling crap wine, employing bad people or providing bad service. The difficulty is that as we get bigger we have to keep the intangibles alive in the on-trade. We have to refuse to become process driven and thus maintain the culture and emotion on which Bibendum was founded. I see our 25th anniversary

as the end of the beginning, we still have it all to do and I am certainly not one for being happy with the status quo, if we are going to hold our competitors at bay we are going to have to be brave.” And this is where the passion and dedication to his company comes to the fore. Whatever it is he does have pumping through his veins I’d like a drop of the same. 

Bibendum were the winners of the drinks business Drinks Company of the Year as well as Best Trade Campaign 2007

© db August 2007