Vimto maker targets out-of-home market with site investment

This site is of major strategic importance to Nichols. To reflect that, we have been investing heavily into its people and processes for the past 18 months.

Vimto was created in 1908 by the chemist John Noel Nichols, who lived in Salford, Greater Manchester. Fast-forward 110 years, and the brand is still performing strongly, up 9% in value sales in the UK last year against 2% market growth.

Today, the Nichols business has become very diverse, with three distinct routes to market. The first is Vimto Packaged, which is everything you see in supermarkets. We took a decision some years ago to outsource all of the manufacturing in this area.

Vimto International makes up 22% of our revenue. Our flagship product overseas is Vimto double strength cordial. With 35 million bottles sold during Ramadan, it’s a phenomenal piece of business.

Lastly, we have Vimto Out of Home – the market that this factory serves. In each of the past three years, this has been our fastest-growing sector, now accounting for 28% of our revenue.

We are unique in that we have a strategic partnership with both Britvic and Coca-Cola European Partners (CCEP) to install dispensing equipment in the independent on-trade.

One of a kind agreement

In fact, the agreement we have with CCEP is the only one of its kind it has globally. We are licensed to produce bag-in-box formats for it, and we also produce Irn-Bru in similar formats for AG Barr.

We are really proud of our representation in this area, because there’s no way these companies would hand you the responsibility to produce such market-leading brands if we didn’t get the quality right every time.

I joined the business in 2009 as group financial controller, and, in 2013, I moved to head up the finance function. Finally, in November 2015 I was promoted to finance and supply chain director. Despite not having any supply chain experience, I wanted to get more involved in the operational side of the business, and I’ve relished it.

It was around this time that the business formulated an out-of-home strategy, and the factory investment programme started in 2016.

First of all, we moved the four factory bag-in-box lines to create space for a fifth, which will be a polyjar line, hopefully installed by early next year. The polyjars look like your typical screenwash tub, and the route-to-market for those is places like Alton Towers or Madame Tussauds, or certain convenience stores.

Space for fifth line

These places typically sell our Starslush frozen brand, which we took on when we bought the Noisy Drink Company in 2016. The polyjars are the ideal format to top up the ice.

In November 2016, we installed a dry sugar silo, which replaces having to tank liquid sugar here. We plan to add a sugar dissolver later this year. With capacity in the liquidising sugar market reducing, it will give us security of supply.

Last October, we increased our warehouse space, adding capacity for both our frozen and chilled products. Most recently, we installed an end-of-line packing and palletising ‘robot’ arm, which automates our process considerably.

It’s a tremendously clever piece of kit, picking up whatever product configuration comes off at the time and packing it accordingly.

Through label scanning, the robot provides us with a real-time completion of works orders, talking to our enterprise resource planning system all the time.

In addition, we’ve invested in improving the working conditions for our people. About 18 months ago, the office area was like a rabbit warren. We had the technical team sat in one office, and the supply chain team in a different office – the environment didn’t lend itself to cross-communication.

Cross-communication

By opening up the floor space, we’re encouraging people to talk to each other and add value just by listening to other discussions taking place.

We’re also keen on staff development. The Ross team is quite small – just 42 staff – but there’s a variety of different skills required within our processes. By developing people across those different disciplines, not only do you give them the opportunity of career progression, you also give the business more flexibility when other staff are on holiday or off sick.

Considerable energy goes into appraisals, performed every six months. It’s a typical plc approach, but one of our major assets at Nichols is our people. So, the training and development of this asset, and the continual investment in our people is what I think differentiates us from others.

In all, we will invest £4.5m into the Ross site by the end of next year. It demonstrates the size and scale of our growth ambitions, and what is required to take us into the next generation of production and manufacturing.

When Vimto launched in 1908, it was called Vimtonic and its strapline was ‘Full of vim and vigour’. That’s as relevant today as it was then. Even with all the automation and technology coming in, it’s still all about the energy of the people. These are the values that we live and breathe.