Manor Fresh has put investment and innovation at the heart of its plan to boost sales and profitability over the coming year.
The supermarket potato and vegetable supplier this week reported six per cent sales growth to £58.2 million for the year to 30 April 2011, but pre-tax profits slipped from £1.46m in 2009-10 to £982,646.
Finance director Nigel Baker attributed the sales increase to gaining market share, but warned of the impact of input costs. He said: “Like everyone else, we suffer from cost-price inflation on anything to do with oil and we can’t pass that on. This has affected in-bound and out-bound logistics and packaging prices.”
Lower yields on potatoes, due to low rainfall and high temperatures in the summer of 2010, led to a shortage of high quality potatoes for the firm’s high-end retail customer. This significantly increased market prices, which in turn squeezed gross margins.
Despite the tough market, Manor Fresh has continued to invest in new grading and material-handling equipment at its Holbeach packing facility, which has helped manage labour costs, as well as providing English language and supervisory courses for its workforce.
In its directors’ report, Manor Fresh wrote: “The recession in the UK changed the way many consumers shopped for their food, becoming more price conscious and in doing so many elected to trade down to other retailers’ stores and within store to ranges with lower retail price points. Retaining and winning back these shoppers remains a key priority for Manor Fresh and its retail customers.”
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