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PROFILE: Chris Honer, BCG
10 September 2008

The Wolseley head offi ce in Leamington Spa is big - very big. Often, UK warehouses tend to be billed as large but look like garden sheds next to European equivalents but not so with Wolseley. Mostly automated, the distribution centre is 330,000sq ft but on top of that the complex also includes a large office building and the new Sustainable Building Centre.

Wolseley is a huge global company and in the UK owns and operates well known names such as Bathstore, Plumb Center, Brandon Hire and - the reason kbbreview is waiting in the spacious reception - BCG.

Probably best know as Broughton Crangrove, BCG is an historic amalgam of fi rst Crangrove in 1980, Broughtons in 1998, and then Galley Matrix in 2003. In 2006 a new management team swept through and cleared 98% of the sales force, essentially starting the company again from scratch.

That team included sales director Chris Honer, who has now stepped up to md following the amicable departure of Paul Theobald. The restructure has included new measurable targets, stricter customer service, and a focus on key accounts. It has also led to a renewed interest in bathroom products and, for the first time, an own brand range called Smart 4 to encompass both kitchen and bathroom. This month BCG launches its biggest ever 'Big Tour', a roadshow of events aimed at retailers.

So what are Honer's plans for BCG now he's got the big chair, and how does it fi t in with Wolseley's overall vision...

Does your appointment as md mark the end of the restructuring BCG has gone through?

Not really, this wasn't planned like that. Paul Theobald [former brand director] came into this business about two-and-a-half years ago - virtually at the same time as me - from outside the kitchen and bathroom industry and I think that he set the foundation. But he's the type of person who likes to do that and then move on, so we always knew he'd probably leave - he's still with Wolseley though. So for me it's a role that I wanted but it's come about probably 12 months earlier than I thought. There's been a gradual handover for the last six months. So it's more about the start of a period of stability.

In the last 18 months you've had a name change and a purge of staff.

Yes, we've gone away from being quite a schizophrenic business with three trading names and five registered logos to one coherent message. There are two things you can do in a business - if you develop processes more than people you get one result, and if you develop the people side more than processes you get another. What we've done in the last two years, and it culminated in the name change in September last year, was develop both sides. So we've been bringing in robust processes behind the scenes that enable us to offer service and availability and at the same time introducing key people. We've had a 98% attrition rate in our sales team and we've gone out and chosen the sort of people we want to work with - both from within and outside the industry.

Swapping your entire sales team is pretty radical. Does that not affect relationships with customers?

That's where the process development comes in. Our mantra is service through availability but behind the scenes of that are strong relationships. The guys that were out on the road before had ok, mediocre, relationships and there was a lack of direction. We treated every customer the same so someone who only sold the occasional thing was treated the same as someone who gave us all their business. There's only a certain calibre of salesman who can segment their customer base and be a chameleon between trade counters, small husband and wife kitchen retailers and top end pristine studios. I truly believe that the 18 guys we've got on the road now are all like that. It took a bit of time, I started the process in March 2005, and we've had a full sales team since November 2007.

BCG is big, Wolseley is massive; do your independent retail customers need to know that?

I come from an independent background, with relatively small distribution companies. So I wanted to make sure that, as a national business, we would have the regional touch and feel. Distribution in the UK is a service proposition first and foremost, so when the customer phones up it doesn't matter if we're not round the corner as long as we answer the phone correctly and politely, we fulfil their requirements, and deliver it the next day - it  doesn't matter where it comes from. The fact that it's there is the key and the same driver makes every delivery.

The next-day delivery aspect of distribution now means that very few retailers keep stock. Does that cause headaches?

Working capital is everybody's bugbear at the moment but many of our customers really aren't that organised. So there's the rare customer who's very slick and can order and invoice online and book and guarantee his stock. Then we've got the guy that thinks 'oh my god, I forgot that range cooker and I'm fitting tomorrow' and that's where we beat most of the competition as we can get a cooker from Cumbernauld to Bournemouth the following day. That's where the science of logistics and supply chain come into it.

What's the plan for own brand product?

At the Big Tour we're launching a range of own branded vitreous china to complement our existing proprietary brand Ideal Standard. So Ideal Standard is still the main focus for us but below that we need to have an own brand offer where we can develop our own styling and our own furniture too. So we're going to encompass that into a new image and new business called Smart 4, as in Smart 4 Bathrooms, Smart 4 Kitchens etc. We're looking at kitchen furniture too, we currently work with Sigma 3 but it's a rigid kitchen offer. My strategic objective for 2008/2009 is to grow market share profi tably, we're currently at number three in the market with 11%. We can only do that by looking at what we've got and we have a void in own brand sanitaryware and fitted kitchen furniture.

A lot of your competitors have gone down the own brand route a lot earlier than BCG - you're a company that has always insisted it is a major brand distributor.

It's safe to say we're probably last out of the blocks, but that's not necessarily a negative. Because we're part of Wolseley we've researched the market extremely well. If you look at some of our competitors' own brand products there's only two or three that are actually working in showrooms. So we're utilising European sourcing and all the experience of Wolseley to launch just at the right time. The Big Tour is really the start of it.

You're the ones taking the orders every day and are therefore an immediate measure of the state of the industry. How's everybody doing?

The strange thing is that I can pinpoint exactly when this downturn started - half term week in May. Everybody is struggling and everybody has seen an effect. But the last time this happened in 1991 I was a salesman working for a very proactive business that grew market share in the downturn and that's what we intend to do. This downturn was sudden, but we did expect it because we measure everything everyday and we could see the call rate, fax rate and picking rate turning.

This is being called a 'credit crunch' and your business operates on credit, have you seen any problems?

Yes. This goes back down to how we treat our customers. We know the ones that are very loyal to us and we can trust. Are we asking for the money more firmly when it's due at the moment? Yes we are, but that's not too much to ask. Having said that, because of the development we've done we've put credit control as a sales function so when a customer is placing an order we can very quickly check the credit limit. We haven't seen a great deal of legal problems just yet - usually you can tell the retailers that are going to get into trouble before it happens.

Wolseley has been having its fair share of problems thanks to the economic downturn. Has that directly affected you?

I'm not going to comment too much on the parent company, but Wolseley UK is robust, it outperformed the rest of the company so it's doing well. We leverage as much as we can out of the group but we're very much an independent business within that framework. Will the global picture affect us? No, I don't think so. We were in a turnaround in 2005, that's gone full circle and we're now on a growth surge.

BCG Origins

1980: Crangrove established in Worcester as a Wolseley Company to distribute Nibco fittings

1990: Develops into a 10 branch network

1998: Crangrove acquires Broughtons, a national distributor based in Accrington, Lancashire

1999: Broughton Crangrove forms and the merged business re-structured to regional distribution company operating from Burnley, Worcester and West Horndon

2003: Acquisition of Galley Matrix, a St Albans-based specialist in appliances, furniture and sinks

2004: Broughton Crangrove and Galley Matrix merged and relocated to new Burnley offices

2006: New management team brought in

2007: Name changed to BCG