Victorian SCALE: Bang up to the Elephant
Martin was out for a curry the other night with the boys from Boosh, Your Next Mortgage and The Implementation Coach. So I took the opportunity to put my feet up, enjoy a cuppa and watch The Great British Bake Off.
It wasn’t Mary Berry’s innuendoes of soggy bottoms, a good wobble and irregular-shaped balls that peaked my attention, but the story of Peek Frean & Co, the first mass producer of biscuits who employed over 4,000 people in its time from when it opened in 1866 to when it closed in the late 1980s.
Their fascinating story has some impressive SCALE lessons from the Victorian Age that I’d like to share with you. So get yourself a brew, a biscuit, and read on…
In 1821 three brothers founded a tea importation company, established as Peek Brothers & Co in the East End of London. By the 1840’s, the company was importing £5m of tea per annum. And by 1857 they expanded into the complimentary trade of biscuit making. With a quickly growing business, three years later they engaged the son of renowned Scottish milling and biscuit making family, Carr’s.
From the outset, the owner had his end in mind, enabling him to set-up his new business and a benchmark to measure his results against as he grew.
In 1906, the company commissioned a documentary, A Visit to Peek Frean & Co’s Biscuit Works, which illustrated the detail of every stage in the biscuit manufacturing process – delivery of raw materials, production of steam, moulding dough, baking biscuits, packaging and distribution. They achieved this on a mass scale thanks to the focus on the physical mechanics, machinery and factory workers.
Like many good employers of the Victorian age, the company developed an enlightened matriarch-like approach, giving many innovative benefits to its employees. At its Biscuit Town factory, as well as having an on-site Bank, Post Office and Fire station; employees and their families had free-to-use access to on-site medical, dental and optical services.
The original contracted hours were 68 across a Monday-Saturday double-shift pattern, but these were reduced from 1868 without a reduction in pay.
The directors wanted to ensure that the workers didn’t indulge in “virtuous pursuits”, and so formed the first of the company paid-for societies, including a cricket club, musical society, and athletic and dramatic societies. Staff magazines also brought together a vast workforce.
Post-World War I, they set up a tribunal, through which workers could freely express and debate their concerns. This resulted in the company giving its employees a pension plan, plus a week’s paid-holiday per year.
Peek Frean’s success was largely down to getting the clarity and congruency through the implementation of the right systems, formations, processes and people.
The company continued to do well producing, what were then, the established form of biscuit that everyone else was also producing – a hard, square, dry style suitable for storage. But this widely commoditised product was never going to reach their aggressive growth plans.
Whilst retaining their original positioning as a complimentary and co-marketing opportunity to the families tea company, they began introducing sweetened product lines and were the first in the world to do so. They innovated the market and were responsible for developing the Garibaldi, the Pearl, the first ever chocolate covered sweet digestive, the golden puff and not forgetting the Creola, now known as the Bourbon. They even introduced us to the Cheeselets and Twiglets.
Among biscuit manufacturers today, Carr is still a demi-god: the first person who succeeded in making an industrial biscuit that was not tooth-shatteringly hard.
The firm knew they could not achieve their end goal if they continued to mass produce the same as everyone else. This alerted them to think of new strategies and innovations before it was too late to change.
Frean had already learnt that “Me Too” was a route to failure. And thanks to new product and market innovations they started exporting biscuits to Australia and agreed to fulfil an order from the French Army. The French Government ordered a further 11 million sweet Pearl biscuits in celebration of the end of the Siege of Paris. The consequential consumer demands of emigrating French expatriate soldiers allowed the company to start exporting directly to Canada.
With all this success came the inevitable: the expanding business needed bigger premises. Carr bought into the business by exchanging shares for the 10 acres of market gardens. Commissioning a new integrated factory, its resultant scale and sweet-emanating smell resulted in Bermondsey gaining the nickname “Biscuit Town”.
James Peek died aged 79 and Frean retired in 1887. The family exited and had nothing more to do with running business. Peek’s nephew became the first chairman of the now publicly listed company in 1901, but on his death again the Peek family had nothing more to do with managing the business. James Carr’s family remained actively associated with the business for several more generations.
In 1924, the company established their first factory outside the UK, in India and in 1949 they founded their first bakery in Canada which still today produces Peek Frean’s branded products.
A remarkable example of SCALE from start to finish, and inspiring to see the heritage of a British Victorian brand living on today thanks to a well-constructed expansion and exit strategy.
And to end on a quote from The Young Ones: “It’s quite interesting, you know, the number of biscuits that are named after revolutionaries. You’ve got your Garibaldi, of course, you’ve got your Bourbons, then of course you’ve got your Peek Frean’s Trotsky Assortment.”
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