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Pars Food Limited

Pars Food Limited is one of the market leaders in the UK frozen food industry, employing
approximately 400 staff and operating from different production facilities within the UK. A
privately owned company (Ltd.), Pars Food was founded in 1950 by John Clapham whose
sons, David and Darren are directors within the compan y. At a corporate strategic level the
board of directors consists of six main shareholders; John is the major shareholder and
Managing Director, his sons are also directors and between them they hold 40% of shares.
There are three further shareholders, also directors, who control the other 60% of shares
within the company. Pars Food Ltd. generates annual sales turnover in excess of 150m.
Their product range includes pizzas, snacks, ready-made meals, soft drinks and desserts,
although their main revenue streams come from potato based product ranges.

Their products are sold direct to restaurants and also to supermarkets throughout the UK. Pars
Food Ltd. also own and operate their own distribution and transportation division with 40
lorries / trucks in different sizes, which provide general freight, distribution and warehousing
services across UK. The headquarters of the company is based in Bradford. The
manufacturing, operation, sales and marketing facilities are located in Hull. All
manufacturing operations including the supply of raw materials, production, storage and
delivery operate out of the Hull site.

Pars Food Ltd. has a number of Core Values and a Code of Conduct which underpins their
actions, decisions, behaviour and strategy. Their philosophy Pars Food, Its All Good is
significant as it has shaped the culture of the organisation.

Core Values
To work every day to make our customers and consumers SMILE
To value continuous improvement in our people, our products and our business
To cherish the Can Do spirit; Trying but failing is okay, failing to try is not
To dare to be different; New ideas, innovation and differentiation matter
To value teamwork and the sharing of ideas
To win market by market, and create advantage by leveraging our global scale
To believe that honesty, integrity and fair dealings are integral to our success good
ethics is good business
To recognise the diversity of our environment and care about our staff, their
families and their local community
To have pride in our heritage and our reputation as a family business

Code of Conduct

The Code of Conduct explains the standards of behaviour that the organisation expects from
all of its employees. It demonstrates their commitment to lawful and ethical conduct across
their business and throughout all their decisions. Pars Food Ltd. is very proud of their
reputation within the industry which has been developed for more than 60 years. They
constantly strive to ensure that business is conducted in the manner of their founders with
honesty, integrity and fairness. By adhering to this Code of Conduct the business has been
able to grow and innovate successfully. They believe strongly in the principle of ethical
business to allow them to achieve their goals in an increasingly competitive marketplace in
ways that build trust and respect.

Strategy and Vision


Their business strategy is designed to drive sustainable, profitable growth. The vision is to
grow Pars Food Ltd. by producing products that their customers love whilst contributing to
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the wellbeing of all stakeholders. This will be achieved through the commitment of their
talented workforce who have a significant stake within the organisation and who are actually
creating their future, today.
Aligned Organisation - Their employees are the heart and soul of their strateg y. They
develop people as leaders at all levels of the organisation and support them as they
pursue the possibilities that will deliver on their vision. They never lose sight of
what's unique and important to each of their customers and consumers, but they act as
one on common priorities and coach each other on what is missing to make a
possibility a reality.
Competitive advantage and differentiation - Delivering good food made with an
attention to quality and safety at good value to their customers and consumers around
the world is their path to growth. Their supply chain is transforming to become a
model of resiliency with the capacity to serve their customers from anywhere they are
located. Standing out from the pack is no easy feat, but Pars Food Ltd. aims to do just
that by investing more than ever before in science, technology and market insights to
develop further innovative products that serve a particular need in society (niche
market) or that simply satisfy a craving for good food.
Valueadded Products Their aim is to be more global and attract more customers
from Europe. In order to do this they must be more innovative and develop a platform
of globally attractive food products that can leverage their knowledge in retail and
foodservice and their supply network.
To summarise, their strategy is built on their philosophy of Pars Food, Its All Good. They
believe that with the right staff producing excellent food products from good ingredients
which their customers enjoy they will be able to grow the business for the future.

Products
Pars Food Ltd. is the UK largest manufacturer of frozen potato products, but their product
range does not stop with potatoes or frozen French fries. They also offer hundreds of
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other products, including appetizers, pizzas, frozen vegetables, beverages, ready-made meals
and desserts which are found in many restaurants and food retailers.

Customers
Foodservice: The Pars brand can be found in the most challenging of kitchens. They
supply quality frozen food products to quick service restaurant chains, as well as
casual and fine dining rooms, institutional and catering customers. All products have
to meet the uncompromising specifications of their customers.
Retail: Their convenience foods appear on grocery shelves in almost every retail store
throughout the UK. Their products are prepared simply with wholesome ingredients
made by conscientious, well trained staff that care about delivering quality in every
box, every bag and every bite.
They deliver directly to restaurants, retailers and also some wholesalers in the UK. They plan
to expand their market to other European countries and increase the number of customers
including restaurants, wholesalers and retailers.

Suppliers
Pars Food Ltd. uses a number of different suppliers within its business including:

raw material suppliers (e.g. potatoes which are grown and supplied by UK farmers),
ingredient suppliers,
equipment suppliers,
Soho Transport , a 3rd party logistics (3PL) company who deliver potatoes to the
Hull processing plant, and finally
Consultancy and training organisations to provide some advisory and staff
development services.

Long Term Objectives


1- Establish the company as a public corporation (PLC) within next five years .
2- Increase market share by expanding their market to Europe.
3- Reduce operation costs by minimising waste and cost of poor quality.
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4- Improve the quality of both products and services to achieve excellent customer
satisfaction and zero customer complaint.
5- Increase product range
6- Invest further in staff, equipment and storage.
7- Become more environmentally and ethically sustainable.

Short Term Objectives between 1st Oct 2012 and


31st March 2013
1- Add the authentic and luxury new product as Pars Chilli Pepper Cheese Nuggets in
1 kg bags to their product range.
2- Add the value pack of the Pars Seasoned Twisters in 1 kg bags to their product
range.
3- Buy some specialist potato transport lorries to reduce their reliance on outsourcing.
4- Implement Total Quality Management (TQM), a culture of continuous quality
improvement in the company to involve everybody in quality and customer
satisfaction throughout the organisation.
5- Get accredited by ISO9001 for standardisation in service and production
6- Purchase a new cutting machine to be used to manufacture the Twisters with value of
300,000.
7- Increase the number of full time staff on the shopfloor (operations) and in the sales
and marketing department by a further 25. Increase the number of part time staff on
the shop floor (operations) and in in-bound transport by a further 30.
8- Reduce the environmental impact and improve the health and safety of staff.
9- Find new sources of finance for the purchase of additional equipment and to build
additional storage facilities.
10- Promote lean and agile operation
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Operations
The key operational activities in Pars Food Ltd. are sourcing, purchasing, manufacturing,
packaging, storage, transport, sales and marketing, administration, finance and accounting.
The purchasing department deals with farms, Soho transport, raw materials and equipment
suppliers. The manufacturing, packaging, storage and transport department has 10 different
production lines, working 24 hour shifts with 280 full time and 20 part-time employees. Most
of the production line capacity is used to manufacture frozen chips but other products are also
produced in the same factory.

The Production manager is Jack Holmes, a young engineer who has been employed by the
company for two years. He is an ambitious manager who had three years previous experience
of working as a production engineer in a ready-made meal food manufacturer in Scotland.
His main duty is to manage the production and packaging teams. A simple flow diagram
below illustrates the supply chain and manufacturing process of material involved in
producing frozen chips.

Supplying
potato

Blast
Freezing

Metal
Detecting

Sorting

Quality
Check

Half
Cooking

Washing

Quality
Check

Packaging

Inspection

Peeling

Cutting

Storage

Transport

The company is currently outsourcing all of its raw material through outside transport and is
considering using its own transport for sourcing the potato in the future. The board of
directors is really concerned with quality, cost and reliability in its supply chain network from
the initial sourcing of the material to final delivery of the goods to customers. The level of
rejection in quality inspection and quality check for frozen chips is high and they would like
to reduce this.
Jane Williams is a food technologist who is in charge of quality control in the company. She
is a young graduate from university with just two years experience of research flow whilst
working at a laboratory for Kraft Food in the USA. Pars Food Ltd. would also like to
improve their performance in JIT (Just in Time) delivery and increase their agility in their
delivery to customers. Craig Calpin, an experienced logistics manager of 25 years, leads a
team of 50 warehouse and transport employees. He is constantly complaining about the lack
of capacity in freezers for all products and the monthly report for the last few months
indicated a high level of fluctuation of stock in storage. There has been a surplus of Stake
Cut Chips (thick cut), suitable for Fish & Chips shops and restaurants, left in the storage
for more than 2 months with very low selling opportunity. Craig has also asked for a detailed
assessment to be conducted prior to building the new proposed storage for products so that it
can be aligned with potential future production and sales volume.
A further issue in the whole operation process is a lack of standard procedures in the
organisation which makes standardisation across the company difficult. Maintenance costs of
outdated machinery have also increased. Marian Holmes, a senior office manager with 20
years experience has been faced with staffing problems due to the increase in administration
as she only has 5 staff.
The purchasing activities, including buying, negotiating and supplier selection, are led by two
of the directors who have five senior experienced buyers working with them. Their
responsibilities are to find appropriate suppliers, deal and negotiate with them, liaise with the
production, marketing and finance departments and finally to identify alternative supply
sources globally.

Marketing
The sales and marketing team consists of 20 people who are managed by Philip Jones, the
marketing and sales manager. The employees are involved in telesales, advertising, website
design and six of the team are regional marketing executives. The marketing departments
main ambitious objective is to increase their market share within Europe, especially northern
European countries, within the next two years. They have already been working with quality
management and the production team to develop five new products for the future. They have
just launched the Pars Chilli Pepper Cheese Nuggets and Pars Seasoned Twisters to
appeal to two different segments within the snack market, the former to appeal to a basic
market and the latter a more luxury market segment.
The department have asked for additional funding to support their plans and also an increase
in their budget for advertising and new product development. They have recently spent
50,000 on advertising these two new products and have asked for a further 100,000
advertising budget for next year.
The marketing team is also working on developing new software as part of their Customer
Relationship Management (CRM) policy. This will store all possible information from
customers including their personal details, their shopping habits, any feedback they have
previously given regarding Par Foods products and even identify products which customers
are currently not buying with a view to using this information in future marketing campaigns
and promotions.
The company would also like to conduct research into the organic food market as a possible
future growth area. They first need to investigate the wider implications of this both from a
legal and an economic perspective. Before they enter this market it is necessary to identify
potential / actual risks and benefits of the strategy for their business and the wider
environment. (Social, Economic, Environmental, Technological).

Human Resources

The HR department consists of five people including Zoe Robertson, the human resource
manager who is the head of the team responsible for recruitment, performance management,
personal development and training, staff payroll and health and safety of staff. This
department has been instructed by the board of directors to reassess current HR practise and
procedures and implement a new HR strategy to ensure that the company can meet its
objectives.
The department needs to recruit some operational consultants

for TQM and ISO9001

implementation for production lines.


Zoe has already interviewed some internal candidates and is looking to advertise to attract
further potential external candidates for interview.
The department is also considering implementing a number of staff development and training
courses. These include:

ISO9001 training for all senior managers and line managers.

Food hygiene training for all production staff

Customer service training for the administration, sales and marketing teams.

It is hoped that these training initiatives would improve the efficiently and effectiveness of all
staff within the organisation and thus improve customer satisfaction and profitability. The
department is also concerned about the well-being of its employees and wants to review its
health and safety policy and generate new health and safety risk assessment criteria for all
production staff to follow with a view to improving safety within the workplace.

Finance
The finance department consists of six people involved in accounting, financial monitoring,
performance measurement, taxation and anything related to money and cash flow. Keith
Stevenson, the finance manager is investigating into possible sources of finance to the build
the new storage facilities and also to purchase some new equipment and machinery for the
production line. The board of directors has asked him to find the best possible source of
finance for the company taking into consideration the current situation of the business.
The total estimated costs are detailed below:
Item
Land Purchase
New Storage Facilities
New Equipment and machinery

Proposed Costs
1,500,000
800,000
600,000

A recent performance measurement and cash flow analysis indicated that although, the
business is in a satisfactory position, net profit is very low and there are concerns that their
current poor financial performance may affect the ability of company to go ahead with its
projects. Therefore, it is vital for the company to find appropriate and reliable sources of
finance, which also align with objectives and strategy of the company.
The company wants to be financially viable both now and in the future. In order to fund their
future plans they are looking for sources of finance which are flexible and cost effective.
They wish to avoid at any cost the need to down size or make redundancies.

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