Salman Amin, CEO of pladis, shares his thoughts on the dangers of an Industrial Strategy that has too narrow a lens.
At the CBI Annual Conference on 25 November, pladis CEO Salman Amin will be a panel speaker to explore how the UK’s industrial strategy can unlock growth by making the case that UK manufacturing, in particular food and drink, is the backbone of the UK economy and its growth potential.
“It’s Time for Growth” is the well-chosen theme of the CBI’s Annual Conference in just a few weeks, which I look forward to contributing to alongside some of the brightest minds in UK business and government. Economic momentum is critical to renewing the UK’s competitiveness and unlocking investment. It requires a concerted effort across the whole economy from businesses large and small.
The Government’s economic growth narrative has so far focused on sectors categorised as technology and green energy. Their success is undeniably important to a sustainable UK economy and delivering forward momentum.
But a disproportionate focus on some industries at the expense of others – like manufacturing, food, drink and agriculture - risks penalising those that have continued to drive the growth of the UK economy for decades.
The key to growth is belief, partnership and innovation
Through its budget on 30 October, the government has asked business to make a significant growth downpayment by raising the cost of employment. This affects food and drink more than any other industry as the UK’s largest employer. It has also made the need for an inclusive industrial strategy even more important, because we cannot rely on only a small number of sectors to deliver sustained growth on behalf of the entire economy, let alone drive the UK to the top of the G7.
When I joined pladis in 2019, I believed passionately in its potential. We built a new growth strategy, backed it with investment, made tough choices, but crucially involved all of our team members. Since then, our revenue has grown by 50% and we are now one of the fastest growing snacking companies in the world when we benchmark organic net sales growth against global peers.
Our growth is driven by the same brands that have been in kitchen cupboards for many generations, made largely in the same bakeries that they were made in decades ago, using wheat grown on centuries-old UK farmland. Our belief in our brands, our supply chain partners and our people, coupled with our willingness to innovate and invest drove them to the next level.
Manufacturing remains the backbone of the economy, but it’s getting brittle
UK manufacturing as a whole generates 23% of our nation’s GDP, five million direct and indirect jobs and delivers wages 11% above the UK average. 47% of business R&D investment were made by manufacturers in 2022.
Food and drink is the largest UK manufacturing sector, employing 475,000 people and generating £38bn for the economy. This does not only come from larger companies like pladis but from several thousand small and medium-sized businesses across the length and breadth of the country.
What’s even more important is that UK food and drink delivers national security by partnering with UK farmers to use home-grown produce, and contributes to net zero by investing in regenerative agriculture and sustainable packaging solutions.
Bloomberg recently dissected what it calls a “two-speed recovery” in the UK, as the growth of technology and science industries has significantly outpaced that of other industries since 2019. Strikingly, the manufacturing and agriculture sectors contracted at -0.45 and -18.1% respectively during that same timeframe.
To truly grow, we must fly in formation
An industrial strategy that places bets only on emerging growth industries risks sustained decline in others and may result in part of the UK economy growing, only for the whole to stand still. Growth forecasts published by the Office for Budget Responsibility alongside the budget demonstrate that this is a material risk.
To truly deliver the UK’s growth ambitions, all businesses must be engaged in the race to net zero, the productivity drive and the push for higher living standards. This requires regulatory stability and true partnership for sustainability. Government can give businesses the tools to grow, but it can also take them away. When Government and business fly in formation, we make sure to create the right conditions for all businesses to grow, not just some.
About the author
Salman is the Chief Executive Officer of pladis, the leading global snacking company behind iconic brands, including McVitie’s, GODIVA, Jacob’s, Carr’s and Ülker.
Learn more at the CBI’s Annual Conference
Want to hear more debate and voices on how a new UK Industrial Strategy can unlock growth across sectors? Hear from our author Salman Amin, alongside other leaders in business and politics, at the CBI’s 2024 Annual Conference. We are proud to partner with pladis on our panel: ‘From no to grow: a new Industrial Strategy to unlock UK growth’. Find out more and book your ticket.
