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Branston deal a reminder of what a pickle Premier Foods has got itself into

October 31, 2012

Old food brands don’t die, they just get traded away. The latest to fall under the auctioneer’s hammer is Branston – sweet pickle, but also ketchup, mayonnaise and salad cream – which has been knocked down to Japanese relishes specialist Mizkan for £92.5m. It’s the second deal Premier Foods has done with Mizkan. Earlier this year, Premier sold its Haywards pickles business and Sarson’s vinegar brand to the privately-owned Japanese company for £41m.

Not so long ago, Premier was being billed as Britain’s biggest (indigenous) food company. That reputation has long gone, as the company struggles to placate an increasingly disenchanted City with a seemingly endless series of disposals aimed at tackling massive over-leverage (it borrowed far too much in the good years) and a burgeoning pension liability.

The finance boys, not to mention Premier’s new(ish) broom chief executive Michael Clarke (formerly Kraft Food Euro chief), are so chuffed at being ahead of schedule in reducing the debt mountain that they seem to have forgotten what the company is supposed to be about.

These days, the only media ripple Premier manages to make is when it announces yet another fire-sale. Last December it was Brookes Avana, its loss-making chilled food business, sold for £30m. Earlier in 2011, it canning business went to Princes (now part of Mitsubishi) for £182m, and before that, the meat-free business – commonly known as Quorn – for £205m.

In fact, so many brands have disappeared from the portfolio in the past few years that people must wonder what – if anything apart from trying to make money – the Premier umbrella brand stands for these days. Remember Gale’s Honey? Robertson’s Jam? Hartley’s? Chiver’s? Typhoo Tea? All once UK household names – now long since divested.

And more disposals are on the way. Bird’s Custard, for example. And even – if the price is right – the Premier bread business; that’s Hovis to you and me. Which, if I remember rightly, was the jewel in the crown when Premier acquired the old Ranks Hovis McDougall business back in 2007.

The talk in the boardroom is of scaling back to the unassailable fortress of Premier’s so-called “Power Brands”, of which Hovis is currently one (yes, that unassailable). The others are Mr Kipling, Ambrosia, Sharwood’s, Loyd Grossman, Oxo, Bisto, and Batchelors.

To the untutored eye, there’s nothing very “unassailable” about any of these, either. The Loyd Grossman business is unlikely to much outlive the celebrity of its founder. As for Bisto, Batchelors, Mr Kipling and Ambrosia, they are in – or moving towards – the brand museum category: famous items in the pantry a generation ago, but now confined to a dubious ranking on the health traffic light scheme featuring in your local supermarket.

Unilever and the likes of Néstlé, Kraft, Campbell’s and RHM saw the dismal future awaiting such brands long ago, which is why they first cut off marketing support and then disposed of them. Scavenging such brands may have made sense while borrowing costs were no object; and while the supermarkets were prepared to offer them a reasonable amount of shelf space. But they aren’t any more.

For these reasons, a big question mark hangs over Premier, its “Power Brands”, and the continuing viability of its business model.

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Buy an IKEA bed and have it away in Thailand. Promise

June 5, 2012

And now for something in the great tradition of Opel cars that break down, but only in Spain – and Pepsi Cola that brings your ancestors back from the grave, if you’re Chinese.

The IKEA Redalen bed, on sale in the global furniture retailer’s recently opened Bangkok superstore, is apparently a lot more seductive in Thailand than Sweden – Redalen sounding suspiciously like a word meaning advanced foreplay. Presumably, the bed can be bought in a job lot with the Jättabra plant pot, which appears to offer seventh heaven into the bargain. Bewildered Thais could not be blamed for attempting to invoke the local version of our Trade Description Act on discovering the products were not, after all, vested with mysterious aphrodisiac powers.

Product names getting lost in translation is an increasing problem for companies as the whole world becomes a potential market. Some other recent corkers:

The Mitsubishi Pajero: the car company noticed too late that pajero means “wanker” in Spanish. It was later renamed Montero.

When Sharwood’s spent millions of pounds launching a new curry sauce in 2003 called Bundh, the firm was deluged with calls from Punjabi speakers who said the new offering sounded like their word for “backside.”

In China, Microsoft’s search engine Bing sounds like “illness” or “pancake” when spoken in local dialects. Microsoft executives expertly changed the search engine’s Chinese name to biying, which also referred to a longer Chinese expression ‘you qui bi ying’, roughly meaning “Seek and Ye Shall Find.”

IKEA’s solution to the problem has been to employ a team of local Thai translators who purge the furniture names of stressful double entendres.


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