E060 - James Perry from Cook

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Welcome back to the Green Element Podcast. where we feature business leaders and innovators transforming their operations to be more environmentally and socially sustainable. I'm your host, Will Richardson, and I can't wait to meet our guest today and help you on your journey of sustainability. James, thank you very much for joining the Green Element Podcast. You're the CEO and founder of Kut. You make frozen ready meals and you make them with a purpose. It'd be great to understand more about what it is that you do at Cook and yeah, the kind of what, how Cook works, please.

Yeah, sure. Well, it's good to be here. Actually, I'm not CEO of Cook. I'm co-chairman and I was CEO until 2008, but now the business is run by my sister Rosie Brown and my brother Edward Perry, but we sort of work together quite closely on developing the business. We started in 1997 with the idea that we could make frozen meals using the same ingredients and techniques that a good cook would use at home. And it took us a while to figure out how to actually make the food. And then it took us even longer to work out how to run a business and how to make a profit. And then it took us even longer than that to get out of debt or too much debt. And we had the financial crisis in the middle of it. So our story is really one of being a small group of people with a kind of ambition which was a bit more difficult than we gave it credit for at the beginning.

And did you start off with a view to be making frozen ready meals and selling them to the general public? Was that your initial offering?

So we started with 2 shops and a kitchen, and the whole idea was that we wanted to create something that was free other people's control, and the 2 people we thought were most likely to be able to control us were either investors or, on the other hand, our customers, because the route to market for our product was the supermarkets. And so we decided not to sell to the supermarkets, which meant that at the time the only thing we could think of to do was to open our own shops. So we opened our own shops, we started manufacturing, and we went from there.

That must have been really hard to find the customers within your local geographic area. Because you're not using the normal route to market by using supermarkets.

Yeah, a frozen ready meal shop was a novel idea, and most people we spoke to told us we were mad, and they told us that you can't be a retailer and a manufacturer, you've got to be one or the other. And what we found when we started was that they were right, in that getting the sales to a level that was viable took quite a long time. But we were lucky because we started in some really good towns. Our first shop was in Farnham, which my brother Edward opened, And Farnham was a terrific town, and he just was in that shop driving that business personally for years in order to get the sales up, to figure out how you could get enough money through those tills, through that till, to create a viable business. And it definitely didn't happen overnight.

And you've got a really unique way of employing people, and with your mission and purpose around Could you tell us a bit more about that, please?

Well, should I just go one step before that, which is the sort of whole idea of purpose in the business?

Yes.

In some ways, how we employ people is a kind of outworking of the purpose. And, you know, when we started, we definitely had this idea that one of the reasons we wanted to be free was so that we could do things that a conventional profit-maximizing business might not do. And yet in the struggle to make the business work, on a commercial level, we had to kind of put all that stuff on the back burner. And then when we had a very near-death experience in the financial crisis in 2008, where we very, very nearly went bust, and we sort of had to throw everything overboard unless it was nailed down, we had too much debt. When we came out of that in sort of 2010, 2011, we had this kind of conversation again, me and Ed, saying, let's just remind ourselves, why are we doing this? And we had this purpose conversation then. And in some ways we'd been going then for 15 years, you know, pretty much. And it wasn't until we'd been going 15 years that we were really able to have a big conversation about purpose, because the first 15 years we'd been trying to be nice employers and stuff, but we weren't able to really do much more than put all our energy into making the business work itself. So then in 2020, sort of '12, 2013, we started having a much bigger conversation with purpose and that led to a whole process and a whole kind of rediscovery of why we were doing it, which is still going on now really.

And have you found that's made an impact on the business?

I think it's transformed the business.

Right. And is that through staff, through customer acquisition, or a bit of everything?

I think it's one of those things that's still permeating through the business and we're still learning what it can mean and it's exciting. So, you know, right at the beginning we went through a process, very simple process actually, to understand what our values were and we came out with 5 core values the business kind of had already, but we sort of formalized them and then we celebrated them and we built on them and we now, you know, they're a really core part of how we run our business. And from the values, we then started having a big conversation about purpose. Why are we doing it? I mean, on one level, we're just a ready meal company, you know, and in some ways, can a ready meal company be a good thing? Maybe the world would be better if there weren't ready meal companies, you know. And we started really having that conversation. And, you know, what we learned was that, yes, we do believe there's a role for a company like ours. But we sort of— the answer to the big question of, you know, do we have a kind of Are we— can we be a force for good? Really became— came down to how we do it, how we employ people, how we manage our supply chain, who we buy from, where we source from, what types of recipes we create, you know, how we market it. The full— every single touchpoint the business has, which is literally millions, needs to be put through that filter of what the purpose is.

That's really interesting. What would you say your business superpower was?

Well, I know what we aspire it to be, to being. I'm not sure we have a superpower. We're hoping to develop them. I'm not sure they're things you can develop. It took us a while, like, why are we doing this? Because on one level, our kind of commercial purpose is to make the best ready meals in the world or something like that. But actually, that isn't why we're doing it. The reason we're doing it and where we really— and it took a lot of soul searching— is our purpose statement, which is to nourish relationships. Our purpose is to nourish relationships. So I hope our superpower is nourishing relationships. I think that's a work in progress. I think some people who have experience of our business will tell you that absolutely we have that superpower, and some people I'm sure will tell you that absolutely we don't. But our goal is to nourish relationships.

Could you tell us about how you engage your staff, suppliers, and customers with your mission and purpose?

Yeah, and we are still— again, we're still on that process of it's like a waterfall, you know. We started with ourselves, like, as an ownership group. You know, really the conversation started with me, Edward, and Rosie saying, have we lost our purpose? Do we mean it? If we mean it, what does that mean? We became a B Corporation in 2013, which was an absolutely massive milestone for us, really unlocked a lot of good things. And then out of that, you know, the conversation around the values, the actual what is our purpose, we landed on nourishing relationships. Then we've redrawn our business strategy So that we have 4 pillars of nourishing relationships, which basically involves every single part of our company. Then it becomes, you know, so through that process it becomes about enrolling the leadership team, enrolling the senior management team, and then the more middle management team, and then right down to the shop floor and getting absolutely everybody understanding what we're trying to do with the business. And that's still a work in progress. You know, we've got a supplier conference now. We've been running it for 3 years, and we would say we're on sort of year 3 of a 7 or 8 year program to get it to where we want to get it to. Because it's about creating a different kind of environment where different kind of conversations can be had, where people can have real trust and really understand that this isn't just about selling more, getting higher margins, negotiating on price, whatever. This is actually about going on a journey together to explore a different kind of food system. That's a really big conversation. You can't get from nowhere to that in, you know, one year or one event. You have to kind of go through a process, and that's kind of what we're in. So it's at varying different speeds with very different parts of the business. The employees is further ahead. We've done, you know, 5 years of amazing work, and it's incredible what's happening now with our employees. But I just still feel we've got a lot further to go.

I think we all do, don't we? And when it comes to running an ethical and sustainable business, what would you say your biggest struggle so far has been and how you've overcome it?

Well, we've been fortunate because we've been in a good growth phase since the period where we really kind of came out of the financial crisis of 2008. So to say, from about 2010, 2011 to now, we've had a really good solid period of growth. And as a result, all of our key indicators have been going in the right direction. You know, we're more profitable, we're selling more, we're hiring, and that means that it's been relatively easy. We had a slightly more difficult year last year than we're used to for one reason or another, and we didn't grow quite at the speed we had been. And what was interesting was that that created a lot of challenges because, you know, when you start coming under budget pressure, Then that's when the difficult conversations need to happen. So, you know, we've had a difficult one some years ago where, you know, we wanted to pay our first dividend and we weren't paying a living wage. And that conversation came up and it's like, well, we just don't think we can pay a dividend whilst we're not paying everyone in the company a living wage. So you end up sort of budgeting to pay the living wage rather than budgeting to pay a dividend. And that's not necessarily an easy conversation, but— But, you know, everybody's kind of— when you're in growth, you can sort of do those trade-offs because you can see that next year you'll be able to pay your dividend in a different way. You know, it's a much more difficult conversation when it's an absolute conversation. It's like this or that. And what we're learning is, again, it's all about nourishing relationships. You've got to have conversations, you've got to understand the different needs and compromise and try and meet them all. And then latterly, we've had kind of coming into our world Obviously the climate emergency, which everybody's, I think, really waking up to. We've certainly had an awakening, I think, in the last 12 months. And that's leading us to ask some really searching questions about what we're doing and whether it's okay and what we should do about it.

And what sort of things are you doing to reduce your environmental impact and your carbon footprint of your business?

Well, I mean, the 2 things we've done, the first thing we did was the easy stuff, Like, that's the obvious thing to do. And the easy thing to do, the obvious and most easy thing to do was to start using renewable energy rather than fossil energy, which meant that our carbon footprint across the business could be nearly halved overnight. And obviously it costs a bit of money, but that's a lovely thing to do. But actually, you know, what we need, if we're really serious about this, we need to look at every single part of our business, root and branch. You know, the business wasn't designed in the context of a climate emergency. So there are things now that we designed into the business 20 years ago that you wouldn't design in now. And we just have to look at that, we have to change it. So obviously moving to recyclable packaging has been a massive thing. It wasn't available, you know, we've been very— I mean, one of the nice things, it wasn't available to us when we had the conversation 3 years ago, and it kind of is now.

It changes almost overnight, doesn't it? Particularly the packaging and this kind of stuff.

It's not an excuse actually, but one of the things that we've been challenged by is that we don't live in a vacuum and we do rely on a packaging industry and the packaging industry can't supply us with anything renewable. So like, what do you do? And you lobby government because actually there is stuff that can be done, but the whole industry needs to move and the whole industry doesn't want to move and we're just a tiny part of a much bigger industry. So, you know, you get into those conversations and I don't— and I think it's easy to make excuses. bite through that. And I don't think— I think what we're learning through the climate emergency is that's not good enough. You've just got to do what you've got to do. You can't rely on other people. So fortunately, with that particular issue, the industry has moved, and that's meant that we do have a relatively easy escape. We can move into recyclable packaging. But actually, there's a much bigger question, which is, what about packaging at all? Like, packaging is, you know, recycling is not— if you look at the hierarchy of things, you know, the best thing is not to need it, not to use it in the first place. Resource usage. So recycling plastic packaging is quite low down that hierarchy. So like essentially it's about getting higher up that hierarchy and what we've learned in terms of the big picture is to talk to experts and to embrace science-based targets because when we look at our entire business, our entire footprint, it's interesting that the things that have the biggest impact are often not the things that you would immediately think about, but when you look at the data, it seems that there's a whole bunch of things we can and should be doing which we wouldn't have thought about if we hadn't looked at the data. So basically take a data-driven approach.

Yeah, I think that's really, really important. Um, have you signed up for the science-based targets? You just mentioned them.

Yes.

Yeah, yeah, I absolutely love the science-based targets. I think that it is such a great way for all businesses to work together on a global scale of, you know, trying to get, you know, your emissions to the same level and getting to that 1.5 degree. We, Green Element, signed up. I think we were talking to CDP. I think we're the smallest company in the world to sign up a team of 8 and remote working.

Incredible.

But once we did it was because we wanted to say, look, if we can do it, It is absolutely possible for anyone to do it because, you know, we've got people working all over the UK in different places, you know, at home or in different work offices. And so it's, yeah, if we can get everyone to do it. Can you tell us a bit about how you approach your environmental management? I mean, is it, do you have monthly, quarterly, do you have targets that you're trying to achieve within this? SBTI, the Science Based Targets Initiative, do you actually have milestones to reach and do you tackle particular projects at one time or how do you do it?

So we're literally in transition because in the past it was very much like the business functions would get on with it. So the food function would plan the menu, the operations function would plan how to make the food. The logistics function would plan how to move it around. You know, the retail function would work out how to sell it. The marketing and comms function would work out how to market it and communicate it. And then the environmental or sustainability team would work out how to be sustainable, you know, and that was kind of slightly how it worked. And what we're doing now is we've brought the whole challenge into a much more central place within the strategy.

Hmm.

So that, you know, if we were about nourishing relationships, It's not nourishing our relationship with our environment and the beautiful planet we live on if we're destroying it. So like, if we're serious about nourishing relationships, actually that issue becomes everybody's problem.

Mm-hmm.

So it gets into a really different mindset of, for example, you know, we sell— a large proportion of what we sell is meat-based food. We've been on for the last 3 years on an intentional drive to increase our vegetarian and vegan sales, and that's been going really well. And, you know, we have a program called Meat Free May, we've actually— it's one of these we've been targeting. But the question now becomes, is it enough? Is it too slow? And when you look at it in the context of science-based targets, then you see that actually if we're able to change our sales mix, it's one of the most powerful things we can do. Whereas I think 2 years ago, the food team wouldn't have dreamt that what they put on the menu was a sustainability issue.

Yeah. Is there any advice or learning that you can share with people listening to this podcast?

Well, I think when I think back at what we've done, I think that the single most important decision we took was to remain free to pursue a broader agenda than just maximizing our profits. And that meant we didn't take venture capital, which was the obvious thing for us to do. And one of the reasons why we very nearly went bust and actually struggled to grow so much in the early years was because we were just so broke all the time, and we were doing everything on debt. And so whenever we thought, oh, you know, we can afford a bit more debt, we'd borrow more money. And as soon as the bank was willing to lend us more money, we'd just take it, buy a new brat pan or buy a new freezer or something, or buy a new shop. And it was all on complete credit card craziness. But what it did do is it meant that we don't have a set of shareholders who've got a bunch of controls over us, which forces us to make more money. And we've been very careful to guard our share register. and the ownership of the company so that we only really involve people who are aligned with our broader goals. Because my view generally of this stuff is when a company starts to be successful and financially successful, then the shareholders start to see it as a financial investment or a finance— almost like a financial instrument. And they all— all the purpose stuff is all great and lovely and terrific as long as it doesn't bump into the money. But the minute it bumps into the money, forget it, because there's only going to be one winner. And we— I— so my main piece of advice to anyone serious about doing this, because I think all of the purpose stuff— anyone listening to a podcast like this is going to learn so much from all the incredible people that you're talking to.

Yeah.

I don't have— I don't think I've got anything particular to add to those people. I think they're all brilliant. I love listening to them and we learn from them, you know. So the one unique thing I could sort of say with real passion, because it's something I believe deeply, is retain your freedom from misaligned investors or investment or capital providers, however you can do that. And it's not easy, and it's not easy.

I think that's a really, really important piece of advice. We've got another— we've got a software company, and our advisory board, we particularly chose people on there, and when we spoke to them, we said, by the way, Profit is not number one. It is up there, but actually driving purpose and driving us to get, you know, whatever you're wanting to achieve is the most important thing. And they came on board knowing that actually that was what we were initially doing. And I think what you've just said is so, so, so important. I think what you've achieved by not getting investments and going, being, having it so hard in 2008 through '13, I think is testament to what it is that you've done, and it's really, really nice to hear. You're probably like, yeah, it's nice to hear now, but you don't understand what we went through. It was horrendous.

Yeah, I lost my hair. But we learned a lot, and there's no substitute for having— necessity is the mother of invention. The other thing actually is, aside to keep your ownership aligned, is actually make money. You know, a lot of purpose-driven business people can sometimes not put that as a high enough priority. If it's a business, it has to make money, and it will become stronger if it makes money, and your purpose will become stronger if you make money. Making money is not a bad thing as long as you do it in a way that's aligned. So don't be shy to make money, but try and be profitable. Because then you don't need all these other capital kinds.

It's one of the things I like about B Corp is the fact you have to be a limited company. I think it's so important, so important that you have to be a limited company because it just shows that what you've just said is, is high priority and sits in with what you're saying. What were you doing before, Cook? How did you end up working in this kind of space?

So I did a graduate training program at Cadbury Limited in Bournville. And they were a great Quaker business. And that's what I kind of joined and signed up to. And then whilst I was there during the 1990s, they underwent a program called Managing for Shareholder Value, which is because the bankers had effectively taken over the board and said, oh, this fluffy, slightly sleepy chocolate company in the Midlands, could bang out a lot more money if we cut all the crap and just got on with flogging more chocolate. And to some extent, they were right, you know, and that's what they did. But what they did in the process was totally trash the idea that the company was about anything other than manufacturing dollar bills, basically, for shareholders. And actually, it had been about a lot of great things. You know, the origin of the company was a Quaker company that was set up as a response, as part of the temperance movement, as a response to the gin shops of Victorian England, which were taking all the poor people and turning them into alcoholics. So it thought, let's provide them with an alternative to gin, and George Cadbury invented chocolate. So it was like a social enterprise.

Yeah.

So that ethos really did continue for, you know, 150 years, and then whilst I was there, literally whilst I was there, it was being literally deliberately ripped out. So that was quite a formative experience. And then I joined my brother and he'd started doing— he'd called it Cakes and Casseroles, which was essentially what became Cook. And I joined him and we rebranded it Cook and kind of put it onto a different footing. And then my other formative experience was talking to the venture capitalists actually, when we needed the capital and learning about their fund mandates and how they saw business and what they thought we were there for. And we just disagreed, but they had the money, so we just agreed to disagree and we never took any of their money.

And how do you find working with your siblings?

Mostly pretty joyful. We're all growing up basically together, you know. I mean, I'm now 46 and I sort of feel we're starting to grow up, you know. We're still pretty childish, but we are getting better. I mean, back in the day when we started, I mean, Ed and I would literally go out and we'd go out onto the fire escape of our office and shout at each other. And we didn't realize that everybody in the office could hear. And I mean, we've got— the nice thing about siblings is you can have these disagreements, but actually you have something deeper that unites you. And we've never been misaligned about what we're trying to do, I don't think, which has made it such a pleasure. We obviously sometimes disagree about tactics, but what we've learned is that evolved the relationship so that actually we don't disagree about tactics anymore, really, because different people have their different areas that they're responsible for and we trust each other. And so far we haven't had any major strategic disagreements, so it's been pretty good.

That's brilliant. I know the business with my brothers. I tell you who— what— it's my mum that really likes it. She looks— because she can see us all working together. And it must be a really nice thing for parents to see their offspring all working together and loving each other. And when you're working so cohesively with each other, I mean, it must be wonderful. It must be really nice for your parents.

Yeah, they love it. And my— actually, my dad's still on the board, and he was on the board originally to basically intermediate when it was needed between Edward and myself. But he's now 74 and he's quite deaf and he comes to the board meetings and basically he doesn't say anything. But there's something about his presence which is like really calming. We all love his presence. He's a lovely— he's an absolutely lovely man and he's got this lovely kind of ambiance around him which kind of makes everyone feel calmer. And just occasionally he sort of— you're always like, oh crikey, he's still there. And he'll say something, but when he does say something, it's like everyone's on the edge of their seat. Brilliant.

It's been really, really useful and interesting talking to you, James. Thank you so much for today. Where can we find out more about Cook? And obviously everything that you say, we'll be putting on our website and leading people towards you as well.

Oh, it's a real pleasure. So it's cookfood.net, and it's a very extensive website. So if you look around, you can find any amount of information. We do try to be transparent about what we're doing and how we're doing it, so we've got quite a lot of purpose. We've got a purpose report which we've just published for 2019 and loads of information which is really there to help other people who are asking these sorts of questions, and to the extent it might help people.

That's really good. Brilliant. Thank you very much, James. Thank you.

It's a pleasure. Thank you.

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Thank you.