Quality earns its slice

Manufacturing: two food managers have found a lucrative niche in the pounds 1.2bn sandwich market hogged by the big cheeses

THE FOURTH Earl of Sandwich (1718-92) was an inveterate gambler. So reluctant was he to leave the card table that he ordered his meals to be served between two slices of bread. Hence the birth of a snack with a past considerably less profitable than its present and future.

The UK sandwich market is big business. Leading manufacturers including Hillsdown Holdings, Northern Foods and United Biscuits are making vast quantities. Big retailers are shifting them at a rapid rate. Boots has 5 per cent and Marks & Spencer 7 per cent of a pounds l.2bn market.

To set up a small company to compete with such wealthy and well-established players might seem like a gamble that even Lord Sandwich would think twice about. Yet in just over three months, the Sandwich Factory has expanded its output from 3,000 sandwiches a day to 55,000. On launch day, 14 March, there were 25 staff. Today there are 350 working two shifts a day to cope with demand from 285 outlets.

A gamble? More like a calculated investment by two men with considerable experience of the food business. John Mason and Tony Cleaver met more than 20 years ago when both were sales managers at Unigate. Mr Mason later moved into meat production while Mr Cleaver, a trained chef, joined Hillsdown.

Both could see that the sandwich market was continuing to grow, although it was becoming increasingly fragmented.

"We saw opportunities for a company producing smaller runs of high-quality, higher-priced products," Mr Cleaver says. "Going for a sandwich is like going for a meal. If a restaurant keeps putting on the same menu, customers will go elsewhere. You have to keep looking for something different."

Everything from a standard egg and cress to chicken fajita with salsa and sweated onions is now being made at the "Factory", a 25,000 sq ft warehouse on an industrial estate in Atherstone, Warwickshire. Flexibility is the key. Only 60 per cent of production is geared to filling triangular, transparent skillets. Elsewhere, they make sandwiches from bloomers, baguettes, fruitbread or ciabatta.

Selling them has been a triumph of hard work and persistence. "We don't have reps," says Mr Cleaver, "but we do spend a lot of time on the phone. Retailers seem to appreciate talking to someone in a position to make instant decisions rather than a faceless person in a big London office."

Expansion plans are focused on petrol station forecourts, which account for 1.5 million of the sandwiches sold every week. Shell is the fifth- biggest seller of sandwiches in Britain.

"At the moment," says Mr Cleaver, "they're reliant on small local producers because of distribution costs. We want to set up another factory in the extreme North, maybe in Scotland, and another in the South-west. We'd have 100 refrigerated vehicles on the road, servicing the needs of forecourts. They're open 24 hours a day and they're rapidly taking business from supermarkets and corner shops. But they're realising that convenience foods have to be of a quality comparable with retailers in the high street."