S2E11 - James Perry of Cook
James is co-founder and co-Chairman of COOK, a certified B Corporation. He is a Founding Partner of Snowball LLP, a multi-asset impact investment manager. He is co-founder of B Lab UK and a board member of B Lab UK and B Lab Europe.
- Decision to open own shops as route to market
- Having purpose and values transforms the business
- Science-based targets is great way for businesses to work together
- “I think the single most important decision we took was to remain free to pursue a broader agenda than just maximizing our profits”
- Disagreeing with Venture Capital money
[0:08] Will: 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 Cook, you make frozen ready meals, and you make them with a purpose. It would be great to understand more about what it is that you do at Cook and yeah, the kind of, what, how Cook works, please?
[0:45] James: 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 worked 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 where they’re kind of ambition, which was bit more difficult than we gave it credit for in the beginning.
[1:41] Will: And did you start off with a view to be making frozen ready meals and selling to the general public, was that your initial offering?
[1:50] James: So, we started with two shops and a kitchen and the whole idea was that we wanted to create something that was free, other people control and the two people we thought were most likely to going to be able to control this 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 that.
[2:23] Will: 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.
[2:34] James: 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 got to be one or the other. And what we found when we started was that they were right, in 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 had 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 that tell to create a viable business and it definitely didn’t happen.
[3:18] Will: 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?
[3:30] James: Well, sure, just go one step before that, which is the sort of whole idea of purpose in the business and 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 were passed, 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 have 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’ve been going on for 15 years, you know, pretty much. And it wasn’t until we’ve been going 15 years that we were really able to have a big conversation about purpose. Because the first 15 years, we’ve 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 20,20, sort of 12, 2013 we started having a much bigger conversation with purpose and that led to our process, and our whole kind of rediscovery of why we were doing it, which is still going on now really.
[5:00] Will: And have you found that’s made an impact on the business?
[5:03] James: I think it’s transforming the business.
[5:05] Will: Right? And is that through staff, through customer acquisition or a bit of everything?
[5:13] James: I think it’s one of those things, it’s still permeating through the business and we’re still learning what it means 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 five 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 cool part of how we run our business. 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 really new company, you know, and in some ways can already meal company be a good thing? Maybe the world we better if they weren’t ready meal companies. And we started really having that conversation and you know, what we learned was that, yes, we do you believe there’s a role for company like ours, but we sort of, the answer to the question of, you know, do we have a kind of, are we or 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, types of recipes we create, you know, how we market it? The full, every single touch point the business has, which is military millions, needs to be put through that filter of what the purpose is.
[6:33] Will: It’s really interesting. What would you say your business superpower was?
[6:36] James: Well, I know what we aspire it to be, to being, I’m not sure we have a superpower and we’re hoping to develop them, I’m not sure that things you can develop. It took us a while, like why are we doing this? Because on one level, our kind of, our 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 it took a lot soul searching is our purpose, which is to nourish relationships, our purpose is to nourish relationship. So, I hope our superpower is nourishing relationships and 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 and that our goal is to nourish.
[7:23] Will: Could you tell us about how you engage your staff, suppliers and customers with your mission and purpose?
[7:28] James: 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 and 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 Corp 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 four pillars of nourishing relationships, you know, which basically involves every single part of our company, then it becomes you know, so through that process, it becomes about rolling the leadership team, enrolling the senior management team, and then you know, the more middle management team and then right down to the shop, or getting absolutely everybody understanding what we’re trying to do with the business.
[8:25] James: And that’s still a work in progress. You know, we’ve got a supplier conference now, we’ve been running it for three years. And we would say we’re on sort of year three of a seven or eight 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 kinds 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 is in varying different speeds with very different parts of the business, the employees is further ahead. We’ve done you know, five years of amazing work and it’s incredible what’s happening now with our employees, but I just still felt we got a lot further to go.
[9:21] Will: I think we all do, don’t worry. 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?
[9:32] James: 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, from about 2010, 2011 to now, we’ve had a really good solid period of growth. As a result, all of our key indicators have been going in the right direction, you were more profitable, we’re selling more, we’re hiring. And that means that it’s been relatively easy, we had a different, 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 how 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.
[10:36] James: 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 you know, everybody’s kind of, when you’re in growth, you can sort of do those tradeoffs, because you can see that next year, you’ll be able to pay your dividends that 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 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.
[11:27] Will: And what sort of things are you doing to reduce your environmental impacts and your carbon footprint of your business?
[11:33] James: Well, I mean, the two things we’ve done, the first thing we did was the easy stuff like that’s an obvious thing to do. The obvious and most easy thing to do is 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 region 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 and we have to change it. So, obviously, moving to recyclable packaging has been a massive thing and it wasn’t available here. We’ve been very, I mean, one of the nice things, it wasn’t available to us when we had the conversation four years ago, and it kind of is now
[12:27] Will: It’s almost overnight, doesn’t it? The particular packaging and this kind of stuff?
[12:32] James: 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 but through that, and I don’t think, I think what we’re learning to the most is that’s not good enough, you just got to do what you 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, resources. So, packet 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 that we hadn’t looked at the data. So, basically take a data driven approach.
[14:06] Will: Yeah. I mean, it’s really, really important. Have you signed up for the science-based targets, you just mentioned them?
[14:13] James: Yes, yeah.
[14:14] Will: And, 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 sign, I think we’re talking CDP, I think we’re the smallest company in the world to sign up, a team of eight and remote working. 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, home or in different work offices and so on, it’s yeah, if we can get everyone to do it. Can you tell is a bit about how you approach your environment or management? I mean, is it, do you have monthly, quarterly, do you have targets that you’re trying to achieve within this SPT? Do you, actually, milestones to reach and do you tackle particular projects at one time or how do you do it?
[15:23] James: 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 will 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 with for the whole challenge into a much more central place within the strategy. 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. So, it gets into a really different mindset of, for example, you know, we sell large proportion of what we sell is meat based food and we’ve been on for the last three 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, 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, and you see that actually, if we’re able to change our sales mix, this one of the most powerful things we can do, whereas I think in two years ago, the food team wouldn’t have dreamt that, what they put on the menu was a sustainability issue.
[17:11] Will: Yeah. Is there any advice or learning that you can share with people listening to this podcast?
[17:16] James: 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 without that, 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 fast and actually struggled to grow so much in the early years was because we’re 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 borrow more money. And as soon as the bank was willing to lend us more money, we just take it and buy a new brat pan, or buy a new freezer or something, and, or buy a new shop, you know, and, and it was all on complete, like, you know, like credit card craziness. But what it did do is it meant that, that we don’t have a share set to shareholders, you’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 border 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 find out almost like a financial instrument. And then all the purpose stuff is all grain, lovely and terrific, as long as it doesn’t bump into the money.
[18:51] James: But the minute bumps into the money, forget it, because there’s only going to be one winner. And we, so my main piece of advice, you’re serious about 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. 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 can 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.
[19:32] Will: And that’s a really, really important piece of advice. We’ve got notice, we’ve got 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. I think what you just said is so, so important. I think what you’ve achieved by not getting investment 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, it’s really nice to hear, it’s probably, it’s nice to hear now, but you don’t know what we went through, it was horrendous.
[20:26] James: Yeah, I lost my hair. But we, you know, we learned a lot, and there’s no substitute for having no needs, necessities are the mother of invention. The other thing actually is aside to keep your ownership alive, is actually make money. You know, a lot of purpose driven businesspeople 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 capitals.
[21:07] Will: That’s one of the things I like about B Corp is the fact you have to build them to company. I mean, 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 high priority and same with what you’re saying. What were you doing before Cook, how did you end up working in this kind of space?
[21:30] James: 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, all 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 blogging 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 trashed the idea that the company was about anything other than manufacturing dollar bills, basically, for shareholders. And actually, I had been about a lot of great things, you know, the origin of the company was a Quaker company, it 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.
[22:32] James: So, I thought, let’s provide them with an alternative to Jim and George Cadbury invented chocolate. So, it was like a social enterprise. So, that ethos really did continue for, you know, 150 years. And then whilst I was there, literally whilst I was there is they literally deliberately ripped out. So, that was quite a formative experience and then I joined my brother and he started doing, he called it cakes and casseroles, which was essentially what became Cook and I joined him and we rebranded 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 agree to disagree and we never took any of their money.
[23:24] Will: And how did you find working with siblings?
[23:28] James: 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, we’ve gone to the fire escape of our office and shout to each other. 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 have something deeper that unites you and we’ve never been misaligned about what we’re trying to do, which has been, made it such a pleasure. We obviously sometimes disagree about tactics, but what we’ve learned is that, evolved a relationship so that actually we don’t disagree about tactics anymore and 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 disagreement, so it’s been pretty good.
[24:28] Will: That’s brilliant. Another business with my brothers, I tell you, who, what, if my mom that really likes it, she look, 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, must be really nice for your parents?
[24:53] James: Yeah, they know that, actually, my dad is 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 death and he come to the board meetings and basically, he doesn’t say anything. But there’s something about his presence, which is really calming, we all love his presence, he is an absolutely lovely man. And he’s got this lovely kind of ambience around him, which kind of makes everyone feel calmer. And just occasionally, sort of, you’ve always like, oh, Crickey, still there. And he’ll say something but when he does say something, it’s like everyone’s like on the edge of their seat, really.
[25:38] Will: And 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 will be putting on our website and leading people towards you as well?
[25:50] James: That’s a real pleasure. And so, it’s cookfood.net and there’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.
[26:17] Will: That’s really good. Brilliant. Thank you very much, James. Thank you.
[26:20] James: It’s a pleasure, thank you.
[26:25] Will: Thank you so much for listening to the end of this episode of the Green Element podcast. Do take a moment and share this with your friends and colleagues’ rate and review the podcast wherever you get your podcasts. I’d love to know what has been your biggest takeaway from this conversation, what are you going to do differently? Please share your thoughts across social media and tag us so we can see them to at GE_podcast. For links and show notes for this episode, visit our website greenelement.co.uk/podcast. Thank you again. I hope you’ll join me on the next episode and together we can help create a better world.
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