N ew Spicers chief Rob Vale has spoken to OPI about his early thoughts on the job in hand at the top European wholesaler, at a time when parent company DS Smith is accelerating a programme to reduce the firm’s UK structural cost base.
Vale, who took over the role of Spicers CEO after the early retirement of company veteran Bill Armstrong, is seen as a vital component in DS Smith’s future plans for the firm.
In a trading update, Spicers parent company DS Smith said it expected full year opertaing profit from Spicers to be about £9 million down from the £21.5 million reported for 2004/5.
The fall in operating profit was largely attributed to UK factors, such as sales margin erosion that was higher than previously anticipated, although this was partly mitigated by improved results in continental Europe.
Vale said: "We’re very pleased with the progress in our European businesses. Every market around Europe is different in the way that it operates and in the opportunities that it has. We have a successful business in France that is continuing to grow very well. We’ve got an established business in Germany, which is going well but there is more effort that needs to go into expanding our dealer base and persuading dealers of the benefits of working with Spicers."
The fledgling Spainish business is showing good progress with a second distribution centre about to be opened in Madrid to complement the one already in Barcelona.
While Spicers has also had a good reaction to its Italian business, with growth rates at least comparable to Spain, it is the acquisition of Belgium-based Timmermans that is expected to have the most significant effect on business overall.
Vale said that Timmermans and Spicers have both been able to learn off each other and DS Smith, in a trading update, added that prospects for the new business in the Benelux region are "in line with our expectations when we acquired it in October 2005".
Vale added: "Timmermans is very strong in Belgium where it supplies both dealers and retail customers. It has a lower profile in the Netherlands right now, but we see a great opportunity for us to partner with Dutch resellers."
The new Spicers chief declined to rule out further acquisitions should the possibility arise. "We are continuing to keep an eye out for new opportunities in Europe, but have no immediate plans," he explained.