The ground-breaking David’s Kitchen business all but invented food-to-go in local retailing more than a decade ago and has secured long-term success by remaining faithful to its original vision all these years later.
By Antony Begley
When directors Keith Fernie and Diane Greenough strode onto stage to collect the coveted Scottish Local Retailer of the Year Award on behalf of the David’s Kitchen business, one of four awards they collected on the evening, it was yet another milestone in the journey of a remarkable and visionary business.
It’s difficult to appreciate all these years later just how innovative the David’s Kitchen business was when the first store opened in Glenrothes back in 2014. This was a store built to focus squarely on food-to-go. Yes, it had a traditional convenience range too but that was – and remains – very much a sideshow to the main food-to-go event.
Food-to-go?
Back in 2014, however, food-to-go just wasn’t a thing in local retailing. Who wanted to buy hot food from a corner shop? Who wanted to buy their ready-to-eat breakfast or lunch from a convenience store? The prevailing logic at the time was that it made no sense.
There was one man, however, who had very little time for prevailing logic: David Sands had long travelled the globe visiting stores with a notepad in hand and an open mind. If food-to-go in small-format retailing was so big in so many countries – particularly Ireland – why wouldn’t it work in Scotland?
Armed with this vision and fresh from having sold his eponymous David Sands chain of 28 stores to the Co-op for lots of millions in 2012, probably somewhere between £10m and £15m, Sands had the idea, the time and the capital he needed to bring his idea to life.
Cash profit
There are many aspects of the David’s Kitchen business that were ahead of their time but possibly the most fundamental was Sands’ commitment to focusing ruthlessly on one thing: cash profit. Not sales. Not POR. Cash profit and cash profit only.
A decade ago, most retailers simply felt that if you kept the weekly sales figure high enough the profits would take care of themselves. And back then, they were mostly right. But times change and life can get a lot tougher very quickly, as all retailers have discovered over the last seven or eight years.
And this is where Sands’ food-to-go vision was so innovative. Food-to-go is very high margin. We’re not talking the single-figure margins of tobacco or the 10% or 15% on lots of alcohol or even the 30% on many own-brand lines. We’re talking 70%, 80% and more.
The flipside, of course, is that food-to-go is also very difficult to do. Or, to be more precise, it’s very difficult to do well. It requires some capital expenditure, it requires lots of staff, it requires a much more intense focus on presentation, it involves a lot of health and safety issues. But most of all, it requires a different mentality.
Sands understood all of that and set about building a bespoke model. Glenrothes was built with a professional kitchen in situ. The vast majority of food on sale would be made in-store, to max out the margins. The store layout was conceived to unapologetically make sure that the first thing customers would see when they walked through the door was food-to-go, both hot and cold. Sands knew, however, that the store would still need a traditional convenience range but that part of his store’s offer was both literally and metaphorically to one side of the main attraction.
Local sourcing
If food-to-go was the headline event, the key supporting act was local sourcing, again something that was far from common back then. In his vision, Sands saw David’s Kitchen as being a true destination store – and you couldn’t achieve that by stocking a bog-standard range of big brand products. The key was to work closely with local butchers, bakers, confectionery businesses and so on, which ensured that much of what consumers would find in the store, they wouldn’t find anywhere else in the area. That plan had the added benefit of tapping into the brand loyalty that was already enjoyed by these local suppliers.
And the final benefit was that local products often commanded premium pricing and thus bigger margins. Sands predicted that customers would be prepared to pay more for high-quality, locally produced lines. And it turns out he was right.
Volume challenge
The biggest challenge that Sands faced is the same one that any business launching a food-to-go offer for the first time faces: getting the sales volumes up without incurring horrendous waste. Many customers won’t buy fresh, chilled or hot food from a two-thirds empty chiller or hot hold. They get confidence from a fully stocked, pristinely clean unit. That’s a hard circle to square. Pack all the chillers and hot holds full and you’ll give yourself a fighting chance of driving sales – but you also know that a lot of that lovely short-dated product is likely to end up in the bin unsold.
Keith and Diane readily admit that the first few months were challenging on that front, but they stuck to their guns and, before long, the volumes started rocketing. It was game on for David’s Kitchen.
Good to go
Over the ensuing years, food-to-go finally did start to become a thing in local retailing and really started gaining momentum – just before Covid brought that bandwagon to a screeching halt.
But the fact that David’s Kitchen did it first and did it best gave it a massive advantage when times got tough. With a committed, loyal customer base, the Glenrothes store could confidently pack the chillers and hot holds all day long knowing that very little of it would end up in the food recycling bin.
Only a year into the journey, a second David’s Kitchen store opened in Falkirk in 2015. In 2019, a further store was added in Kirkcaldy then, last year, the Bo’ness store was unveiled.
Consistent drive
Now, around a dozen years into the journey, the business has thrived by staying entirely true to its roots and to that same vision that inspired the launch of the business in the first place. David’s Kitchen remains just as committed to food-to-go and local sourcing as its foundational planks as it was on day one. Yes, there have been many tweaks and evolutions and improvements along the way but fundamentally it remains the same business.
The range has been expanded and honed over the years, the kitchen now operates a night shift to cope with demand, self-scan tills have been added, a large contract catering business has evolved in tandem and so on, but David’s Kitchen remains more or less as it was founded.
Even the new Bo’ness store is an evolution rather than a revolution. Don’t fix it if it ain’t broke. It takes the best of the other stores and combines them in a more modern presentation – but it’s instantly recognisable as a David’s Kitchen store.
The net result? The business does margins most retailers can only dream of – north of 40% across the store – and it does weekly sales volumes that are equally impressive, particularly in the original Glenrothes store.
Worthy winners
So it should come as no surprise that as well as David’s Kitchen being named Scottish Local Retailer of the Year in June, the Bo’ness store also picked up three other awards: New Store of the Year, Food-to-Go Retailer of the Year and Scottish Brands Retailer of the Year.
A word of praise must also go to the astonishingly passionate team behind the success. Built and led by Keith and Diane, the teams in each store consistently demonstrate an energy, enthusiasm and friendliness that is infectious and unmistakably helps create that special vibe that customers can instantaneously sense when they walk into a good, well-run store.
It’s also worth mentioning that the judges visited David’s Kitchen stores on at least a dozen occasions and not once were the stores anything less than immaculate. That’s no mean feat and it speaks to the pride of the people who make the business so very special.
