“Not just a new contract” as Park Cakes boost turnover with M&S deal

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A north-west bakery is reaping the benefits of a bumper new contract to provide Marks and Spencer’s own brand cakes, demonstrating how securing just one deal can transform a company’s prospects. Park Cake Bakeries, which specialises in the production of retailer own brand cakes for and has bases in Oldham and Bolton, won the contract back in 2014 from its South Wales competitor Avana Bakeries, who relied on M&S’s custom so heavily it closed for business within 2 months.

Having announced the M&S deal in February 2014, turnover at Park Cakes to the end of March 2015 rose by over 25% to £141.3m when compared to the previous year. As production for M&S only started part way through 2014/15 and one off on-boarding costs of over £10m were incurred, the results are likely to be even better for the 2015/16 financial year, where the bakery no doubt hope that the increased revenues will boost profit levels that have been creeping ever further over the red side of breaking even in recent years.

The contrasting fortunes of Park Cake Bakery and Avana illustrate how crucial the procurement and retention of a single contract can be. This makes it all the important that the terms of the deal are clear and do not contain any nasty surprises that could result in its early termination. Just as important can be guaranteeing that a business’ intellectual property is properly ring-fenced and that any necessary assignments are included, along with ensuring that each party’s data protection responsibilities are equitably covered.

Forbes’ commercial experts are on hand to ensure that a business’ prospects are fully protected under the terms of its contracts with other commercial entities, consumers, and suppliers. Depending on the circumstances we can either review and negotiate documentation on a company’s behalf or draw up a set of terms from scratch.

If you have any questions relating to the matters discussed above or require assistance with any other Corporate and Restructuring matter, please do not hesitate to contact me at Pauline.Rigby@forbessolicitors.co.uk or my colleague John Pickervance at John.Pickervance@forbessolicitors.co.uk

 

Pauline Rigby

About Pauline Rigby

Pauline Rigby is Head of the Corporate and Restructuring team at Forbes Solicitors. Pauline’s blogs cover a wide range of corporate issues, specifically areas including company formation, banking, joint ventures and shareholder matters, contractual matters and equity fundraising or investing.
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