Wynnstay is committed to sustained development within the sector and will strive for continued growth by acquisition and organic development of the business model. In so doing, Wynnstay Group Plc will optimise the return to all stakeholders in the business.
In order to achieve this ambition, the Group recognises that it must excel in terms of value, quality and the development of its products, services and people. The Group strives to become the “Supplier of Choice” for its customer base.
The business operates in an environment where fundamental macro-economic drivers are supporting the growth of the principal activities. A growing world population and changing dietary habits are creating an increased demand for food production, which is supported by a political desire to promote greater productivity and self-sufficiency, in a sustainable manner. These factors provide a strong backdrop for expansion of the Group’s activities, although the inherent cyclical nature of much of the world’s food production can create certain short term stresses to the smooth operation of activities. The Board has always recognised that the natural processes involved in food production will, from time to time, create risks to certain enterprises at different times, either through climatic, disease, economic or other influences. There will also be political factors to consider in any strategic planning and the decision of the UK to exit the EU will be a factor for consideration for future development of the business. The Group has therefore developed a strategy which is designed to minimise such risks through ensuring a broad and balanced spread of activities across all the main agricultural input areas, rather than relying on any specific single agricultural enterprise. This policy of having a broad based business limits the impact of any adverse performance in any single activity, and has helped shelter the Group from periodic commodity volatility extremes.
The main markets that the Group operates in are currently supplied by a relatively fragmented industry. This provides a strong platform for the development of the business, which has a long track record of both organic and acquisitive growth. The Board is confident that, with the expertise and enthusiasm of staff, strong commercial relationships and balance sheet strength, the successful consolidation strategy will continue. The Board expect continued geographic expansion of the business’s core operating areas and a broadening of its product offering through the ongoing implementation of this strategy. Further growth of the Group will be across all aspects of the company to ensure balanced development of the business model.
The business recognises the importance of innovation for the future of efficient agricultural production. There is a focus on selecting innovative products which can enhance the productivity of farming businesses and the company encourages communication with customers to promote the benefits of the products.
Consideration is also given to the marketing and distribution channels to ensure effective supply of the wide range of products and services.
Long Term Viability
The Group works within a corporate plan to ensure clear direction and focus for strategic development of the business. Instigated in 2015, the existing plan provides a framework into 2019 and there is regular review of planned goals to confirm they remain appropriate. A current review is being undertaken and will be assessed by the Board in early 2017. Annual budgets are set in line with corporate goals but recognising specific market conditions at the time.
The Group’s major focus is closely linked to the viability of the UK agricultural industry. Well publicised information on macroeconomic factors associated with world supply of food and energy point to a resilient industry. However it is recognised that European farm enterprises have benefited from support mechanisms for a number of years. The recent decision for the UK to leave the EU will bring attention to the Government’s support for the industry, however there has been a commitment to the current support mechanism until 2020. Beyond then, agriculture, food and the environment are viewed as areas of strategic importance and it is deemed likely that the UK Government will recognise this in the decision making process.
Wynnstay constantly reviews the long term outlook for the industry, the effect on the customer base and the likely actions of competitors. The Board remains optimistic for the future of the UK agricultural industry but also recognises the requirement for efficiency at all points within the agricultural supply chain.
The Group has identified four main groupings associated with the business; each has specific outline goals which must be balanced to satisfy the expectations of all stakeholders.
Shareholders – where the Group focuses on financial performance which supports a progressive dividend policy and capital growth in share value. Customers – where the Group seeks to excel in terms of range, value, quality and service.
Employees – where the Group aims to attract, develop and reward high calibre personnel, and ensure a safe, interesting and productive environment to work in, thus encouraging the highest levels of customer service.
Suppliers – where the Group wishes to provide the best marketing route, thereby procuring preferential terms and offering better value for its customers.
Business Review and Future
A review of the business and future developments of the Group and a discussion of the principal risks and uncertainties faced by the Group are presented in the Chairman’s Statement and Chief Executive’s Review included within the Group’s published accounts..