In a blaze of bright lights, at the Forbes 100th anniversary party, the Oracle of Omaha Warren Buffett, the second richest man on earth worth more than $80 billion, took center stage before a huge crowd of millionaires and billionaires in New York. Where did those billions come from? Well, less than a week later, on a wet Monday, I arrived at a money-making outpost of the Buffett empire in the English countryside; an operation that has thrived longer than both the man himself and the magazine.
Warren Buffett may not know the way to Midland Road, Worcester, yet be sure he has looked very closely at the cost of making the ocean of spicy, black liquid that emerges from it to add millions to his balance sheet every year.
You can’t help thinking of Buffett’s long-term investment homilies as you walk through the Victorian red-brick portals of the Lea & Perrins building. It is as steeped in history as it is in the pungent odour of churning vinegar and spices.
For this is a factory that is 120 years old; it grew from a family business that took root in this city 180 years ago. It survived two world wars and heaven knows how many recessions. Even a fire, in 1964, merely disrupted production for a few days. It also survived corporate takeovers; it sold out to HP Sauce in 1930 and became part of the Heinz stable, in 2005, through an $885 million acquisition from the French food outfit Groupe Danone. It is now owned by the world’s fifth largest food company Kraft Heinz, following a merger in 2015 – creating a food giant that made $26.5 billion in sales in 2016, according to company figures.
The Oracle of Omaha, through his holding company Berkshire Hathaway, owns 19.5% of Kraft Heinz – that is 325,634,818 shares, worth around $31 billion, his single largest holding.
Midland Road also makes Amoy Chinese sauce, another Kraft Heinz product in the competitive and crowded sauce market.
For Lea & Perrins, that market is that bit tougher because, despite the fact the sauce is made from a secret recipe, there are plenty of imposters. At least one, made far from Worcestershire, carries the name, but tastes like spiced caramel with bits in it.
“It is not a protected name. We are not like Champagne. We just have to hope people recognize our quality,” says Nigel Dickie, the London-based spokesman for Kraft Heinz, in Worcester.
This story is from the November 2017 edition of Forbes Africa.
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This story is from the November 2017 edition of Forbes Africa.
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