Dubliner’s kitchen business success is no flash in the pan

When David Bobbett first joined global manufacturing company H&K International, taking over the business was the last thing on his mind.

The Trinity graduate had failed five sets of accountancy exams, and had joined H&K on a two-week work assignment. Running a company with 20,000 customers was not even on his radar.

“I finished the two weeks on a Thursday and was fully paid. The next day I remembered there was something I had forgotten to do. I went back into the office to do it and was offered a job. The junior accountant had resigned that day so I got his job.”

Bobbett had studied business at TCD, before going on to train to be an accountant at KPMG, where he kept failing those exams.

At the time he joined H&K in 1985, the company was losing money hand over fist and the Trinity graduate worried it wouldn't survive six months. Originally founded in Canada in 1975 to supply kitchen equipment to restaurants in Canada and the US, IDA Ireland later enticed it to set up operations in Ireland.

Once in the door, Bobbett was assigned various roles in the commercial, sales and finance departments. Chief executive Brian Ranalow quickly recognised the youngster’s ability to solve problems and, over the next decade, Bobbett gained a reputation as the man who got things done.

“Wherever there was a problem, I was put in to sort it. There were a huge number of problems all over the company. It was effectively an engineering company with no commercial focus.”

In 2000, the company did a major project for McDonald’s in the US and performed very poorly. The fast-food chain, which was H&K’s biggest client, informed the company that its technology was “behind the times”, that it needed to improve internal and external communications, billing and be more flexible.

McDonald’s said H&K provided conflicting information, was slow to respond, poor at following through on commitments and tended to hear what it wanted to hear.

“The shareholders wanted out of the company and that led to the management buyout,” says Bobbett, who led that team. “We got money from Anglo Irish Bank and bought the business.”

However, within days of taking control in 2002, disaster struck. McDonald’s changed the strategy of their business deciding to not to open any more restaurants, focusing instead on service and quality. They wanted to be better not bigger.

Drastic measures
As H&K had specialised in fitting out new restaurants, it lost 85 per cent of its entire business overnight. The company had to close its Dublin manufacturing plant, resulting in the laying off of 85 people.

“It was the hardest thing I’ve ever had to do,” says Bobbett. “It still gives me nightmares. I had no choice but to close it. We had to keep our business in markets where our customers were.”

That year, the company had brought in more than $200 million in revenue. The following year, turnover dropped to $130 million. Drastic measures had to be taken.

The business model changed, geared towards the provision of solutions. It started working on total service solutions, including facility design, construction management, product manufacturing and installation. The company also began investing in product innovation and web-based technologies.

“I wouldn't be a natural leader. The need to change drove what I did, not any ambition to be the boss. I initially didn’t want to go into service solutions but one person on my management team really pushed it. The innovative things in the business don’t usually come from me,” Bobbett says.

The company began offering a full solution service – from designing the kitchen, delivering complete fit-outs and having them up and running in a matter of weeks.

The change worked and the company grew rapidly, gaining more customers, expanding its operations and more than doubling its revenues.

New markets
H&K now has 1,200 employees and 20,000 customers in 80 countries worldwide.As one of the leading suppliers globally of stainless steel equipment to the food service industry, its kitchens serve 30 million people on a daily basis.

Last year, it fitted out the kitchen of the world’s biggest McDonald’s to date at the London Olympics. In 2011, turnover was just shy of $500 million.

Recently, the company has expanded in Asia, acquiring a manufacturing facility in Indonesia.

“New markets give us opportunity but it's nearly a defence move. China is a high- cost place with a lot of competition, so many companies will struggle there.”

He says he is most proud of the company's transition “from being a total mess to setting the worldwide standard”.

In 2010, the company won the McDonald’s worldwide supplier of the year award. This was followed by partner of the year awards in 2011 and 2012.

In 2008, Bobbett was also shortlisted as a finalist for the international Ernst & Young Entrepreneur of the Year.

Bobbett attributes a “strong Irish culture” within the company to its success, saying the Irish characteristics of tenacity, thinking outside the box, inquisitiveness and argument have helped it grow.

Last year was the company’s best, with records set in terms of revenues and profits. For Bobbett, however, it was a different story.

After a routine health check, doctors gave him a one in four chance of having a heart attack within 12 months. A CT heat scan showed a score which would be understandable for someone in their 80s, but life-threatening to Bobbett at 52.

He consulted doctors in America, and discovered he had a genetic predisposition to heart disease. In an effort to stop dangerous calcified plaque growing, he now follows a strict diet and exercise regime, taking lots of vitamins and medication.

He has since spent more than 2,000 hours researching the topic, and H&K has invested $2 million in the research of heart disease, including giving $1 million to the Irish Heart Disease Awareness charity, a charity Bobbett founded.

“Ten people die each day in Ireland of a disease that is manageable. If 10 people a day were killed in road accidents, we’d be up in arms.

"We are using a system that is 40 years old to evaluate risk. There are newer and better ways to do so. My aim is to educate people on the disease and better tests so they can bring about change.”

Bobbett says 36 per cent of people who have a heart attack in Ireland die and it's avoidable.

“Nobody is representing the 36 per cent of people who are dead. They are dead, buried and we move on.”

He wants to raise awareness of coronary disease as a measurable, progressive and treatable condition that can be detected by a simple calcification test.

While there hasn’t been any let up in the number of hours he puts in at H&K, and while he probably has endured more stress with the launch of the charity and push to raise awareness, Bobbett says he has started enjoying some of the fruit of his success.

“I took money out of the company last year. I’m fortunate to have enough money for myself and my family for the rest of our lives. I don’t want to own properties all over the world.”

What it does do, however, is ensure this sports nut never has to worry about getting the best seats for his chosen event.

“The money does allow me to go to any sporting event I want,” he says.