Interview Peer Swinkels, over bedrijfsovername en kansen pakken tijdens een crisis

Yes, we are active in beer and malt. So we have a business-to-business company that supplies malt ingredients to many breweries all over the world, and on the other hand we have business-to-consumer beer and also some soft drinks and energy drinks. We are active in 120 markets worldwide. It all originated from a centuries-old family business. The great-great-grandfather of my great-great-grandfather was the first Swinkels to work as a beer brewer. The company is 300 years old. It started as a farm where brewing activities were added, very small, very local. And slowly, in the last century, from 1924 onwards, we grew because my great-great-grandfather chose to be one of the first in the Netherlands to invest in a pilsner brewery. That was something very new in the market at that time. And after that we really grew from a local and regional player to a national player, international player. Now we are actually more in the multinational phase.

Yes, it is... when I started as CEO, I also looked back, of course, and at the same time looked forward. Then you look at what footsteps I am following, where do we come from, what are the roots of the company. But I also thought very carefully about where we need to go and what we might need to let go of. The company has also become big by letting things go. It hasn't just been a gradual build-up; we have also faced very difficult times and have had to let things go, either out of necessity or conviction, and then went on a different track and thereby made the company bigger and bigger. So the art is, as an entrepreneur, to seek what you want to hold on to, especially in a very old family business, but also what you want to let go of and innovate for the future.

Well, it started in 1924, as I just told you about my great-great-grandfather who chose pilsner. That was very unusual at the time, very disruptive, because in the Netherlands we drank ale like the English did. He dared to put all his savings on the table and build a completely new brewery, and also closed other breweries, and introduced a new product to the market. That turned out to be a great success. We did that later with alcohol-free beer, for example, where we were the first true founders in the world. That was also very disruptive. And so we have gradually done that every time. In my generation, for example, if you look at the last 10, 15, 20 years, we have introduced a new brand on the market, the brand Swinkels, but we also started a brewery in Ethiopia. So we are clearly present not only with production in the Netherlands and Belgium but also in countries around us in the world. We are looking much more internationally. So in that way we try to take a step further every time.

No, not predetermined, to be honest. I actually started at a young age in the company, what we call holiday work, summer jobs as a forklift driver, as a helper in hospitality, as an administrative employee, and in the English department I worked one summer. I did that kind of thing as a boy. Then I went to study, and then gradually my ambition in the family business began to focus on other things. Actually, I thought I wanted to do something else, I didn't want to go into the family business. Until at one point I was called, I was working at Unilever at the time, by two brothers and my father. Then I thought carefully about whether I should make the switch in my life. I eventually chose to do it. It was the biggest doubt, but I did it and have never regretted it. What tipped the scales? A few things. One very important thing was a personal frustration I had. I had gone to study at 18, I grew up here in the south, and here our brand Bavaria is very well known. But I soon discovered when I went to study in Rotterdam that it was less known there. So that became a bit of a frustration for me. I thought, I also got the opportunity to become marketing director, and I could do something about it myself. So I felt I shouldn't stand on the sidelines; I had to pick up the gauntlet myself. That played a very important role. My father was also still working in the company at that time, and I was able to work with him for a year or a few years until it was determined by the bylaws that you must retire at a certain age in the family business. You can't stay indefinitely as a family member.

Very special. The most special thing I found was that when I was in the company, he was literally in the next room, so to speak. And I never had a day when he walked into my room just to tell me what to do. It was actually the other way around: I had to go to him to ask, 'Dad, do you have any advice on this?' They actually gave everyone a lot of freedom. I thought that was very clever of him, especially. I think many family businesses are often the opposite. I have always had a lot of respect for him that he was able to do that. And now he is no longer active in the company. No, not for a long time. Since Windows 7? (laughs) Do you still share things from the company with him, or does he still talk about it? Yes, occasionally, but I am also cautious about that because we have it so tightly regulated that ultimately he, like me and many other family members, is a certificate holder in the company. The information I share goes literally through the governance channels. And since my father retired, he has also become one of the certificate holders, so I am very straight about that.

Well, the first signs of the corona crisis we got in January, because then we noticed that production stopped in China, and that had an impact on the port of Rotterdam because fewer containers came back from China. We need those containers to ship our beer all over the world, especially malt. That became difficult, the supply chain got stuck. So that's where it started. So we already thought, oh, what could that be a harbinger of for what might happen in Europe? I think few people could have predicted what actually happened here in Europe, we didn't either. But we were very early in taking measures. I believe that in the last week of February we already had a crisis team set up, two crisis teams, and from there we started to lead the crisis.

Yes, yes, we have several locations in the Netherlands, but our largest brewery is in the epicenter of that area. And at one point, at the peak, we had an absenteeism rate of over 30 percent. So you get into a phase where you might not be able to continue your processes. So we wanted to prevent that at all times. So we had to balance very carefully on that point. Because the moment you really have to shut things down, it costs a lot of money. So we got through the first phase well. And what I found most surprising: we decided, like many companies in the Netherlands, to start working from home very early in March for the part that could work from home, because we also have many employees in production and logistics. But what could work from home, worked from home. And then we thought, will that work? Will invoices be sent, will orders come in, do the systems all have to work? And it went amazingly well. The systems worked, the people worked from home, and the systems just kept running remotely. That was really impressive.

Yes, we were the first. And that actually came from the fact that it's a bit of entrepreneurship. Look, in such a crisis, threats arise, but also opportunities. But not every opportunity as an entrepreneur should you see as, especially when there is so much misery around you, you have to pull the chestnuts out of the fire. You also want to do something for society. A company should not only have a role for itself but also for society. Especially in the beer business, we bring people together, we always say, with a glass of beer. So we received a request from the UMC in Amsterdam, who were going to have a severe shortage of hand alcohol, three to four days of stock. I got a phone call. That means for a hospital that you can actually shut down completely if there is no hand alcohol. So it is very dramatic if healthcare comes to a standstill because of that. We had never thought of that impact. I couldn't expect that a hospital, such an important hospital, would run out of hand alcohol. So that story came to us, and we eventually set up an opportunity team to think about whether we could do this. Then a few puzzle pieces fell into place. Quite coincidentally, it had to do with an investment we had made in a column, a kind of production column with which you can extract alcohol from beer. On the other hand, we had the problem that in the hospitality industry, beer that could no longer be used was also going to waste. So we thought, if we take that beer back from the hospitality industry, it costs us a lot of money, but okay, we'll do it. And then we run it through that column a few times, and you eventually get 80 percent alcohol. Then you officially make hand alcohol with 80 percent alcohol, plus some glycerin and hydrogen peroxide and water, you make an official hand alcohol. That turned out to be possible. Initially we thought it would be very difficult, but it turned out to be possible. And thanks to that opportunity team, we managed to supply 1,200 healthcare institutions in the Netherlands with hand alcohol, very quickly. And what I found the nicest compliment was that our competitors started following our example. That's really nice. Seeing that you can contribute in this way at such a moment in a crisis. You can imagine that in the company there was a vibe of 'okay, we are really helping here.' That does so much for the morale of your people in such a difficult time. As an entrepreneur, you choose to just do it, even though we were also financially very hard hit. But the nice thing was that when we went public with it, we decided to go public early, even though we weren't sure yet if we could do it. That was a very wise choice in hindsight, because then other parties started contacting us, saying they could help us with distribution to all those 1,200 healthcare institutions, for example. We weren't set up for that. So parties came forward who said they visit those kinds of healthcare institutions and wanted to do it for free. And so a number of parties helped with filling jerrycans. We don't have a filling installation for jerrycans. So a company came here and said they could do that. And precisely because we announced it, help came from outside. So with all kinds of partners, we were able to make this a success.

We have had a very tough few months, in March, April, May, because of the hospitality lockdown in various countries where we are active. That was very impactful. But the company has spread its risks well. With both business-to-business and business-to-consumer, in 120 different markets, different brands, different channels where we are active, that mix ensured that we could weather the crisis well. But we had to put all sails up. And if you look back, we are still in it, but looking back, are there aspects that you say, hey, I really want to hold on to that? What has the crisis brought to our company that we think we will continue to do? Yes, in that sense, you have to try to take positive points from the crisis. You can't complain about the crisis; it's pointless. You have to get into the mindset of 'what can I get out of this crisis?' And we did that by doing innovative things. For example, we very quickly launched an online beer webshop with all kinds of special beers that you normally get in hospitality but not in the supermarket. So a website, a very fast webshop had to be developed. Those are things that you do on the side of 'hey, I'm losing turnover there, but how can I get turnover back elsewhere?' Besides the necessary cost measures and cash flow, which you as an entrepreneur have to keep a very close eye on at that moment. But what I think is most important is what we see from the crisis: the agility you always want in your organization. I think we as a family business have always been agile, but the degree of speed and agility we have experienced in recent months, I would like to hold on to that. Under pressure, everything becomes fluid. But when the pressure goes away, there is a chance that it will decrease. And you want to hold on to that speed with which you could switch, so that you also do that at other times in the future.

Yes, we chose to announce last April, right in the middle of the crisis, that we want to become a 100% circular company. And we don't want to do that in a non-committal way. We don't believe in non-commitment at all. If you set truly ambitious goals, you have to make them measurable. So we introduced our own index, called the Swinkels Circularity Index. We worked on that index for more than a year and a half, with a very scientific approach. And we were the first company in the Netherlands to receive an official assurance from the KPMG accountant for that. So with that index, we can really measure where we stand on the ladder of circularity. And we can say we strive for 100% circular. In 2019, we were at 40%. And this year, despite the crisis, we hope to make a step to 50% circularity. So we make an action plan year by year to take a step further on that measure of circularity. Is it then 10% each year? Over 5 years, that won't work. As absolute 10%? It is relative, but we will make enormous steps in the coming years. Our ambition is to double by 2025 compared to 2019.

My biggest drive as an entrepreneur, and often the leader of a company or one of the leaders, is the team. Because I believe as an entrepreneur that you have to put the best people around you, and you have to be clear about what you want, but also be humble. It's about getting the maximum out of your team, out of the people in the team, but also ensuring that the team itself functions optimally. That is the most beautiful thing about entrepreneurship, apart from the successes achieved and also the failures that occur, that you acknowledge that truth every time, look at it together, and do something with it in a positive way. And if you can get that throughout the company, that is very satisfying.

Yes, I think if I look back over the past 15 years, it comes down to this: if you want to do the right things as a leader in the company, you have to look very carefully around you, and sometimes dare to let things go. Don't think that everything revolves around you as an entrepreneur. That is perhaps the paradox: the entrepreneur, especially if you are the sole owner of a company, you can think that it revolves around you. But the art is to let others revolve and thereby let the company grow. I always try to keep that in mind.