With a fun culture and a bonus system that rewards good customer service, staff at Pret A Manger seem a pretty happy bunch, reports Nicola Sullivan
A basement office deep in the bowels of a Pret A Manger store on Baker Street in London is probably not where you would expect to find one of the international sandwich chain’s heads of department.
But the firm’s newly-appointed head of people systems and reward, Jeremy Hinds, seems quite at home in a location where the only way to see the store’s browsing customers and evening sunlight glinting through the glass-fronted shop upstairs is via images from the security camera.
It transpires that Hinds, like many head office staff, spent his first week with Pret A Manger working on the shopfloor – in this very store. This initiative, which is designed to ensure head-office staff fully understand the nature of the business, enabled Hinds to get a handle on the kinds of issues facing frontline staff.
“We like to promote the business,” he says. “We like to give people opportunity and, if they are talented individuals, we like to give them the opportunity to excel.
“If they have come through the ranks and ended up in head office, they have all got a story to tell and they all understand the business from the operations side of the fence.”
During his week in the Baker Street shop, Hinds got stuck in making sandwiches and salads, as well as the numerous frothy coffees so many London commuters rely on to kickstart their day. Shop staff can also take secondments at the firm’s head office in Victoria to give them a wider understanding of how that side of the business works.
Hinds’ regular contact with Pret A Manger stores and staff gives him a valuable insight into what kind of people work for the company and what makes them tick. This is particularly important, given that his remit is to excite staff with reward.
Hinds says he is also influenced by the firm’s tradition of using quirkier methods of motivating and rewarding staff. He is currently putting together an employee incentive and recognition scheme, which he plans to unveil by the end of the year.
This scheme will be added to existing initiatives, such as the parties the company throws twice a year in London for all its UK staff. During these events, shop staff may enjoy the serving skills of the company directors, who staff the bar.
Further fun activities are held for managers and head-office staff who attend Pret A Manger’s national quarterly briefings, when it presents its financial results. The most recent event was themed around the game show It’s a Knockout and saw staff, wearing the show’s traditional costumes, taking part in their own version of the competition. But there is a serious message behind such fun initiatives. According to Hinds, half of Pret A Manger’s brand is based on its people and half is based on its food. So excellent customer service is particularly important. One of the ways the company seeks to instil these values into staff is through its bonus schemes. All UK employees are eligible for a bonus once they have worked for the firm for more than 10 days.
For example, general managers who hit their quarterly targets can treble their salary with bonuses, which are based on their individual achievements, as well as sales growth at the shop where they are based.
Meanwhile, all employees can benefit from the firm’s mystery shopper scheme. Staff are put to the test when Pret A Manger representatives, posing as ordinary customers, drop into shops several times a year to review customer service. High-performing teams are awarded a pay increase for the week the mystery shopper visited their store.
“There is a focus on standards,” says Hinds. “We have a mystery shopper that comes into the store and they fill in a questionnaire that each shop gets scored on. If the shop scores well, every single employee, not just the general manager, benefits and gets extra cash.
That not only drives the general manager, it drives staff in the shop as well.”
Further team incentives are also available through the scheme, says Hinds. “If a store gets a certain amount of high mystery shopper scores during the quarter, the general manager is offered a sum of money to take their team out to party, so to speak. If the mystery shopper recognises a certain individual who has done really well and offered really good-quality service, they are untitled to an extra £50 on top on their salary as well.”
For example, last February, staff at the Baker Street store were awarded £500, which they spent on a day at Alton Towers.
Although Pret A Manger is known for its fun approach to reward, it also has a more serious side to its strategy, For example, Hinds is looking at introducing a group personal pension (GPP) plan to replace the company’s stakeholder scheme. If approved, the GPP will offer employer contributions – a first for the firm.
“A lot of people in Pret head office have grown up through the company at a young age and, five or 10 years ago, pension schemes would be the last thing they would want to join,” says Hinds. “We now have an average staff age of 28 or 29, so people are starting to engage on this thought process on pensions.”
One of the reasons why Pret A Manger decided to look at pensions is to ensure it is ahead of the game when the government brings in personal accounts, compulsory contributions and auto-enrolment in 2012.
“What we doing at the moment is trying to establish what the cost of the business is going to be if we introduce a pension scheme,” says Hinds.
“We have got to be mindful of 2012. A lot of employers, depending how things are taken forward by the government, will be forced into engaging their employees into a pension scheme, so we want to be ahead of the game.”
The firm is talking to consultants and providers to establish how such a scheme would work at Pret A Manager. A proposal will be put to the board by the end of the year and, if approved, will be rolled out to senior UK staff in February, and will later be made available to all staff.
“We have a very diverse workforce, so we need a really diverse pension that is going to allow employees to enjoy the fruit of the scheme,” says Hinds.
But setting up, implementing and communicating a pension scheme for such a diverse workforce, 70% of whom come from abroad, is far from easy. “One of the big challenges we have is that so many employees are from overseas,” says Hinds. “One of the things that will happen is they could say ‘how do I receive my pension in years to come if I have gone back to the country I have come from?’.”
This is not the only big project Hinds is working on. Also in his in-tray is a revamp of Pret A Manger’s people systems in the UK and Hong Kong; aligning HR, reward and training and development; and setting up a people system in the US for the first time.
This move is partly driven by the firm’s growth in the past five years, along with its desire to expand its US business.
“New York is trading quite well, but it could be better,” says Hinds. “As a business, we are focusing on growing the US trade. We have quite a lot of former UK-based operators out in the US. Part of my role as people systems manager is to support them with new people systems.”
There are also plans to implement a new self-service portal, where every Pret A Manger employee will have their own benefits and reward page. “With an employee self-service system, we can advertise our benefits directly online,” says Hinds. “We can offer staff total reward statements to illustrate not only what their salary is and their earnings, but also to show what they are getting on top of that.”
The portal is in keeping with the company’s existing online self-service system, which is provided by Sage. This was introduced in 2004 to cut the time store-based staff spend on administration, enabling them to focus more on customer service.
The system is also designed to enable line managers to take greater responsibility for updating personnel records, and making it easier to access details of employees’ pay and working hours. Line managers particularly needed access to team records to update timesheets, manage absence and input new salary details directly from the shopfloor.
They can also implement reward and bonuses awarded by the company’s incentive schemes instore, instead of having to go through payroll.
With so many new projects on the horizon, Pret A Manger’s reward and benefits landscape is likely to change significantly over the next year. But the firm will no doubt hang on to its vibrant workplace culture, which will continue to be characterised by its refusal to be ruled by a strict corporate hierarchy between staff, as well efforts to create a sense of fun among its employees
Pret a Manger at a glance:
Pret A Manger, which is French for “ready to eat”, was founded in London in 1986 by friends Julian Metcalfe and Sinclair Beecham. Metcalfe later founded the Itsu chain of sushi cafes.
The firm boasts a passion for food, and that all of its products are made from natural ingredients.
In 2008, European private equity firm Bridgepoint agreed to acquire a majority stake in Pret A Manger, taking over from McDonald’s, which had acquired a 33% share in Pret in 2001.
Pret A Manger currently has 224 shops – 193 in the UK, 20 in the US and 11 in Hong Kong – and employs about 4,000 staff.
The average age of the company’s UK employees is about 28 and 70% of its staff working in the UK are from overseas.
For the period between December 2007 and January 2009, Pret A Manger posted profits of more than £30.2 million. During the same period, it reported a £249.6 million turnover – 12% up on the previous year.
The company now sees expansion in the US as a key driver for its overall growth.
Career profile: Jeremy Hinds
Jeremy Hinds, head of people systems and reward at Pret A Manger, joined the firm in July 2009 after spending two years as HR operations manager at law firm SJ Berwin.
Before that, he was group payroll and benefits manager for Esporta Health Clubs, which he joined in 2005. That followed a two-year stint at the London Clinic, where he was payroll and benefits manager.
Hinds’ career began at British Rail’s payroll department in Derby in 1991. Recruited as a trainee, he carried out clerical duties before landing the role of payroll service manager.
Hinds says Pret A Manger’s culture contrasts sharply with the law firm he used to work for. One of his funniest challenges at Pret took place on his very first day, at its national quarterly briefing, when he found himself wearing a colourful costume and competing in the firm’s It’s a Knockout competition.
“Going back to my first day with SJ Berwin, the law firm, I was primed in my blue suit and black shoes,” says Hinds.
“Within an hour of working with Pret A Manager, I was wearing a dress and plastic boobs, ready for It’s a Knockout.”
Case Study: Bonuses keep employees buttered up
Alfredo Varela, general manager of the Baker Street branch of Pret A Manger, has spent seven years with the firm.
Varela, originally from north-west Spain, is responsible for the day-to-day running of the shop, overseeing the provision of food and drink, as well as the health and safety of customers and staff. The 36-year-old is also responsible for training new Pret employees.
He is particularly impressed by the company’s bonus system, which in some cases can treble a general manager’s salary. During the first quarter of 2009, the Baker Street Pret A Manger was hailed as one of the firm’s top shops, which resulted in Varela receiving a generous bonus, which he spent on new furniture for his living room.
Varela and his team received a £500 cash windfall in February after impressing one of the company’s mystery shoppers who visited the store. The staff spent the money on a team day out at Alton Towers. “The bonuses are very motivating,” says Varela. “If you do the right things and do what you are supposed to, you have a reward. I am always thinking about being the ‘top shop’.”