Nestlé trades in-house design for global experience

The position of Nestlé UK’s three-strong design roster has been called into question, with news that the company has agreed to sell its in-house design division, Group Creative Services, to US-based branding and design consultancy Anthem Worldwide (DW 24 November).

Anthem executive vice-president Anne Marie Pagliacci says that Anthem will now compete to pick up as much Nestlé work as possible, acting in competition with roster groups Bloom, Coley Porter Bell and LMC Design, by improving the consultancy’s strategic capabilities.

‘One of the things we will build up is the strategy offering, which I think is the reason that Nestlé may have gone outside of Group Creative in the past. It is safe to say there will be competition here; everyone has to keep creating good work,’ says Pagliacci.

Under the terms of the sale of Group Creative’s assets and staff – the value of which Pagliacci declines to disclose – Anthem takes an initial guarantee of a proportion of Nestlé projects. ‘There is an arrangement [for work], but it’s ours to lose if we mess it up,’ she says.

Nestlé UK is in a consultation period with the 50-strong Group Creative team, which will be completed on 3 January 2006. Consequently, the company will not discuss any aspect of the transfer at present, says a spokeswoman, although both Nestlé and Anthem Worldwide claim there will be no redundancies from the division as a result of the sale. Nestlé has not yet contacted its roster consultancies to outline how the development might affect the workings of the roster.

David Hudson, Nestlé UK corporate affairs and communications director, says that the deal will give the company’s designers the opportunity to ‘leverage the focused support of a global design consultancy’ and to work on brands both within and outside the Nestlé portfolio. It will allow Nestlé to concentrate on the manufacturing, marketing and selling of its products, which Hudson describes as the company’s core activities.

Nestlé wants the Group Creative team to continue to work on projects but keep the [designers] inspired by working on other [non-Nestlé projects. Anthem’s culture is such that we will bring in expertise from other offices where needed, too,’ adds Pagliacci.

Group Creative Services managing director Barrie Creaser is in line for retirement and Pagliacci is poised to appoint a managing director to oversee the division when it becomes Anthem Worldwide. The managing director post will also involve running an Anthem office in London, which the company plans to launch either from scratch, or through the acquisition of another group.

For Anthem, owned by US brand development and imaging company Schawk, the deal with Nestlé is the first strike in plans to develop its presence in the UK and continental Europe. ‘Anthem’s introduction to the European market, through Nestlé is a first-class way to build Anthem’s brand name throughout Europe,’ says Nigel Parsons, president of Schawk Europe, based in Leeds.

Transfer of Undertakings (protection of employment) Legislation

• The transfer of in-house teams to an external business is subject to TUPE legislation
• TUPE guarantees employees the legal right to be transferred to the new owner, so such sales cannot be used to justify redundancies
• In practice, redundancies do happen, either because some staff do not want to join a new business, or because it is difficult to find a buyer for a team that is intact
• Many seller businesses do offer redundancy packages to staff, but it is illegal for the buyer to have any part in any restructuring process
• Restructuring must be completed before the deal goes through

ANTHEM WORLDWIDE

• A Schawk Strategic Design Company with offices in the US, Canada, Singapore, Japan, Australia and China
• Set to launch London office alongside Nestlé-based York office
• Disciplines cover brand development, naming, corporate identity, packaging, collateral design, audit and analysis
• Clients include: Glaxosmithkline, Cadbury Beverages, Diageo, Kimberly-Clark, Kraft, Nestlé and Parmalat