Archive for 'Industry Politics'

I did not think I would end up writing that soon again about what is the Holy Grail  to some and an abomination for others – regulated marketing!  But as the New Zealand apple industry is trying to come to grips with the opportunities and threats represented by gaining access to the lucrative Australian market, the regulated marketing concept is getting another outing.  And rightly so, if for no other reason but to ensure that the industry has looked at all the options open to it.  As it stands, the debate on the matter is going on right now as I write this, today,  at the Pipfruit Meeting  in Hastings.

What is the core issue?

Well, when  apple marketing was deregulated in the late nineties the New Zealand pipfruit industry was shaken to its core, pardon the pun, and there exists a more or less general agreement that we stuffed up had not thought the issues entirely through and acted prematurely.  The since reconstituted, changed and slimmed down pipfruit industry which is earning no where near the margins it did under regulation is within reach of the biggest prize denied for close to a century – market access into Australia.  Naturally those of us who have learned from our actions and are also able to observe the fortunes of our friends, the kiwifruit growers, would like to see an orderly approach to entering the Australian market rather than a stampede akin to the “Running with the Bulls’ festival in Pamplona, which is a real possibility.  The smart money amongst the apple growing fraternity is trying to gain government support for creating order by way of manouvering Australian apple exports into HEA jurisdiction.  The excitable element of the industry, the element who are natural salesmen, be that of apples or second hand cars, do not want a bar of this. I do sincerely hope that common sense will prevail.  We need to go to Australia in a coordinated and strategic fashion.  Loose cannons need to get to the back of the queue and let wiser heads prevail.

A tricky one, though.  A free market government that nevertheless supports the kiwifruit regulations and faces an election in three months time.  An authority, HEA, who is all sorts of things but NOT a regulator in the way apple growers might think or like.  Australian growers who would love nothing better than see us shoot ourselves in the foot.  And Australian corporate retailers ready to pounce.

By the way, let us not for even one minute assume that Australian growers have rolled over and are playing dead.  On the contrary, here is a submission by one Australian orcharding family which considers itself under threat from our apples.

Zespri Stand at Fruit Logistica Berlin 2011

I sympathise with Turners & Growers.  I truly do.  Here they are, the quintessential New Zealand produce marketer, which in the 1960s probably did more than any other company at the time to turn kiwifruit into the commercial boon the fruit  is  for New Zealand today. But can they sell kiwifruit today?  Nope! Why not? Because of a set of  Parliamentary Regulations which ensure single desk status for what used to be the grower owned marketing company – Zespri.  Well, in a roundabout way anyway.  It is actually a little more complicated than that but I don’t want to open that can of worms right now.

Here is what I wrote on Twitter just now: 

Why do householder surveys on kiwifruit regulation? Zespri is the ultimate scale model, the NZ industry can’t afford not to have it. Period.  

Exactly 140 characters by the way, but I am digressing. I am a free marketer from way back, which is not surprising given my supermarket background; but I mean every letter of that Twitter message.  Turners & Growers have waged quite an effective PR campaign on their opposition to the single desk  model for kiwifruit and some of their arguments do actually make sense.  At the end of the day though, the horticultural industry simply cannot afford to jettison the only scale model it has in order to satisfy free market principles. Sorry guys, but no can do.

I must have missed this last year but someone has obviously been busy.  Business New Zealand seems to have updated the info on its Food & Beverages pages in March 2010.  Check out the Horticulture section.  Not entirely complete and up to date but , hey, at least we are there.

A Prominent Image from the Zelger Produce Website

The latest edition of Fruchthandel arrived on my desk today.  As the magazine is aimed at the German fresh fruit & vegetable trade the articles it contains are inevitably written in the language of that country.  Quoting from an article is therefore not as simple as scanning in  a page but it involves engaging the grey matter some translation which is why I rarely get around to discuss what I read in that magazine. 

I need to make an exception though. My eye caught a column contributed by one Marcus Niebisch.  Mr Niebisch works for Munich based produce wholesaler Zelger GMbH, and  sits on the board of the Deutscher Fruchthandelsverband e. V., the German Produce Merchants Association (English website version available).  Here are a few gems from his column in which he discusses the state of the produce wholesale trade in his country vis-a-vis retailers and consumers. 

“A key driver of our activities should also be increased usage of fruit and vegetables…Have we lost our ability to influence the Point of Sale sector ( POS), that’s if we ever had it?…Is the structured grocery retail sector really the only bridge left between the producers for whom we provide services and the consumers who we try to tempt (with our products)? …How can we transform supplier confidence into consumer confidence?”    

I have taken the key statements made and lined them up.  The underlying message revolving around these sound bites is that the position the German wholesale produce trade finds itself in appears to be  not sustainable, so non-linear solutions are needed. 

Here is Niebisch again… 

“We need to generate our own POS (vehicle) which we are able to mould and care for ourselves.  At this Point of Service (not a typo, Niebisch specifically used ‘service’ here and not ‘sale’) we would be allowed to market the passion, which made us join the industry in the first place.  Maybe wholesalers should discover the collective “we”.  Are modern marketing options possibly our chance to connect again with the consumers and their, as well as our own, wishes?” 

If nothing else, here is confirmation yet again that the world has become a global village and what we might perceive to be a unique problem only applying to us is in fact generic and is present everywhere.

Kiwi Ingenuity Under Threat

Here we go again. Everyone has an opinion. Sue Kedgley does not like it, an academic from Otago university has never seen anything like it and smells an ethics issue and Katherine Rich from the Food and Grocery Council says her children like it. What am I talking about? The latest marketing initiative by Yummy, John Paynter’s innovative fruit growing and marketing company. Luckily children take a while to adopt their parents’ prejudices. For goodness sake, eating fruit should be fun and we need to get the next generation into eating fresh fruit and vegetables.
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