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Turkish fresh produce exports to Russia skyrocket with stabilised relations

turkish fresh produce

Turkey’s fresh produce exports have been given a sizeable boost this year by the end to the conflict with Russia. In the first four months of 2018, exports climbed 25% compared to the same period in 2017, reaching US$794 million, according to the Uludag Fresh Fruit and Vegetable Exporters’ Association (UYMSIB). In volume terms, 1.6 million tons of fresh fruit and vegetables were exported, representing a rise of 17%.

Exports to Russia rocketed by 125%, from US$90 million to $202 million. Total shipments to Russia went up by 91% to around 315,000 tons. These exports to Russia contributed 70% of Turkey’s increase in revenue in the four-month period. Exports to the EU were also up, with Turkish goods gaining access to new markets such as the Scandinavian countries.

Following a military altercation between the two countries in January 2016, Russia banned imports of Turkish fruits and vegetables including tomatoes, oranges, apples, apricots, cabbage, broccoli, mandarins, pears, peaches, cucumbers, plums, strawberries, onions, and cloves, and also poultry.

 

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Poupart Imports brings world best produce to the UK

Topfruit, grapes and summer stonefruit / soft-fruit are the mainstays of Poupart Imports’ success and continue to show annual growth, Green said.

“It’s a very dangerous business to be in and it’s daily, it’s immediate, it’s spot, it’s the open market. We are still traders, unlike the companies that supply the retailers, who are programmed and automated and predictable – we are the unpredictable end of the fresh produce industry.”

That’s Poupart Imports Senior Trader Jerry Green talking to ED about the volatile prices in the world of wholesale supply.

While at the London Produce Show in June, he said this specialist supplier to the non-supermarket sector handles high quality produce and trades across the whole UK fresh produce wholesale market, including pre-packers and processors, even retail category managers in the event they run short.

Topfruit, grapes and summer stonefruit/soft-fruit are the mainstays of Poupart Imports’ success and continue to show annual growth, Green said.

The company is also a specialist in handling consignments destined for retail which have either become ‘compromised’ (under-specification, for example) or which are ‘excess to requirement’ and which need a special type of handling.

Bases in UK & Spain

“We’re very well-placed,” Green said. Poupart Imports – part of the Poupart Ltd Group – has offices in 3 different areas.

Deep sea procurement, off-market sales, accounts and logistics are run out of its head office in Hertfordshire, in England, while most of its European procurement is handled out of its base in Figueres, near Barcelona.

A third office in Surrey, also in England, is a 2-person operation controlling some 35% of the company’s total sales volume.

Why wholesale supply is so unpredictable

Tomatoes are a huge item for the importer, which offers the whole gamut, be they round, plum, cherry, cherry on the vine, cocktail tomatoes, etc. Green said they are a good illustration of the challenges of buying on the spot market as it takes very little to change the supply and demand equation.

“A little blip in the temperatures in the production area and it looks like there’s a spike in demand. There’s not, demand is constant, it’s just the supply is not there, so it contributes to a hugely volatile market.”

Also volatile is the market for iceberg lettuce, where a 5kg box can be £10 one day, £5 the next day, £2 the following day and £8 the day after, Green said.

“We operate within probably the purest form of the oldest economic law, that of supply and demand. Prices move in an instant depending upon the perceived availability or under-supply.”

Salad and vegetables procurement via Spain

Poupart Imports offers a wide, seasonal product range. Green said salad items and vegetables are procured almost exclusively by the firm’s base in Spain. “We handle all sorts of salads, leaves, capsicums, aubergines, courgettes, tomatoes and a range of vegetables – a pretty comprehensive range – but there are various products, like potatoes and onions that we don’t find worth touching as we don’t have the product knowledge, contacts or expertise properly to manage these categories.”

Spain is the main source of Poupart’s salads and vegetables but it also sources from France, Italy, Morocco and Poland.

Avocadoes: mainly sourced from Peru but also South Africa, Spain

Poupart aims to supply avocadoes year-round, mainly drawing its supply from Peru (50%), South Africa (25%) and Spain (25%). Green said Hass is the biggest seller in the UK, and what the retail sector mainly sells, but Poupart Imports doesn’t tend to handle that variety. The open spot market sells mostly greenskins, such as Fuerte, Pinkerton and Zutano.

The company doesn’t tend to import products such as pineapples as a retail programme is required to successfully manage the individual season and to mitigate losses incurred in the spot markets. “This is really outside the remit of Poupart Imports as non-retail is the target market,” Green said.

The company does however import melons – from Europe, Brazil, Costa Rica, Honduras, Panama and Guatemala – for its open market business.

Year-round grape supply and largely seedless

It imports grapes throughout the year, averaging about 60 pallets a week but attuning its volumes to supply and demand. “If there’s an oversupply, we will attempt to dissipate that supply across the market, if there’s an undersupply we do our damnedest to procure whatever we can, safe in the knowledge that it can be traded successfully in such times of high demand.”

The company does import a seeded grape variety in Red Globe but about 85% of its grapes are seedless and mostly white varieties, particularly Thompson, Sugarone and Superior. Red varieties such as Flame and Crimson complete the offer.

“Obviously we start off in Europe, and that lasts us through to about September-October, from there we go to Brazil, Peru, and then South Africa. After Christmas it’s still a bit of South Africa, then we major on Chilean red and green grapes before going heavily into India. At the end of the Indian season, which is about now (early June), you’re looking at bringing in Israeli, and Egyptian before we go back into the European season in about a month’s time.”

“We bring it in in bulk 9kg, in 4.5 kg boxes and in ready-packed 10 x 500g punnets, labelled or unlabelled, and with single or mixed varieties in the punnet –  whatever the customer wants.”

Wide client base

As for its clients, Green said Poupart supplies virtually every Total Produce outlet in the UK wholesale sector and views the group as an integral part of its customer base.

Other clients include Barton & Redman in Manchester’s New Smithfield Market; H G Walker, Premier Fruit and P&I at New Covent Garden Market; JT Produce, Payne Simmons and Mirpa/Cypro Food in London’s Spitalfields Markets; Burbank in Bradford, Crossley and Graham, and Nicol & Dow in Glasgow, just to name a few.

Keeping customers by keeping them happy

“We never become complacent about our customers and fully accept that no customer belongs to us no customer belongs to us, they just happen to be customers who are reasonably loyal to us in the short term. There’s no long term about it unless we continue to perform for them and keep the customers satisfied. We do manage to keep customers loyal to us and in some ways dependent upon us because we’re pretty good at what we do and have become acknowledged market leaders in the sector,” Green said.

“We have a 12 man sales desk if you like, albeit split up between the 3 offices, and we attempt to service the best part of 138-140 customers. Every single day, they will all get at least one phone call a day from us and if they don’t take one particular product they’ll take another. Very rarely do you put the phone down without selling somebody something.”

“We’re there five days a week most of the year and six days a week during the summer months when there’s a lot of stonefruit. We are viewed as being one of the two principal suppliers to the wholesale sector,” he said, “and continue to enjoy this position thanks to the professionalism of the procurement and sales teams, the synergy between the two, the back-up provided by the admin and logistics departments and above all by the comprehensive nature of our daily offer to the market.”

Poupart Imports: http://poupartimports.co.uk/

JB

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Inside India’s biggest e-grocer – BigBasket

Big Basket is currently India’s biggest online grocery player, clocking an average 12,000 orders a day – 70% of which include fruit and vegetables – and sales growing 10-15% month on month.

BigBasket says fruit exporters have a big chance to grow their brands in India, the world’s 6th largest grocery market e-grocery

Currently India’s biggest online grocery player, BigBasket clocks an average 12,000 orders a day – 70% of which include fruit and vegetables – and sales growing 10-15% month on month.

Even so, that’s just a drop in the ocean of potential grocery e-commerce in India. Against a total F&V market of about US$ 53 billion, modern retail sales of fresh fruit and vegetables contribute around US$ 500 million and online sales around US$ 30 million. So said Vipul Mittal, head of fruit and vegetables for Bangalore-based BigBasket.com.

Speaking to ED from India, Mittal also stressed that e-retail success is “not as simple as it looks.”

“A lot of back end work has gone into this company over the last 3-4 years to make it very powerful. It’s about being a comprehensive service and delivery package and not just a web site.”

And Indian consumers look for value irrespective of the channel through which they buy. Hence constant benchmarking against all competitors takes place to compare prices and ensure value, he said.

E-grocery potential in India

With an estimated 1.27 billion people — and likely to overtake China by 2028 as the world’s most populous country — India also has lowest rate of meat consumption, highest rate of vegetarianism, and a growing affluent class keen to try new cuisines.

According to the Indian daily Business Standard, last year Randstad India – which pegged India as the world’s 6th biggest grocery market – estimated just 1% of the groceries Indians buy are online. By 2020, it expected that to grow to 2%, making India’s online grocery market worth around €9 billion.

Indian households tend to buy fruit and vegetables 2-3 times a week, and the same trend is seen on Bigbasket.

Mittal said e-commerce facilitates insight into consumer buying patterns and allows the offering to be tailored accordingly, for instance running a promo on apples to all mango customers in the off-season (July).

Expansion into ready-to-cook food

The online retailer sells other grocery items apart from food, such as personal hygiene products, but until now, sales of fruit and vegetables have hovered around 14-16% of its total value sales, Mittal said.

However, having built a solid customer base, it now plans to increase its assortment further with many other food products including an imported and gourmet range.

According to recent reports, BigBasket is also set to offer more organic fruit and vegetables and plans to start selling gourmet salads and ready-to-cook meals – initially Thai, Mexican and Italian dishes – that include freshly cut vegetables and other ingredients, and recipes. This it has launched under the brand ‘Happy chef’ – a la Blue Apron.

Technology aids forecasting

Getting supply right is the key to BigBasket’s success, Mittal said. ”We have used a lot of technology for forecasting demand and use a dynamic model to plan capacity and the availability of vehicles.”

“Historical data has limited scope to assist demand forecasting in perishables, especially when the growth is so rapid and there are multiple variables.”

Big Basket has developed backward linkages with growers and buys directly from growers wherever possible, giving it better control of quality and enabling delivery of fresher produce by reducing time between harvest and consumption.

Direct sourcing preferred

BigBasket is currently located in six cities – Bangalore, Hyderabad, Mumbai, Pune, Chennai and Delhi – and tries to source what it needs in the vicinity of each.

By the end of this financial year, it will have opened 50 more locations, all in clusters with 5-6 cities around six central locations typically with one central warehouse.

BigBasket has no contracts with growers as yet, but is setting up collection centres to source directly from multiple farmers. It plans to establish linkages to bring safe food to the table with complete traceability, having already set up four such centres in southern India.

“We are currently a very small player with respect to total production in an area. So typically when we go into source areas, there are multiple farmers who can supply us. We create an enabling environment for the farmer to bring his produce to us soon after harvest and provide him the transparency of price and weighment. We have also initiated a pilot to provide extension services to the farmers through our field agronomists.”

BigBasket may also draw on wholesale markets to fill any gaps but prefers not to, Mittal said, because the produce is a step further from harvest, therefore less fresh and more expensive. “Quality and freshness are the driving force rather than price and margin.”

Chance for exporters to build brands

In terms of opportunities to export into India, it is a matter of creating differentiation, which so far has been very limited. BigBasket is looking to stand apart by bringing in different products and varieties, such as seedless watermelon, wider variety of pears and apples, exotic fruit, etc. (Few vegetables are imported by India, mainly due to shelf life reasons.)

Mittal stressed he sees a big – and so far largely untapped – potential for foreign suppliers to harness e-commerce to build their brands.

Most imports into India are channelled through traders and conventional retail channel. Growers/shippers don’t have much opportunity to build their brands because they don’t have much control over distribution channels, as well as other marketing elements. BigBasket, in contrast, can package, display and deliver its imported apples under a brand, for instance.

“It’s a big opportunity to build a brand in India, where ecommerce is still in a very infantile stage but set to expand rapidly,” he said, stressing e-commerce’s power to communicate directly to consumers.

(BigBasket is also said to be looking at launching a data analysis business to offer information on customer trends related to brands.)

Also on imports, Mittal said produce should adhere to global food safety and quality standards but trade with India is “not as tricky” as with the EU and US.

No questions asked returns

BigBasket’s customers mostly order by noon for same day delivery or choose a convenient slot among four options the next day. Insulated boxes are used to maintain the cold chain for temperature sensitive products such as mushrooms.

Its recent acquisition of a a hyperlocal food delivery startup in Bangalore will be act as a springboard to compete with rivals offering hyper-rapid delivery.

Mittal said customers can return produce at the time of delivery if for any reason they don’t like it. The return rate for fresh fruit and vegetables is about 0.5% and the most common reason is a problem with quality caused by transit damage.

Analysis of complaints has led to service improvements, such as in the case of customers finding worms in their cauliflower. Now the company has introduced florets, thus solving the worm problem “and adding value.”

Another big source of complaints was fruit being delivered semi-ripe. Thus, in March, BigBasket set up a ‘freshometer’ – for bananas, mangoes and papayas – on its sales page so consumers know when to eat them. Mittal said this is important because BigBasket tends to ship these fruit to consumers at the semi-ripe stage – to reduce transit damage – so consumers need to know what to expect and when to consumer for best results.

Customers expect Big Basket to be ‘greener’

Mittal said customers’ increasingly expect Big Basket to be environmentally friendly, but e-grocery has its pros and cons in this regard.

On the one hand, all its produce must be pre-packed for home deliveries and till recently only plastic was used. But unlike on retail store shelves, having transparent packaging is not a necessity for home deliveries, so Big Basket is now trying to increase its use of more eco-friendly packaging, such as paper and cardboard boxes. “For example, this season all mangoes were shipped in cardboard boxes,” Mittal said.

BigBasket.com

JB

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Prophet tracing fresh produce around the globe

Prophet is a leading designer and provider of supply-chain software for the food and horticultural sectors, with extensive expertise in fresh and chilled horticultural products, and was an official partner and sponsor at the show.

“Traceability is now expected by retailers, as opposed to something that’s nice to have,” Prophet customer relations director Paul Seekins told ED at the London Produce Show.

Prophet is a leading designer and provider of supply-chain software for the food and horticultural sectors, with extensive expertise in fresh and chilled horticultural products, and was an official partner and sponsor at the show.

Seekins said one of the competitive advantages of Prophet’s software is batch control.

“A batch can be as big or as small as you want it to be – it can be a ship, a truck or even down to a pallet – it gets a unique number no matter where it goes, if split down, packed, wasted or marketed, whatever, the identify of that batch goes with the product.

“It can end up on the shelf as something completely different but we can trace back to that raw product, who supplied it and potentially which field or tunnel it was grown in, depending on the requirements of that particular supply chain.”

Traceability is now much higher on the agenda for retailers and suppliers, Seekins said. In the US, fresh produce food scares – where, for example, people have died from food poisoning linked to eating melons – has highlighted the need for much higher levels of traceability.

“Because not only do you need to know that you have an issue now, you also need to know precisely who else has had that particular batch in order to be proactive and do a proper recall, without scaremongering everybody who might have ever bought something from you.”

“We specialise in fresh produce and therefore we deal with all kinds of it – everything here at the show is a commodity that is being transacted on our system somewhere in the world,” he said.

Prophet: http://www.prophet.co.uk/

London Produce Show: http://londonproduceshow.co.uk/

JB