Abares Outlook Conference 2011Abares Outlook Conference 2011Supplying and Meeting the Demands of Supplying and Meeting the Demands of

Processors and RetailersProcessors and Retailers

Shane SchnitzlerShane Schnitzler

ContentContent

1. Overview – A National Perspective of 1. Overview – A National Perspective of the Fresh Produce Industrythe Fresh Produce Industry

2. Kapiris Bros – Overview from 2. Kapiris Bros – Overview from Production to RetailProduction to Retail

3. Who Drives Demand – Marker Forces3. Who Drives Demand – Marker Forces 4. Managing Demand4. Managing Demand

Approximately 6,000 Retail Outlets + Food ServiceApproximately 6,000 Retail Outlets + Food Service

Approx. 400Approx. 400 WholesalersWholesalers

15,000 – 17,000 Production Businesses15,000 – 17,000 Production Businesses

21 million consumers in Australia

Seed, crop protection and fertilizer (input) companies

Approx. 50 companies

1,000 bigger retail outlets + 10 retail chains + Food Service 1,000 bigger retail outlets + 10 retail chains + Food Service

IntegrationIntegrationBoth vertical Both vertical Approx. 80 key Approx. 80 key

and horizontal and horizontal WholesalersWholesalers

Approx. 3,000 main producers and of these approx. Approx. 3,000 main producers and of these approx. 1000 key producers1000 key producers

21 million consumers in Australia

Seed companies – 3 total 65%Crop Protection – 4 total 70%

Fertilizer – 1 total 50%

Kapiris Bros OverviewKapiris Bros OverviewMarket SegmentsMarket Segments Wholesale market Wholesale market Large independentsLarge independents Multi nationalsMulti nationals Food service needsFood service needs National accounts National accounts

Understanding the supply chain commodityUnderstanding the supply chain commodity Managing the product and production - highs and lowsManaging the product and production - highs and lows Plant yield or a more consistent approach - weather dependantPlant yield or a more consistent approach - weather dependant Harvest stages - Pick at what colour?Harvest stages - Pick at what colour? Distribution centres Distribution centres Value addingValue adding Managing food milesManaging food miles

Who drives demand?Who drives demand? Shelf spaceShelf space Multi nationalsMulti nationals WeatherWeather Similar productsSimilar products

What drives demand?What drives demand? Weather/ gas & electricity shortagesWeather/ gas & electricity shortages Specials & increase in shelf spaceSpecials & increase in shelf space Matched competitionMatched competition Product shortages creates internal demandProduct shortages creates internal demand

Competitive tensionCompetitive tensionCustomer vs customerCustomer vs customer Product vs productProduct vs product State vs stateState vs state

Managing InterfaceManaging Interface Our farms vs wholesaleOur farms vs wholesale Other farmers productOther farmers product Wholesale pricingWholesale pricing Retail outletsRetail outlets Import and exportImport and export

Managing riskManaging riskFarming undercover vs outsideFarming undercover vs outside Value recoveryValue recovery Production cycleProduction cycle Export and importExport and import On time paymentsOn time payments

Cost of meeting demandsCost of meeting demands

Quality assurance systemsQuality assurance systems Freight Freight Packaging Packaging Equipment/ machinesEquipment/ machines Labelling requirements Labelling requirements IT/ hand held'sIT/ hand held's Warehousing systemsWarehousing systems GPS systems on farm and freightGPS systems on farm and freight And importantly, people – finding and developing a good team!And importantly, people – finding and developing a good team!

Return On InvestmentReturn On Investment Managing the highs and lowsManaging the highs and lows Business development – new varieties Business development – new varieties

and time lagand time lag One category of broader fresh produceOne category of broader fresh produce One segment of the fresh food industryOne segment of the fresh food industry

SummarySummary

If you want to be a successful fruit If you want to be a successful fruit & veg producer and supply chain & veg producer and supply chain

provider…..provider…..

You need to be able to ...You need to be able to ...