J U LY 2 0 1 4
The Future of Cold Storage Top 10: Food Processing Brands India’s Top Grocers vs. Mom-and-Pop Stores
Higher Learning: Burger Uni’s Management Training
IN THIS ISSUE
8
Production
14 Franchising
34 Top 10
48 Heineken in Ethiopia
154 PRONicaragua
EDITOR’S COMMENT
Preparing For The Unknown impossible – that much is simply a part of life. But while we can’t know ahead of time what the future will hold, we can make our predictions and prepare for it accordingly. We can analyze trends in the cold storage and cold chain industries, for instance, and adjust our manufacturing goals to meet the needs of our consumers. We can learn from growth patterns and training techniques at work around the world, and use that knowledge to plan how we do business in the years to come. We can anticipate what can go wrong, like trademark infringements, and cut danger off at the pass. So read on, enjoy, and prepare for the future by learning from the past. Enjoy the issue! KNOWING THE FUTURE IS
Sasha Orman Editor Sasha.Orman@wdmgroup.com 3
CONTENTS
FEATURES
14 8 PRODUCTION How to protect your Trademark
20 RETAIL
FRANCHISING Higher Learning: Management Training at Burger Universities
Industry Insight: Top Grocers Go Headto-Head with India’s Mom-and-Pop Stores
TOP 10
Food Processing Brands
34
SUPPLY CHAIN The Future of Cold Storage
28
5
Co n t e n t s
120
Coinadrink
48 Heineken in Ethiopia company profiles This month we feature Heineken in Ethiopia, where we focus on some exciting new investments in what is becoming a fast and expanding Ethiopian market Africa
162 Cargill
48 Heineken in Ethiopia
174 CANIRAC (Association)
68 Makro
182 International Meal Company of MĂŠxico (IMC)
84 Guinness Ghana Breweries 98 Majesty Oil Mills
Europe 108 Danya Foods 120 Coinadrink 130 AmRest Spain
America Latina
Canada 204 AgroCorp 212 St. Albert Cheese
Brazil 224 Josapar
Australia
154 ProNicaragua (Association)
238 Tassal Group
July 2014
Danya Foods
194 Grupo Empresarial CHAMA
140 Ingenio Monte Rosa (Pantaleon)
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108
7
Co n t e n t s
120
Coinadrink
48 Heineken in Ethiopia company profiles This month we feature Heineken in Ethiopia, where we focus on some exciting new investments in what is becoming a fast and expanding Ethiopian market Africa
154 ProNicaragua (Association)
48 Heineken in Ethiopia
162 Cargill
68 Makro
174 CANIRAC (Association)
84 Guinness Ghana Breweries
182 International Meal Company of MĂŠxico (IMC)
98 Majesty Oil Mills
Europe 108 Danya Foods 120 Coinadrink 130 AmRest Spain
America Latina 140 Ingenio Monte Rosa (Pantaleon)
6
July 2014
108
Danya Foods
194 Grupo Empresarial CHAMA
Canada 204 AgroCorp 212 St. Albert Cheese
Brazil 224 Josapar
7
PRODUCTION
8
July 2014
How to protect your Trademark General Mills and the Girl Scouts of America are not going easy on e-cigarette makers for their liberal use of names like “thin mint” and “cinnamon toast crunch” – here’s why you shouldn’t either, and how you can protect the integrity of your products. W R I T T E N B Y: S A S H A O R M A N
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PRODUCTION WHEN YOU HAVE a favorite flavor, it’s not unusual to want more of that flavor everywhere you go. That was most likely the reasoning behind electronic cigarette makers coopting popular flavors like “Cinnamon Toast Crunch” and “Thin Mint” for liquid nicotine flavors. E-cigarettes are already rising in popularity with generic flavors like pineapple and chocolate, but those don’t have that brand loyalty-triggering name recognition. If consumers love their Cinnamon Toast Crunch in cereal form, wouldn’t a Cinnamon Toast Crunch in e-liquid cartridge form appeal to them as well? But just because consumers want it, that doesn’t mean it can
‘If you haven’t used a brand name in long enough, or if enough third parties have used it without any argument from the owner, a judge could rule that your brand has become generic’ 10
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– or should – happen. Thin Mint and Cinnamon Toast Crunch may be beloved flavors, but they are also attached to, respectively, a hugely powerful national organization and one of the biggest food production powerhouses in the world. The Girl Scouts of America and General Mills aren’t too keen on third parties using trademarked brand names for their own unrelated products (the fact that Thin Mints and Cinnamon Toast Crunch are for the children, while vape cigarettes most certainly are not, probably doesn’t help). So what’s an infringed-upon brand to do? Litigation – when General Mills found out that Cinnamon Toast Crunch was being used in an unauthorized way, it sent out cease and desist motions posthaste. This may have happened to General Mills recently, but Cinnamon Toast Crunch isn’t the first brand to have its trademark infringed upon, and it certainly won’t be the last. Just as General Mills isn’t putting up with it, you shouldn’t have to put up with it either if it happens to your brand. With these pointers, you can help to keep your brands proprietary and the law on your side.
HOW TO PROTECT
YOUR TRADEMARK
Regular use of a brand without owners permission will reduce the brands value and the owners rights to it
Ensure That Your Trademark is Up to Date While it should be obvious, sometimes we can sometimes let things fall through the cracks. But some lapses can prove to be more disastrous than others. Even a relatively momentary lapse on a website’s domain name, for example, can give poachers just enough time to swoop in and purchase it, causing a lot of time consuming headaches for the original owner. When it comes to the perils of falling into the public domain, trademarks
aren’t beholden to quite the same rules and constant renewals as copyrights. But public domain is still a threat – if you haven’t used a brand name in long enough, or if enough third parties have used it without any argument from the owner, a judge could rule that your brand has become generic and you won’t have a case. Which brings us to our next point. Stay Consistent in Trademark Disputes As an executive for your brand, 11
PRODUCTION Be consistant and attentive in protecting a business’s products and services brands, as the premium assets of any business
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HOW TO PROTECT
you know that consistency is key for product quality and consumer satisfaction. It’s also the key to winning a trademark dispwute. If you allow some trademark infringement conflicts slide, you will have a harder time arguing your case when you do decide to take an issue to court. It’s still important to pick your battles wisely and not to waste time and money by being overly litigious – some cases, like a local ice cream shop using your brand to suggest the name of a flavor for example, just aren’t worth the effort of going to court. But by fighting for your brand whenever it’s needed, the court can see that you are serious about protecting your brand and will be more likely to side with you on a regular basis.
‘Consider investing in a trademark enforcement services business to keep track of your trademarks and go after third party offenders’
YOUR TRADEMARK
Hire a professional IPO company to help enforce your brands Hire an Enforcement Service Dealing with a third party business is taking advantage of your brand names can be frustrating and time consuming for a company that already has so many issues to worry about. But because ignoring the problem won’t make it go away, it’s still a task that needs to be taken care of sooner rather than later. Luckily, there are businesses that will do the work for you. Consider investing in a trademark enforcement services business to keep track of your trademarks and go after third party offenders with the necessary cease and desist tactics whenever the occasion arises. 13
FRANCHISING
Higher Learning: Burger Uni’s Management Training From McDonald’s Hamburger University to InN-Out University, what are the benefits of an intensive centralized training program and how can they further your growth strategy? Writ ten by: SASHA ORMAN
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FRANCHISING FRANCHISES MAY BE businesses divided on a local or regional level, but that division shouldn’t be visible to the consumer – even restaurants with menus that vary slightly by region are still bound by a common look and a common philosophy. That’s not a bad thing – in fact, few assets are more critical than consistency. The knowledge that a core menu item from one of your locations in Idaho will taste the same as a location in Iowa or Oahu, in a store with a similar look and delivered with a similar level of friendly service, is an appealing source of comfort and a reliable way to attract consumers to their favorite QSR chain. The best way to maintain that consistency is through standardized training, and in that regard, all fast food chains understand the importance of teaching the basics. But some chains and franchises go above and beyond with “university” programs meant to teach the finer points of management, leadership, and brand positioning. McDonald’s Hamburger University is the most famous example of this kind of advanced training program, still recognized today for being the first to open a global training center, but today chain restaurants like In-N-Out 16
July 2014
McDonald’s Hamburger University is recognized as being the first to open a global training centre
M A N A G E M E N T T R A I N I N G AT B U R G E R U N I V E R S I T I E S
The In-N-Out University provides programmes to train their staff with the founding principles that uphold the restaurants’ success offer similar programs. This level of training is a lot more costly than any series of instructional videos that can be watched during downtime in the break room. So is the return on investment worth it? What could the development of a university program do for your franchise? A Unified Message of Leadership According to In-N-Out, the creation of its In-N-Out University in 1983 has helped it achieve a very particular training goal: “The university, a training school for new managers, reinforced In-N-Out Burger’s business tenets and standards and ensured uniformity of management techniques and methods.”
When employees are trained solely at a local level, that training can become a game of telephone – filtered through new employees for years, strategies and core values can become distorted. By collecting new and hopeful managers all in once place, you can better control the lessons that new managers are learning and ensure that their training is similar in quality and content. Armed with this standardized knowledge, these new managers can take their university lessons with them to any region practically anywhere in the world. This can go a long way in reassuring your corporate team and stockholders that you are maintaining a consistent level of quality throughout your locations. 17
FRANCHISING
Chipotle Mexican Grill’s restaurateur program promotes dedication, initiative and leadership qualities helpings the graduates develope their careers while gaining recognised skill sets along the way
Encouraging Employee Personal Growth A common problem in retail and foodservice jobs is a feeling of frustration among workers that there is no real way to move up. Global training centers serve a big role in showing employees that there is a way to advance for the right employees with the right dispositions. 18
July 2014
According a Businessweek report, for example, In-N-Out University standards require that its students must be demonstrably dedicated – having worked for the company for at least a year, with known instances of showing initiative and an interest in leadership, with the people skills necessary to make a good leader. Similar signifiers are in place for
M A N A G E M E N T T R A I N I N G AT B U R G E R U N I V E R S I T I E S
‘The knowledge that taking initiative could have real results can be enough for some employees to grow personally and strive to succeed’ Chipotle Mexican Grill’s restaurateur program, which takes promising hourly employees on a path from kitchen manager to general manager to team leader. The knowledge that taking initiative could have real results can be enough for some employees to grow personally and strive to succeed. While your employees should have a clear path before them to advance in their career with your business, ultimately not all of them will opt to take that path – and that’s okay. But those who do, and who prove themselves in the field of leadership, can be encouraged appropriately with a shot at an education. What’s more, these management courses can also help with employee retention. While employees are free to leave the company of their own
free will, whether or not they’ve taken management training courses, an employee is much more likely to stay invested in a company that has obviously taken an invested interest in their future and your career path. Go Forward and Expand Now that you have a league of employees well-trained in the arts of managing one of your stores and being an effective team leader and brand ambassador, you are perfectly primed to expand your brand. Typically, graduates of a franchise university type program make excellent choices for managers in new locations, as they have a keen understanding of the brand and its expectations, as well as strong training in effective management techniques so that you can be more confident that the store is being run well. “If we are going to go anywhere, we’ve got to have talent,” says Ray Kroc in McDonald’s description of Hamburger University. “And, I’m going to put my money in talent.” If a titan of industry like Ray Kroc considered global training to be worth the investment, it’s certainly worth considering as your franchise grows. 19
R E TA I L
Industry Insight: Top Grocers Go Head-to-Head with India’s Mom-and-Pop Stores 20
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Competition from local mom-and-pop stores, which constitute 90 percent of India’s $500 billion retail market, price-sensitive customers, and low margins remain the core challenges to the growth of organized food retailing in the country W ri t t e n b y: S A S H A O R M A N 21
R E TA I L
A kirana store
‘Far and away, the largest challenge that international multibrand retail groups face in India is from the country’s strong kirana store culture’
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EVERY COUNTRY IS unique, and India in particular has been presenting unique challenges to the retail industry. For decades, its culture of kiranas (family-owned corner stores) has worked hard to keep multinational retail chains from entering the market, a policy born of worry that this kind of competition could crush local business and harm India’s economy. In some ways, the times have been changing in India on this front. In 1997, India’s foreign direct investment (FDI) policy changed to allow international retail chains to enter the country as cash-and-carry wholesale suppliers; in 2012, India began opening its doors further to the possibility of foreign retail trade. But for those who have decided to enter this new market, turning a profit has proved to be a complicated matter. Overcoming Culture Far and away, the largest challenge that international multi-brand retail groups face in India is from the country’s strong kirana store culture. Much like New York City’s bodegas, kirana stores are a strong part of India’s cultural landscape as much as its commercial landscape. Corner
T O P G R O C E R S V S . I N D I A’ S M O M - A N D - P O P S T O R E S
These local stores are the ‘corner stone’ of their communities, the customers are overwhelmingly loyal and in return the stores are mutrally supportive and of other local businesses that they serve stores are often family-owned, passed down through generations, and have strong rapport with the families who have grown up buying their wares. Tied strongly to their individual communities, these retailers are known to invest heavily back into their hometowns and support their neighbors as much as their neighbors support them. But while they may sound quaint, most kiranas take a
keen interest in staying up to date on the best products and meeting their consumer base’s needs. It’s a culture that is strongly protected in India, leading to the laws that until only recently kept international retail brands out. Although government opposition to international growth has ebbed, consumers have overwhelmingly stayed strong in their resolve to 23
R E TA I L
Best Price, a Walmart venture into the Indian wholesale sector, like other large international and national retailers, are hemorrhaging money and still struggling to attract consumers to purchase food products
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T O P G R O C E R S V S . I N D I A’ S M O M - A N D - P O P S T O R E S
continue shopping at their corner markets even as large grocery options like Best Price (a Walmart subsidiary) and Germany-based Metro AG have moved in. According to recent reports, these large international retailers – and even large India-based retailers like Aditya Birla Retail – are hemorrhaging money and still struggling to attract consumers to purchase food products. Large organized retailers in India lost a total of Rs 13,000 crore within the fiscal year 2013/2014, and experts expect that this number will continue to rise as the years progress. Pulling Back the Reins For some, it’s not worth the struggle. Take Carrefour, for example – with over 10,000 locations worldwide and €74.8 million in net sales in 2013, Carrefour SA is one of the largest retail groups in the world and a success by any usual count. But Carrefour’s attempt to enter the market through its cash-and-carry platform has proved to be a risk that is not paying off. At the moment, Carrefour’s presence in India at the moment is still relatively small. Since 2010, the group has opened a handful of cash-andcarry locations. According to a report
‘Large organized retailers in India lost a total of Rs 13,000 crore within the fiscal year 2013/2014’ in Business Standard, Carrefour’s five India-based locations have seen losses of $17 million since 2012. Earlier this year, Carrefour addressed these losses by announcing that it had hired professional services agency KPMG to facilitate the sale of its assets in India, making it clear that the retail group intends to exit the country altogether at least for the time being. This wouldn’t be the first time that a major retail group has pulled out of an underperforming market – it’s not too different from Tesco leaving the United States behind when it became obvious that its business model wasn’t matching up with the country’s particular culture or shopping habits. But it paints a powerful picture of the strength of India’s small business staying power. 25
R E TA I L
Walmart is pivoting from outright retail to cash-and-carry Changing Your Approach While withdrawal may be the best option for some, other retailers are attempting to double down on growing their business in the India retail market. According to retail experts, it’s not impossible – it’s just a matter of changing your approach. A study by Indian ratings agency CRISIL suggests that large and international retail groups still stand a chance of succeeding within this market by shifting their offerings to better fit Indian tastes and 26
July 2014
preferences. This could mean working more closely with local producers for a tighter supply chain and lower cost, reducing store sizes for consumer comfort, or developing more finelytargeted private label lines. It also means adjusting overall scale within the country and adopting lowercost store models to maintain profit margins until business picks up. If You Can’t Beat Them, Join Them on the Internet Another approach that is taking
T O P G R O C E R S V S . I N D I A’ S M O M - A N D - P O P S T O R E S
off for international and national retail brands alike: the internet. According to Bloomberg, Walmart is pivoting from outright retail to cashand-carry, and to support this shift the brand has opened a cash-and-carry e-commerce site with the specific purpose of supplying wholesale products to India’s mom-and-pop grocers. This allows Walmart to grow within in the India retail market, but in a way in an alternative way that doesn’t compete with its corner markets directly. Hopes are already high for this model: “The mandate from Wal-Mart for me is to focus on the cash-and-carry business.” Walmart India CEO Krish Iyer told Bloomberg. “We are into cash-and-carry for the long-haul and the prize is big.”
Within India alone, online retailers like Mumbai-based Localbanya.com and Bangalore-based Bigbasket. com are seeing success on the retail front by abandoning the brick-and-mortar storefront model, capitalizing on busy consumers and their need for convenient options. “It’s a huge, underserved market,” entrepreneur and Bigbasket founder Hari Menon told Quartz in a recent interview. “Convenience is a major factor in our metros. We are finding that at least 85% of our customers return after the second order.” Kirana stores are here to stay, there’s no doubt about that. But by retooling and rethinking the way retail works, India may still be plenty of room yet for the supermarket chain.
Walmart’s cash-and-carry would allow it to grow within in India’s retail market, but in a supportive role that does not compete with kirana stores
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S U P P LY C H A I N
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The Future of Cold Storage What does the industry hold for cold storage? With new regulations in the works and new technology on the horizon, how can you stay ahead of the trends? Writ ten by: SASH A ORM A N
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S U P P LY C H A I N FROM THE TIME that a product is picked in a field or pulled off the assembly line, the cold chain goes to work making sure those products stay fresh and safe for consumers until they reach their intended retail destinations. From the advent of the ice-filled boxcar a century ago, cold chain logistics is an industry that has evolved drastically over a relatively short lifespan. But it’s not done growing yet. What is in store for cold chain and cold storage in the future? It’s a bright future, marked by a wealth of growing industry needs. A Rising Need for Cold Chain Facilities Growth is a key factor for cold storage in the near future. According to a study produced by Reportlinker, demand for commercial refrigeration equipment in the United States is expected to rise 3 percent annually for at least the next five years, reaching $10.7 billion by 2018. The report cites growth in other sectors of the food and beverage industries, especially foodservice and retail, as primary factors for growth in supply chain. That makes sense – the more you produce, the more product you will have to move and store properly. 30
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While the study focuses on growth in North America, this growth is also expected to be present on a global scale. Recently the Indian government noted a huge amount of food waste that can be traced back to inadequate cold storage facilities. Experts within the country are calling for a bolstering of cold storage infrastructure as a critical measure to grow India’s food supply and curb food price inflation. Europe has been facing the same
THE FUTURE OF COLD STORAGE
‘Demand for commercial refrigeration equipment in the United States is expected to rise 3 percent annually for at least the next five years, reaching $10.7 billion by 2018’ food waste issue, with experts also calling for cold storage infrastructure growth to solve the problem – it seems safe to say that the issue is happening everywhere, and growth in the cold storage sector is the answer. In a vote of confidence for an increasingly globalized food production and processing industry, the Reportlinker study also predicts that the largest area of growth for refrigeration equipment will most
likely be within the transportation refrigeration equipment segment. As warehousing technology improves with time, businesses may begin to build bigger warehouses in more centralized locations, meaning that transportation fleets will have longer drives in store between sources, distribution hubs, and retail destinations. This means that state-of-the-art effective refrigerated transport will be in high demand. 31
S U P P LY C H A I N A Rising Need for Energy Efficiency The need for cold chain facilities is growing, but not just any cold chain facilities. After all, that increased need for cold chain facilities could also lead to a lot of added expenses for producers and food processors. Even those who own their own cold storage facilities certainly face significant added expenses in the form of electricity costs to keep their machines and temperature control mechanisms running without interruption even at peak cost times. Because of this, the cold storage
industry needs to find ways to become more efficient. Already, storage facilities are utilizing ways within their means to keep costs and energy usage down, employing methods like LED lights and motion sensorguided lighting capable of highlighting only the areas of a storage facility that need it at the moment. But the cold storage industry needs more than just patches on facilities that are already there – there is also a strong need for greener and more efficient cooling and refrigeration methods. In an interesting point of intersection, this need for updated and more
Warehouse lights working in tandem with motion sensors will save power
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THE FUTURE OF COLD STORAGE
efficient equipment is expected to be one of the biggest drivers of demand and growth over the next five years. Traditional refrigeration units powered by hydrochlorofluorocarbon-22, also known as R-22, are already being phased out of use due to the part that they play in ozone depletion, and the demand for high efficiency cold chain storage and transportation equipment is huge as businesses upgrade their supply chains and storage facilities to meet new environmental standards and as R-22 sources become less readily available. According to Reportlinker, although the current standard for R-22 alternatives run on hydrofluorocarbons (HFCs), those also carry a significant amount of environmental risk due to similar ozone depleting properties – meaning that, once units running on R-22 supplies are put to rest, the government could start to go after cold storage equipment cooled with HFCs. All of this could go into further overdrive if the U.S. Environmental Protection Agency (EPA) chooses to move the final R-22 phase-out date from 2020 to 2018, which is a very real possibility. This would significantly drive up the demand for alternative
‘The cold storage industry needs more than just patches on facilities that are already there – there is also a strong need for greener and more efficient cooling and refrigeration methods’ refrigeration. There is a lot of research being done in order to find such methods – some forward thinkers like PepsiCo have already begun switching to hydrocarbon compounds like isobutane (R-600A) as more a more energy efficient “green refrigerant” alternative to run their supply chains, while even more recently magnetic cooling has emerged as a technology with a significant amount of potential to eliminate the need for hazardous refrigerant fluid altogether. Cold chain equipment producers that are able to capitalize on these technologies will be a huge force in industry growth in the near future. 33
TOP 10
Top 10: Food Processing Brands Behind the scenes at the world’s food processing powerhouses
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TOP 10
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Associated British Foods Revenue: $22.6 billion (13.3 billion lbs) (2013)
London-based Associated British Foods (ABF) has made a name for itself through such major household brands as Twinings, Mazola oil, and Fleischmann’s yeast. But it’s the food processing company’s multipronged approach as a manufacturer of ingredients and private label grocery store products that’s helped ABF earn its place as one of the world’s top food processors, with revenue of £13.3 billion (USD $22.6 billion) in 2013. www.abf.co.uk
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Groupe Danone Revenue: 29.04 billion (21.29 billion euro)
In North America, Groupe Danone is best known for its yogurt brands like Activia and Brown Cow produced by the Dannon Company. But around the world, the food processing business has strategically diversified its offerings through acquisition of brands like Yakult and Evian. This dairy and beverage empire has done well for itself, posting â‚Ź21.3 billion (USD $29 billion) in 2013. www.danone.com 37
TOP 10
08
Tyson Foods, Inc. Revenue: 34.37 billion (2013)
Arkansas-based Tyson Foods is massive in the industry, ranked among the top in its class for food processing and meat production with revenue of $34.4 billion in 2013. In June, Tyson triumphed in a bidding war against Pilgrim’s Pride to purchase Hillshire Brands for $8.5 billion – by acquiring the packaged meat company, Tyson can expect even bigger revenue in the next year. www.tyson.com 38
July 2014
FOOD PROCESSING BRANDS
07
Mars Inc. Revenue: 33 billion (2014)
Candy and confections are big business, and no one is a better example of that than Mars Incorporated. Famous for candy brands like Milky Way and Snickers, this family-owned business is ranked by Forbes as the third largest privately owned company in the United States, pulling $33 billion in revenue between its own international brands and its subsidiary The Wrigley Company. www.mars.com
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06
Mondelez Revenue: 35.3 billion (2013)
Global snack and confectionery brand Mondelez International has truly come out from under the shadow of Kraft, the company it spun off from just a couple of short years ago. While 2013’s revenue of $35.3 billion is only modest growth compared to 2012’s numbers, the maker of brands like Cadbury and Nabisco is still going strong. www.mondelezinternational.co.uk
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G L O B A L U T I L I T I E S C O M PA N I E S 2 0 1 4
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JBS S.A. Revenue: $40 billion
São Paulo, Brazil-based JBS SA continues its reign as the largest meat processing company in the world, with 150 facilities processing and selling beef, chicken, and pork products to consumers around the world. JBS’s growth has been bolstered by its notable acquisitions over the years, including Smithfield Foods’ beef business and a majority stake in Pilgrim’s Pride. This year JBS topped its 2012 numbers, posting revenue of $40 billion for 2013. www.jbssa.com 41
TOP 10
04
PepsiCo Revenue: $66.41 billion (2013)
Even as soft drink sales slump, PepsiCo can always count on a huge boost from its food processing sector with its portfolio of brands like Quaker Oats and Frito-Lay, along with synergistic successes like its partnership with Unilever to produce Lipton iced teas and its blockbuster partnership with former subsidiary Yum Brands on Taco Bell’s Doritos Locos tacos and Mountain Dew Baja Blast drinks. These smart moves have helped PepsiCo increase revenue from 65.5 billion in 2012 to $66.41 in 2013. www.pepsico.com 42
July 2014
FOOD PROCESSING BRANDS
03
Unilever Revenue: $67.9 billion (2013)
With headquarters in London and Rotterdam, Unilever is truly a multinational consumer goods brand. With brands like Hellman’s/ Best Foods and Lipton within its portfolio, food processing is among the many services that have helped Unilever collect €49.8 billion (USD $67.9 billion) in revenue in 2013, and the brand’s commitment to improving its environmental footprint is a strong step forward to ensure that the brand will still be producing for decades to come. www.unilever.com
TOP 10
FOOD PROCESSING BRANDS
02
Nestle Revenue: $102 billion
Nestle may have been formed as a milk company, but a century later it’s so much more. The Vevey, Switzerland-based food processor has a hand in everything from chocolate and coffee to frozen foods under big name brands like Nescafe, Nesquick, Lean Cuisine and Wonka – not to mention brands like Arrowhead and San Pellegrino under its lucrative Nestle Waters brands. All told, Nestle’s extensive portfolio has brought in revenue of CHF 92.16 billion (USD $102 billion) in 2013. www.nestle.com
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TOP 10
01
Cargill Revenue: $136.65 billion (2013)
Minnesota-based food processing company Cargill remains at the top of the game, earning $136.65 million in revenue and an impressive $2.31 billion in profits alone in its 2013 fiscal year. It’s been a good year for Cargill – according to the company’s 2013 annual report, improved supply chain efficiencies contributed greatly to its earnings performance. This year, Cargill is turning its focus to its corporate responsibility, looking at ways to increase food security and productivity. Cargill also displayed its ability to learn from history and adapt to changing consumer needs, raising its transparency level and consumer goodwill with its announcement that it would begin labeling meat products containing “finely textured ground beef” for retail. All of this is adding up to a 2014 that will be as promising as Cargill’s 2013, if not more. www.cargill.com
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Heineken in Ethiopia invests $150m in new brewery The greenfield facility on the outskirts of the capital Addis Abbaba will add 1.5 million hectolites capacity to the company’s annual production in a fastexpanding beer market Written by: Joel Levy Produced by: Oliver Bishop 49
HEINEKEN IN ETHIOPIA
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Heineken’s Harar and Bedele brewery brands
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eineken Ethiopia is taking its production to the next level with a new $150m greenfield brewery, which will add 1.5 million hectolitres capacity and complement its established facilities at Harar and Bedele. Opening later this year, the new greenfield brewery near the outskirts of Addis Ababa will create new jobs and new opportunities in the region, and increase the availability of the key brands Bedele Special, Bedele, Harar, Hakim Stout and Sofi Malt, while also producing a variety of Heineken global brand’s portfolio. Alongside this, the company’s existing facilities at Harar and Bedele are being upgraded at a cost of $65m, as Heineken seeks to expand its reach and production. Corporate Relations Manager Nebat Sukker said: “We are making good progress with the construction currently taking place and the new greenfield brewery will be operational by the end of this year. “Our capacity is growing from 600,000 hectolitres in 2011 to roughly 2.4 million hectolitres in 2015, and can grow further depending on our needs.” Ethiopia has become a key location for Heineken in Africa as a developing and growing market. A population of 90 million makes it the continent’s second most populated country, and its 4.297 million hectolitre beer market (2012 figures, source Canadian) has grown double-digits over the last years.
AFRICA
An aerial view of the new greenfield brewery
Long history The latest investment displays Heineken’s longterm commitment, and also represents the latest phase of the Dutch brewer’s long African history dating back more than a century. In 1900 the company was already exporting beer to various African countries including Ghana, Nigeria, Liberia and Sierra Leone; the first brewery in DRC was established in 1923 and it continued to expand across the continent. Taking a major step into Ethiopia in 2011, Heineken acquired two breweries from the government for a combined $163m: the facilities which are currently being modernised. Sukker said: “We are transforming the two companies that we bought from the government from more regional players to national players and the new greenfield brewery is an important element in this plan.
“Our capacity is growing from 600,000 hectolitres in 2011 to roughly 2.4 million hectolitres in 2015, and can grow further depending on our needs” – Nebat Sukker, Corporate Relations Manager
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Boiler installation for Heineken
Kuiper en Zonen, driven by steam since 1918 The family-owned business Kuiper en Zonen sells steam and superheated water boilers. We also offer rental projects and all types of boiler and burner maintenance all over the world . From design to preparing your boiler for inspection Kuiper en Zonen employs a team of well-trained and skilled technicians.
www.kuiperzn.nl
Advertorial
Steam, warm & hot water boiler installations
Kuiper en Zonen congratulate Heineken with their success in Ethiopia. From design to preparing your boiler for inspection. Kuiper en Zonen employs a team of welltrained and skilled technicians.
pressures, perform boiler and burner inspection, repairs and maintenance. Besides Ethiopia Kuiper en Zonen has delivered, inspected and maintained dozens projects Kuiper en Zonen works for a variety for Heineken all over the world. of companies ranging from food, For example, in Burundi we are paper, textile, oil, gas and chemical preparing to install two new industries all over the world. Viessmann steam boilers of 17 They have been delivering new and ton/h at 10 barg each. This order reconditioned turn-key boiler plants includes all piping, commissioning as well as auxiliary equipment in as well as training the operators. Africa since the early 90’s. In addition At this moment we are installing they perform boiler and burner a large superheated water inspection, repairs and maintenance. boiler project in Rotterdam (The Kuiper en Zonen are a unique Netherlands) for a power company. partner to work with as they rent This project will deliver 70 megawatt. out boilers in all capacities and
HEINEKEN IN ETHIOPIA
AFRICA
Bedele Brewery packaging line
“At both Bedele and Harar breweries, we have invested substantially in line with our business plans, notably in the quality of our processes and systems; in production capacity; in the sustainability of our breweries, as well as in training and development of our staff, which have all contributed to the further development of our brands.” Harar Brewery has invested in a new state-of-the-art waste water treatment plant ensuring that brewery effluent is properly treated, and Bedele and the new greenfield brewery have done the same.
A Ceremony marking the arrival of the brewery’s fermentation tanks
Investing in Ethiopia In meeting the increased demand for malt barley and other raw material created w w w. t h e h e i n e k e n c o m p a n y. c o m
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nigeria
www.re mc o.n l
He inek en B rew er ies Sh a re Co m p a n y Niger i an B rew er ies Pl c B e d ele B rew er y S h a re C o m p a n y B r al im a Bralima
ethiopia
DEMOCRATIC REPUBLIC OF THE CONGO
E ff ic ie nt ind ustr ial halls constructed exactly to size T h e R e m c o Group of c om p a ni e s in t he Net her lands and abro ad is co n s i d e re d t o b e one of th e l e a ding builder s o f st eel indust r ial premises an d s u p p l i e r a n d i n sta l l e r of p re - eng ineered building s. F o r o ver 40 y ea r s t h e y a re sp e c i a l i z e d i n d e s ig ning , eng ineer ing and co nst r uct io n o f s u c h b u i l d i n g s. The Af ri c a n tra c k reco rd co nt ains numero us building s in N i ge r a , Ga b on, Se n e ga l , De m o cr at ic Republic o f t he Co ng o and Et h i o p i a fo r a wi d e ra n ge of m ul tinat io nals and lo cal elit e co mpanies.
SUPPLIER PROFILE
REMCO AFRIQUE
Employees: 50 Established: 1972 Industry: The Remco Group of companies consist of various entities in various European countries and is specialised in the construction of production facilities and warehouses for a broad range of industries. The companies are part of Janssen de Jong Groep, one of the leading construction companies in The Netherlands and the Caribbean. Services: The Remco Group of companies offer one-stop-shopping to their clients by providing design, engineering, production and assembly of industrial halls integrated in one company. Over four decades of experience in industrial buildings only assure the availability of proven pre-engineered solutions for any kind of industry. Ongoing Projects: Currently the Remco Group of companies is executing numerous appealing projects in amongst others Poland, Belarus, The Netherlands, Belgium, Surinam and Bonaire. Meanwhile in Africa numerous projects in Ethiopia, Democratic Republic of the Congo, Nigeria, Cameroon and Senegal are in various stages of development and execution. Management: J.F.J. (Jan) van Vulpen, General Manager M.D.J. (Tino) Haze, Financial Manager E.H.D. (Erik) van den Hurk, Tender Engineer Export projects Website: www.remco.nl
HEINEKEN IN ETHIOPIA by the current expansion, Heineken was keen to implement a strategy that would uplift communities at the same time. It partnered with the ATA (Agricultural Transformation Agency) and the EIAR (Ethiopian Institute of Agricultural Research) for a four-year programme named CREATE (Community Revenue Enhancement through Technology Extension in Ethiopia). The company and the Netherlands government committed to invest $2.72 million between 2013 and 2018 to increase food security, improve the livelihoods of smallholder famers and reduce reliance on imports by developing local barley production and connecting farmers to the Heineken Ethiopia supply chain. By 2018, CREATE will have increased direct revenues for 20,000 smallholder farmer families; created 5,000 MT of additional barley for households or the local food market; and 10,000 hectares of land will be under improved malt barley management practices, increasing yields by using better seeds and more adapted farming techniques. Heineken subsidiaries’ dependence on imported products will also be reduced by replacing an additional 20,000 MT of imported barley with locally produced barley. Another Private Public Partnership (PPP) is the Sustainable Water Sources Harar (SWSH), signed last year with the Harar Regional State, Vitens Evides International B.V. and other institutions to
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‘The company and the Netherlands government committed to invest $2.72 million between 2013 and 2018 to increase food security’
Heineken products
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A fully operable brewery on a greenfield - our EPC concept 30% saving - incontrovertible turnkey service. Successful delivery to 50plus greenfield projects, 21 years dedication to brewing and packaging equipment.
Sep.9-12,2014
East Afripack
KICC, Nairobi Kenya
NINGBO LEHUI FOOD MACHINERY CO.,LTD
Add: Xiangxi Industrial Zone,Xiangshan County, 315722 P.R.China Tel: + 86-574-6583 6556 Fax: + 86-574-6583 61111
www.lehui.com
weixin@lehui.com
HEINEKEN ETHIOPIA
AFRICA
Farming techniques in Ethiopia are centuries old
formally commence a sustainable water services project in Harar Regional State. This project is co-funded by the Dutch Ministry of Foreign Affairs through the Sustainable Water Fund. This project will improve water access for 50,000 people, half of which are in deprived rural areas, using water buffering schemes and other supply solutions. As well as contributing $135,000, Heineken will also provide technical expertise. Staff focus This knowledge transfer mirrors to the company’s approach toward its workforce. Heineken in Ethiopia’s staff benefit from numerous training sessions at home and abroad, focused on
In Ethiopia barley is grown for food and malting purposes
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Global provider of air conditioning & refrigeration solutions Turn key: design, project management, installation and commissioning Service, maintenance and training Compressor service and overhaul Monitoring and remote control Energy saving solutions and upgrades Compressors, chillers and heatpumps Pieter Zeemanweg 16 3316 BV, Dordrecht, Netherlands +31(0)78 625 2518 www.johnsoncontrols.com
Johnson Controls - Industrial Refrigeration
For a more comfortable, safe and sustainable world
LEADERS IN ENGINEERING TECHNOLOGY Holvrieka develops, builds and installs tanks and systems on a worldwide scale
W: www.holvrieka.com E: info@holvrieka-ido.nl T: 31-591-614888 F: 31-591-617234
Crates and Packaging specialists Certified Quality Products P.O.Box 80030 Addis Ababa - ETHIOPIA tel: +251.11629346 fax: +251.116293444 upfenthiopia@gmail.com
HEINEKEN ETHIOPIA
AFRICA
Most smallholder farmers own about five Hectares of land
safety and technical capacity building to ensure business processes meet the strictest standards. Heineken Group specialist technicians also attend to train staff in other key areas including marketing, sales and IT. Additionally, technical operators (green teams) visit from various operating companies overseas to facilitate trainings and transfer knowledge. The Bedele brewery, for example, is currently hosting a South African green team. “We have also sent our employees to other operating companies and equipment suppliers on the continent and in Europe for training.
“We are transforming the two companies that we bought from the government from more regional players to national players” – Nebat Sukker
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HEINEKEN IN ETHIOPIA We benefit from the experience and knowhow from an international company, where we exchange best practises,” added Sukker.
Heineken offers a variety of training
Making a difference On the sustainability side, a dedicated 10-year programme, launched in 2010, named Brewing a Better Future (BaBF) is another area of specific attention. Sukker explained: “BaBF focuses on four key areas where we can make a difference: protecting water resources; reducing CO2 emissions and energy consumption; sourcing sustainably and advocating responsible consumption.
Flagship meat pie products
Specialized & Focused SINTEC aims to contribute to the process of industrialization, transfer of technology and know how in a manner that is responsive to national resource endowment and absorptive capacity. We see, we fabricate, we erect, we install, we build, we supply.
Pieman’s produces a range of delicious savoury pies and other pastry based products, made from superior quality ingredients. We offer a tasty, versatile and wholesome meal for in-home or on-the-go consumption.
Let us partner & solve your problems.
www.sintec.com.et
+27 11 953 4230 • enquiries@foodcorp.co.za
www.foodcorp.co.za
AFRICA
Heineken training programme ensures a high level of safety and technical understanding
“Each of these areas is highly relevant to our day-to-day business operations, and to our stakeholders. We have already seen considerable improvements on most of these KPI’s (Key Performance Indicators) in our breweries.” Heineken has also been active in improving healthcare. In 2013, the Heineken Africa Foundation committed $145,000 to upgrades at Bedele District Hospital in addition to $100,000 from Bedele Brewery SC and the $90,000 contributed to The Finkele Health Clinic project, focused on obstetric care. The brewery has already provided an ambulance, new medical and laboratory equipment, and 55 people have been trained for the centre in collaboration with African Medical and Research Foundation (AMREF).
“We want to become a major player in the industry by surprising and exciting our consumers with a great portfolio of brands, and by being a partner for growth in the communities in which we operate” – Nebat Sukker
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HEINEKEN ETHIOPIA
Patients and staff at Bedele District Hospital
Through the Heineken Africa Foundation, the company has heavily invested in local healthcare
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Spreading the word Heineken’s future plans in the country involve a focus on the further development of its supply chain. “We are very much involved in increasing the opportunities to source locally and are focused on our commitment to buy locally. We have local and global suppliers, Heineken approved, and we are trying to attract specialists to further develop the local supply chain,” Sukker said. Such progress is necessary to stay ahead of the game in a rapidly developing market with an
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Company Information INDUSTRY
Beverage HEADQUARTERS
Addis Ababa, Ethiopia FOUNDED
2011 EMPLOYEES
1,100 REVENUE
Not disclosed
increasingly discerning clientele who demand the best. With its huge investment, this is exactly what Heineken in Ethiopia will be able to offer. Sukker concluded: “We are seeing more competition, faster growth in the market, more demand from customers, as well as more branding and marketing. “We want to become a major player in the industry by surprising and exciting our consumers with a great portfolio of brands, and by being a partner for growth in the communities in which we operate.”
PRODUCTS/ SERVICES
Bedele Special, Bedele, Harar, Hakim Stout, Sofi Malt, Heineken brands
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Makro expands its range with new ecommerce platform The South African warehouse club is giving its customers ever more ways to buy ever more quality affordable products, while maintaining a universally excellent experience across multiple channels Written by: Joel Levy and Produced by: Alex Barron
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‘We are very much positioned to cater to the needs of the higher-end customer who is looking for good quality and good value’ – Melanie Louw, Marketing Director
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W
ith the launch of its new ecommerce platform, South African warehouse club distributor Makro is further broadening its considerable appeal as it grows its market share based on a diverse and affordable range of quality products. The last three years have seen a spate of activity for the company, in which time it has almost doubled its store presence, with the opening of nine outlets, and another large development planned for 2015, alongside a push into upgrading its delivery capabilities. Makro online went live in March, complementing the 19 physical stores across the nation from which it distributes more than 55,000 product lines in three major categories: food, liquor and
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New directional signage helps the customers find their way around the store
general merchandise, and conveniently bringing the company’s offering to ever more consumers. Marketing Director Melanie Louw expects this new platform to go from strength-tostrength following its early success, adding to the ‘one-stop-shop’ nature of a company that provides business users and retail customers with everything from cleaning products to stationary, office desks to computers. Makro store website
Ecommerce launch “We have always had an online presence from a research point of view, but recently we became an ecommerce site as well and it’s growing rapidly,” she said. The new platform has already proven w w w. m a k r o . c o . z a
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MAKRO SA
The fresh department boasts vegetables and a butchery
Doug Jones speaking to the store staff before the ribbon is cut and the store is officially opened to the public 72
July 2014
popular with Makro’s customers and will continue building from a strong base, constantly adding new product lines over 2014, bolstered by a TV marketing campaign. Customers can choose from affordable delivery to their front doors, or to collect their order carefully pre-packed from their nearest store. Although Makro already had an online presence prior to this launch, the updated platform goes far beyond the original, adding many new lines, with the coming launch of a wide range of alcohol products a particular highlight. Louw said: “We’ve had a fabulous response
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in terms of traffic on the site. At this stage it’s only general merchandise available but in the next phase, towards the end of 2014, we will also be selling liquor online. “This will be one of the biggest liquor stores in the Walmart stable online and we will move to food and dried groceries in the foreseeable future.” The quality of the online presence will be familiar to Makro customers, as the company has strived to ensure a consistently excellent shopper experience across its multiple channels. Louw continued: “Whether our customers interact with us through a telesales centre, direct or
This is a happy shopper at one of the famous Makro store openings
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SUPPLIER P R O FI LE
Tiger Management Services
Tiger Brands Limited is pleased to be associated with Makro and thanks them for their continued support.
T: +2711 840 4000
E: tigercsd@tigerbrands.com
W: www.tigerbrands.com
MAKRO
AFRICA
online, they will get exactly the same experience, and we’ve certainly done that on our website. “Our stores are massive but very modern, not a musty old wholesaler type experience. And we wanted to replicate that experience online with a lot of white space and openness, bold colours, big buttons: very bright and inviting. At the end of the day, the in-store experience is what makes Makro.”
‘Whether our customers interact with us through a telesales centre, direct or online, they will get exactly the same experience’
Customer focus Makro, opened its first outlet in 1971 in Johannesburg, becoming South Africa’s first cash and carry operation. Since then it has continued to add new stores and capabilities to stay ahead of the curve. The particular success of recent years can
– Melanie Louw
SUPPLIER PROFILE
TIGER BRANDS
Tiger Brands Limited, a Top 40 JSE Limited company whose footprint extends across the African continent and beyond, is one of the largest manufacturers and marketers of FMCG products in Southern Africa, and has been for several decades. The Group focus is on the core business of FMCG categories that spread synergy across the value chain which a broad basket of categories spans food, home and personal care as well as baby products. Website: www.tigerbrands.co.za
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SUGAlite Cubes and Sugar Crystals White and Brown Sugar
Syrups and Molasses
EquiSweet Sucralose
Growing our Family of Products – and our Customers’ Profits – for more than100 Years
Making Every Day Sweeter
Baking Sugars
www.hulettssugar.co.za
®
At Kellogg’s, we believe a better breakfast leads to a better day, and that each day represents a fresh start to realise life’s potentials.
See you at breakfast
Consumer Affairs: Tel - 0860 200 601. Kellogg’s Press Office - Tel: 011 233 6600
kellogg.co.za
MAKRO be attributed significantly to Makro’s intimate understanding of customers’ needs. Part of the Massmart family (and also the Walmart group), Makro is a uniquely South African company that knows the nation’s consumers better than most. This understanding is further cultivated through its sought-after Makro card, which is available to business owners and retail customers. Louw said: “What makes us extremely unique is that you cannot purchase from Makro without a Makro card, so we have a very unique customer database which tells us what a customer bought and when. That gives us a very intimate understanding of what our customers want or need when they shop, and we communicate regularly with them.” As well as giving its customers the right products, the company has aligned itself perfectly to give them these premium goods at the right price. Louw said: “We are very much positioned to cater to the needs of the higher-end customer who is looking for good quality and good value. We will not necessarily be selling the cheapest laptop in the market, but we will be offering the best bundle with a carry case. We have great prices on bundle deals and that is very much what we specialise in. “With those great value deals that we offer, we end up being more affordable, and part of that is knowing our customers so well. The
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Key Personnel
Doug Jones, Managing Director
Melanie Louw, Marketing Director
‘We are very focused on supplier development, helping them, especially in the farming areas’ – Melanie Louw w w w. m a k r o . c o . z a
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Engage. Innovate. Collaborate.
Collaboration is more than a technical solution, or product. It is experience that integrates people, processes, and technology and creates opportunity. At RCS we believe that by working together, people can achieve extraordinary things. We understand the retail sector and apply our knowledge and experience of credit to provide retail credit solutions that are relevant and deliver growth. Together we create value for our partners, their customers and ourselves by combining competence and enthusiasm into successful business. This is what we have been doing in partnership with Makro over the years and will continue to do as they expand their markets and drive growth for their business. As the largest provider of outsourced retail card programs in South Africa, we make it our business to constantly review our way of working with our partners in order to ensure that the credit solutions we offer are relevant to their environment and drive growth for their business. We want our partners to choose us for what we stand for, what we deliver and how we deliver it. For More Information: Visit www.RCS.co.za
The difference between design and total design. As the leading manufacturer in the Home Appliance industry, Whirlpool understands your needs and knows, that everyday you take care of all the things you love in a unique and special way. Our 6TH SENSE technology, senses, adapts and controls the appliances intuitively to always give you perfect results every time. Whirlpool sixth sense technology monitors and automatically adjusts the performance of your kitchen appliances, offering outstanding results and significant resource savings. With over 100 years of experience dedicated in household appliances, we continuously strive for No.1 performance. Discover the new 6TH SENSE technology: your extra power for perfect results, intuitively as never before.
www.whirlpool.co.za
MAKRO
AFRICA
products and stock levels we carry are specific to our target market; we don’t carry unnecessary costs that filter down to our customers.” The economy of scale comes into play in force to keep prices attractive, with national distribution centres serving stores daily with large trucks 100 percent filled with stock, maximising cost efficiencies and product availability. Competitive advantage Makro’s decentralised trading culture means shop-floor staff are empowered to deal directly with customers, their thorough training and development leaving their employer confident in their ability to understand the market. The faith Makro places in its employees has made it an attractive place to work, and for Q1 2014, year-on-year staff compliment increased by almost seven percent. This overwhelmingly local talent is fostered through a graduate training programme and access to Massmart development schemes, including via its Leadership University. Responsible trading Makro’s excellent performance in South Africa makes it keen to repay the communities that have enabled it. The company donates one percent of its profits to the uplift of South African society through various schemes. Louw said: “We are very focused on supplier development, helping them, especially in the
Makro’s excellent performance in South Africa makes it keen to repay the communities that have enabled it
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Patleys is a leader in the distribution of local and imported fast moving consumer brands.
waxes, coatings and packaging adhesives
A division of of the Bidvest Group Limited
www. Patleys.co.za Tel: 011 2268800 12 Renaissance Drive, Crown Mines, Johannesburg
From one smart company to another.
Here’s to 43 years of continued success Barloworld Logistics would like to congratulate Makro on its outstanding track record of consistently delivering comfort, convenience and affordability to South African businesses and homes for over 4 decades.
Specialist in food processing equipment At Rademaker, we have managed to transform bakery traditions of the past into robust, state-of-the-art industrial bakery production lines. Call +31 (0) 345 543543 for the specialist in food processing equipment and industrial baking systems. Or visit us at www.rademaker.com.
We look forward to a smart partnership that drives productivity, profitability and performance and delivers real value all round.
MAKRO
AFRICA
farming areas, and we are extremely involved with feeding schemes, and also schools. Those are the areas that we are really focusing on in terms of Corporate Social Responsibility.” To this end, vendor’s engagement in the supply chain area is strongly supported through Walmart, with key strategic vendors regularly engaged to identify opportunities to jointly improve service to customers and identify efficiencies for mutual benefit. The company also annually contributes more than R1.425 million to schools to assist with purchasing educational aids that directly benefit the learner. Through the Tomorrow Trust, it also assists orphans and vulnerable children in achieving invaluable academic qualifications. Its feeding schemes, in partnership with charities and the Department of Education, works
Top left: Derick Kalan, Dean Bauer, Doug Jones, Pieter Schoeman, Garry Hendry, Jonathan Koff. From bottom left: Melanie Louw, Gert Lourens, Julie Wilford
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MAKRO SA
S’nethemba Day Care Centre receiving the gift card from Doug Jones, Managing Director of Makro
Housekids Educare Centre received a R30,000 Makro Gift Card as part of the Amanzimtoti Store Opening
Housekids Educare Centre receiving the gift card from Doug
to feed disadvantaged children both at school and during the holidays, and assists schools in setting up vegetable gardens in order to understand how to feed themselves, giving ownership to the food produced and a sense of empowerment.
Jones, Managing Director of Makro
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Future advances It has been a big year for Makro so far, and the second half of 2014 promises further development and success for this thriving South African company. As the online platform strengthens, Makro will not stand still on the store
AFRICA
Company Information INDUSTRY
Distribution & wholesale HEADQUARTERS
Johannesburg FOUNDED
1971 EMPLOYEES
Approx. 8,000 REVENUE
Approx. R21bn
front either, and is actively seeking to renew its formats, further tailoring the experience to suit is customers’ preferences and better engage underserviced regions. An increased store footprint will also enable Makro’s focus on upgrading its delivery capabilities, with speed and reliability at the forefront of the company’s strategy going forward. Makro has thrived on giving it customers what they want, when they want, in the way that they want. Both its ongoing strategy and future plans are a clear continuation of this process.
PRODUCTS/ SERVICES
Food, liquor, general merchandise
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Guinness Ghana Breweries Ltd strives to become country’s most vibrant and iconic business
This award-winning business has strong values as well as a socially and environmentally-bound ethos aimed at making it a role model for other companies Written by: Sheree Hanna Produced by: Oliver Bishop 85
G U I N N E S S G H A N A B R E W E R I E S LT D
“We are particularly aware of the growing middle class in Africa and that is one of the reasons we have effectively brought the spirits business, which used to operate through agents, inside the business” – Corporate Relations Director, Preba Greenstreet
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G
uinness Ghana Breweries Ltd (GGBL) is on a path to become the most vibrant and iconic business in Ghana by 2017 following its recent £27.5 million investment in a new state-of-the-art brewing and packaging line at its Kaasi brewery. The company is currently implementing a number of changes within its distribution systems and making innovations within its branding and marketing divisions, in a bid to increase its overall efficiency and stay ahead of ever-changing consumer needs. This socially and environmentally responsible company, which is part of the world’s leading premium drinks business, UK-based Diageo, also strives hard to play a leading role in improving the lives and livelihoods of the community in which it operates, through a number of breakthrough initiatives. It employs more than 700 permanent staff across its two sites located at Kaasi in the Ashanti Region and Achimota, in the Greater Accra region, and up to 500 contract staff. In Ghana, it distributes a wide range of internationally celebrated brands including Johnnie Walker, Smirnoff and Baileys and on the beer and stout front, produces Guinness, Malta Guinness, Star and Alvaro as well as Ruut Extra Premium Beer, which was the first cassava-based beer on the market. It currently produces some 2,000hl a day equivalent to 26,700 cases rattles out 36,000
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Entrance to GGBL headquarters at the Kaasi Brewery site
bottles an hour on its just installed packaging line. Corporate Relations Director, Preba Greenstreet, said: “We also distribute Heineken as they have a 20 percent stake in our business as well as other products in the Diageo range including the Johnnie Walker, Baileys and Smirnoff ranges.� Merging interests The company was formed in 1960 and is the only Total Beverage Business to be listed on the Ghana Stock Exchange (August 23, 1991). Guinness Ghana Breweries has existed in its current form since 2005 when Guinness Ghana Ltd merged with the Heineken-owned Ghana Breweries Limited. Heineken retained a 20
36,000
Number of bottled products produced in one hour
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G U I N N E S S G H A N A B R E W E R I E S LT D
Preba Greenstreet, CRD of GGBL and Faculty Team member of the McGill CSR Training Institute
500,000 Number of people across Ghana that now have access to safe drinking water as a result of the company’s CSR strategy
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percent stake in the company. With a clear goal in mind and aside from the recent capital investment, the company has been focusing on its distribution methods in its bid to broaden its customer reach. Greenstreet explained: “We carried out a detailed study of our routes to consumers and realised from that there were opportunities for us to expand particularly into off-trade areas. “Last year, we had a few major distributors as our prime customers but now we are evolving to a more efficient distribution model that is enabling us to capture the market opportunities we identified and to better serve consumers in those segments.”
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Serving customers’ needs GGBL is also working hard at improving its ability to serve the off-trade more efficiently and effectively. The company is aligning its brands to fit more snugly the various consumer profiles within the market. Traditionally, parent company Diageo has been primarily concerned with the premium end of the market in terms of its brand portfolio. “In recent years, we have seen the opportunity of expanding in a number of different ways, innovating to include affordable products such as Ruut Extra and Gilbey’s Dry Gin” said Greenstreet. “We are particularly aware of the growing middle class in Africa and that is one of the reasons we have effectively brought the spirits business, which used to operate through agents, inside the business. “We have all the top brands such as Johnnie Walker, Baileys, Gordon’s and Smirnoff which we see as covering the space for the middle income consumer. “We are also now trying to serve the more affluent end of the market with our reserve range of products such as Johnnie Walker Platinum, Gold and Blue.” Baileys is also being directed at the sophisticated female consumer and for the mainstream market, GGBL has innovated a new portable spirits packaging line, nick-named ‘The Cube’ which enables the company to blend and package spirits locally.
“We have all the top brands such as Jonnie Walker, Baileys, Gordon’s and Smirnoff which we see as covering the space for the middle income consumer” – Preba Greenstreet
Baileys is a drink to attract the sophisticated female consumer
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Taking care of employees and helping them to develop is key to the business
Poster advertising campaign 90
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Sourcing ingredients The award-winning company won the first Best Taxpayer of the Year Award (Beverage category) from the Ghana Revenue Authority in 2011 for contributing three percent of total tax income to Ghana together with its value chain. In a bid to play a socially responsible role within the community it operates, GGBL has implemented its local raw material initiative and has actively sought home-grown ingredients that it can use in the beer making process. GGBL engaged with the Government of Ghana and it responded by providing graduated
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Final stages of packaging
concessionary excise duty rates on utilisation of local raw materials (LRM) in the production of alcoholic beverages. In line with the brewery’s commitment to move its LRM usage to 50 percent by mid-2015 it has shifted from 12 percent usage in December 2012 to 38 percent today. Greenstreet said: “This has had a significant impact along the chain: we find that our increased local purchasing has created, broadened and deepened the supply chain, from farmers, through to aggregators and processors, as well as the provision of ancillary services to each of
7,000 Number of Ghanaian farmers the company uses to source sorghum and maize
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G U I N N E S S G H A N A B R E W E R I E S LT D these groups.” GGBL is also currently undertaking a baseline study to establish the ground position for the farmers in the cassava chain. She said: “The excise duty concession has provided additional value primarily through an exciting new product, RUUT Extra Premium Beer, that has enabled us undertake the investment needed to integrate new brewing materials into our processes.” The company now works with more than 7,000 Ghanaian farmers in the north of the country to source sorghum and maize and a further 3,000 farmers and a couple of large industrial farming companies to provide the cassava which underpins the formulation of its successful Ruut Extra Premium Beer.
SUPPLIER PROFILE
AFRICA
“The excise duty concession has provided additional value primarily through an exciting new product, RUUT Extra Premium Beer” – Preba Greenstreet
RENAIZANCE SUPPLY CHAIN
Vision: To transform supply chain management in Ghana by providing superior cost effective services that matter to our customers with the ingenuity of our people Mission Statement: Renaizance Supply Chain designs, implements and manages supply chain solutions. We deliver operational excellence through superior people, processes and technology. This gives our employees challenging and rewarding careers, our customers competitive advantages, and our shareholders sustained value. Website: www.renaizancesupplychain.com
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Preba Greenstreet, Corporate Relations Director - GGBL
Setting targets Its wide-ranging Corporate Social Responsibility strategy has also involved the company and other partners in helping to provide access to safe drinking water for more than 500,000 people across 65 communities in all 10 regions of Ghana. The GGBL Water of Life programme has received numerous awards including the best company in CSR from the Association of Ghana Industry. The company also takes a very strong stance towards responsible drinking through its Alcohol in Society programme. Its programme is based on the five-pronged
Flagship meat pie products
Premium Foods Limited is a limited liability company with business operations at Jachie Pramso, Kumasi in the Ashanti region of Ghana. Our core activities are; grains trading, grains handling and post-harvest management and processing of grains (maize, soybeans and rice) for industry and domestic consumptions for Ghana and the sub region. www.premiumfoodsgh.com info@premiumfoodsgh.com
Pieman’s produces a range of delicious savoury pies and other pastry based products, made from superior quality ingredients. We offer a tasty, versatile and wholesome meal for in-home or on-the-go consumption.
+27 11 953 4230 • enquiries@foodcorp.co.za
www.foodcorp.co.za
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Peter Ndegwa - MD, GGBL
CEO Commitments adopted by the presidents of the leading alcohol producer companies of the world. In service of this and in the last year alone GGBL has undertaken four programmes, they are: What’s your Drink IQ – an engaging alcohol education initiative rolled out to 2,000 tertiary students of the University of Ghana and the Kwame Nkrumah University of Science and
‘The company was adjudged the best employer by the Association of Ghana Industries in 2013’
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G U I N N E S S G H A N A B R E W E R I E S LT D
“We very much believe in not taking our employees for granted and ensuring they are happy and to this end we carry out an annual survey which we take very seriously“ – Preba Greenstreet
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Technology (and soon to be available via internet link to all other tertiary students); Twa Kwano Mmo, an anti-drink driving initiative run in five transport terminals across Accra and Kumasi which engaged with 1,230 commercial drivers; training of 600 bar tenders through its Responsible Serving Programme under the Master Bar Academy (MBA) training; and the commissioning of research into alcohol consumption patterns, behaviours and attitudes. Loyal employees Taking care of employees and helping them to develop and grow their own careers is also high on the agenda and it is testament to the company that many of its staff have been with the business for 10 years or more. The company was adjudged the best employer by the Association of Ghana Industries in 2013.
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Company Information INDUSTRY
Beverage HEADQUARTERS
Kaasi in Kumasi – Ashanti Region GGBL product range
FOUNDED
1960
“We are a hunting ground for many of the other multi-national companies operating in Ghana, which is a real challenge for us, but we work hard to ensure that the people we employ are aligned with our values and ethos as a company, and are motivated and engaged” said Greenstreet. “We offer a variety of training from the shop floor through to leadership and mentoring. Also through Diageo our employees can seek information online and take advantage of international training opportunities that build brand awareness and employee effectiveness. “We very much believe in not taking our employees for granted and ensuring they are happy and to this end we carry out an annual survey, the Diageo Value Survey, to measure how employees are feeling and to obtain their feedback on a wide variety of issues,” she concluded.
EMPLOYEES
700 permanent staff REVENUE
Ghc 483m PRODUCTS/ SERVICES
Total Beverage Business - (Premium Spirits, Stout and Lagers, Nonalcoholic drinks, Ready to Drinks.
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Company logo goes here
Majesty Oil Mills: Majesty Oil Mills couples pioneering work with continuous investment The oil processor has unique facilities in South Africa and is making further investments within its considerable sole property to offer a wealth of services on a larger scale Written by: Sam Jermy Produced by: Alex Barron
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MAJESTY OIL MILLS
Headquarters at West Krugersdorp, South Africa
100
July 2014
M
ajesty Oil Mills has invested R6million in new production facilities and become the first in South Africa to produce Lecithin as part of an ongoing expansion programme. The oil processor has also earmarked R50m for a new silo complex, which is expected to be constructed in the next six months, and is also planning an R30m upgrade of its TVP plant. The innovative company which operates from an 116,500 square metre production facility in West Krugersdorp, near Johannesburg, has a capacity of 250 tonnes of Lecithin product a month, and produces 60 tonnes a month at present.
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Billy Pillay, who has been Majesty Oil’s Chief Executive Officer since the company’s inception in 2000, is excited about leading the way in the production of Lecithin and has announced further multiple investments. He said: “Our new product, Lecithin, is the first of its kind in South Africa. Basically, Lecithin is made from the gums that we extract out of the oil. “It is used in the margarine and paint industry, as a form of binding agent. We’ve got the texturised vegetable protein line, regular oil, Lecithin, Oil Cake, and then the full-fat which is a separate line. So we have two production lines.” The new Lecithin plant was a turnkey project which involved local sub-contractors Flintstone Engineering and India-based Kumar Metal Industries, which supervised the installation. Pillay explained that there are also further plans to construct a new sunflower extraction plant costing a projected R300m. The entire Krugersdorp plant is worth approximately R400m. Majesty Oil was established in 2000 and initially started crushing cold-press sunflower seed in its first premises. It didn’t have any solvent plant and experienced a lot of problems with electricity because the site where it was located on a rural farm area, and this impacted the company’s decision when it was looking at expanding the plant. For the first month it produced
Key Personnel
Billy Pillay Chief Operating Officer
“Our new product, Lecithin, is the first of its kind in South Africa… it is made from the gums that we extract out of the oil” – Billy Pillay, CEO of Majesty Oil Mills
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MAJESTY OIL MILLS sunflower oil but then made a decision to change to soya bean, and Majesty is still crushing soya beans today.
Soya beans
Soya bean cake
“We have a good quality product and as a result our order book is full a year in advance” – Billy Pillay
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July 2014
Industrial hub The main industrial hub at Krugersdorp houses all the company processing plants and lines, including the new Lecithin plant. Pillay explained the products Majesty Oil provides. He said: “We do soya bean oil processing and the product we get out is the oil cake, which is used in the animal feed industry. Full-fat soya is also used in the animal feed industry. Then, as well as regular oil, we started a section for human consumption which is called texturised vegetable protein.” Strategic Management With regard to supply, Majesty Oil provides some of its products to Seaboard trading and shipping (Pty) LTD, an international overseas trading company. The company speaks directly to endusers and clients, but uses Seaboard Corporation as a vehicle to carry out and manage contracts. It uses the same principle when working with Olam International, also an international trading group, which manages an integrated supply chain for Majesty Oil and helps create greater value in products. In terms of exports, Majesty Oil supplies Olam International and it then sends the oil products to countries such as Zimbabwe and Zambia.
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MAJESTY OIL MILLS The actual soya beans are sourced via agents as the company does not buy them directly from farmers at present. Four or five different agents are used to supply the beans and contracts are normally signed a year in advance. Looking after employees is another key focus for the company, because within such a specialised industry such as the Lecithin plant, the skills and expertise required are not always readily available in South Africa. This means most of its senior staff have been with the company since inception and are nurtured to management levels through
Market Research Safex Services Management of Stock Planning of Marketing
Strategies Agricultural Commodity Contracts Ex-Silo Transations
www.unigrain.co.za
+27 11 692 4400
info@perdigon.co.za www.perdigon.co.za @perdigonsa
Trading of summer grains and oilseeds
Grain Storage
Proud Supplier to
Majesty Oil Mills
Trading of winter grains
Grading of derivitives on the JSE market
Tel : 021-870 3960 Fax : 021-872 8548
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comprehensive, ongoing training. “We don’t have much turnaround of staff. Twice a year we will get external boiler specialists to do training with our operatives,” Pillay said. “Other than for medical, safety and boilers, we get in house training. The plant is specialised for specific needs for oil extraction and there isn’t the facilities in this country for that sort of training. “At the moment we have a few apprentices in the workshop section. This current group will take three years to go through the course, and at the end of it we will have readily available and highly qualified staff.”
“We are the first to start to producing and processing soya bean on a large scale and we have been in operation for nearly 10 years, we are an established brand in the market” – Billy Pillay
Soya bean cake
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MAJESTY OIL MILLS
Majesty Oil production plant based at West Krugersdorp, South Africa
“The main challenge is whether South Africa can produce enough soya beans...” – Billy Pillay
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Future plans and challenges Majesty Oil has looked to import soya beans from South America, but mostly sources from within the continent including Zambia and Malawi, and more frequently local South African beans. Pillay said: “The main challenge is whether South Africa can produce enough soya beans and also to try and minimise the importation of the soya oil cake.
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Company Information INDUSTRY
Oil processing HEADQUARTERS
West Krugersdorp FOUNDED
2000 EMPLOYEES
228 REVENUE
R850 Million PRODUCTS/ SERVICES
“We were the first to start to producing and processing soya bean on a large scale and we have been in operation for nearly 10 years, we are an established brand in the market whereas others go through teething problems with setting up to get the quality right. “We have a good quality product and as a result our order book is full a year in advance. We do want to see vertical integration within Majesty Oil, and hope to grow more on the Oil Cake line”.
Lecithin, Oil Cake, fullfat soya, texturized vegetable protein, regular oil
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Danya Foods
driving growth through supply chain professionalisation The Middle Eastern subsidiary of dairy co-operative Arla Foods is committed to total supply chain efficiency, and in turn providing increased value for money Written by: Sam Jermy Produced by: Craig Daniels
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D
Surveying the new site ready for the new equipment facilities
“What sets us apart here is we have this team spirit; it encompasses the entire organisation” – Thomas Nordholt, Regional Supply Chain Director at Danya Foods 110
July 2014
anya Foods Co. Ltd is enjoying considerable progress within the Middle East and North Africa regions, and is planning substantial investment to enhance its success in the dairy products industry. Based in Northern Europe, the global dairy giant Arla Foods, producer of the recognizable Lurpak butter, is the parent company of Danya Foods. There is DKK 35 Million worth of investment earmarked for more automation in the production processes, as well as warehouse capacity expansions and automation. Further investments were approved last year to specifically invest in training, systems, process optimisation and production capacity, and the company envisages investments to at least remain the same going forward. Thomas Nordholt, Regional Supply Chain Director at Danya Foods, explained how the company has adopted new technology to help the firm become more efficient. He said: “In the last 12 months Danya has gone from manually operated to almost fully automated production. Part of our main investment is purely being able to produce more processed cheese. “Another part of it is to automate existing production facilities to reduce conversion costs. For instance, where the company had manual labourers empty pallets, wash glasses before the filling lines, fill boxes and cartons, then pack them onto pallets it now has robotic machinery for all of this.”
MIDDLE EAST
A conveyor belt now brings finished items from production to the distribution part of the site, and there are robots which not only bring pallets into the warehouse but even shrink-wraps the finished products being loaded for distribution. “It has been a fantastic journey. In this coming year our focus will be to increase capacity even more while reducing time and cost to market.� added Nordholt. Progressiveness Danya prides itself on having achieved a doubling in production volume at the same time as reducing costs. Apart from the worldwide Lurpak butter from Arla, one of the big brands in the Middle East is called Puck. This brand offers processed cheese, cheese triangles and slices,
Preparations to install the new equipment
Construction of the new production building
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WE KNOW THE MARKET WANTS WHITE JAR AND TRIANGLE CHEESE Burt Lewis, with offices in Dubai, Denmark, Canada and the US, is a global supplier of US raw materials such as White Butter, White Cheddar, White Milk Powder, perfect for Jar and Triangle Cheese. doris@burtlewis.me www.burtlewisingredients.com www.mammencheese.dk +45 30 58 62 12 +971 56 741 2102
D A N YA F O O D S cheddar, processed cheddar, processed garlic cheese, cream cheese, thick cream, sterilised cream and condensed milk. It also imports 20kg blocks of cheese from Europe, mainly Denmark. Then it is shredded and sold as shredded Mozzarella under the Three Cows and Puck brands. Saudi Arabia counts for about 50% of Danya business in the Middle East. There is also a vast market in Africa, but it is more skewed towards products such as the Dano milk powder brand. It is a widespread market too; in North, East and West Africa. Operations were established in Saudi Arabia in 1977 and Danya now has 13 depots, 3 warehouses, and 420 vehicles which is a mix of sales vans, trailers and smaller vehicles. The company head office is in Dubai, and
SUPPLIER PROFILE
MIDDLE EAST
FAT testing kit
BURT LEWIS
Burt Lewis Ingredients is a subsidiary of Burt Lewis International which was established in 1976 and has now gone on to become one of the leading ingredient suppliers to many large and well known multinationals around the world. At Burt Lewis Ingredients we pride ourselves on delivering the highest quality dairy ingredients at the most competitive cost utilizing the most efficient supply chain. Burt Lewis Ingredients provides a wide range of services to meet customer needs. These services range from logistics and documentation services to price risk management. Website: www.burtlewisingredients.com
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D A N YA F O O D S
Laying equipment’s foundation
“There is a never ending demand especially for industrial size processed cheese, that’s why we are investing heavily to help reduce cost per kilo and increase capacity” – Thomas Nordholt
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July 2014
Scrambling to install equip
Riyadh is the location of the production site for both Danya and a selection of Arla items sold within the Middle East and Africa. Rationalising of its local transportation to, from and between depots within Saudi Arabia and abroad and using third party logistics solutions are avenues the company are exploring. Nordholt said: “Because of the sales growth of our main products there is a never ending demand especially for industrial size processed cheese, that’s why we are investing heavily to help reduce cost per kilo and increase capacity.” The dairy producer knows there is a direct correlation between volume output to the costs of materials, man-power and the effort
MIDDLE EAST
pment
Up and running
that goes into a finished product. Therefore everything is geared towards making the whole business process gain more fluidity. The group supplies products to all Middle Eastern countries and as an importer of Arla Foods finished goods from manufacturing sites in Europe, Danya is also a distribution centre for its parent company in Saudi Arabia to the region. There are several distribution set ups in other Gulf countries but it has a presence in every country in the region. Strategic Vision and Team Spirit Minimising disruption in the supply chain and maximising profitability, without compromising
Equipment
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SPX - OVER 100 YEARS IN THE DAIRY INDUSTRY With a focus on innovation and process development, we continue to expand our product portfolio in order to provide our customers with more choices and more solutions. From engineered to customised systems and components, SPX helps you process dairy products your way. Contact us today to find out how our newly launched solutions and industry leading brands can help you meet your most critical processing challenges. www.spx.com ft.enquiries@spx.com ft.dubai.sales@spx.com EVAPORATORS • DRYERS • HOMOGENIZERS • HEAT EXCHANGERS MIXERS • SEPERATORS • VALVES • PROCESS SYSTEMS • PUMPS
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D A N YA F O O D S excellent value for money to the end customer has not been the sole focus for Danya. A key feature is its multifunctional, multinational group of employees who are all working towards the company’s long-term strategy of increasing volume by at least 20% per year by 2020 while at the same time continuing to reduce the cost base. The growth will be a mixture of organic growth, adding new products to the line and may also include mergers and acquisitions if such opportunities surface. Nordholt said: “Last month we again broke our volume and cost production record for the 12th consecutive month and immediately I took the team out to celebrate. “There are always rewards and what is unique in my opinion is that we give high
MIDDLE EAST
Working late
FAT testing kit
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D A N YA F O O D S
Staff outing: The Supply Chain SWAT team
“It has been a fantastic journey. In this coming year our focus will be to increase capacity even more while reducing time and cost to market” – Thomas Nordholt
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July 2014
achievers an opportunity but also those hardworking people who may not come with a very high end education or a very fancy looking resume in terms of their work experience.” This inclusiveness in encouraging the careers of all people no matter what background, education or background is a focal point of staff recruitment and retention. One prominent example includes one gentleman who started working at Danya as a receptionist one year ago; today he is in charge of all direct deliveries to all the main supermarkets in Saudi Arabia. “Simply by delivering results it immediately gets noticed at the top end of the organisation. It’s those people we are willing to invest in hard and fast. We give them opportunities
MIDDLE EAST
to succeed and we value their ideas and contributions.” commented Nordholt. He explained: “What sets us apart here is we have this team spirit; it encompasses the entire organisation and that means if a labourer from the warehouse really believes he has a good idea or suggestion, he is not afraid to walk into the general manager’s office proposing his idea because he knows we will be very receptive.” There is a government programme called Saudization to employ at least 20% local people in companies such as Danya, and Danya has been quick to support the government on this. Increasing automation created a need for more highly-skilled employees with Nordholt recognising many Saudi’s have a high skillset in robot technology and programming, therefore naturally increasing demand for those people. Asked what sets Danya aside from competitors, Nordholt said: “Our agility in the supply chain is incomparable. Objectively we are fairly small compared to some of our competitors here but they are very heavy organisations whereas we are extremely good at getting everyone to buy into a project instantly and delivering the results in a short time.” A perfect illustration of this operational overhaul is the fact Danya now saves 97% of the total packaging material used for its industrial cheese whilst it can also fit 15% more volume on the reusable pallets; another pleasing milestone in the company’s long-term, progressive vision.
Company Information INDUSTRY
Dairy foods HEADQUARTERS
Dubai FOUNDED
1977 KEY PEOPLE
Thomas Staerk Nordholt, Regional Supply Chain Director EMPLOYEES
900 REVENUE
+800 mio SAR PRODUCTS/ SERVICES
Dairy foods, processed cheese, cheese blocks, triangles, cheddar, mozzarella, condensed milk
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Coinadrink embraces vending trends to stay on top
This veteran company has emerged from the recession stronger by keeping up with a changing industry while maintaining its reputation for quality customer service Written by: Joel Levy Produced by: Stuart Brown 121
COINADRINK
The company supplies vending machines for hot and cold drinks, snacks and food
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July 2014
U
K vending specialist Coinadrink has stayed strong in a competitive and changing industry by embracing the latest trends while maintaining its renowned customer service experience. The Walsall company with more than 50 years’ experience has leveraged all its knowledge to launch its own brand range, CaféCasa, which provides high quality hot drinks at an attractive price-point. Managing Director Roger Williams said: “When the recession hit, we started our own label, taking a good look at what supermarkets are doing. We started to develop tea, coffee, chocolate and skimmed milk. Now 20 percent of our business is our own label.” The ‘supermarket approach’ gives customers the best of both worlds, offering
EUROPE
Coinadrink have achieved the Investors in People Gold rating
recognised brands and also the option of a lower-priced alternative with the quality they would expect from the big names. This strategy is apt in a market of squeezed disposable income where customers look for value everywhere, and just another example of the adaptability that has kept Coinadrink successful. Adaptability Founded in 1962 the company has ridden out the changes in an industry that has faced its share of challenges. The demise of large-scale UK manufacturing workforces in the 1980s and the more recent recession led to businesses removing vending machines with savings in mind. But Williams believes his company’s openness to change has seen it emerge from such tough years in a relatively strong position.
“When the recession hit, we started our own label, taking a good look at what supermarkets are doing... Now 20 percent of our business is our own label” – Roger Williams, Managing Director
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Lavazza’s success lies in constantly growing, innovating and evolving without ever betraying its traditions. A great Italian story of a company that, has come to symbolise coffee, taste and pleasure, worldwide.
01895 209750
info@lavazza-coffee.co.uk
www.lavazza.co.uk
COINADRINK
EUROPE
Moves have been made to replicate the coffee shop phenomena of recent times in the workplace to a degree of success, and another trend is a blurring of the line between the vending and Horeca (HOtelREstaurantCAfe) sectors. Williams said: “We now supply the Horeca sector, and that’s something we didn’t do a lot of five years ago. People want the two side-byside, and that’s what’s happening here now. The equipment is quite different to vending, so you need slightly different skill-sets like Barista training, and slightly different engineering as well.” Coinadrink has also gained, he says, from the mistakes of its rivals, whose new owners have neglected the customerservice side post acquisition. “We really stuck to our guns and never cut the
SUPPLIER PROFILE
Key Personnel
Roger Williams Managing Director
LAVAZZA
Coffee is naturally at the centre of Lavazza’s universe: Coffea Arabica and Coffea Canephora (widely known as Robusta) are the two coffee species used to produce and market this product. An excellent raw material is essential for the quality of the end product, in the same way as it is essential to constantly control each processing stage. The experts in the Research & Development department monitor the whole process of coffee production, from purchasing right through to extraction in the cup, so as to ensure that the coffee meets Lavazza’s Quality Standards. Website: www.lavazza.co.uk
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COINADRINK service, and that’s paid off. It’s not like it used to be; the price is more competitive, you have to run the business far more efficiently than ever before, so you’ve got to invest a lot more in IT systems and employing quality staff. Maintaining this quality has enabled us to come out the recession in better shape than we went in,” he explained.
Coinadrink’s vehicles carry the company’s very distinctive brand message
Unrivalled service Coinadrink boasts 24-seven customer service and a guaranteed response time 363 days a year, including a full site survey followed by fast installation, regular visits by operators to ensure machines are running 9649 MONDELEZ MECC ad A4.pdf
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StORk techNIcaL SeRvIceS T +31 (0) 314 684 545(Industrial Automation) T +31 (0) 58 284 4600 (Calibration) www.storktechnicalservices.com WWW.KENCO.CO.UK/CLEANWATER
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smoothly and well-stocked, and rapid reaction to any equipment issues that arise. “We’ve stayed at what you might call the premium end,” explained Williams. “We said ‘this is the level of service we’re going to give‘ and that’s what it will cost us to do it.” It is an approach valued by customers prepared to pay a little more for this consistent level of professionalism and the expertise of experienced staff and engineers. Staff retention As the first UK vending company to gain the Investors in People Gold award, Coinadrink creates a great working environment for its 75 staff, and an atmosphere that promotes long-termism. “It comes down to keeping the staff together,” said Williams. “We pay people the most we can afford, not the least we can get away with. “Everybody has a training plan for the year. You really have to look at everybody and see what you can do to improve their skills and what new ones they may need, with our online business and also our move into the micro-market business. We have a five-strong IT department now that five years ago we didn’t have.” This investment in people is an approach geared towards keeping the most skilled and experienced team together while also encouraging new blood. Williams continued: “We bring people in from
“You really have to look at everybody and see what you can do to improve their skills and what new ones they may need” – Roger Williams
Coinadrink is based just off junction 10 of the M6 in Walsall
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COINADRINK
The warehouse for Coinadrink’s online store – refreshmentshop.co.uk
school or university and they tend to stay. The investment we have made in IT essentially means you have to bring in young people. That’s the area where the growth has been in staff recruitment and they’ve helped the business become more efficient. We see that as an ongoing process.”
Coinadrink’s fleet of operators use the latest hand-held scanners
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Streamlining and IT The shift to IT has allowed Coinadrink to streamline the business with a focus on providing better value for customers. Cutting admin staff by half through the automation of admin tasks freed up finance for investment into front-line services. Williams said: “We have to make things more efficient but at the same time improve the service you give the customer and give them the things they appreciate, rather than what you may be proud of but the crowd places zero value on. This enabled us to take quite a bit of cost out. We look twice a year and ask what we would do differently if we had a blank piece of paper.” The money saved has gone into switching
EUROPE
Company Information INDUSTRY
Vending HEADQUARTERS
Walsall
some suppliers to enable greater reliability of machinery, with Coinadrink looking overseas to guarantee the best. Premium, reliable equipment has been sourced in the US, and the IT investment has built up large quantities of supplier data, allowing the company to easily identify issues and act accordingly. Further technological investment was made with a recent upgrade of handheld devices used in stock control and for servicing machines. The new machines, from Spirit Data Capture, are yet another example of a boost to efficiency, saving time for engineers. As Coinadrink has modernised, it has remained true to its values, and for this reason, it has emerged from the recession as a stronger company, with its core ethos intact. “We’ve maintained the integrity of what we do, haven’t been tempted to cut corners like others have, and we want this to continue,” Williams concluded.
FOUNDED
1962 EMPLOYEES
75 PRODUCTS/ SERVICES
Wide range of refreshment products including own-label coffee, tea, chocolate and milk
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AmRest Spain strives to lead the QSR field through its ‘everything is possible’ ethos
Quick Service Restaurant specialist is determined to communicate its core KFC values across the country and become the destination of choice for eaters and workers alike
Written by: Tom Wadlow Produced by: Craig Daniels
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A M R E S T S PA I N
A
Alan Honan, Managing Director
KFC is growing across Europe
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mRest Spain is pushing hard to become the QSR of choice for customers and employees in Spain by operating through its world-class systems with an ‘everything is possible’ attitude spearheading its activity. Having witnessed huge success across Central and Eastern Europe with its premium chicken brand KFC, it is now looking to replicate this in the Spanish market and continue its flourishing partnership with brand owner and global franchisor Yum!. Spreading its core brand messages is central to taking the numbers of KFCs in the country into the hundreds, with freshness, in-store preparation and a sharing ethos at the heart of its image. The company, part of the global KFC, Burger King, Starbucks, Blue Frog, Kabb and Pizza Hut operator AmRest, also has 170 Italianthemed La Tagliatella branches which it took over along with the 31 KFC sites when it acquired Spanish firm Restauravia in 2011. Everything is possible Managing Director of AmRest Spain and overseer of KFC operations, Alan Honan, attributes the wider company success to an everything is possible mind-set, or ‘Wszystko Jest Mozliwe’ when CEO Henry McGovern touched down in Poland 20 years ago. “We have a very special culture which was a huge part of us being able to grow from one store to nearly 1,000 world-class operations
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KFC exterior in the evening
and a billion-dollar organisation,” Honan said. “It was a 25-year-old American guy who landed in southern Poland 20 years ago who has built a $1 billion organisation starting in Central Europe. We now have operations across Europe, the US and China and there is no reason why we cannot do the same in Spain, it has a higher population and more favourable demographics than Poland.” Honan has overseen success in the Czech Republic and recently Hungary, where 12-13 KFC stores were opened in the past 18 months making it the fastest-growing QSR in the country. Currently AmRest Spain runs 19 stores in Madrid and 12 in Barcelona, and is also aware
“If we can communicate our values and ideals then the potential here is massive” – Alan Honan, Managing Director
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KFC restaurant
of the opportunity for roadside branches which is yet to take off as a concept in the country.
Premium offerings
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Communicating core values The greatest challenge to AmRest Spain also represents its greatest opportunity. “The brand awareness of KFC in Spain is not huge even though it’s been around for 40 years,” Honan said. “If we can communicate our values and ideals then the potential here is massive. First and foremost our chicken is fresh and locally sourced in the vast majority of cases.” “One of the things I was really proud of when in Hungary and the Czech Republic is that 97 percent of our KFC supply chain is local.”
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All of its food is also prepared in-store by hand using the renowned Colonel’s secret recipe of 11 herbs and spices, and much of its menu encapsulates a culture of sharing, something which Honan believes is primed for the Spanish market. He added: “The Spanish really love good food and are very family-oriented. There’s a beautiful family feel in Madrid where I live and KFC have a real relevance here; there is something special about walking into our stores and seeing people share food.” Honan is looking to communicate these brand images through in-store methods, digital marketing, mass media and with partners Yum!.
“There’s a beautiful family feel in Madrid where I live and KFC have a real relevance here” – Alan Honan
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“This is what we do at AmRest, we give people reasons to come to work. We really want to give them the why” – Alan Honan
Shared vision Crucial to AmRest Spain driving KFC growth is a continuing partnership of fruition with Yum!, for whom AmRest as a whole is a key partner in expanding its various QSR brands. “We have a great relationship and we’re seen as a very important strategic partner and are very proud to operate 650 of their stores,” Honan said. “They really support our core values and for the last 20 years they have trusted us to operate and expand in chosen territories.” “We are in constant dialogue with them and we both have the same goal. They are the curator of the brand and we are there to operate and grow
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KFC Restaurant exterior
it, there is a really excellent synergy between us.� AmRest Spain is also well-backed by private equity investors Warburg Pincus. Employer of choice The culture of everything is possible filters through the ranks of the organisation and is something Honan sees as key in AmRest Spain’s KFCs becoming an employer of choice as well as an eatery of choice in the country. w w w. a m r e s t . e u
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There are several strategies and thought processes in place making this happen. The company’s 1,500 KFC employees receive mandatory training and can apply for a new six-month fast-track development which results in a managerial position. This relates to a culture of staff empowerment. “Everybody has a voice and this comes from lean management,” Honan added. “We empower people to solve problems at all levels of the organisation which is pretty unique in the QSR business.” AmRest Spain also recognises its employee’s achievements on a regular basis. Each month the top performing 30 percent of KFC staff are handed cash bonuses as part of the Crew Reward Programme, acknowledging those who excel in a ‘speed with service’ environment. Employees are also encouraged to have fun through social events, team building and parties, rounding off their experience and incentivising them to drive growth. Honan concluded: “The vision is to become the QSR to eat and work in in Spain - how we hire, how we train, how we communicate, how we develop. That’s our true north. “I spoke to a friend recently and one thing struck me. He asked what my purpose was, what is your why? This is what we do at AmRest, we give people reasons to come to work. We really want to give them the why.” 138
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Company Information INDUSTRY
Quick Service Restaurants (QSR) HEADQUARTERS
Madrid FOUNDED
Not disclosed EMPLOYEES
1,500 across KFC branches REVENUE
Not disclosed PRODUCTS/ SERVICES
KFC, La Tagiatella restaurants
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Ingenio Monte Rosa (Pa Entrepreneurial Innovation fo Adjacent activities in Ingenio Monte Rosa have boosted their increasing the value of their products. Written by: Rebecca Castrejon Produced by: Taybele Piven Interviewee: Bernardo Chamorro, CEO of Ingenio Monte Rosa
antaleon): or Industrial Self-Sufficiency economic power, crossing national boundaries and
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I N G E N I O M O N T E R O S A ( PA N TA L E O N )
I Pantaleon talent
ngenio Monte Rosa joined Pantaleon upon acquisition in 1998. Since then, the sugar factory has followed a strategic growth plan that has exponentially increased its operations, performance and productivity. Additionally, the company has strengthened its leadership in the sugar industry in Central America with sustainable businesses including energy generation and the upcoming construction of a distillery. Strategic Management Sugar came into the life of Bernardo Chamorro in November of 1998. Following a career in the technology industry, Chamorro became the CFO for Ingenio Monte Rosa—a sugar facility—and their various business units in the energy field. Soon, he was leading the company as CEO, a post he has managed since 2011. Sugar Competitiveness in Nicaragua Nicaraguan sugar factory Ingenio Monte Rosa has intensified and diversified its operations in the country, creating much-needed added value for their business. Some of these developments are: Production efficiency: Ingenio Monte Rosa is recognized for their competitiveness in costs, adding value to their products in an industry characterized by low margins and market variations.
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Investments in parallel businesses: The company has developed other related businesses through investments, such as the cogeneration of energy for the plant’s use and the sale of residual power to the country, obtaining not only savings but also subsidiary income. Additionally, they are investing in the factory with the implementation of modern processes. “We are a self-sufficient and innovative company, which is a differentiator and a competitive advantage because it enables us to utilize our assets,� says Chamorro. Culture of Improvements: From business management to product innovation.
Monte Rosa Products Ingenio Monte Rosa Headquarters (Pantaleon)
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I N G E N I O M O N T E R O S A ( PA N TA L E O N )
Sweet competitiveness
Global Distribution In addition to the significant percentage of sugar distributed domestically, their export activities have increased their profitability in recent years thanks to free trade agreements with foreign countries and partnerships in the sector. Countries such as the United States, Mexico and Chile have been strategic allies of Nicaragua. The country has also increased its international presence with the European Union and Taiwan in recent years, given the free trade agreement with Asia.
Workers
Modern Industrialization Following major investments of more than $40 million, the company is consolidating its sugar milling capacity and reaching 16 thousand metric tons per day in the harvest that will begin this November. 144
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Their industrial processes are now 80 percent automatic and managed through digital panels; however, they are looking into reaching an automation of 100 percent. Another transformation is the expansion of their mechanized harvest of green sugarcane (cane that isn’t cut by hand and mechanically harvested), a technique that has strengthened their production from 30 to 70 percent.
“We want to produce more sugar, bring the sugar mill to grind 18 thousand metric tons and be the largest generator of clean energy
Mechanized harvest of green sugarcane benefits:
– Bernardo Chamorro, CEO of Ingenio Monte Rosa
- Soil conservation, as the residue remains in the field. - Fresher products, as they are delivered more quickly to the sugar cane mill. - Increased power generation due to cane residues found in leaves. Experienced Cutters - Training program abroad. To promote the best cutting techniques, field leaders are transferred to the company’s research institute in Guatemala and trained in specialized methods. - Occupational safety and preventive health. Monte Rosa has invested in proper mechanics for the prevention of accidents and the implementation of the tools needed for a safe working environment. In addition, 40 monitoring w w w. p a n t a l e o n . c o m
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I N G E N I O M O N T E R O S A ( PA N TA L E O N ) health specialists ensure that all workers comply with safety and health plans such as water ingestion, a balanced and authorized meal designed by nutritionists and proper breaks.
Responsible activities
Agricultural Advantages The mechanization of activities in Ingenio Monte Rosa has benefited their final product; proof of this is the production and commercialization of a special sugar called ICUMSA 150. They have introduced precision farming with GPS, which enables agricultural work at any time of the day thanks to geo-localization. The tractors automatically read coordinates, providing greater efficiency to the agricultural process. Monte Rosa has a nursery where they analyze varieties in order to find the best match. In collaboration with CegicaĂąa, an institution in Guatemala, they study adaptability to soil, climate and environmental conditions. “This automation allows us to standardize our processes, leading to less waste. All these investments in technology and implemented improvements over the years have provided us with many benefits for the future,â€? says Chamorro. More than Responsibility Ingenio Monte Rosa has the OHSAS certification for occupational health and safety; this is one of many assets the company has acquired as part of their responsible activities. Another example is their social development department, which
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Cutters
Automation
interacts with 50 communities in the surrounding areas to develop strategic plans that will improve the quality of life of the population. “We want to go further,� says Chamorro, regarding environmental protection. The sugar company complies with all of the local legislation requirements and licenses to operate. In addition, they hired a world-renowned firm that is measuring Monte Rosa’s impact in the area. The Pantaleon Foundation develops programs to improve health and education in communities. For w w w. p a n t a l e o n . c o m
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csc@dnp.com.ni www.dnppetronic.com.ni
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example, they opened two schools in Nicaragua that served more than 600 children and provided classes of high international standards to ensure quality. The foundation also supports child development centers with children from birth to five years old and where female workers can leave their children during working hours to receive education, motivation and food. “We have very good interaction and open communication; we receive complaints or questions and take actions that will benefit the community,” he adds. Human resources
Providing Developments Rather than providing products, these suppliers— or strategic allies—of Ingenio Monte Rosa deliver progress with the provision of new technologies and specialized training on the
SUPPLIER PROFILE
COMPANY NAME
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www.metaltronic.com.eca info@metaltronic.com.ec
www.maquipos.com.ni ventas@maquipos.com.ni
www.disagro.com
www.disagro.com
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latest sector updates. Given that new equipment is usually somewhat complex, suppliers provide customized training to operators taught by professionals. “The supplier who knows us, who has worked with us for years, that is always aware of our operation and suggests new technologies is a partner to us, and that relationship is a win-win,” says Chamorro. Progressive Projections Pantaleon Group (where Ingenio Monte Rosa is a subsidiary) seeks to develop its operations both organically and through acquisitions. Chamorro says, “We want to produce more sugar, bring the sugar mill to grind 18 thousand metric tons and be the largest generator of clean energy.” In the future, they hope to expand their sustainable businesses as part of their corporate responsibility and climate change in the Nicaraguan industry. Among their new business is the construction of a distillery with a capacity of 300 thousand liters, investments in their delivery network and plans to increase their energy generation from 30 to 50 megawatts per hour over the next three years. “We continue to focus on improving efficiency, productivity and reducing our costs to be more competitive and have continuous long-term development,” says Bernardo Chamorro, CEO of Ingenio Monte Rosa.
Machinery
Sugar mill
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I N G E N I O M O N T E R O S A ( PA N TA L E O N )
Bernardo Chamorro, CEO of Ingenio Monte Rosa
High quality in the production process
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“We are a selfsufficient and innovative company, which is a differentiator and a competitive advantage because it enables us to utilize our assets”
Company Information INDUSTRY
Sugar production and refining HEADQUARTERS
Chinandega, Nicaragua FOUNDED
1998 (acquisition) EMPLOYEES
6,000 KEY PEOPLE
Bernardo Chamorro (CEO of Ingenio Monte Rosa), Gilda Martinez (Communications Coordinator), Milvia Amador (Executive Assistant) SERVICES
Raw sugar, sulfite sugar, molasses and cogeneration W E B PA G E
www.pantaleon.com
– Bernardo Chamorro, CEO of Ingenio Monte Rosa
www.facebook.com/PantaleonIngenioMonteRosaSa twitter.com/search?q=Ingenio%20Monte%20Rosa&src=typdt www.linkedin.com/company/pantaleon-sugar-holdings www.facebook.com/pages/Corporación-Maresa/378166975598528
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Company logo goes here
PRONicaragua Produced by: Taybele Piven
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PRONICARAGUA
Nicaragua’s success harvest in cocoa industry Nicaragua has always been highlighted by the quality of its agricultural sector, as weather conditions and abundant water resources make the country ideal for producing a wide variety of crops instead. Thus, the cocoa industry of Nicaragua has established itself as the most dynamic in Central America, and also enjoys a favorable environment for the modernization and increased production and processing. Also, cocoa available in the country is the Trinitarian type, if properly fermented, is the preferred raw material for thin and dark chocolates.
Harvest
Annually 4,000 metric tons of cocoa from approximately 8,000 hectares are produced and exported primarily to Central America and Europe. However, the country has more 350,000 cocoa hectares suitable for growing, mainly located in the North Atlantic Autonomous Region and the South Atlantic Autonomous Region, according to a study by the Ministry of Agriculture and Forestry (MAG ) done in 2010. Since 2007, cocoa exports were driven by rising grain prices on the international market and increased domestic production. These 156
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“The competitive advantages that Nicaragua offers investments in agribusiness are what has driven the growth of the cocoa industry in the country�
Cosecha
have shown an annual compound growth rate of 24 percent in value and 22 percent in volume between 2007 and 2012, from U.S. $ 1.32 billion in 2007 to U.S. $ 3.93 million in 2012, to 900 metric tons in 2007 to 2.400 metric tons by the end of 2012. Currently, until July 2013, there have been w w w. p r o n i c a r a g u a . o r g
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PRONICARAGUA
Worker & harvest
U.S. $ 4.26 million and 1,890 metric tons in terms of exports of this product.
Harvesting
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The competitive advantages that Nicaragua offers for investments in agribusiness are what have driven the growth of the cocoa industry in the country. First, Nicaragua has access to more than 1,500 million people worldwide since it has signed free trade agreements (FTA) with several other countries. Moreover, Nicaragua is the largest country in Central America in terms of territory and more than 50 percent are uncultivated, representing a large availability of land. The Government has also made it a priority to attract quality foreign direct investment and creating a more favorable environment for business in the country in recent year’s environment.
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Harvest
Most cocoa farmers in Nicaragua are considered small producers with average production areas of 1 hectare. However, from the year 2010, a large group of foreign and domestic companies have begun investing approximately 5,000 hectares of cocoa plantations in the South Atlantic Autonomous Region (RAAS), specifically in El Rama and New Guinea in the region Autonomous North Atlantic (RAAN) in the municipalities of Siuna, Bonanza and Rosita, and Rio San Juan. Additionally, some Nicaraguan companies began to invest in cocoa plantations and in total, according to their projections, are expected to arrive to cultivate more than 8,000 hectares in the next 10 years.
“The company first entered Nicaragua in 1991, buying and supporting the production of small cocoa farmers, due to their excellent quality�
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PRONICARAGUA
“Annually 4,000 metric tons of cocoa from approximately 8,000 hectares are produced”
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An example of success in the cocoa industry in Nicaragua is the case of Ritter Sport, internationally recognized company dedicated to the production and marketing of fine chocolates from around the world. The company first entered Nicaragua in 1991, buying and supporting the production of small cocoa farmers, due to their excellent quality. Beginning in 2011, the company decided to invest around U.S. $ 25 million in cocoa plantations of at least 3,500 hectares and in 2012 began to expand its operations and that Nicaragua had found the ideal conditions for the production, processing and export of cocoa.
Company Information INDUSTRY
Nicaragua’s official investment and export promotion agency COUNTRY
Nicaragua EXECUTIVE DIRECTOR
Javier Chamorro KEY PEOPLE
General Alvaro Baltodano, Presidential Delegate for investment WEBSITE
www.pronicaragua.org
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Cargill: A bastion of brands to conquer the poultry market in Central America Artisanal quality and genetics for the regional market
Written by: Rebecca Castrejon Produced by: Taybele Piven Interviewee: Xavier Vargas, Business Unit Leader, Cargill Meats Central America
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Xavier Vargas, Business Unit Leader
A history of acquisitions to promote progress
Products Cinta Azul, one of Cargill’s brands in Costa Rica
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B
y 1975 the poultry processing and commercialization company initiated the strategic alliance of two Cargill business units in Central America, Cargill Meats Central America and Cargill Animal Nutrition, this after opening and acquiring companies in: Nicaragua, Costa Rica, Honduras and Guatemala. After 50 years of operations in Central America, they are now one of the most valuable companies in the global sphere and have the preference of 60,000 customers in the region. Their production of chicken, sausage and food for animals and pets, has marked a strong market competitiveness, providing innovative solutions in
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agriculture, food products and industrial services with highly recognized brands such as: Pollo Norteño, Delicia, San Miguel, Tip-Top, Cainsa, Pipasa, Cinta Azul, Kimby, Tiquicia, Zaragoza, Perry, Cinta Roja, Premier, Mike’s, Castillo del Roble, Beannie’s, Purina Nutrimentos, Alcon, Dogui, Gati, Pet Master, Tuiti, Ascan, Kan Kan, Mimados, Don Gato, As de Oros, Aguilar & Solis and Dog Pro. In addition to their success in the food market, Cargill continues to thrive in its commitment towards the community, and in partnership with the national government, clients and farmers, they conduct social and ecological works. “We are committed to feeding the world responsibly, reducing our environmental impact and improving the communities where we live and work,” says Xavier Vargas, Business Unit Leader of Cargill Meats Central America.
“We are committed to feeding the world responsibly” – Xavier Vargas, Business Unit Leader
The exact formation for an strategic direction Within the management of Cargill Meats, is engineer Xavier Vargas, who as head of the company has driven its evolution, presence and businesses. Vargas has spent most of his career with Cargill, managing all operations in Central American countries (Honduras, Nicaragua, Costa Rica and Guatemala). It was 1996, when the current president of the board of Cargill Meats Central America, began his work at the company as training manager in w w w. c a r g i l l . c o m . h n
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CARGILL Honduras. Subsequently, he worked his way up, occupying the cold cuts management post. By the year 2000 he moved to Guatemala to handle one of Cargill’s acquisitions and took over the commercial management position. By 2002, Vargas decides to start his own business, a coffee roaster. Six years later (2008), he returned to Cargill as purchasing manager for Central America, and then became commercial manager for Cargill in Honduras. In 2010 he moved back to serve as CEO of Cargill in Nicaragua. In 2013, Vargas served as commercial manager and CEO of Cargill in Costa Rica; afterwards he was selected as executive director for Nicaragua and Costa Rica. Since May first, 2014, Xavier Vargas was announced Chairman of the board of Cargill Meats Central America.
Products Cinta Azul, one of Cargill’s brands in Costa Rica
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Brands that make a difference “Our most important asset is the trademark of our products, we own more than 20 brands in the region that have a lot of tradition in our operating countries,” says Vargas. The brand value of Cargill, is equivalent to customer appreciation, with products that have been in the Central American households for decades. One example of this value is the brand Tip-Top of Nicaragua, Pipasa from Costa Rica and Pollo Norteño in Honduras, which have captivated the national market for decades. In the range of cold
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meats, where the main attribute is practicality, the company has strong brands such as Perry in Guatemala, Delicia in Honduras, CAINSA in Nicaragua and Blue Ribbon in Costa Rica, to name a few. “Brands are associated with tradition, quality and taste; which helps us have the preference of consumers,” he adds. Investments and next acquisitions for global competitiveness Among their main investments for entrepreneurial development, some examples are: • Costa Rica: With an investment of millions to increase the fabrication of products with added value. • Nicaragua: With the opening of a new distribution center that will become the largest
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CARGILL site of operations in the country. In addition it will include two processing plants. This project has an investment of $40 million. Their growth strategy will evaluate the possible incorporation of companies that fit Cargill’s vision for commercial expansion in the Caribbean, Central and South America. Human talent, basis of corporate success The outstanding achievements Cargill Meats has acquired in Central America over the years have been largely thanks to the human resource commitment and competent execution. Among their objectives is being the best company to work for in Central America by 2020. To achieve these goals they are optimizing their work environment and are developing talent by transferring employees to international Cargill plants. “We are not a company of chicken, we are a company of people, and we are dedicated to have the best for them to take care of our chickens. But our job as leaders of this company is to bring the best talent, develop them, retain them and promote them,” says Vargas. Food advances for consumers’ taste In recent years, Cargill has increased their brand’s market presence by packaging individual pieces with information about the company, thereby increasing the consumer preference. Additionally they have expanded their added 168
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value lines, providing a greater number of solutions towards convenience and ready to cook products. Artisanal and modern processes As the poultry industry continues to use traditional methods, the implementation of modern technology exceeds investments of $20 million in equipment, improvements and genetics. Given the intensity of the process, farms require about 10 thousand employees. Strategic partners that supply quality “Our suppliers, which we call strategic partners, walk hand in hand with us, providing us with raw materials,” says Vargas. Aside from having their own fleet, Cargill has a department that negotiates all regional purchases. To be less dependent on imports and strengthen domestic suppliers, they are updating agricultural techniques to develop local crops of corn and sorghum in Honduras and Nicaragua. “We are trying to give more value to the country, by supporting the local produce of grains, corn, sorghum and soybeans, and stop importing,” he adds. A future of vast opportunities Cargill’s success in Central America is more than evident; the company has doubled the size of their operations in the region in just five years, making w w w. c a r g i l l . c o m . h n
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them a model for other units in Latin America. For 2020, they are looking to double the size of the company once again. The future remains prominent for Cargill Meats Central America and Cargill Animal Nutrition, in a region with one of the largest GDP growth in the world and with an increasing domestic consumption of animal protein. The company will continue to innovate to bring to market new lines and solutions, creating new consumption and increasing in percentage.
www.linkedin.com/com https://twitter.com/Car
CARGILL
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Company Information INDUSTRY
Aviculture (process products) HEADQUARTERS
San Pedro Sula, Honduras FOUNDED
1969 EMPLOYEES
9,300 PRODUCTS AND SERVICES
Aliments, agricultural products and services, financing and industrial services
“We are trying to give more value to the country, by supporting the local produce of grains, corn, sorghum and soybeans, and stop www.facebook com/pages/Cargill/108265632534606 importing”
REVEUE
USD $250 million WEBSITE
www.cargill.com.hn
mpany/cargill rgillConstructora/100558403364829 – Xavier Vargas, Business Unit Leader
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National Chamber of Restaurants and Flavored Food Industry: AIMMGM Written by: Lic. Hilda Lozano Calderon Produced by: Taybele Piven
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Restaurateurs entrepreneurs
N
ational Chamber of Restaurants and Flavored Food Industry (CANIRAC) is the organ who represents, integrates, educates, promotes and defends the interests of the restaurant industry, through dialogue with the government and related sectors. CANIRAC REPRESENTS the restaurant industry in Mexico and abroad. INTEGRATES businesses and institutions in the gastronomic sector: product and service providers, restaurateurs and public and private institutions. EDUCATES by designing and identifying the best training programs to the restaurant industry.
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CANIRAC directives
Given the nature of a public interest organization that has CANIRAC, the Government considers it a mandatory consultation body for taking decisions related to the development of the restaurant industry and as a channel of communication and dialogue with the authorities. The restaurant industry has been organized since 1958 in CANIRAC.
“We generate more than one and half million direct jobs�
MISSION To be a national business organization that accounting, integrates, educates, promotes and defends the interests of the restaurant industry through dialogue with the Government and other sectors.
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N AT I O N A L C H A M B E R O F R E S TA U R A N T S A N D F L A V O R VISION To be an efficient, modern and respectable chamber, influential in the public opinion and committed to the preservation, research and dissemination of the gastronomic traditions of Mexico. The restaurant industry DIMENSION IN MEXICO According to the National Statistics Institute (INEGI) there are 428,000 restaurants in Mexico. • We generate more than one and half million direct jobs, three and a half million indirectly. In all, five million formal jobs • 55 percent of workers in the industry are women • Our annual sales are nearly 200 billion pesos. • represent 1.5% of GDP and 15% of GDP Tourist • 96% of records are SMEs restaurants. CANIRAC represents all restaurants in the country and gives its direct members, the following benefits: Union Representation • Incorporation to the Mexican Business Information System (SIEM) • Free Fire Insurance and Casualty Insurance • Legal help • Training • Nutritional Information • REDSTAURANTES (electronic invoices, order 178
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online, reservations, personal control, electronic files ...) • Project management of general interest for the restaurant industry • Communication Services • Trade shows, exhibitions and gastronomic • Financing Options Lines of Action 2012 CANIRAC 1.- To increase the representativeness of the CANIRAC 2.- Dignify the Mexican restaurant industry and endorse the values identified as suitable: Sustainability, Legality, Modernization, Organization, Professionalism, Service, Performance, Honesty, and Transparency. 3.- Accredit CANIRAC to Mexican society as solid
Manuel Gutierrez Garcia, national president
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National Chamber of Restaurants and Flavored Food Industry
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trade organization, participatory, recognized, transparent and influential. 4.- Give dimension to the potential of the Mexican restaurant industry, 5.- Reverse the drop that happened in the restaurant industry in 2009, achieving average growth rates of 7% annually. 6.- Promoting compliance of current legal framework, under the slogan of “ZERO TOLERANCE to ILLEGALity�. 7.- Maximize sectored public programs of economic development. 8.- Establish sufficient and reasonable funding sources to the industry . 9.- Maximize participation and the impact of the restaurant industry in the national tourism industry.
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L AT I N A M E R I C A
“To be a national business organization that accounts, integrates, educates, promotes and defends the interests of the restaurant industry�
Company Information INDUSTRY
Food processing COUNTRY
Mexico SERVICES
Union representation, training, project management for the restaurant industry, trade fairs, exhibitions and dining PRESIDENT
Manuel Gutierrez Garcia KEY PEOPLE
Manuel Gutiererz Garcia, National President, Jose Luis Mier y Diaz, Executive President ADDRESS
Aniceto Ortega 1009, Col. Del Valle, Mexico, D.F., C:P: 03100 EMAIL
estrategiaspresidencia@ canirac.org.mx W E B PA G E
www.canirac.org.mx
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International Meal Company of Mexico (IMC): Passion in Food Excellency Food supply for the national taste
Written by: America Barcelo Feldman Produced by: Taybele Piven Interviewee: Alejandro Cappello, country manager for IMC of Mexico
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I N T E R N AT I O N A L M E A L C O M PA N Y O F M E X I C O ( I M C )
I Alejandro Capello, Country Manager of IMC Mexico
nternational Meal Company (IMC) is a Brazilian group with operations in Latin America Latin America and recently, in the United States. Its subsidiary in Mexico operates prestigious restaurants and food brands such as ‘La Mansión’-thin cuts of meat - ‘Group Champs Elysées’, ‘Casa Ávila’- Spanish restaurants, Brazilian Café, among others. 40 percent of their businesses are located in sites with high traffic flow such as airports and shopping malls. Recently, the group purchased the food chain Gino’s and Margaritaville, which originated in United States. The Country Manager of IMC Mexico , Alexander Cappello, has over six years of experience within the company. He arrived in Mexico in 2009 in the area of process and technology. Later, he was part of the financial board in Brazil. He also spent a year and a half in the stock exchange of the company until 2011, when he returned to Mexico to take over the post of CFO. He currently serves as country manager for IMC of Mexico. Food Differentiators In the processed food field and in the restaurant industry, corporate values such as a passion for food excellency have distinguished IMC from their competitors. “Passion is what reflects the larger engine that integrates this company, from our founder and president, Javier Gavilan, to new partners. We
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have a spirit of excellence, we work with heart, which is reflected in our mission. We strive not only for the goals of our position, but to exceed expectations,” says Cappello. IMC integrates a centralized business platform that incorporates new units to their portfolio and logistics. “It facilitates a rapid expansion which has led us to positive growth,” he adds. With an accelerated growth, IMC went from 12 restaurants and 500 employees in 2006 to a business group with 400 restaurants and 13,000 employees in 2014. Entrepreneurial Development IMC of Mexico has a distribution and production center that caters to all units, centralizing purchases and allowing for better development of brands.
Original paella at Restaurant Casa Avila
Bistrot Mosaico patio
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Champs Elysées restaurant
In 2014, IMC will continue to strengthen their brands, purchasing power and organic growth. Margaritaville (IMC’s most recent acquisition) will open its first unit in Mexico; the company will then expand this brand presence in beach destinations. In 2015 they will open 12 restaurants, in addition to 55 owned food sites today. New Markets Bourgogne snails
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The recent commercial negotiation for ‘Margaritaville’ (an American brand) will intensify IMC’s expansion throughout the Americas; the United States being the first step for an exploration headed to Europe and Asia. “Our mission is to be the best operator of food abroad
L AT I N A M E R I C A
La Mansion Restaurant entrance
America,” says Cappello. The goals of IMC are to reach more distant markets in the next three to five years. They will focus on North America, although they are already studying European markets.
“The success of our brands wouldn’t be possible without the cooperation of our business partners”
Human Resources Development
– Alejandro Capello, Country Manager of IMC Mexico
Ongoing training is reflected in IMC’s employees, due to major investments in their intensive programs for personnel at all levels. IMC’S human resources are transferred to the Integrated Training Center located in Mexico City, where they teach the best practices in their job position as well as the vision and values of the company. The company also has workshops, leadership
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Restaurant La Mansion
development programs, business administration and management courses for working executives and managers. Technological Advances In their production area, they have incorporated the latest technological devices in order to standardize processes. “We ensure the supply and reduce costs,� says Cappello. Thanks to these advances, they have achieved major energy savings and increased efficiency. 188
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In a short time, IMC of Mexico will implement a system for the finance area that will streamline and centralize administration. They are currently working with a digital platform to track sales at various restaurants and control their operations through online software; the back office automatically generates an inventory of ingredients used in recipes and controls the supply chain from the manufacturing plant to the consumer’s table.
Night view of the Champs ElysĂŠes restaurant
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I N T E R N AT I O N A L M E A L C O M PA N Y O F M E X I C O ( I M C ) Supply Chain “The success of our brands wouldn’t be possible without the cooperation of our business partners,” Cappello mentioned after speaking about their suppliers and how they have developed synergies to optimize costs. With the support of these strategic partners, International Meal Company has managed to expand into new markets. One example is the presence of meat cuts “La Mansion” in supermarkets thanks to a meat producer. “By sharing our success, we promote both brands,” he adds.
L AT I N A M E R I C A
IMC Future The Latin American company International Meal Company of Mexico intends to expand their brands all over the world, based on their passion for high quality standards. In the next five years, they expect to gain significant international growth. “We want to be the best food company in the next few years, and the first step to achieve this goal is to enter the complex United States market,� says Cappello.
Octopus Stone at Casa Avila
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Empanadas del Restaurante La Mansi贸n en M茅xico
Bistrot Mosaico Restaurant in San Angel, Mexico 192
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“Passion is what reflects the larger engine that integrates this company, from our founder and president, Javier Gavilan, to new partners. We have a spirit of excellence, we work with heart, which is reflected in our mission. We strive not only for the goals of our position, but to exceed expectations”
Company Information INDUSTRY
Food and drinks HEADQUARTERS
Mexico City (Corporate in Brazil) FOUNDED
2006 EMPLOYEES
1,835 (Mexico) KEY PEOPLE
Javier Gavilan (Corporate President), Alejandro Cappello (Country Manager of IMC Mexico), Salomon Rodriguez (Technical Director) PRODUCTS AND SERVICES
Restaurants and food service REVENUE
USD $60 million (Mexico) WEBSITE www.internationalmealcompany.com
www.facebook.com/pages/International-Meal-Company-IMC/136872226369047 twitter.com/search?f=realtime&q=International%20Meal%20Company&src=typd www.linkedin.com/company/219713?trk=tyah&trkInfo=tarId%3A1403710504356%2Ctas%3AInt – Alejandro Cappello, Country Manager of IMC Mexico w w w. i n t e r n a t i o n a l m e a l c o m p a n y. c o m
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CHAMA Business Group: A world of businesses surrounding dairy
Agribusiness union with more than one hundred years of experience in the Mexican food industry
Written by: Rebecca Castrejon Produced by: Taybele Piven Interviewee: Arturo Belmar, CEO of Grupo Empresarial CHAMA 195
GRUPO EMPRESARIAL CHAMA
A
More than 100 years in the production and comercialization of dairy products in Mexico
lthough their main activity is the processing and commercialization of dairy products, Grupo Empresarial CHAMA ‘s operation goes beyond this unit, with an industrial diversification that has taken place through the integration of products from Del Abuelo brand, Gourmet Products Fiumicino, APCO Association (Asociación de Productores Caprinos y Ovinos), UFNP Union (la Unión de Forrajeros del Norte de Puebla) and the company Ximena. Cheese production in Grupo Empresarial CHAMA has its origins in the late nineteenth century, in the hands of De La Parra family from Michoacan, Mexico. In 1991, the family industrialized their production after Don Mario Parra and de la Parra founded “Del Abuelo,” a brand recognized for its essence, craftsmanship and high-quality raw material, qualities that have been attached to the family’s creations for four generations. Management with Direction With 23 years of experience in various industrial sectors, Arturo Belmar, current CEO for Grupo Empresarial CHAMA, has a professional life filled with milestones in the financial management area of diverse sectors, such as banking, food, electric energy, video games and retail. Belmar began a partnership with Grupo Empresarial CHAMA as an external consultant in the area of strategic planning. A year later, in March 2011, he joined CHAMA as CEO of this agribusiness group.
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National Competitiveness “We differ in service and quality,” says Belmar, since the raw materials they use in all product lines are of the highest quality and satisfy the most demanding palates, even in the gourmet industry. Their fresh cheeses have won consumers and gained brand followers for Del Abuelo and Fiumicino. These dairy products retain an appetizing taste because they are only available in the market a maximum of 24 hours after being produced. CHAMA has a distribution center with a delivery route that provides goods to traditional stores, centers, groceries and creameries throughout the retail market. Their gourmet line is now in major supermarkets, hotels and restaurants.
“Our economic growth wouldn’t be reachable without the support and synergy achieved with our suppliers” – Arturo Belmar, CEO of Grupo Empresarial Chama
Arturo Belmar, CEO of Grupo Empresarial Chama
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Ximena is also part of CHAMA and is a company dedicated on improving fields
New Product Lines Additionally, in the second half of 2014 they are looking to launch new products aimed at children, redesigning their presentations to suit the market with the inclusion of an important personality for kids. Headquarters in
International Presence The group seeks a strong national distribution by increasing market penetratio in some areas in México. In the following years they will add distribution centers to broaden their presence in the territory and to prepare outlets for future distribution in the United States and Latin America. “We will focus on our national expansion and exports to North American markets,” says Belmar.
Mexico
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Dairy foods “Del Abuelo” since 1991
Manufacturing Implementations In addition to their traditional mechanized processes, the group has sought improvements in the production of goods; such is the case with their containers and packaging, which are constantly being updated to provide a better presentation to the consumer’s table. APCO Association
Featured Employees CHAMA Business Group has fostered the ongoing development of its employees, not only within the company, but also in the field of education by providing support and encouragement in their personal and professional life. “The development of people and the technical w w w. c h a m a . c o m . m x
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GRUPO EMPRESARIAL CHAMA
UFNP works with CHAMA in the fertilization and forage
L AT I N A M E R I C A
growth of staff members is the foundation of our corporate growth,” says Belmar. Responsible Activities One of the group’s priorities is to comply with all environmental regulations, waste and pollutants. They are still working on their energy consumption plan and will eventually include an alternative source. CHAMA promotes sports and education in rural areas by sponsoring sports leagues and cultural activities. “We live very committed to all the communities where we are, with all of our customers and suppliers. Even though there have been instances of slowdown, we have not reduced a single job because we are convinced that we have a social responsibility to them and the day the market reacts, then we will grow with all the people who supported us,” says Belmar. Suppliers Suppliers are critical in the manufacturing process of high quality products. Furthermore the group has created strong ties among their providers and continues to form strategic partnerships for a mutual development in both Mexico and abroad. “Our economic growth wouldn’t be reachable without the support and synergy achieved with our suppliers,” says Belmar.
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CHAMA and Del Abuelo, the way to create artisanal cheese
A Look Into the Future In the first half of 2015, the group expects a sustainable period, followed by growth and the expansion of their new product lines, projects and distribution channels. This growth will continue throughout 2016. Between 2017 and 2019, the company is looking towards moderate growth in the domestic market and a more substantial economic increase due to exports. “Our plan is to continue to innovate in this time of climate change, to emerge stronger and with significant inertia when the industry reacts,� says Arturo Belmar, CEO of Grupo Empresarial CHAMA.
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“We live very committed to all the communities where we are, with all of our customers and suppliers. Even though there have been instances of slowdown, we have not reduced a single job because we are convinced that we have a social responsibility to them and the day the market reacts, then we will grow with all the people who supported us”
Company Information INDUSTRY
Food and drink HEADQUARTERS
Mexico FOUNDED
1991 EMPLOYEES
200 KEY PEOPLE
Arturo Belmar (CEO), Mario de la Parra (President) PRODUCTS AND SERVICES
Agribusiness and lacteous REVENUE
USD $110 millions W E B PA G E
www.chama.com.mx
www.facebook.com/pages/Del-Abuelo/126899040684864?ref=ts – Arturo twitter.com/QuesosDelAbuelo Belmar, CEO of Grupo Empresarial Chama www.linkedin.com/company/grupo-empresarial-chama w w w. c h a m a . c o m . m x
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Agrocorp
Canadian Agriculture with a G
Managing Director Colin Topham discusses how the comp in the last fiscal year due to its strategic expansion. Written by: Sasha Orman
Produced by: Sean Bakke
Global Reach
pany has grown nearly triple its size
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Agrocorp Processing - Central Alberta Transloading Terminal in Innisfail
Canadian crops don’t just stay in Canada – the fields of Saskatchewan and Alberta help to supply the entire world. As a leading processor and distributor of grains, pulses, oil seeds, and specialty crops, with distribution offices across Canada and into the Indian Sub Continent, Africa, Russia, Turkey, Australia, and Southeast Asia, Agrocorp is a leading force in providing Canadian farmers with a global reach. Strategic Expansion Agrocorp has experienced considerable year over year growth –the business has made significant 206
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investments into expanding its reach in the last couple of years, especially in the construction of its new state-of-the-art pulse and special crop processing facility in Moose Jaw, Saskatchewan. “The merits of that facility have already been well recognized and are now creating a lot of buzz in the as a result of both with the efficiencies in turning our inventory and the quality of the product that we’re delivering into the market,” says Colin Topham, Managing Director at Agrocorp. “We have introduced some new cleaning technologies that have allowed for cleaning export quality
CANADA
at terminal speed. . It’s a technology we’re looking to extrapolate in future expansion projects.” Agrocorp will not have to wait long to take advantage of its technological advances – recently the business acquired another facility in Alberta and is looking forward to making upgrades that will enhance its abilities even further. “Although it’s an older facility, it is a very efficient facility and we’re currently engaging in modernization design work,” says Topham. Improving From Within In addition to improving its reach,
output, and facilities, Agrocorp has turned its focus inward, putting energy into rounding out its staff to grow and improve its corporate capabilities. A critical benefit for the company has been its acquisition of a business process and SOP specialist, who has now moved to Moose Jaw to contribute her expertise full time after years of previous work with Agrocorp on a consulting basis. “Her entire focus has been on streamlining plant to trade connectivity, which extends to our global offices for communicating hedging and position reporting,” says Topham. w w w. a g r o c o r p . c a
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AGROCORP “It’s been a big leap forward for us – we have three offices in Canada, and of course the many offices overseas, and communication between all offices is paramount for being able to navigate trade risk. So the improvements and the mechanisms that are now being put in place have enabled us to trade on more solid footing.” Agrocorp has also taken the opportunity to solidify the business’s core values, an important factor for multinationals that must maintain an even level of customer care and service across countries and continents. “We originally were a
CANADA
family business, and have adhered to the same principles that have driven our business forward” says Topham, explaining the meaning behind CHEAA – cooperation, healthy spirit, excellence, agility, and accountability. “ We have seen very good cohesion around these values across our 3 offices in Canada. A Good Year for Growth The effects of Agrocorp’s strong expansion efforts are already coming into focus – in the last fiscal year, the company tripled its growth. According to Topham, this impressive progress can be
SUPPLIER PROFILE
CN
CN is more than just a railroad; we’re a transportation company, offering our customers the right supply chain solutions and integrated transportation services including rail, intermodal, trucking, freight forwarding, warehousing and distribution. With our 21,000 mile network and access to all three coasts, we help our customers reach new markets worldwide. We work closely with all our supply chain partners to allow our customers to gain market share, all the while delivering fast, safe and sustainable transportation solutions to get our customers’ products to market. Website: www.cn.ca
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Central Alberta Transloading Terminal in Innisfail
THE EXPERTS IN SHIPPING SPECIALTY GRAINS WORLDWIDE
CFT CORPORATION 2020 Winston Park Drive, Suite 300 Oakville, Ontario, Canada L6H 6X7 Telephone: (905) 829-5829 Fax: (905) 829-5219 Email: cft@cftcorp.com www.cftcorp.com
attributed to a serendipitous combination of its concentrated growth strategies, its new facilities in Saskatchewan and Alberta, and a good year for Canadian agriculture as a whole. “We’ve had 2 plants come online within this last fiscal year, and next year we’ll be able to realize the full potential of those assets,” says Topham. “Second, there is a historically big crop in Canada – the biggest crop Canada has ever produced – so
CANADA
the timing of those assets coming online was fortuitous. The third aspect would be our growing management team, Kevin Price joined us from one of the largest trading companies in the world, it is actually a reunion for us having started out in this business together 10 years ago. His experience has enabled us to capitalize on our new acquisitions and forge deeper relationships with existing trade partners. But there is still plenty of room for Agrocorp to grow, and the company is actively seeking out opportunities. “We’re definitely still looking for and in discussions for additional acquisitions – that’s what our primary focus is right now, especially in Canada,” says Topham. With the groundwork it has laid to date, building a strong network with end markets around the world, Agrocorp’s unique attributes and growth in the past will continue to propel its growth in the future. “We have distribution offices in most major distribution centers all over the world wherever Canadian agriculture products find their home,” he adds. “This Agrocorp Singapore initiative has really enabled us to get aggressive on pricing and truly bridge the gap between Canadian growers and overseas consumers.”
Company Information INDUSTRY
Agriculture HEADQUARTERS
Singapore FOUNDED
2008 (Agrocorp Canada) EMPLOYEES
25 out of Canada REVENUE
2 billion annually (globally) PRODUCTS/ SERVICES
All Major Agri Products • Specialty Crop Pulses, Cereals, Oil Seeds
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St. Albert Cheese St. Albert Through Growth a
Through growth and hardship, St. Albert Cheese Coopera brand that is dear to Ontario’s heart Written by: Sasha Orman Produced by: Anthony Santamaria
and Change
ative continues to prove itself a
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E
stablished in 1894, St. Albert Cheese Cooperative was formed by a collective of Ontario-based dairy farmers hoping to set a standard for high quality cheese production. 2014 heralds St. Albert’s 120th anniversary of production, and the cheese cooperative has certainly seen a lot of growth as well as change over the last century – especially over 214
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the last year. But whether it’s in its best or most difficult times, St. Albert has never compromised its values of quality, respect, and local pride that have kept the brand a Canada favorite. Growth Through Acquisition: St. Albert and Mirabel In recent years, one of the biggest events for St. Albert has been its acquisition of Saint-Jérôme,
SECTOR
Quebec-based cheese producer Fromagerie Mirabel in 2009. This acquisition has helped both brand names to grow and thrive. “With the acquisition of Fromagerie Mirabel, Cooperative Fromagerie St. Albert hopes to expand its expertise and know-how while respecting the traditions of this Laurentide favorite,” stated St.Albert in a press release announcing the merger. “Since the purchase, the St. Albert Cheese Cooperative has invested more than $ 2 million in La Fromagerie Mirabel (1985) Inc. to
“St. Albert has been in business for 120 years – we’re well known for the quality of the cheese” –says Lafontaine
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give the brand a major facelift and a whole new image.” According to the brand, this facelift includes new branding features like revamped packaging depicting the natural beauty of the region that St. Albert and Mirabel call home. But as the brand stated, St. Albert has also been able to lend its technical expertise to joint cheese production as well. “With our extensive expertise and our sense of innovation, we deliver uncompromising quality and quantity,” St. Albert Cheese Cooperative stated. “With our
equipment at the cutting edge of technology, in addition to our extensive know-how and sense of innovation, we deliver uncompromising quality and quantity. We are able to produce, package, store and distribute products tailored to the specific requirements of our customers following the retail, catering and food services.”
Rising and Rebuilding No one can predict if or when tragedy will strike your business.
SUPPLIER PROFILE Businessfriend is more than just a professional community. Watch the video to see how Businessfriend takes you beyond professional networking by adding collaboration tools and communication tools. We believe a professional social network should be more than just a list of contacts; it should it should enable you to interact and get work done with your network. Businessfriend offers various tools to help you build your network, organize your work flow, collaborate, and communicate with your network. Our end goal is to give you a social platform that helps you stay on task, be organized and be more productive. Website: www.businessfriend.com
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http://www.atis-tech.com/en/
expertise and leadership your can depend on for your energy efficiency projects Engineering firm specialized in energy management, energy efficiency and building services in the industrial and food processing sectors.
Telephone: 514-486-6686
Fax: 514-669-3385
www.atis-tech.com
S T. A L B E R T C H E E S E
CANADA
For St. Albert Cheese Cooperative, that tragedy came in February 2013 when a fire destroyed the cooperative’s cheese manufacturing plant and left nearly 200 employees out of a job. But the fire has not kept St. Albert down. Thanks to its merger with Mirabel, St. Albert was able to shift much of its cheese production to an alternate facility in Saint-Jerome and preserve a good deal of production volume and jobs. Then, just seven months after the fire, the cooperative began the ambitious process of rebuilding a factory that is bigger and better than the last. The new $30 million facility will span 76,000 square feet, making it 30 percent larger than the previous facility. It will feature new state of the art functions including an improved energy efficient design built in conjunction with Atis Technologies
SUPPLIER PROFILE Atis Technologies is an engineering firm specialized in energy systems and energy efficiency projects in the industrial and food processing sectors. Atis Technologies designs, engineers and implements global solutions which deliver energy savings. It identifies project opportunities based on detailed analyses of energy needs and project’s costs. It develops detailed engineering designs and plans. It implements the projects on a turnkey basis or in concert with customers and guarantees performance. Systems provided include energy systems (heating and cooling) and building services (heating, ventilation, refrigeration). Key to its projects is an energy management and control system developed by the company which fully integrates into the plant’s operation and provides remote surveillance and control and performance tracking. Atis Technologies has implemented dozens of projects and carried out studies for a large number of customers, the majority in the cheese and dairy industry. Atis Technologies, expertise and leadership you can depend on. Website: www.atis-tech.com/en/
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We believe in
partnership
Alain Royer is a leading supplier of dairy products, industrial cheeses and food ingredients.
www.arconsultant.com
S T. A L B E R T C H E E S E
CANADA
Inc, a Montreal-based engineering firm specializing in energy management and efficiency. This design involves circulating water at different stages of the cheesemaking process to conserve and make the most of generated heat. For locals and visitors, St. Albert has devised a whole new way to experience the facility. “We’re going to have a new restaurant in the building, which we didn’t have before, and it will use all the different cheeses that we produce to promote them,” says Eric Lafontaine, general manager of the St. Albert Cheese Co-operative. “The other big feature it’s going to have is a big visit room. People can go to the second floor and see how we transform the milk to make cheese live – the processing, the packaging, all of the aspects. That’s going to be something new, and there’s no other
SUPPLIER PROFILE
Alain Royer is a leading supplier of dairy products, industrial cheeses and food ingredients. We serve a wide range of clients, including processors, further processors and food distributors, both nationally and internationally. Alain Royer is an ideal partner for sourcing all your dairy products and ingredients. Website: www.aroyer.com
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place in Canada like it.” Community Cooperation The loss of the original St. Albert cheese factory was devastating, but the reaction afterward has been a testament to the cooperative’s beloved place in its community. From town members to Ontario Premier Kathleen Wynne, who In March 2014 announced a major investment to help with St. Albert’s new facility, there has been support for the rebuild process at every turn. “It was really hard on the community, that’s for sure – the business has been here for 120 222
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years, so it doesn’t matter who it is, they all know somebody who worked there or who used to work there or are a supplier,” explains Lafontaine. “But it’s really a community that sticks together. When we burned down, it was really hard for the first days. Since then, everybody’s working together to make the rebuilding a success. It’s unbelievable the help we’ve had.”
The Road Ahead Already, St. Albert Cheese Cooperative is nearing its relaunch, anticipating production starting
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in July with the grand opening of its store and restaurant to follow in August and full capacity runs by September. From there, St. Albert is looking forward to even more growth in the years ahead. “In the rebuilding process, we decided to invest a couple million more than we were supposed to receive because we wanted to think about the future,” says Lafontaine, noting the extra space and updated technology to be deployed at the new facility, along with an effort to obtain further safety and standards accreditations. “The market is changing so fast, and now we have a lot of flexibility, and new machines we have brought in are going to help us with the future for sure.” Still, this new technology does not mean a change in the formula that has made St. Albert Cheese Cooperative famous. “St. Albert has been in business for 120 years – we’re well known for the quality of the cheese,” says Lafontaine. “That’s why we’ve purchased some of our new equipment and hired some new staff with a lot of experience in quality assurance. We know with the new plant, our quality is going to be better than what it was before – even though it was already a top quality product. We’re aiming even further.” At the end of the day, says Lafontaine, when it comes to the future what St. Albert is looking forward to most is simply doing more of what it does best: “to transform the milk and make more cheese!”
Company Information INDUSTRY
As early as the end of the 19th century, master cheesemakers in a charming Eastern Ontario village were already manufacturing a highly renowned Cheddar: the St-Albert. For over 100 years, Worldwide connoisseurs have enjoyed savory products from the StAlbert Cooperative Cheese Manufacturing Association.
https://www.facebook. com/FromagerieStAlbert
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Brazilian
Josapar
maintains innovative spirit
n national market leader with Tio Jo達o rice, company invests in real estate Written by Simone Talarico Produced by Taybele Piven 225
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K Shopping Pelotas inauguration
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nown as one of the largest food companies in the country, Josapar is exploring new frontiers and embarks on the national housing market intensively. Since selling its supermarket chain, Real, the company began to invest in its real estate arm, called Real Empreendimentos, which currently has 15 properties leased to WMS, aka Walmart, and has several areas of commercial land in stock: “These areas , located primarily in the State of Rio Grande do Sul, came from our network of supermarkets, and we are offering them to the market for future facilities, directed mainly to shopping malls,” reveals Augusto de Oliveira, Vice president and grandson of Josapar’s founder. As a result of the new enterprise, in October of last year, the company inaugurated the Shopping Pelotas, born of a partnership between the Real Empreendimentos, Phorbis and Bicar. “We currently have around seven areas, each
BRAZIL
Shopping Pelotas
approximately with 80 thousand square meters, for which we are seeking partners to develop projects,� Augusto accounts. TRADITION AND INNOVATION IN THE FOOD INDUSTRY Located in Rio Grande do Sul, more precisely in the City of Pelotas, in the south of the State, Josapar is known for having been the first company to offer rice sold already selected and washed in transparent packages, separated per kilo. Currently, the company is present at points of sale throughout Brazil, as well as having exported
Shopping Pelotas inauguration
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Tio João rice
products to over 40 countries. Among the flagship products of the company besides Tio João, are Meu Biju and SupraSoy. “But the company today has a range of over 70 products, with five national and seven regional brands. Over the past decade our mix grew over 35 percent and revenues increased by 30 percent,” says Augusto. Considered one of the largest providers of Brazilian retailers, Josapar has industrial units in Pelotas and Itaqui, both in the State of Rio Grande do Sul, one in Recife, in the State of Pernambuco, and one in Campo Largo, in Paraná State. The company also maintains a complete infrastructure of silos for storage and drying units to receive crop from producers. In addition, the company has distribution branches in various regions of the 228
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country and also distributes inputs such as rice seeds, fertilizer and mineral raw materials. With a complete structure, the company has plans to build a new plant in the municipality of Mairinque, interior of São Paulo, which will have a production capacity of approximately 4,500 tons of grains (beans and rice) per month. “We’re still in the phase of the pre - project. We want to be in São Paulo, as this is a strategic region for us. The new facility will increase our current total capacity from 432 thousand tons to 486 thousand tons per year,” reveals Augusto. The new unit should start operating in 2018 and is located in a land the company acquired with approximately 15 hectares, and should build 20 w w w. j o s a p a r. c o m . b r
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Oatmeal line Meu Bijuzinho
thousand square meters. “Our goal for this unit is that it will be a food industry. We will produce, at first, our rice and beans, and in a second moment, our entire product line,” says Augusto. In parallel, the Recife unit will also be expanded: “We acquired an area and we transfer this unit to a new plant in Recife, which should come into operation shortly after the São Paulo unit start operating,” assures Augusto. However, it is the unit of Pelotas where Josapar concentrates all its exports, due to the proximity of the plant to the Port of Rio Grande. Exporting to all the countries of South America and also the Caribbean, USA, Canada, and even to Russia and Iraq, the export represents about 10 percent of the annual revenue of the company. “This number
Olive oil
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Supplier Profile
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Cake line
is growing. It has been 3 percent, 5 percent, 7 percent and is currently around 10 percent. And, most important of all, is that we’re getting loyal international customers. In Angola and Mozambique, for example, are leaders with the Tio João brand,” celebrates Augusto. Josapar, however, has the goal of increasing this number in the coming years and reach 30 percent of its revenues from exports, building its brands internationally: “Even in countries that have a very low purchasing power, we could develop the same work we’ve done here in Brazil, adding value to a commodity. Tio João has a distinctive quality and taste against other rice, which is already becoming known internationally - consumers are now realizing this. And, in a second stage, we will also introduce our lines of products to those countries,” reveals Augusto. w w w. j o s a p a r. c o m . b r
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Josapar
Supra Soy cans
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With over 90 years in the market, the company acquired a very great knowledge and has a body of collaborators of the most efficient in the industry: “A large number of these professionals have been with us for more than 20 years. This puts the company always in the vanguard of launching products and innovations,� celebrates Augusto. One of the most recent releases was the line of mixes for cakes of the SupraSoy brand, consisting of a products based on soy protein - which are designed especially for people with
BRAZIL
Company Information INDUSTRY
Food HEADQUARTERS
Pelotas, RS FOUNDED
1922 EMPLOYEES
1100 MANAGEMENT
Executive Vice President: Augusto Lauro de Oliveira Júnior
lactose intolerance or Celiacs: “We are innovating in this segment, since there is no industry who settled in this sector nationally. The line has had a great acceptance in Brazil and there are several inquiries from abroad about these products,” concludes Augusto.
PRODUCTS/ SERVICES
Josapar produces products derived from grains such as rice, beans and soybeans, and inputs
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Tassal Sustainable aquaculture: Tassal’s clear growth plan for
With a clear plan to grow the company in a sustainable man with WWF to the benefit of the business, surrounding com Written by: Laura Close
Produced by: Nick Ledue
r the future
nner, Tassal utilises its partnership mmunity and environment.
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A
s one of Australia’s leading sustainable aquaculture companies, Tassal continues to produce fresh and healthy Tasmanian Atlantic salmon while keeping the community and the environment a priority. It is a trusted leader in quality and innovation and has the support and backing of several third-party sustainability 240
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partners. Tassal was founded in 1986, became a publicly traded company in 2003 and partnered with the World Wide Fund for Nature Australia (WWF) in 2012. Throughout its 28 years, the company has experienced huge growth and is looking to continue the trend. Tassal’s commitment to its product, employees and the environment
SECTOR
combined with its clear sustainability plan for the future will ensure the company will move towards their strategic vision of sustainable long term returns to shareholders as the leader in salmon in Australia, selling a highly recognised ethical valued brand and product to Australian consumers and retailers – while operating in a zero harm environment.
“Knowledge is power,� Mark Ryan, Managing Director and CEO of Tassel
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How we helped Australians get hooked. For some time now, we’ve been in the business of changing people’s behaviour.
• Domestic Retail market – Volume up 18.8%, Revenue up 17.8%
You could say, change for good. Because the words “for good” not only mean permanent change, but good for the individual and good for the community overall.
• Per capita consumption rose from 1.57kg to 1.63kg • M$ - EBIT up 22.6%; EBITDA up 16.2%; contribution margin up 15%
Increasingly, and clearly in Tassal’s case, changing behaviour can be good for business, too. To encourage Australians to get hooked on Tassal salmon we plumbed the depths of our experience as a behaviour change communications company. We combined our long-term learning on behaviour with a fresh imaginative “hook” to create an emotional connection with our audience; a connection that sparked the desire for Tassal salmon, beyond the odd special occasion. We inspired Australians to enjoy salmon in new ways and as such, serve it more often. We changed their behaviour. So today, choosing to serve salmon as a meal - brekkie, lunch or dinner – is a perfectly normal choice. The results we’ve helped achieve, however, are anything but normal.
“The marketing campaign and the domestic stimulus programs are pulling through top-line benefits and returning bottom line results”.
Mark Ryan, CEO Tassal, 2013 Annual Results.
Obviously, Australians are hooked on Tassal. Isn’t it time other companies got hooked on behaviour change. If you’re interested in talking to us contact Michael Daddo, at michael@theshannoncompany.com.au
TA S S A L Tassal is moving beyond a compliance-only culture towards a more proactive champion of sustainable business practices. Their partnership with the WWF began with the goal to make sure all Tassal seafood is produced to the highest global standards of responsible aquaculture by 2015. Credible third parties endorsing Tassal’s sustainability initiatives have been vital for the company. WWF-Australia provides Tassal with expert advice on the development
AUSTRALIA
of the company’s sustainability strategy and has provided guidance throughout the ASC certification process. Tassal has also signed WWF’s Sustainable Seafood Charter, committing to an allencompassing sustainability approach to the business. Recently, Tassal became the first producer of farmed seafood in Australia to achieve the gold standard Aquaculture Stewardship Council (ASC) certification. ASC is an independent, not-for-profit
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Fresh Freight Tasmania is delighted to be associated with Tassal and the Tasmanian Aquaculture Industry, supplying quality cold chain deliveries throughout mainland Australia.
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TA S S A L organisation established in 2009 to manage global standards for responsible aquaculture. The standards of the certification include strict requirements in several categories such as the minimisation of escapes, chemical use, predator control and effluent release, feed ingredients from sustainable sources, habitat protection and freshwater smolt production. Involvement in the community Tassal’s attention to sustainability
AUSTRALIA
translates well to its interest and commitment to its stakeholders, which include customers, investors, employees, suppliers, contractors, government organizations, Environmental Non-Government Organisations (ENGOs), research organisations, neighbours and the surrounding industry. Several environmental and social concerns – antibiotic use, noise from farms, wildlife interactions – were historically brought to Tassal’s attention. In its Sustainability
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TA S S A L Report, published annually since 2011, Tassal addresses each one of these concerns and outlines the steps it is taking to resolve the issues. It has implemented proactive fish health strategies, worked with acoustic specialists and invested in sound mitigation, and has seen a significant reduction in bird and seal mortality because of staff training and infrastructure development. The communities where Tassal processes and hatches fish are defined as rural or regional. Because of this, Tassal is the biggest employer in these parts of the state. Tassal continues to invest time in its social license to be upstanding, reliable members of the communities in which it operates. Currently, Tassal is committed to several community engagement initiatives, including the Your Marine Values Project, workshops for communicating communities’ marine environment concerns and priorities, and Skilling Tasmania for a Sustainable Future Project, aimed at determining the skills needed for Tasmania’s business community.
AUSTRALIA
Strategic priorities Tassal’s overarching priority is zero harm – zero harm to employees, the fish and the environment. Its ROCK safety program, focusing on Resilient leadership, Observation, Communication and Knowledge, provides a solid platform for the physical and emotional wellbeing of employees. Mark Ryan, managing director and CEO of Tassal, understands the importance of knowledge in his organization. “Knowledge is power,” he said. “We invest a lot of time and resources into undertaking continuous education.” Ryan noted that with both marine scientists and workers with high school education could present a disparity and challenge to effective communication. It is one of Tassal’s main goals to make sure employees are empowered to have a confident voice in the organization; employees are always encouraged to speak out. Because of these empowering initiatives, Tassal won Tasmanian Employer of Choice Award in 2013. Supporting strategic priorities include optimising the business, maximising cash flow and w w w. t a s s a l . c o m . a u
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TA S S A L delivering acceptable returns.
A fish health field officer has also been appointed to provide on-farm Project Sweet Spot support to the fish health team and Tassal operates global best-practice to monitor the rollout of the health hatchery facilities in Tasmania, management plans. and the health and welfare of In order to improve sustainable its salmon is a top priority. The growing and harvesting efforts, company has researched and put Tassal’s Project Sweet Spot – which into place region-specific fish health makes sure the right fish go to the management plans that include right place at the right time and at a list of all potential diseases, fish the right size – continues to evolve health and biosecurity measures, and be refined. In order to account fish health monitoring, harvest for the many variables associated protocols and training requirements. with any agriculture or aquaculture
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endeavour, Tassal started Project Sweet Spot by considering the answer: the region needed to grow its fish. By working backwards and fitting its plans into an overall
production cycle from a sales cycle, Tassal ended at the beginning of the equation – the type of fish needed in the hatchery. Forecasting must be done well
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TA S S A L
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in advance, as the capital investment cycle is up to five years and the working capital cycle before the fish are harvested is around three years. “There’s a lot of innovative thinking around how we’re going to optimize the business,” said Mr. Ryan. “Recirculation technology that we employ in our hatcheries gives us the ability to either speed up or slow down fish so they can go out at the right size.” What sets Tassal apart There are several aspects of
AUSTRALIA
Company Information INDUSTRY
Aquaculture HEADQUARTERS
Tasmania FOUNDED
1986 EMPLOYEES
Tassal’s business that sets it apart from others in the industry – first and foremost its partnership with WWF-Australia and other sustainability partners. By self-reporting and working towards certifications from credible thirdparties, Tassal is proving that what it says it is doing is actually happening. “At the end of the day,” Ryan said, “it’s not just about talking the talk – it’s walking the walk. “We have a clear strategy for future sustainably growth, and we are applying that strategy to where we can deliver global best practice by maximizing our competitive advantages and really having the sustainability, zero-harm vision. That’s what defines us.”
850 REVENUE
$300m
https://www.facebook. PRODUCTS/ SERVICES com/TassalSalmon Salmon
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https://www.linkedin. com/company/994067 ?trk=tyah&trkInfo=tarId %3A1397687841667%2 Ctas%3Atassal%2Cidx %3A1-1-1
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