Food Drink & Franchise - August 2014

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In Breweries

Salinas Valley Meets Silicon Valley:

The Future of Agriculture Starbucks: Finding Value in Product Diversification Philippines: the Next Franchising Hot Spot?

What Can NestlĂŠ Teach Us About Supply Chain Diversification?

August 2014

editor’s comment

A New Start something different about us this month – we have launched under a new title, Food Drink & Franchise.

With this rebranding, we renew our effort to always bring our readers the latest discussions in food and beverage production, processing, and the franchising and foodservice industry.

Whether it’s examining business growth hot spots, new product strategies, or the point where the agriculture and technology industries collide, we hope you’ll join us on the journey.

Yo u m ay h av e n o t i c e d

Enjoy the issue!

Sasha Orman Editor Sasha.Orman@wdmgroup.com 3

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Contents

FEATURES

32 Supply Chain What Can NestlĂŠ Teach Us About Supply Chain Diversification?

8

Top 10 International Breweries

Production

38

Salinas Valley Meets Silicon Valley: The Future of Agriculture

18 Franchising Is the Philippines the Next Franchising Hot Spot?

24 Retail

Starbucks: Finding Value in Product Diversification

5

Contents

66

122

Guinness Ghana Breweries

Surati Sweet Mart

company profiles Europe 52 Danya Foods

Africa 66 Guinness Ghana Breweries 82 Heineken in Ethiopia

Australia

Associations 130 Australian Macadamia Society 136 Commonwealth Fisheries Association (CFA)

104 Makro

142 Sheepmeat Council of Australia (SCA)

Canada

America Latina

122 Surati Sweet Mart

148 ProNicaragua

130 Australian Macadamia Society

156 CAMANICA (Pescanova) 170 Ingenio Monte Rosa (Pantaleon) 184 Cargill

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August 2014

142 SCA

136

148

CFA

ProNicaragua

184 156

Cargill

Camanica

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P R ODUCTION

Salinas Valley Meets Silicon Valley:

The Future of Agriculture Written by: Sasha Orman

With coastal vistas and acres of green fields, California’s Central Coast is visually stunning.

But there’s a real strength behind that beauty: it’s also an $8 billion agricultural powerhouse.

This month, the Monterey County Agriculture industry reported a production value of $4.38 billion just at farm gate, generated by 26 unique crops ranging from strawberries and leafy greens to livestock and wine grapes. Known as the “salad bowl of the world,” a nickname stemming from its cultivation and marketing of the easilyshipped iceberg lettuce varietal in the 1950s, Monterey County’s Salinas Valley is one of the top producers of fresh and value-added vegetables in the world.

But that world is changing – and to stay on top, growers and producers are finding that they must find ways to change and develop as well. In Salinas Valley, those producers are turning to technology to improve their production and thrive.

Rich Land in a Dry State: Salinas Valley’s History of Water Conservation The soil and climate of Salinas Valley may be perfectly suited for 9

P R ODUCTION

26 unique crops ranging from strawberries and leafy greens to livestock and wine grapes

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August 2014

agriculture, but that does not make the region immune to the problems that have been plaguing much of the food production industry in recent years – drought. It’s a problem that has hit particularly hard in California, but Salinas has a major benefit in technology that has allowed the region to stay relatively insulated against the worst of the drought’s effects.

A major example of this has been the early adoption of microirrigation techniques like drip tape, a strategy that delivers water uniformly and directly to crop roots. By employing this practice across more than 60 percent of operations over the last two decades, Salinas Valley growers have been able to save a significant amount of water – and not at the expense of yields.

“We’ve grown our yields almost three times in those two decades and used less water while doing it,” says Monterey County Farm Bureau Executive Director Norm Groot.

“We are highly efficient in what we do already at this point, and now we’re looking at new technologies to help improve that efficiency even further through soil moisture sensors, climate prediction systems, and

T h e F u t u r e o f A g r i c u lt u r e

“We’ve grown our yields almost three times in those two decades and used less water while doing it” – Norm Groot, Monterey County Farm Bureau

An ideal coastal climate for produce and livestock linking all that information together so that farmers can actually determine when a particular crop will be most receptive to an irrigation pattern. We’re getting much more precise in how we’re predicting irrigation, it’s not just someone going outside and turning on a faucet on a daily basis, so to speak.

That will lead to more conservation of our water resources and efficiencies.”

RFID for Food Safety “The American consumer has become conditioned to expect that their food is safe when they buy it at the supermarket, so they take it

for granted a lot of times and don’t realize the rest of the world pays a lot more for fresh fruits and vegetables and may not have that level of safety built in. So I think our consumers are spoiled in that regard – they don’t fully understand all that goes into a product to ensure that it’s safe and that we’re making sure that what goes to their table every night is something that they can rely on as being healthy and beneficial to their livelihood.

In 2006, a rash of more than 200 E. coli O157:H7 cases were traced back to packaged baby spinach originating in the Salinas Valley. It may be eight 11

P R ODUCTION years ago now, but the incident still weighs heavy on the region’s heart.

In particular, it’s a critical driver in the push for every Salinas producer to be at the top of their game in the realm of food safety. This drive has led to innovations like the low-pH propylene glycol based SmartWash that is now used in produce processing plants around the world.

Another technology that has been adopted extensively throughout the

Salinas Valley agriculture system is RFID and similar tracking systems.

These comprehensive systems allow growers and processors to track their products throughout the value chain from end to end, and to know exactly what lot a piece of artichoke or broccoli was picked from and on what day. This transparency isn’t just for record-keeping – if an inspector finds produce that has been contaminated by a foodborne pathogen, RFID

Heightened dedication to food safety has become one of Salinas Valley’s greatest assets in helping its local growers compete in the marketplace

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August 2014

T h e F u t u r e o f A g r i c u lt u r e

systems allow growers to more quickly isolate and address problem areas without shutting down all production completely.

According to Groot, in recent years this heightened dedication to food safety has become one of Salinas Valley’s greatest assets in helping its local growers compete against inexpensive labor overseas.

“Obviously production can be a lot cheaper [in China or Mexico], because labor is a lot cheaper and they have less regulatory restrictions,” he says.

“But what we like to promote here is that we provide the safest food supply in the world – mainly because we do have a lot of those protections, but also because we developed the food safety measures that are currently in effect for the rest of the country here in this Valley. That was out of necessity in 2007, but we have taken the step as an industry voluntarily to put in some very strict measures for food safety to ensure that what’s produced is healthy, and we’ve seen that that’s been successful.”

“We have a very safe food supply that we’re producing locally here, and with the focus on local I think that’s important for people to understand,”

“Consumers want to know where their food is produced and how it’s produced, as well as how safe it is” – Norm Groot, Monterey County Farm Bureau he says. “[Consumers] want to know where their food is produced and how it’s produced, as well as how safe it is. We have those advantages that we can use that as a selling factor to differentiate ourselves at this point.”

“China and Mexico are buying our Driscoll strawberries because they know they’re safe,” adds Salinas Mayor Joe Gunter”. “Our folks have been very aggressive about these issues, and are pretty proud of what they’re able to do.”

The Silicon Valley Connection: Building the Steinbeck Innovation Center “We’re seeing a lot of interest in technology coming into our valley 13

P R ODUCTION now,” says Groot. “We like to pride ourselves and our community here as being early adopters of new technology.” But the Salinas Valley is not content to be a passive adopter of new technology that comes along.

The region is also actively courting the production of new agricultural technologies by harnessing the tech movement happening sixty miles north in Silicon Valley, in an initiative referred to as the Steinbeck Innovation Cluster.

“Anywhere in the world, agriculture is the backbone of any country,” says John Hartnett, CEO of SVG Partners and co-founder of the Steinbeck Innovation Group. “40 percent of jobs in California’s Central Valley are in the agriculture world. When you look at innovation and think about the future of any economy, he who leads in innovation is going to drive change.”

The Steinbeck Innovation Cluster represents a four-pronged approach to promoting new technology in agriculture and driving this economic future, targeting innovation building (youth education outreach and entrepreneurial training), acceleration (startup incubation and professional services), investment (outreach to venture capitalists 14

August 2014

National Steinbeck Center

“Anywhere in the world, agriculture is the backbone of any country” – John Hartnett, SVG Partners

T h e F u t u r e o f A g r i c u lt u r e

National Steinbeck Center and angel investors), and strategic corporate engagement. The Steinbeck Innovation Foundation has already made headway with youth programs like Coder Dojo and adult programs like FastTrac to help budding entrepreneurs refine their concepts and acquire capital funding. Further strategic partnerships with leading ag-focused research colleges like UC Davis, Georgia Tech, and Hartnell College

along with corporate partnerships with local and global businesses like Dole, Taylor Farms, Ocean Mist and Chiquita have gone a long way in highlighting the interest in bringing technology and agriculture together.

At the heart of the initiative are the Steinbeck Innovation Center, a hub currently under construction in downtown Salinas which hopes to bring in researchers and entrepreneurs for project incubation, and the newly 15

P R ODUCTION launched Ag Tech Summit which aims to bring business leaders together to enhance the role of innovation in agriculture on a global level.

“We are bringing together some of the biggest companies in agriculture and technology,” said Hartnett in a statement announcing the summit.

“These are leaders who will shape the future of ag, water use, energy and tech not just for this region, but for the world.” This July marked the inaugural Ag Tech Summit, and featured speakers including Taylor

Farms CEO Bruce Taylor, IBM Software Strategy Director Deborah Magid, former Cisco Chief Futurist and current SV entrepreneur David Evans, and a host of other experts and professionals to share their ideas and build a better industry.

A Unique Agricultural Landscape “As you can see, Salinas Valley is quite different than what you may be used to in the Midwest or other parts of the country as well as other parts

“These are leaders who will shape the future of ag, water use, energy and tech not just for this region, but for the world” –

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August 2014

– John Hartnett, SVG Partners

T h e F u t u r e o f A g r i c u lt u r e

of California,” says Groot. “We are primarily what’s called a ‘specialty crop’ county, where we’re producing the leafy greens, the lettuces, the spinaches, the broccolis, the carrots, the strawberries – which is one of our biggest crops at this point. We produce about 55% of the strawberry crop in California here locally.”

That land isn’t expected to change hands any time soon, either. “You’re not going to pry it from the hands of our locals,” says Gunter.

“There’s an incredible amount of multigenerational pride that families have – their grandfathers or great

grandfathers began the agricultural industry here,” adds Kimbley Craig, District 5 Councilmember of Salinas City Council. “I think there’s a tremendous amount of pride and also just the desire, the want, and the need to keep the businesses here and give back to the community. Bruce Taylor of Taylor Farms and Fresh Express is building his headquarters literally across the street. It’s not the cheapest thing to build from the ground up built to spec. But he opted to bring his 450 employees into our oldtown to grow it, and that’s just his commitment to the city of Salinas.”

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F R ANCHISIN G

Is The Philippines the Next Franchising Hot Spot?

With a growing economy and regional development in the works, the Philippines is an area with a lot to offer growing businesses Writ ten by: Sasha Orman

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F R ANCHISIN G When it comes to franchising your restaurant, steady expansion is everything – but so is smart franchising. Expanding your brand in an already mature and oversaturated market is a risky proposition, throwing your restaurants into heavy competition with brands that have had the necessary time to become established and putting your own franchise at a marketing disadvantage. Finding the next smart market to expand in is crucial.

In late July, 60 franchises from around the world converged at the SMX Convention Center in Pasay City for Franchise Asia Philippines 2014, an expo event arranged by the Philippine Franchise Association. What makes the Philippines the next potential hot spot to grow your franchise?

“Why are they coming here? We have 100 million population and the population is young” –S amie Lin, Philippine Franchise Association 20

August 2014

A Quickly Growing Economy What makes a particular country a prime location for franchise expansion? There are a few traits that can make a region more desirable for building out your business. One of the most critical traits is a growing economy – especially a growing middle class, with an interest in other cultures and the disposable income to spend on small luxuries like fast food and dining out.

In this regard, The Philippines more than fits the bill. In 2012 analysts singled out the Philippines as the next potential economic bright spot in Asia, due to its highest Standard & Poor’s debt rating in a decade and strong 6.4 percent growth in the country’s gross domestic product. At the time, HSBC Bank ranked the Philippines as the 44th largest economy in the world, but predicted that the ranking could climb as high as 16th by 2050.

So far, that prediction seems on target: the country’s economic standing has only continued to improve in the couple of years since, and for 2013 the International Monetary Fund ranked the Philippines as the 40th largest economy in the world with a gross domestic product of $272 billion.

I s T h e P h i l i pp i n e s t h e N e x t F r a n c h i s i n g H o t Sp o t ?

60 franchises from around the world converged at the SMX Convention Center in Pasay City for Franchise Asia Philippines 2014, an expo event arranged by the Philippine Franchise Association Incidentally, much of this economic growth is being driven by a youthful and growing population. The majority of the Philippine population is within working age, making for a robust and ready workforce that drives both earnings and employee potential for businesses hoping to come in and grow. According to local franchising experts, these traits make the country perfect for franchises looking for good opportunities.

“Why are they coming here? We have 100 million population and the

population is young,” said Samie Lin, chairman emeritus of the Philippine Franchise Association, at a press release regarding the Franchise Asia Philippines 2014 expo. “In fairness to this government, economic growth or economic miracle is happening. Other economies, they don’t have this much people.”

A Connection to an Integrated Growing Marketplace The Philippines is not an isolated country. In addition to being 21

F R ANCHISIN G an invitation to grow within the Philippines itself, Franchise Asia Philippines 2014 markets itself as being “a gateway to the ASEAN economic community.” That’s a community with a lot of potential yet to be tapped by the QSR franchise industry in the years to come.

Five core countries (of which the

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August 2014

Philippines is one) formed ASEAN in the 1960s to promote economic and cultural growth and progress in Southeast Asia; the remaining five countries joined in over subsequent decades. The association is now in the process of creating the ASEAN Economic Community (AEC), with the objective of more closely pooling

I s T h e P h i l i pp i n e s t h e N e x t F r a n c h i s i n g H o t Sp o t ?

“By 2015, there will be an AEC. In franchising, [the Philippine Franchise Association] has been a pillar and we would like to help franchise companies prepare for the Asean integration” – F ranchise Asia Philippines 2014 their resources to form a single market and a highly competitive economic region. The Philippines sees franchising opportunities increasing with the formation of this program, as brands will be able to easily build a base in one country and expand their reach across the region.

“By 2015, there will be an AEC. In franchising, [the Philippine Franchise Association] has been a pillar and we would like to help franchise companies

ASEAN, or the Association of Southeast Asian Nations, is a collective of ten member states: • Brunei Darussalam • Cambodia • Indonesia • Lao PDR • Malaysia

• Myanmar • Philippines • Singapore • Thailand • Vietnam

prepare for the Asean integration,” said Franchise Asia Philippines 2014 Alan Escona at the expo’s press conference, noting the increased growth potential that franchises will see under this new program.

“Instead of having a clientele of 100 million Filipinos, all of a sudden these companies will have 600 million.”

Bringing Opportunities Under One Roof While the AEC is still in progress, the Philippine franchising community hopes to show off what the region has to offer at the Franchise Asia Philippines expo. “The Philippines remains as one of the top three franchising sites in the world. We believe that if there should be a place to launch franchise concepts, it should be in events like the Franchise Asia Philippines,” added Samie Lim. 23

R ETAIL

Starbucks:

finding value in product diversification W r i t t e n b y : S A S HA O RMAN

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R ETAIL Sometimes it’s good to be known for doing one thing well. But it’s also a dangerous proposition, putting your bottom line at the mercy of consumer trends. But when you’re a billion dollar global brand, with your livelihood – not to mention the livelihoods of tens of thousands of employees and suppliers – riding on your bottom line, you don’t want to leave yourself susceptible to consumers suddenly deciding en masse that the product you’re selling is “over.”

As a breakfast staple since time immemorial, it isn’t likely that coffee will ever go out of style; meanwhile, with an outpost on practically every block in every major city in the world, Starbucks has seemingly Starbucks premium products include Frappuccinos and Pumpkin Spice Lattes

defied any and all conventions about oversaturation killing consumer interest. But while there will always be a stream of consumers ordering a cup of black coffee for their morning commute, one thing Starbucks CEO Howard Schultz is predicting is an inevitable downturn of consumers maintaining their excitement for frothy premium coffee drinks like Frappuccinos and Pumpkin Spice Lattes – in other words, Starbucks’ bread and butter. If Starbucks is going to continue to thrive at its current capacity, it’s going to have to offer up some new flavor profiles and keep audiences interested.

But how do you diversify when you’re a massive brand known for selling one thing? That’s what Starbucks is trying to find out, utilizing partnerships and acquisitions along the way to see what sticks.

Acquiring the Tea Market and Moving it Forward Last year, Starbucks made a major move toward diversification by finalizing its acquisition of the Atlantabased retail chain Teavana for $620 million. Starbucks has taken this acquisition to heart, throwing itself

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August 2014

S ta r b u c k s : V a l u e i n P r o d u c t D i v e r s i f i c at i o n

Starbucks CEO, Howard Schultz, at a Teavana tea bar into the expansion of the specialty tea brand – in October of 2013, Starbucks brought Teavana from a strictly retail space into the foodservice world with the launch of the first Teavana tea bar in New York City. Betting on the success of this test location, Schultz expressed to the media that he hoped to build out the brand’s existing retail locations and open a thousand new full service Teavana tea bars within the next five years.

But this isn’t a case of Starbucks competing against itself with its newly acquired Teavana brand – it’s expressly about not putting all of its revenue eggs in one coffee-based basket. Tea is a huge global market – a $90 billion market worldwide, in fact, with more consumer interest in more regions than coffee. By acquiring Teavana and incorporating it properly into the Starbucks brand now, the company as a whole can have more 27

R ETAIL

Starbucks launched a Teavana-branded chai tea designed in partnership with Oprah

“By acquiring Teavana and incorporating it properly into the Starbucks brand now, the company as a whole can have more faith in remaining afloat even if coffee prices fluctuate unfavorably or consumer interest in coffee wanes” faith in remaining afloat even if coffee prices fluctuate unfavorably or consumer interest in coffee wanes.

Though this means a steadier source of revenue for The Starbucks Company on the whole, there’s also a benefit to the Starbucks brand itself through the power of brand integration. Earlier this year, with much fanfare, Starbucks launched a 28

August 2014

Teavana-branded chai tea designed

by Oprah herself; this summer, Starbucks has launched a line of Teavana shaken iced teas. Until the company is able to build out all of the Teavana tea bars that it hopes for – and even after it does – Starbucks will be able to leverage the appeal of new tea offers with the convenience of its own ubiquitous presence to draw

S ta r b u c k s : V a l u e i n P r o d u c t D i v e r s i f i c at i o n

in a new potential customer base and a new opportunity for income.

A New Approach to Soft Drinks Starbucks has always sold Italian sodas, lightly flavored with a shot of any syrup they have on tap, but they were never specifically branded or capitalized on before. But as Starbucks continues its plans to diversify its offerings, the brand has turned to soft drinks by launching its new Fizzio™ Handcraftted Sodas line alongside its Teavana iced teas as the centerpiece of its Summer 2014 season.

“We have heard from our customers that they’re looking for more refreshing, cold beverages, especially during the warm summer months,” said Cliff Burrows, group president, U.S., Americas and Teavana in a press release issued

by Starbucks. “Fizzio Handcrafted Soda is unlike any soda in the marketplace because it’s handcrafted and made-to-order each time.

The addition of Fizzio and Teavana Iced Teas gives our customers more refreshing beverage choices made with the premium ingredients they expect from Starbucks.”

Instead of relying on its usual stable of flavor syrups, Starbucks has put the time and effort into creating traditional yet more complex flavors like spiced root beer and lemon ale especially for the Fizzio™ line. With soft drink sales in decline for major brands like Coca-Cola and Pepsi, this may seem like a counterintuitive move on the part of Starbucks.

Then again, Fizzio™ isn’t really competing with Coca-Cola or Pepsi.

Starbucks isn’t serving its Fizzio™ drinks out of regular soda fountain taps – to underscore the line’s “handcrafted” nature, the brand has

Starbucks’s italian style soft drinks brand, Fizzio™ handcraftted Sodas

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R ETAIL launched a special Fizzio™ machine at its stores, offering what the brand calls “a breakthrough in carbonation technology with the ability to deliver an unmatched soda experience.”

It seems reasonable to expect that a Verismo-like home version will be released once consumer interest in the soda line has been sufficiently piqued, putting Fizzio™ in competition instead with increasingly lucrative brands like SodaStream and providing multiple potential revenue streams in both the foodservice and the retail markets.

Partnering with Groupe Danone for Smoothie Success Acquiring a smaller brand like Teavana makes plenty of financial and strategic

Starbucks new product, yogurt smoothies

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August 2014

sense for Starbucks, but acquiring a giant like Groupe Danone would be another story – and even if Starbucks could acquire Groupe Danone, chances are slim that it would have much use for most of the European dairy titan’s operations. But what would make sense is a partnership for compatible products, and that’s exactly what has happened.

In late June, Starbucks announced its partnership with Groupe Danone, pairing its already popular Evolution Fresh juices with Dannon Oikos Greek yogurt for the launch of a line of yogurt smoothies. It’s a smart move for both companies, getting the Dannon name out there while at the same time Starbucks gets a boost from the current trendy popularity of yogurt as an ingredient.

It’s also smart because it’s a launch that is targeting a totally different demographic compared to its soda line, hoping to capture healthconscious consumers looking for a light and protein-packed option for lunch. These are still in test mode, only currently available at a few select locations – but if they test well and take off, they hold the potential to bring in a new consumer base that might

S ta r b u c k s : V a l u e i n P r o d u c t D i v e r s i f i c at i o n

The chain has begun a rollout of what it calls “Starbucks Evenings” not have been interested in the sugary coffee drinks at Starbucks’ core.

Going Adult with Beer and Wine Offerings Starbucks has been testing beer and wine at various locations for a while now, but the concept started really ramping up in March as the chain announced the rollout of its “Starbucks Evenings” campaign at thousands of locations nationwide.

While the concept feels like the last frontier in beverage diversification and the least likely to stick permanently, it’s perhaps the

best way to court customers during the evening day part. Still, it seems at odds with the important younger demographic of students getting together at Starbucks for a relatively quiet and relaxed atmosphere to study. It also brings in further complications like licenses and distribution that aren’t present with the brand’s new non-alcoholic offers.

It’s hard to imagine beer and wine rolling out at all Starbucks locations worldwide any time soon – but if they are able to figure out a way to pull it off, their diversification plan will be about as complete as it can get.

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SU P P LY CHAIN

What Can Nestlé Teach Us About Supply Chain

Diversification?

Photo credit: © Nestlé

Writ ten by: Sash a Orm a n

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SU P P LY CHAIN

Photo credit: © Nestlé

To say that Nestlé is a big company is an understatement – in terms of revenue, it’s the largest food processing company in the world.

But just because it’s the biggest, that doesn’t mean that it has perfected its processes. The best companies are always looking for ways to improve, and this month Nestlé Chairman Peter Brabeck announced to the press that the processing titan would be increasing the amount of commodities it buys directly from suppliers.

“We want to double the ratio of commodities we buy directly - so not via traders - in the years ahead, especially for coffee and cocoa,” said Brabeck according to

Nestlé Chairman, Peter Brabeck

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August 2014

Reuters reports, “not because of the price, but rather due to quality and traceability. Of course also because the consumer demands this in the age of social media.”

It seems like a complicated move, when so often there is a push to streamline and simplify. But diversifying your resource base can be an important move in the process of boosting not just consumer confidence, but the overall safety and security of your supply chain and manufacturing operations.

Why Diversify Your Supply Chain?

When talking about supply chain diversification, most experts today refer to a major example that hit the manufacturing industry hard just recently – the tsunami disaster that ravaged parts of Japan in 2011. Manufacturers who lost sole suppliers of auto parts, for example, are still feeling the effects today.

With that said, it also doesn’t have to take a natural disaster to put a critical dent in your supply chain – an ingredient supplier may go out of business, or simply find it more costeffective for their own operations to

“We want to double the ratio of commodities we buy directly - so not via traders - in the years ahead, especially for coffee and cocoa, not because of the price, but rather due to quality and traceability” – Nestlé Chairman, Peter Brabeck discontinue a product or package that your business has counted on for years. If this supplier happens to be your sole supplier, you could find yourself scrambling and dealing with production delays while you source a new outlet or reformulate your processes completely to compensate for this change.

By procuring your supplies from multiple sources, on the other

hand, you can avoid this type of damage. If one source dries up, you can still count on other sources to keep your operations running, and can even up your orders to keep producing at full capacity.

One important factor in this that Nestlé mentioned was that it will be sourcing from a wider array of commodity suppliers directly, rather than through third party traders?

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Photo credit: © Nestlé

N e s t l é : S u pp l y C h a i n D i v e r s i f i c a t i o n ?

SU P P LY CHAIN

NestlĂŠ has pledged to source 10% of its global cocoa supply this year from farmers covered by the NestlĂŠ Cocoa Plan. It plans to scale this up to 15% in 2013. It will also work with its partners, the suppliers, to improve conditions in the supply chain not covered by the plan

N e s t l é : S u pp l y C h a i n D i v e r s i f i c a t i o n ?

Why does this make a difference?

Actually it’s an important distinction – while Nestlé may be making its supply chain more complex by adding more vendors, cutting out third party vendors allows Nestlé to work more closely with each supplier on production techniques and technology. Overall, you will have a much more informed handle on how your raw materials are produced, and stronger traceability throughout your supply chain from end to end.

Are There Risks to Diversification?

Diversification is meant to cut down on supply chain risk – but is there risk involved with the actual diversification process? Naturally, there is risk involved with every aspect of business. When it comes to supply diversification, the risk lies in adding these extra layers to your business that must be properly balanced and managed. Having to deal with more vendors and salespeople on a regular basis can make some aspects of your supply chain management more complicated and put your team at risks for oversight and a drop in individualized customer

‘By thinking bigger, and accepting that the streamlined and straightforward path isn’t always the most assured path to success, you can secure a supply chain that is ultimately more agile and informed in the long run’ service. But with the right team and proper management training, such risks can be kept to a minimum.

If you have a strong and stable supply chain already, you may be ready to make the leap into diversification. By thinking bigger, and accepting that the streamlined and straightforward path isn’t always the most assured path to success, you can secure a supply chain that is ultimately more agile and informed in the long run.

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TO P 1 0

Top 10: International Breweries The most famous breweries in the world that quench our thirst!

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top 10

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Boston Beer Company Founded: 1985 Located: Boston, MA

The growth of the craft beer market has continued to be good news for Boston Beer Company, better known to consumers by its brand name Samuel Adams.

Thanks to the massive growth and consumer demand within this sector, Boston Beer Company produced 2.5 million barrels and reported $793.7 million in revenue for its 2013 fiscal year, more than a 200 million dollar difference over the year before. www.bostonbeer.com

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09

Yuengling Founded: 1829 Located: Pottsville, PA

East coasters are all too familiar with Pennsylvania-based Yuengling – the family owned brewery is a staple of the region. Yuengling prefers to keep revenues and profits out of public knowledge, but experts know the brand is a valuable one thanks to its strong brand name recognition, low costs and high sales. This year the Brewers Association named it the fourth largest United States brewery in terms of sales volume. www.yuengling.com

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top 10

08

Asahi Breweries Founded: 1889 Located: Tokyo, Japan

Japan’s largest beverage company has enjoyed a strong year due to economic recovery and a renewed focus on brand promotion.

Asahi’s 2013 fiscal year saw a modest 0.4% sales increase in its alcoholic beverage segment that the brand attributes to a rising consumer demand for the first time in more than a decade. www.asahibeer.com

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I n t e r n at i o n a l B r e w e r i e s 2 k 1 4

07

Tsingtao Brewery Co. Ltd. Founded: 1903 Located: Qingdao, Shandong Province, China

China’s second largest brewery continues to command the global landscape, both in China and abroad and into the Western market, almost entirely on the strength of a single brand name. Tsingtao Brewery Co. saw significant growth in its 2013 fiscal year, posting year end revenue of $4.6 billion (28.3 billion RMB). www.tsingtaobeer.com

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top 10

06

China Resource Enterprise Founded: 1992 Located: Hong Kong

Unlike Tsingtao, Chinese brewing company China Resource Enterprise is quiet and all but completely unknown to Western consumers even in spite of its joint venture partnership with SAB Miller. This hasn’t stopped the blue chip brand from tackling a significant portion of the global beer market share through brands like CR Snow. www.cre.com.hk

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G l o ba 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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Pabst Brewing Co. Founded: 1844 Located: Los Angeles, CA

Pabst Brewing Company may be a hipster staple, but it’s also a thriving brand that has grown substantially in recent years due to its pop culture status. Private company Pabst is another brand that keeps its financials close to the vest. Nevertheless, this year the Brewers Association named it the third largest brewing company in the United States, following only Anheuser-Busch and MillerCoors in terms of sales volume. www.pabstbrewingco.com 45

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04

Carlsberg Group Founded: 1847 Located: Copenhagen, Denmark

Carlsberg’s reign as one of the top four leading macro brewing companies in the world is still going strong, as evidenced by its solid 1% sales growth in 2013, which the brand attributes to rising interest in the Asia market. In its 2013 fiscal year, Carlsberg Group reported revenue of $12.1 billion (66.6 DKK). www.carlsberggroup.com 46

August 2014

I n t e r n at i o n a l B r e w e r i e s 2 k 1 4

03

Heineken NV Founded: 1873 Located: Amsterdam, Netherlands

It has been a good year for Heineken, propelled by strong advertising like its “Man of the World” campaign and campy “Legends” ad starring a seamless progression of twenty actors in one role. Between its flagship brand and supporting players like Tecate and Newcastle, Heineken reported 1.3% growth in revenue over last year bringing the brand to $28.9 billion (21.3 billion Euro) over its 2013 fiscal year. www.theheinekencompany.com

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02

SAB Miller Founded: 2002 Located: London, England

While there is still talk of SAB Miller merging with AB InBev, thus far the brand is still holding its own. Between its MillerCoors joint US operations venture with Molson Coors and attempts to diversify and insert itself into the liquor and craft beer landscapes, through new launches like spirits-reminiscent Miller Fortune, the company has managed to keep a firm grip on the second largest chunk of the world’s beer market share by volume. www.sabmiller.com

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01

Anheuser-Busch InBev Founded: 2008 Located: Leuven, Belgium

Once again, Anheuser-Busch InBev reigns supreme in the beverage category. With a mass of important brands, from Budweiser and Busch to craft brands like Goose Island, AB InBev is stiff competition for any other brewing company. Controlling more than a full fifth of the global market share, $43.195 billion in its 2013 fiscal year. The year to come should prove even bigger as AB InBev has enjoyed the benefits of an even bigger branding advantage than usual: its role as a key sponsor of the 2014 World Cup, which led to an overturn of Brazil’s longstanding ban against drinking during soccer games and a further rise in beer sales. www.ab-inbev.com

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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 a n ya F o o d s

D

Surveying the new site ready for the new equipment facilities

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August 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.�

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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.

“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

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, 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

Preparations to install the new equipment

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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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 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 that goes into a finished product. Therefore everything is geared towards making the whole business process gain more fluidity.

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Working late

FAT testing kit

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The Clear Choice for Packaging Primary Packaging Secondary Packaging Case Packing and Shrink Wrapping Palletizers Conveyors and Turnkey Packaging

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D a n ya F o o d s

middle east

Laying equipment’s foundation

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 excellent value for money to the end customer has not been the sole focus for Danya.

A key feature is its multifunctional, multinational

“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.”

– Thomas Nordholt

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D a n ya F o o d s

Installation

YOUR FOOd & LIQUIdS SpecIaLISt INdUStRIaL aUtOMatION Operational improvement, increase in efficiency, process optimisation by functional industrial automation and IT, building related systems and service & maintenance. caLIBRatION More than controlling the measurement device.

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Equipment up and running

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 achievers an opportunity but also those hardworking people who may not come with a very

“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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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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August 2014

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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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 67

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

food

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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August 2014

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.”

af r i c a

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 72

August 2014

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

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“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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G u i n n e s s G h a n a B r e w e r i e s Lt d 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 CEO Commitments adopted by the presidents of the leading alcohol producer companies of the world.

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‘The company also takes a very strong stance towards responsible drinking through its Alcohol in Society programme’

GGBL products

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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, Corporate Relations Director - GGBL

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 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;

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

food

Peter Ndegwa - MD, GGBL w w w. d i a g e o . c o m

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“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 and the commissioning of research into alcohol consumption patterns, behaviours and attitudes.

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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.

af r i c a

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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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 83

Heineken IN Ethiopia

H

Heineken’s Harar and Bedele brewery brands

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August 2014

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.

Food

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.

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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.

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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

af r i c a

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

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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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KHS Proudly Supports Heineken

H

eineken recently chose KHS as a reliable partner for Africa installing several KHS lines and extensions. The installed lines are located in Pointe-Noire (returnable glass line and syrup room), Kinshasa, Kisangani (partial returnable glass line) and there is a mixer and alcohol storage plant in Ijebu Ode. Further projects will be realized together in the very near future based on the common partnership to ensure Heineken’s growth concept in the region.

Heineken is putting its trust in KHS labeling technology with up to 80,000 bph also in Nigeria by ordering 3 new modular labeling machines.

This machine technology offers

Heineken breweries a high level of flexibility and future security to cover all possible label decorations. With the KHS Innoket SE modular labeler all modules are interchangeable in the range of cold glue, pressure sensitive and roll-fed modules.

The patented modular bottle orientation camera system enables Heineken to produce its containers with outstanding orientation results.

One of the latest projects between KHS and Heineken is the implementation of a KEG filling line at the new brewery set-up in Kilinto, Ethiopia. The capability of producing/filling all types of container makes the position of KHS unique in the market.

www.khs.com

Heineken IN Ethiopia

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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 safety and technical capacity building to ensure

Fermentation tanks at the new Greenfield brewery

supplier profile

KHS

Industry: Filling and packaging Services: Our core competence lies in the development and production of both single machines and complete filling and packaging lines.

Management: Prof. Dr.-Ing. Matthias Niemeyer CEO Contacts: RSA: Joerg.thomas@khs.com / +27 11 262 1100 Kenya: denise.schneider-walimohamed@khs.com / +254 733 611253 Nigeria: michael.kloss@khs.com / +234 70 9800220 Website: www.khs.com

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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 in Ethiopia

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Farming techniques in Ethiopia are centuries old

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 benefit from the experience and knowhow from an international company, where we exchange best practises,� added Sukker.

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 in Ethiopia

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Most smallholder farmers own about five Hectares of land

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.

“Each of these areas is highly relevant to our day-to-day business operations, and to our stakeholders. We have already seen considerable

“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

Harar Brewery

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.

Let us partner & solve your problems.

www.sintec.com.et

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Heineken training programme ensures a high level of safety and technical understanding

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).

Spreading the word Heineken’s future plans in the country involve

“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 in Ethiopia

Patients and staff at Bedele District Hospital

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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 increasingly discerning clientele who demand

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Company Information Industry

Beverage headquarters

Addis Ababa, Ethiopia founded

2011 employees

1,100 revenue

Not disclosed products/ services

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.”

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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Makro

‘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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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

food

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.

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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 108

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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

food

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

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

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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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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.”

supplier profile

SC johnson

We make homes better for families. SC Johnson is one of the world’s leading makers of household brands. We’re a 128-year-old family company, and our trusted products can be found in homes around the globe. We employ nearly 13,000 people globally and generate $9 billion in sales.

Our company is still headquartered in Racine, Wisconsin, where it was founded. We have operations in more than 70 countries and sell products in virtually every country around the world.

Website: www.scjohnson.com

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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

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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 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

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

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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

Fruitree is the Juice for all Occasions.

Refreshing Fruitree is available in a wide range of flavours, from Apple to the ever popular Mediterranean and Tropical. Tetra aseptic packaging & Glass are the preferred packaging formats to present the highest quality beverages, without the need for nasty chemical preservatives. An array of pack formats exists, from 250mL right up to 5L.

T: +27 (0)21 943 6900 F: +27 (0)21 943 9059 exports@ceres.co.za www.fruitree.co.za

VISIT US ONLINE

CLICK HERE

makro

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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 farming areas, and we are extremely involved

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.

Collect and Redeem

rewards points at Makro with UCount Rewards 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.

We look forward to a smart partnership that drives productivity, profitability and performance and delivers real value all round.

To join visit www.standardbank.co.za/UCount

R E W A R D S

With UCount Rewards you collect up to 10%* back in rewards points on groceries and up to 2.25%* back in rewards points on general merchandise purchases, when using a qualifying Standard Bank personal debit cheque and credit card. You can also redeem your rewards points at Makro using your UCount Rewards Card. UCount Rewards from Standard Bank. Just another way we’re moving you forward.

*Terms and conditions apply.

Authorised financial services and registered credit provider (NCRCP15). The Standard Bank of South Africa Limited (Reg. No. 1962/000738/06). Moving Forward is a trademark of The Standard Bank of South Africa Limited. SBSA 185606 7/14.

Moving Forward

TM

makro

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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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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

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 120

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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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Surati

Surati Sweet Mart Prepares

Surati President Haren Sheth discusses expansion plans in and what lies ahead for the Toronto-based food manufactu Written by: Sasha Orman

Produced by: Sean Bakke

for Growth

n manufacturing and distribution, uring business

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Fresh and crispy biscuits available in a variety of flavours are a staple of Surati’s bak

Surati Sweet Mart has undergone a real transformation throughout its many years in business. Getting its start in East Africa, the company produced a handful of snacks with the goal of bringing consumers a taste of East India and Southeast Asia. While that goal remains the same, the Toronto-based Surati Sweet Mart of today produces 124

August 2014

more than 400 SKUs in the snacks and baked goods sectors with distribution throughout North America. Now the company is on the verge of undergoing yet another transformation, taking on a new facility in a bid to expand its reach to an even bigger global audience.

sector

kery

Growing Into a New Expansion “Fortunately, our business is growing rapidly,” says Surati Sweet Mart President Haren Sheth.

It’s this growth, which encompasses everything from a growing consumer base to a growing catalogue of SKUs that the company produces, that has necessitated an upcoming expansion to a new expanded facility that will give Surati all the room it needs to grow.

Surati Sweet Mart is filling this new space with

CEO Haren Sheth

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S u r at I updated equipment to improve operations across the board. “We are bringing in new equipment for bakery and snacks as well as packaging,” says Sheth. New depositors and state-of-theart oven systems are just some new features that the new Surati will be able to boast. In addition, Sheth explains, the new facility provides the added benefit of consolidating Surati’s manufacturing and warehousing operations under one roof – a move that will dramatically increase the company’s efficiency.

Surati’s bakery produces fresh cookies, biscuits, cakes and rusks daily for shipping across North America.

An Expanded Reach Surati Sweet Mart’s manufacturing facility is not the only feature of the company that is growing –

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reliable professional recruitment service. We provide full-time, part-time personnel that has all the qualifications.

Acorn Packaging Inc. 563 Queensway East, Mississauga, Ontario, L5A 3X6 Tel: (905)-279-5256 Fax: (905)-279-3234 sales@acornpkg.com www.acornpkg.com

canada

the company is also working hard to expand its distribution network.

“We have been a manufacturer since 1940, so we know food manufacturing in essence,” says Sheth. But when the brand found that it had outgrown the capabilities of its distributors, the Surati team started to learn how to build that side of the business in its own right – and by working directly with retailers and consumers, Surati has gained invaluable insight. “What this does is it gives us a very good rapport with our customer base,” Sheth adds. “That is where we get the ideas for new product development, by learning what is missing in the marketplace.”

Today Surati Sweet Mart reaches its customers across North America through distribution centers in Toronto as well as San Francisco, Dallas, and Spotswood, New Jersey. But the brand is also exploring other options and areas to expand further.

Setting the Brand Apart What makes Surati Sweet Mart a cut above the competition? It could be the brand’s dedication to end-to-end food safety along its value chain – as an ISO and FSSC-22000 certified company with stringent training programs and safety assurances like destoning machines and metal detectors, Surati accounts for and strives to eliminate the potential of both mechanical and human error.

According to Sheth, what also sets Surati apart

Founded in the 1940’s by Maganlal Sheth, Surati is now welcoming the 3rd generation to the family business.

“Overall we have the distribution that we can grow on, we have the product ability that we can grow on, and new generation with fresh legs and fresh minds coming into play”

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Surati cookies come in a variety of flavours including almond, cashew, pistachio and coconut with many more being introduced.

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is its people. “We have people here who were working with us since the days of inception, and we have people who have retired from the company where it’s the only job that they have done,” he notes. That longevity leads to unparalleled expertise that extends throughout the business. “You can always have machinery that can make a product,” says Sheth. “But the know-how –the people that you train, and who become a part of your unit – is more significant.

With the food industry background and knowledge we have, from the top management to the people working on the floor as well, we would be way ahead in the competition field.”

canada

The Future Ahead Company Growth is a major focus for Surati in the years to Information come, as it continues to expand its distribution and manufacturing capabilities. “We will be Industry looking at more distribution centers and, since we Food manufacturing & will have the bigger facility, we will also have the distribution ability to add many more SKUs at a much faster rate,” says Sheth. “We have food technologists headquarters working on new product development on a Toronto, ON, Canada regular basis, which helps us in providing the platform for introducing new products.” founded The company is also being propelled forward 1940’s in Kampala, by the family-owned company’s third generation, Uganda which has entered the business within the last two years and is taking a hands-on approach to employees learning the ropes. “It’s a good learning base for 65 in Canada them, and now they’ll be figuring out how we can grow this business by adding more territories – products/ services Europe, Australiasia and Latin America would be new territory growth for us in the coming future,” Snacks, baked goods, says Sheth. “Overall we have the distribution that frozen vegetables, we can grow on, we have the product ability that Indian fast food we can grow on, and new generation with fresh legs and fresh minds coming into play.” Between these three factors, the future for Surati Sweet www.facebook.com/suratisweetmart Mart is looking bright.

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Australian Macadamia Society (AMS) Australian macadamias - The World’s Finest Nut Written by: AMS

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Australian Macadamia Society

BOOMING ASIAN DEMAND, high prices and new investment opportunities mean substantial growth potential for the relatively young Australian macadamia industry.

Australian macadamia nuts enjoy a first-class reputation (taste and quality) all over the world, thanks to a dedicated group of innovative growers, world-class farming practices, commitment to clean, green production and a multi-million dollar research and development program that has delivered some of the world’s leading technology and pioneering scientific breakthroughs.

Australia - the birthplace of macadamias - leads the world in macadamia production and export, accounting for more than 30% of the world’s crop. In 2014, around 750 growers will produce 40,000 tonnes of Australian macadamias, of which 70 per cent ($120-130 million worth) will be exported to more than 40 countries.

Growing regions are found in the sub tropical climates of northern NSW and southern and central Queensland, and smaller 132

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plantations in Western Australia, while new regions are now opening up (to cater for growing demand) in the northern Queensland areas of Mackay and Emerald.

The growing Asian appetite for macadamia nuts is being driven by not only China and Japan (the two largest export countries), but by relatively new markets like Korea and Taiwan, where consumers are beginning to associate macadamias with health, beauty and wellbeing.

The peak industry body is the Australian Macadamia Society (AMS) which is charged with driving the industry’s cuttingedge research and development, marketing and strategic investment.

The AMS marketing program is geared up to take advantage of increasing global demand, launching a major promotional campaign in Korea in 2013, and coordinating a blogger event in 2014 (where five Korean bloggers shared their Aussie macadamia experience with 2 million Koreans).

A comprehensive social media campaign also helped 1.9

australia

Renowned Aussie chefs Karen Martini, Kylie Kwong and Giovanni Pilu celebrate 40 years of the AMS with Bundaberg macadamia grower Scott Allcott

million Japanese consumers vote macadamias as their favourite nut in a major consumer brand promotion.

AMS Chief Executive Officer Jolyon Burnett says these growing Asian markets place a high priority on clean, green production and appreciate the premium product Australia can deliver. “New free trade agreements

in key markets like Korea and Japan have further enhanced the competitiveness and excellent value of Australian macadamias in these markets. This represents a major opportunity for the Australian macadamia industry, allowing it to undertake significant expansion into these markets,� says Mr. Burnett.

The national Research &

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Macadamia are in high demand

Development program has also positioned the industry to take full advantage of the current boom.

New tree varieties currently being trialed by the nation’s best scientific researchers have 30% higher yield and will be available from 2017-18. As well, the ‘Small-Tree High-Productivity’ project (which has just received a further injection of $3million from the Australian government) will produce smaller, more efficient trees with higher yields, that are quicker to harvest, meaning lower production costs for farmers. In addition, a macadamias global health project – set to kick-off in 2015 – will provide the research needed to further support macadamias health proposition and take full advantage of consumers increasing awareness of the health benefits of nuts in relation to heart disease, diabetes and weight management which is helping to drive demand globally, as is the increased recognition of the macadamia nut’s versatility and exquisite, buttery taste. It can be found in up to seven aisles of the supermarket – from breakfast cereals to snack food, confectionary, ice cream and skin care.

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australia

Company Information Industry

Food headquarters

Lismore, NSW, Australia The World’s Finest Nut founded

anniversary. The AMS represents 600+ members representing all facets of the Australian macadamia industry. Whilst the majority of members are growers, membership also includes processors, investors, marketers, consultants and researchers. The AMS is committed to driving initiatives to secure the future of the industry, including conservation of the endangered wild macadamia species, regeneration of rainforest pockets on farms and the development of biological pest and disease controls.

1974 employees

Jolyon Burnett - CEO, Andrew Starkey Chairman, Lynne Ziehlke - Market Development Manager

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Commonwe Fisheries Association (CFA)

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Fishing for Glacier 51 (Patagonian Toothfish) in the fishing zones of Australia’s sub-Antarctic Territories.

CFA IS THE peak body representing the collective rights, responsibilities and interests of diverse commercial fishing industries in the Commonwealth managed waters of Australia.

CFA’s mission and vision is to have ‘Recognised leadership in sustainable and profitable wild capture fisheries’ and to ‘Enhance and promote the Commonwealth wild capture fisheries and our industry’.

The CFA is a politically independent professional association. Its membership 138

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is across all facets of the wild catch fishing sector and it plays a key role within the Australian community as a major contributor to the formulation of effective and responsible fisheries policies.

Founded in 2002, the CFA goals are to; − Enhance the environmental sustainability of our fisheries; − Enhance the economic value, benefits to society, and profitability of our industry; − Strengthen security of access to our fisheries; − Facilitate research,

Food

development and extension of programs to improve the sustainability and profitability of our fisheries and industry; − Reduce regulatory complexity and costs on our industry; and, − Foster pride within our industry for our achievements, our role in society, and our care for the marine environment we live and work in.

The practical significance of CFA’s involvement in fisheries management and research development processes is a long

term improvement to the efficiency, productivity and profitability of Australia’s wild catch fisheries.

This leads to a better managed and strengthened wild catch fishery and operating environment, for CFA’s members.

CFA is structured around three priority pillars that provides the framework for consultation, these being; 1. Security of Access; 2. Efficient regulation; and, 3. A competitive industry.

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C o m m o n w e a lt h F i s h e r i e s A s s o c i at i o n Within these three key pillars, CFA have addressed issues on marine protected areas and their impacts on the fishing industry, resource sharing with other jurisdictions under the Offshore Constitutional Settlement agreement, resource sharing with the recreational fishing sector, policy development such as the Harvest Strategy and By Catch policy.

CFA have also been influential and successfully achieved; 1. a Government exemption

for the fishing industry from the Carbon Tax; 2. a Government commitment to maintain the fuel tax credit scheme for the fishing industry; 3. Progressed an initiative with PriceWaterhouse Coopers to allow industry to claim their research and development levies; 4. Provided leadership and coordination of an industry response and highlighted to Government the detrimental impacts from the Commonwealth Marine Bioregional

Fisherman in Australia’s sub-Antarctic Territories

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Planning process. CFA was successful in obtaining an election commitment from the Coalition to suspend and review the marine bioregional process; 5. a commitment from Government to a Productivity Commission inquiry on regulatory burden; and, 6. a Government grant to assist exporters with a national residue survey.

These are only but a few of the many achievements CFA have accomplished, through pursuing and liaising Government on our members behalf.

CFA currently comprises membership covering over 90% of Commonwealth fishery-specific industry Associations. In addition a number of Commonwealth fishers have chosen to join as individual members where they have no fisheryspecific Association to represent them. Some members have also contributed significantly to CFA via Corporate membership which is additional to their continued membership via fishery-specific associations. CFA membership is currently at 4 Corporate members, 8 Associations and 8 individual members.

The opportunity exists for CFA to represent industry to Government and other stakeholders, as there is no other Commonwealth body that offers these networks and support. While a number of more regionally based, sector specific bodies are present, it is CFA that Government seek to consult with.

Company Information Industry

Food headquarters

Melbourne founded

2002 employees Anthony Ciconte - Southern Shark Industry Alliance, Simon Boag - South East Trawl Fishing Industry Association, Les Scott - Australian Longline Pty Ltd, Annie Jarrett - NPF Industry Pty Ltd, Martin Exel - Australian Fisheries Pty Ltd, Brian Jeffriess - Australian Southern Bluefin Tuna Industry Association, Jeff Moore Great Australian Bight Industry Association, Executive Officer - Renee Vajtauer, Public Officer - Gail Richey

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Sheepmeat Council of Australia (SCA) Maintaining and improving market access for sheepmeat- our key priority Written by: Dr. Kat Ferme, CEO SCA

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SCA President Ian McColl (right) hosting a Japanese trade delegation on his property at Koorawatha, NSW

THE DAYS WHEN lamb was dismissed as a by-product of the wool industry have long gone. So is the era when Australian lamb was a commodity beset with inconsistency of supply and quality problems.

The industry is now worth $3.5-$4 billion a year, exporting to over 70 overseas destinations, and at the top end of the global sheepmeat market in terms of quality.

Lamb exports generated $1.31 billion in returns in 2013, with a similar retail value being realised on the Australian domestic market. The 144

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vast majority of Australian mutton (around 96%) is also exported, worth around $630 million in 2013. Today Australia is the largest exporter of mutton and live sheep, and the second largest exporter of lamb.

Sheepmeat Council of Australia CEO Dr Kat Ferme says, “The sheepmeat industry has been the quiet achiever of Australian agriculture,” “The industry continues to strive through planning and collaboration to be the leading supplier of lamb and sheepmeat

Food

to a world with growing demand for our premium product”, “Maintaining and improving market access is our key priority,” SCA focuses on market access to ensure that there is a variety of market specifications available to accommodate the sheep industry’s diverse production systems; to increase the competitiveness amongst buyers; and overall to maximise the prices farmers receive for their product.

Australia has increased access to world markets over many years due to the quality of our product, its favourable disease

status and world class food safety and integrity systems. Whilst sheepmeat exports have grown substantially, unfortunately both economic and technical trade barriers hinder our industry from realising its full potential.

In pursuit of freer trade, SCA works via an industry & Government partnership to ensure that access is not eroded through administrative, regulatory or policy impositions; and to secure a more favourable export market environment through strategic trade reform initiatives.

Over the past 12 months we have continued to build international

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SCA CEO Dr Kat Ferme and George Christensen MP enjoying some lamb at a ‘Free Meat BBQ’ at Parliament House

relationships with our export markets, including the TriLamb partnership in the lucrative United States market. We have promoted the sheepmeat industry’s position in the Japan-Australia Free Trade Agreement (FTA) and the KoreaAustralia FTA, both of which will provide certainty for small but growing sheepmeat trades. SCA has also supported market access developments in the Middle East 146

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and North Africa, including the reopening of the Bahrain livestock export trade and the signing of the animal health protocols necessary to reopen the livestock export trade to Iran.

SCA will continue to work with industry and Government stakeholders to improve market access for sheepmeat, and improve the farm-gate returns of Australian producers.

australia

Sheepmeat Council of Australia Sheepmeat Council of Australia (SCA) was formed in 1979 and is the peak national body representing and promoting the national and international interests of Australian lamb and sheepmeat producers.

SCA’s key role is scrutinising the performance of and setting the strategic imperatives to be pursued by the levy funded bodies, Meat & Livestock Australia (MLA), Animal Health Australia and the National Residue Survey. Our aim is to ensure the best investment of the levy funds, and that producers are receiving the benefits at the farm gate.

SCA also develops national policy on issues affecting sheep producers and lobbies the Federal Government to achieve better outcomes for producers.

For 2014/15 SCA’s market access reform focus, on behalf of our members, will be to ensure that sheepmeat is a recipient of advantageous outcomes from the suite of free trade agreements (FTAs) currently under negotiation including the: • Australia-China FTA; • Australia-Gulf Co-operation Council FTA; • Trans-Pacific Partnership negotiations; • Australia-India Comprehensive Economic Cooperation Agreement; • Indonesia-Australia Comprehensive Economic Partnership Agreement; and • The Regional Comprehensive Economic Partnership.

Company Information Industry

Food headquarters

Canberra founded

1979 employees

Dr. Kat Ferme - Cheir Executive Officer, Ian McColl - Vice President, Jeff Murray - Vice President

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Company logo goes here

PRONicaragua Produced by: Taybele Piven

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PRONi c a r a g u a

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 150

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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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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.

l at i n a m e r i c a

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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PRONi c a r a g u a

“Annually 4,000 metric tons of cocoa from approximately 8,000 hectares are produced and exported 50 percent mainly Central and Eastern Europe�

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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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Seafood excellence for the global consumer: Camarones de Nicaragua, shrimp production under global standards

Written by: Rebecca Castrejon Produced by: Taybele Piven Interviewee: Roberto Ferron, General Manager for CAMANICA Translation by: Rafael Tablado 157

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Atarrayero sampling shrimp

Superiority in crustaceans

A

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fter almost 20 years from its inception, Camarones de Nicaragua (known as CAMANICA) has established itself as one of the leading shrimp production companies in Latin America.

This standout leadership brought PESCANOVA (Spanish multinational) to focus into the corporation’s industrial globalization

sector

process in Central America, thus allowing commercial expansion in the area after the acquisition of CAMANICA in 2007, whose competitiveness nationally matched PESCANOVA’s strategic vision.

CAMANICA’s farms are the largest in Latin America; the company’s operation consists of shrimp breeding and processing, producing over 900 million prawns monthly.

A very strong competitive advantage for

“Every supplier’s role is important at the end of the day” – Roberto Ferron, CEO, CAMANICA

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CAMAN I CA - G RUPO PESCANOVA

Key People

Roberto Ferron CEO of CAMANICA

Sponsoring sports in the communicty

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CAMANICA is the quality of Nicaraguan water— among the purest in the world—and also a value added which has earned the company FDA and GlobalGAP approval. Under sustainable production and compliance with government regulations, the company exports up to 10-ton prawn shipments to important markets such as the U.S. and Europe. Also, the processing plant is continually upgraded through a US $175 million investment for the research and development department as well as acquiring the newest cutting-edge technology and machinery.

As PESCANOVA’s subsidiary, the company’s supply chain has products and services from suppliers in Central America up to logistics management in their Spanish headquarters.

Today, CAMANICA is an established company professing international leadership and a positive global projection towards its production goals.

Managerial leadership CAMANICA is one of Latin America’s leading companies in shrimp and other species’ breeding, farming and marketing. Their CEO, Roberto Ferron, is a Spanish executive whose love for the sea drove him to leave his career as an economist in order to major in Oceanography.

Following his five-year education, specializing in Mariculture, Ferron began a promising tenure with Grupo Pescanova in 1997. He started as an operator for the production area, and in 1999, he was put in charge of mariculture. Soon, he was

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named diagnostic laboratory manager, remaining in that position until 2001.

By 2006, Ferron had already been appointed as a technical director. That same year, PESCANOVA began working abroad, breeding whiteleg shrimp and other seafood products with salmon-breeding affiliates in Portugal and tilapia fishers in Brazil, among others. But it was not until 2007 that PESCANOVA scouted Central America in order to achieve strategic expansion into countries such as Ecuador, Guatemala, Nicaragua and Honduras. Further research resulted in the

Greenhouses for juvenile offspring

View of Traditional Farms

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Breeding of larvae in Miramar

Packaging for sale example; Europe product

acquisition of CAMANICA that same year, where Ferron first joined as a laboratory manager in intensive farming before becoming the head of the front office by 2012.

“My father was an economist too, but I walked away from all that due to my love for the sea; since mariculture is involved with the essential proteins from animal origin, without which we would not be able to do anything at all. In this life, doctors are necessary, lawyers are necessary, but the work derived from mariculture is necessary up to three times a day: breakfast, lunch and dinner,” says Ferron.

New management Due to the company’s growth during recent years, the management has focused on sustaining

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progress through expansion and increasing productivity for every single activity performed by CAMANICA, including collaborations with other companies from the PESCANOVA corporation in other locations worldwide and continuous improvement breeding shrimp for export to Mexico, United States and Europe.

Additionally, CAMANICA has paved the way in disease-free breeding, they have successfully developed breeds in different feeding phases, and their plant has been upgraded with the latest technology.

“We have always tried to perform at our best to contribute to the company’s local breeding operation, based in our work with other species abroad,” says Ferron.

Global differentiation Even though Central America’s natural conditions provide only two growing cycles a year, CAMANICA supplies large volumes year-round due to a 100 percent vertical structure, controlling every single stage in the process from inception to distribution. The company is always in compliance with food quality requirements and standards.

“Product quality and compliance with health standards are our best marketing resources; these are the most important factors in the markets we supply. We are certified and consumers can make sure that every single aspect surrounding our product finds itself in

“Product quality and compliance with health standards are our best marketing resources; these are the most important factors in the markets we are suppliers to.

We are certified and consumers can make sure that every single aspect surrounding our product finds itself in compliance with regulations and standards” – Roberto Ferron, CEO, CAMANICA

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Bringing you The Science of Survival

MADE IN USA

You produce them.

We protect them.

Nutritional and Biological Control Program for

Raceways & Nurserys Systems

Hatcheries Stage 1

Raceways

Farms Stage 3

Nurserys

Epicore BioNetworks Inc. is an ISO 9001:2008 Registered Company

USA: 4 Lina Lane Eastampton, New Jersey, 08060 USA • Telephone: (609) 267-9118 • Fax: (609) 267-9336 e-mail: Information@EpicoreBioNetworks.com • www.epicorebionetworks.com Ecuador: Vía a la Costa km. 11 (antes de la gasolinera Mobil) • Teléfonos: (593-4) 2990663 / 2992171 Fax: (593-4) 2990874 • e-mail: epicoreecuador@epicore.com.ec Epicore BioNetworks Inc. is a public corporation with a registered office in Calgary, Alberta, Canada and with shares listed on the TSX Venture Exchange (symbol EBN).

CAMAN I CA

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compliance with regulations and standards,” says Ferron.

Exports and expansion CAMANICA’s consistency has turned into a 15 percent growth during the last three years. The goal for 2015 is producing more than 1,000 tons and consolidating related investments for the next five years.

As one of Latin America’s largest laboratories with certified production quality, conditions are proper now for third-party sale of shrimp larvae, guaranteeing food security.

Their breeding and processing plant is focused in preserving the previously achieved production levels of packaging more than 140 tons per day,

supplier profile

Traditional Farms

- Epicore Bionetwokrs Inc.

Number of employees: 38 employees Establishment year: 1987/01/09 Type of industry: We design, develop and manufacture innovative and environmentally responsible biotechnology products and specialty animal feeds.

Main service: Microbes and enzymes that have applications in aquaculture, agriculture and horticulture, cleaning and sanitation, food processing and nutrition, waste water, pollution control and environmental remediation.

Recent projects: ”Global Aquaculture Advocate” Publishes Epicore Article Featuring a New Shrimp Growing Technique.

CEO: William P. Long CEO Website: www.epicorebionetworks.com

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CAMAN I CA - G RUPO PESCANOVA with a growth forecast of up to 180 tons. As for larvae production, the goal is to produce more than 11,000 tons of finished products by the end of the year.

Social responsibility

Sustainable development Among the sustainability projects developed by the company, are permanent energy saving programs and a solar panel system for the laboratory’s water supply during December and January. These projects benefit soil conservation, increase water quality and help the preservation of a green environment and surroundings.

www.inveaquaculture.com/best-balance

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Remaining consistent with the labor’s immediate environment, the company manages intermediate breeding as part of sustainability and socially responsible programs.

“There is intensive breeding and non-intensive breeding; we have an intermediate process able to enhance our soil’s productivity. During the last year, we have experienced better water quality,” says Ferron.

Sponsoring sports in

Key suppliers Without key providers’ supplies, CAMANICA’s aquafarming production quality wouldn’t be

the communicty

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Internal view of

possible. Some of the fully met needs in this area include hi-tech equipment, raw material and other supplies enabling the company to meet the demand of consumers worldwide. Imports from Norway, Iceland and the United States are key factors in their supply chain.

“A local hardware provider is as key a supplier as big logistics and transportation companies are, too. Every supplier’s role is important; at the end of the day, constant improvement is always required; proteins from vegetables, animals and prices vary, we must rearrange our routines on the go when such changes happen,” says Ferron.

laboratories

The future Aquaculture has become a feasible alternative for animal protein production. And it turns out this activity was an important factor in Nicaragua’s economic growth during the last 10 years.

CAMANICA plans to keep growing based on their 15 percent annual increase in production for the next five years, along with sustainable improvements and preserving quality standards as a commitment to their country, environment and foreign market.

“We are one of our trade’s model companies in Latin America, and obviously we want to keep at that same level,” says Ferron.

Freezer storage chambers www.empremar.net

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“We have always tried to perform at our best to contribute to the company’s local breeding operation, basing our work with other species abroad”

Company Information c o m pa n y

CAMANICA (Grupo Pescanova) industry

Aquafarming headquarters

Chinandega, Chinandega, Nicaragua founded

1995 (Founded), 2007 (acquired by Pescanova) employees

1,400 Revenue

USD $105 million email

– Roberto Ferron, CEO of CAMANICA

info@camanica.com.ni website

www.camanica.com.ni

www.linkedin.com/company/pescanova_2 www.facebook.com/CamanicaSa w w w. c a m a n i c a . c o m . n i

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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 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 In November 2008, Bernardo Chamorro entered the cane guild after having successfully worked in the technology industry. Afterwards he started working in the various business units of Ingenio Monte Rosa as CFO, and then lead from the general manager post, a position he has held 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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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.

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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 Cengicaña (Centro Guatemalteco de Investigación y Capacitación de la Caña de Azúcar), 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,” 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

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Cutters

Automation

of their responsible activities. Another example is their social development department, which 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. 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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The Pantaleon Foundation develops programs to improve health and education in communities. For 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

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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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technologies and specialized training on the 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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http://www.pdelaire.com/ | Informacion@pdelaire.com.ni http://www.facebook.com/Productos-del-Aire-de-Nicaragua-SA

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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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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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C a r gi l l

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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C a r gi l l 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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C a r gi l l 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.

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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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We execute the entire supply chain, we are distinguished by a strong quality assurance culture, inhouse developed operational systems and an innate knowledge of the region.

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C a r gi l l

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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.

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DEVELOPMENT

INTEGRATED SOLUTIONS

INNOVATION

We have a range of products for the meat and snacks industry, sauce and soup industry, bakery and food service - fast food.

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PBX: (502) 6628 8000

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C a r gi l l

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Company Information Industry

Aviculture (process products) headquarters

San Pedro Sula, Honduras founded

1969 employees

9,300 revenue

“We are trying to give more value to the country, by supporting the local produce of grains, corn, sorghum and soybeans, and stop importing”

USD $250 million products/ services

Aliments, agricultural products and services, financing and industrial services

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