Latin American exporters lost in translation -

Latin American exporters lost in translation

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Latin American exporters lost in translation

U.S. consumer preferences have shifted towards locally-produced foods, but in a recent visit to Chile the Produce Marketing Association (PMA) has called on Southern Hemisphere exporters to promote their ‘locales’, rather than just the products themselves.

PMA chairman of the board Mike O'Brien

PMA chairman of the board Mike O'Brien

If a community-conscious customer in St. Louis can relate to the story of a grower in their home state of Missouri or even California, why not apply that same principle further afield? This is the message of PMA chairman of the board Mike O’Brien, who is also vice-president of perishable products at Schnucks Markets in the U.S.

At an industry breakfast in Santiago’s Casa Piedra, he highlights the success of Chile’s blueberries and grapes in recent sales figures, but believes more can be done to help customers relate to food that comes from a distant country.

See our Image Gallery PMA Breakfast in Chile

“What’s missing is the connection between retailers and growers, and getting that story to the customers, that our growers in Chile are farmers too,” he says.

“We don’t just buy locally, we buy globally and we’re proud of every item of produce we sell, so for the connection we have made with our customers with our local growers, we have pictures of the farmers, and let them know where this produce is grown.”

PMA president Bryan Silbermann highlights a similar principle, pointing to statistics conducted by the Hartman Group showing 59% of consumers want a ‘connection’ with farmers.

“As we’ve become more corporate in the produce industry, we’ve become more efficient, we’ve talked about the scale of operations, and huge ships coming across the world with product, we’ve been going up and up and up in terms of sophistication and consumers have been going down down down as far as their desires, and it’s very important for us to understand that,” he says.

“It’s just as important for people, whether they are buying Scotch whisky, or Chilean grapes, or strawberries that might come from California, (it) is the locale.

“Who’s behind it? What’s the story behind it? How do you communicate that to the person buying in the store? This is more important than ‘local’.”

But how do exporters tell this story?

In the room there is a strong sentiment that while U.S. buyers like to discuss issues of quality, what they really hammer home is price. While to supply grapes 365 days per year retailers need to source from abroad, Subsole managing director Miguel Allamand says exporters need to better capitalize on the benefits of their successful produce.

For O’Brien, the answer lies in true supplier partnerships that don’t change at the whim of better market opportunities elsewhere. He says suppliers need to continue with an emphasis on quality, while working with retailers to create marketing campaigns to tell their farmers’ stories.

“Everything we do in our produce department, it has to be quality. Now, are we still tough negotiators with our suppliers? Yes we are. We negotiate tough but we negotiate fair, but when it comes to making a decision between quality and price, we rely on quality,” he says.

For many, the issue of quality relates to a choice of locally-grown over industrially-produced fruit and vegetables, with 47% of respondents to the Hartman Group survey stating they shopped at farmers markets.

“Our recent research that we have done in the United States has told us, for example, that farmers markets and retail outlets offering locally-grown product in particular, have what I call a ‘health halo effect’ that outperform traditional supermarkets,” says Silbermann.

PMA president Bryan Silbermann

But will this locally-focused trend prohibit exporters? O’Brien says it will do the opposite, as higher consumption of fruit during the U.S. growing season will continue into the seasons of other fruit-growing countries.

“We have to look at the big picture, that the more people connect with fresh produce, the more they sell and the more they eat all year long. So that’s the big picture, we have to stop thinking small, we need to think big,” he says.

“When you think about it, in St Louis our local farmers grow peaches, they grow tomatoes, they grow lettuce, they grow zucchini, but they don’t grow grapes. You can’t get grapes in Missouri, so it’s not a threat at all.

“it’s a different season and that’s the advantage Chile has in the United States right now, is that it’s a different season, but what the customers need to know is that the growers in Chile are farmers and farmers are people. You put a personal face to the produce as opposed to just having them in the stores and refrigeration.

“They’re buying more this season than they’ve ever bought before because it’s part of their diet, so if they get into the produce department because it’s local, it means they’re going to buy more when it’s the season in Chile.”

O’Brien also makes his own personal forecast that grapes and cherries will eventually follow the lead of berries and kiwifruit in clamshell packaging, which have been very successful innovations for Schnucks so far.

But while the U.S. and much of the developed world has moved in the direction of organic produce and an emphasis on quality as a high priority for customers, surveys show a different story in the supermarkets of South American fruit-growing countries.

The PMA breakfast event closes with comments from Rodrigo Tapia of Cencosud, which owns the supermarket chains of Santa Isabel and Jumbo.

“For us, in the Latin American market – it happened the same in Brazil, Argentina and Peru - price is the most important factor in the market, and to get that right you need to be efficient in your produce.”


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