NZ: T&G gains 'unexpected insights' from Zespri MoU in Bangkok

More News Top Stories
NZ: T&G gains 'unexpected insights' from Zespri MoU in Bangkok

T&G's executive general manager for pipfruit Darren Drury says the company's MoU with kiwifruit marketer Zespri and the opening of an office in Bangkok, Thailand has gone "beyond expectations".

During Asia Fruit Logistica in Hong Kong, Drury told www.freshfruitportal.com an on-the-ground presence brought extra information about the Thai market, and the greater sense of context was powerful for utilization in messaging and branding.

"The biggest benefit that we really didn’t quite see coming was just how much insight we could get," Drury says.

"I think we’ve learnt more about the Thai market in three months probably than in the last two years.

Darren Drury and Joe Barsi

Darren Drury and Joe Barsi

"It's a big market for our company and to have that presence in-market just takes it to the next level. I guess a lot of what we’re trying to do as a business is become more customer-centric."

Zespri chief operating officer Simon Limmer said the Thailand operation with T&G was a working example of complementary businesses that were starting to get momentum.

"So we're excited about that. They have such a strong brand, they’re a great company, with a strong New Zealand heritage like our own," Limmer says.

"So there’s a lot of synergy between our companies and we’re very complementary in terms of the product and the branding that we have in place.

"But of course the structures that they have in place and the resources allow us to work together and look for opportunities where we can complement each other and provide a natural synergy...it is paying dividends for us already in several markets, and we will continue to look for opportunities there."

Drury says developing in-market presences involves a series of incremental movements, which is key for growing T&G's customer base.

"We’ve taken on somebody in Vietnam recently, we’ve got an employee based in Singapore, we’ve got our Chinese office, our Thai office, and we’re looking at our Japanese office and giving that more support," he says, referring to an upcoming office opening in Tokyo.

In all global markets, T&G will likely remain more of a business-to-business brand, but Drury has his sights set on making consumers much more aware of individual brands owned by the group such as Envy, Jazz and Pacific Rose.

"To a degree we've had good brands in terms of trade, and there has been a little bit of a reach into the market and it has touched consumers, but I think one of our big drives over the next 10 years is to actually build consumer brands," Drury says.

"That takes a lot of things – one, it takes investment, and two it actually takes scale, so we’re trying to do those two things.

"We believe, especially with our apple business, that we have brands that have significant advantages over our competitors."

He said Jazz was the biggest selling premium apple across Asia, in part due to T&G's partnership with Thai importer Vachamon, but Envy had also had a "phenomenal response" from trade and consumers thanks to its color, consistent grade and sweet flavor.

Production outside NZ

North American production will form a significant part of forming a consistent supply for customers in Asia and beyond, and to help with this strategy the company brought in Joe Barsi to head up T&G North America's pipfruit business.

"We are a New Zealand-based business but I think it’s very clear our growth is not going to come from New Zealand," says Drury.

"It's going to come from Washington in particular; we’ve got a huge growth curve there and that’s one of the reasons Joe has come in to the business is for us to manage that growth.

jazz-apples"So that branding and that proposition where we’re taking product to market for 12 months, we’re not just going to do that from just one hemisphere - we’re going to need both hemispheres."

He says one of the biggest challenges recently has been the growth stage for Envy, whereby T&G has not yet been able to source enough supply to meet demand.

"We don’t like saying no to customers but we have to. We’re building the volume and when we get to that point obviously we won’t be saying no so much," he says.

He says about 40% of the North American volume is exported with Asia as the main destination region.

"In terms of the China market, it takes a very significant percentage of Pacific Rose, maybe 60-70%, whereas Envy is a lot less, probably 20-30%.

"I think Pacific Rose has a particular niche in China where it does very well. It grows very well especially around Brewster, Wenatchee, and the Chinese just love it."

But would T&G consider growing its proprietary apple varieties in China, similar to what Zespri is currently investigating for its kiwifruit?

"It’s something we’ve talked about for a long time. We’ve had a lot of enquiry and interest in our varieties to be grown in China," Drury says.

"A lot of our business model is built around intellectual property, so it’s really understanding the intellectual property laws and how they work in China, how we can protect our varieties.

"We’ve done some work in that space but we’re a long way from getting anything into a tangible result...that's why we have a team in Shanghai because it’s about building up our knowledge of the market."

T&G does however have a small production of its proprietary apples, mostly Envy, in South Korea and Japan.

"We actually already have a presence in South Korea so there’ll probably be a bit of material coming out as we get into the harvest this year – we’re going to have a reasonably significant volume to sell. envy-pic

"We might even export a couple of containers as a little trial, but South Korea is one place where we do see good prospects and we do have some reasonable volumes planted. The other one is Japan."

For several years now T&G has also been working with grower San Clemente in Chile to grow its proprietary varieties as well.

"I think in the early years we probably made a few mistakes in terms of site selection and more technical issues, but we feel in the last three to four years there’s been a lot of progress made getting the fruit quality right," he says.

"For us to expand our production base in South America we need to get to a point where we’re providing a uniform offering throughout the world.

"At the moment we have a cap set on our growth but we’re looking at that in future to release that as those technical outcomes start improving with crop, crop loading, all those kinds of things."

www.freshfruitportal.com

Subscribe to our newsletter