Presentation on theme: "ADC Africa Business Briefing Lord Charles Hotel 5 th March 2013 “An Overview of the Western Cape Fine Food Initiative”"— Presentation transcript:
ADC Africa Business Briefing Lord Charles Hotel 5 th March 2013 “An Overview of the Western Cape Fine Food Initiative”
"any substance or product, whether processed, partially processed or unprocessed, intended to be, or reasonably expected to be ingested by humans.” ….. EU Excludes: "(a) feed; (b) live animals unless they are prepared for placing on the market for human consumption; (c) plants prior to harvesting; (d) medicinal products within the meaning of Directive 65/65 (…); (e) cosmetics (…); (f) tobacco and tobacco products (…); (g) narcotic or psychotropic substances (…); (h) residues and contaminants." What is food?
Definition of Fine Food Fine Food products shall mean: “Foods and beverages that exemplify quality, innovation and style in their category” The Fine Food specialty nature derives from some or all of the following characteristics: Their originality, authenticity, ethnic or cultural origin, specific processing, ingredients, limited supply, distinctive use, extraordinary packaging or specific channel of distribution or sale. By virtue of their differentiation in their categories, such products maintain a high perceived value and often command a premium price. Adopted from NASFT National Association for the Specialty Food Trade
Clear Vision To guide the growth of the South African Fine Food (and related Agro-Processing) Industries toward achieving worldwide recognition as a supplier of premium products and brands
History Time lines 2008 Idea of an Association conceived at meeting at Blouberg’s Blue Peter Hotel Steering Committee Elected 2009:Strategic Planning Interim Board Elected Structure and Organisation 2010:Implementation, Project Management Section 21 Company, Constitution, Programs & Events identified 2011:Membership of 50 TOP FINE FOOD CO’S Sustainable, Self Funding Participate in Events (SATH, FFS) Appointment of CEO 2012:Series of Capacity Building Workshops Towards Full Corporate Governance Compliance Improved Strategic Partnerships 3-Year Budget AGM
Partnerships & Associates Western Cape Department of Economic Development & Tourism Supporter of WCFFI from inception – ongoing commitment Provides funding, people and facilitation support Strategic Partner in the spirit of a Public Private Partnership WCFFI Project Management, Project Planning, Funding CPUT – AFS Projects, events and progammes (Larry Dolley) South African Global Trade Hub – Funding, Export Development Government - DTI, SEDA, SETA, Agriculture, Embassies Development Agencies – USAID, NorAid, Swiss Contact, etc. Corporate SA – as Associate Members
OPERATIONAL & OVERSIGHT STRUCTURE Industry Development Officer Business Service Providers WCFFI Board Chief Executive Officer Admin assistant Shreef AbassChair Person Debbie PayneDeputy Chair Person Nazeem SterrasActing CEO Larry DolleyBoard Member Dingaan Goodwell Board Member Earl StarrBoard member Shelldon BredaBoard member Amina AbrahamsBoard Member
Objectives interests Manage, promote and protect the interests of the Fine Food Industry; links Create close links between suppliers, producers and retailers; training Share information on training provision to fulfill the needs of the organization; conducive environment Create a conducive environment for the development of the Fine Food Industry by means of a membership-based platform.
Promotion of services, operations and functions Promotion of services, operations and functions of the Fine Food Industry including procurement, processing, marketing, sales and distribution in respect of the products of the industry; food safety standards Promote the protection of consumers by adhering to international food safety standards and the Consumer Protection Act; innovative measures Promotion and implementation of innovative measures in line with local and international requirements; transformationcharter Adhering to the transformation charter by employing an affirmative approach to the industry
Improve Competitiveness in Supply Chain Identify Trade Opportunities, Trade shows & Trade missions Enterprise Development & Supplier Diversity (BEE) Market Access & Compliance Access to Business Finance, Funding & Risk Management Capacity Building, Mentorship & Incubator program Market Research & Market Intelligence/Information Workshops & Industry Applicable Events PROGRAMS, SERVICES & EVENTS
Horticultural Crops Field CropsLive StockForestry AGRO-PROCESSING SLAUGHTERINGBLENDINGMILLING MOLDING CUTTING FERMENTING Sugar Processed, value added meat & meat products Bakery & Confectionery Beverages Fresh, dried, canned & frozen fruits Processed, dried, frozen & canned vegetables Inputs for Bio-Fuels Inputs for Chemical products R&D TECHNOLOGY MARKETING INPUT SUPPLIES GOVERNMENT SUPPORT MULTINATIONALS LOGISTICS TRAINING & SKILLS DEV. MACHINERY QUALITY ASSURANCE INVESTORS RSA Agro-Processing Value Chain Matrix PACKAGING
Processed Products Fruit Flowers Eggs Vegetables Seed Oils Fuel Energy Waste Management Selected Sectors/Sub-Sectors Agri Business Fresh Produce Benefication Technologies Milling – Grains,Oilseeds Dehydrated Products – Soups, Sauces, Spices,Dried Fruit Non/Alcholic Beverages - Wine,Tea,Juice Canning – Fruit,Vegetables Meat – Poultry,Red.Wool
DEMAND SIDE Needs of target Group SME & CORPORATE SUPPORT SUPPLY SIDE Small, Emerging, Commercial Enterprises Large Agribusinesses & Commercial Corporations Manufacturing, Sorting, Packing Agro-Businesses Large commercial retailers, export & consumer markets Information Knowledge management Technology Advisory assistance Financial Assistance SME Infrastructure Training & Capacity Building Marketing& Business Development Six pillars of support
Existing Supplier that is Linkage Ready Potential Supplier that is Linkage Ready Company Diagnostic SME readiness/ Deficiency report Org & management improvements Accounting/MIS Quality assurance Certification (ISO) Product/ Production improvements Marketing strategy BEE certification Mentorship, coaching Business Service Providers provide support Periodic review of progress No progress REFER to STRATEGIC PARTNER Mobilise corporate support for SME supplier development Analyse corporation value and supply chains Identify and quantify linkage opportunities for SME suppliers SMEs engaged in accordance with corporation requirements INCREASED BUSINESS LINKAGES Strategise & plans for SME linkages & support to procurement practitioners Facilitate necessary support to build capacity SME readiness/ Deficiency report SUPPLY DEMAND
SME Product/supplier Market/Buyer Balance Dilemmas
Sense of Simplicity: Trend 1: Sense of Simplicity: - People nostalgic for simpler times, and simpler foods - Back to Basics has driven interest in natural and clean-label foods - Natural ingredients, including natural sweeteners extracted from source (apple, agave and maple syrup) - EU approval of the high-intensity natural sweetener stevia also looks close - The natural trend has been particularly evident in beverages: * 13% of global soft drinks launches in the first 9 months of 2009 period were positioned on a “natural” platform,dominated by bottled water and fruit drinks Sustainable Gathers Steam: Trend 2: Sustainable Gathers Steam: - Well-informed consumers looking for locally-sourced, fairly-traded products - The organic trend has flattened in the downturn - Fairtrade new product activity is continuing to rise * major confectionery companies Cadbury and Mars making fairtrade commitments - The notion of carbon footprinting also looks set for a move into the mainstream World food TRENDS
Inherent Nutrition Trend 3: Inherent Nutrition: - It is a tough time to be in the functional foods - Strict EFSA policies demanding scientific support for ingredients such as probiotics - Consumers increasingly skeptical of foods that fail to provide immediate benefit - Foods with traditionally perceived benefits (fruit, vegetables, milk) pushed further as inherent health benefits are communicated Functional Superstars: Trend 4: Functional Superstars: - The relatively few healthy ingredients have survived EFSA’s early rulings will move to the fore in functional foods - Others will be forced to rely on softer claims - With EFSA decisions thus far, it is difficult to predict exactly which ingredients will triumph, but tough times ahead for radical and obscure ingredients making outlandish claims. Going Immune : Trend 5: Going Immune : - Swine flu fears have fuelled a demand for immunity boosting products - Expect ingredients (probiotics, various antioxidants) to be marketed on this - Manufacturers will have to be careful overdoing claims (E.g. Danone has found itself in trouble with the Advertising Standards Authority UK over claims that its Actimel probiotic drinks could help support children’s defences and Kellogg’s has already dropped an immunity claim it was using on Rice Krispies in the US)
World food TRENDS New Delivery for Energy Trend 6: New Delivery for Energy : - “Energy” is the hot concept in functional foods - Stimulating ingredients are used in new applications - Energy shots, essentially US concept, now well and truly arrived. - The “energy” concept increasingly hot in confectionery product activity, E.g chewing gum “Free From” Rises: Trend 7: “Free From” Rises: - Move toward more “gluten-free” and other “free-from” foods - Focus more on taste and quality - High-quality brands are positioned as “easy to digest,” - At ANUGA : a product formulated with konjac gum addressing needs of seafood allergie indicating that previously untapped markets are now starting to be addressed. Continuing to Cook at Home: Trend 8: Continuing to Cook at Home: - Grocery retailing enjoying a boom in both budget and high-end products - While………….. the mid-sector is squeezed (majority of consumers) - One of the catchphrases “Staying in is the new going out” - Despite some indications of “green shoots of recovery” on the horizon, consumers do not have the confidence to foresee complete economic recovery as yet - Foodservice will continue to struggle…: Consumers continue to rediscover their cooking and entertaining skills.
Development Profiles for 2013 Ingredients black garlic, padron chile, horseradish, quail eggs, durian, ramps, pine needles, fish milt, whey, seaweed, ashes, sawtooth herb, green chickpeas, kimchi, fermented everything Flavors dukkah, sumac, sour, torridly hot, smoked, turmeric, barrel-aged hot sauce, gochujang (Korean hot sauce), Japanese katsu sauce Vegetables center of the plate, sunchokes, raw winter vegetables, cauliflower, broccoli romanesco, parsley root, chiogga beets, pumpkin, baby sweet potatoes, turnip greens, beet tops, collards. Fruit cherries, baobab, huckleberries, finger limes, calamondin, rambutan, heirloom apples, grapefruit, white strawberries Grains freekeh, farro, bulgur, noodles (udon, soba, cellophane, rice), millet, teff, buckwheat Desserts Doughnuts, artisanal soft serve, push-pops, savory flavors, boozy desserts Drinks Tea (the new coffee?), coconut water Snacks popcorn, homemade snacks, popped grains Authentic Ethnic Nordic, Middle Eastern (my favorite!), Asian, Nex Mex (high-end Mexican), South American (Brazil, Argentina, Peru)
Overcoming export barriers for South African SME's TRADE AGREEMENTS: DOHA Round suspended EU local import duties waived Free Trade Agreements signed with Mexico (2000) & Chile (2003) Generalised System of Preferences (GSP) in place Negotiating Bi-Lateral Trade Agreements with Brazil and India….and others (not RSA) FOOD SAFETY LEGISLATION New impetus after 1990’s food scares General Food Law – placing responsibility with the industry HACCP, BRC, GlobalGAP, EurepGAP, Nature’s Choice, Fairtrade Stronger role for European authorities STRICTER FOOD LAWS Contaminants, including MRL’s Labeling & Consumer Alertness (allergens, nutritional & health claims) Additives & Flavouring Full Ingredient Statements Organic Foods Genetically Modified Foods (GMO’s) Preservatives (Long-Life stabilisers)
Growing control of LARGE Retailers Concentration in buying power Demand for high level of professionalism of the producers, food safety programs, continuity, volume, competitive pricing, marketing support Chain control from seed to shelf/field to fork
Value Chain Analysis ParticipantRole/ContributionBenefits/Interest Retailers (PnP, Spar, FreshMark, Whole Foods, Tesco, Woolworths) 1.Merchandising of produce; 2. Channel products to satisfy consumer demand 3. Producer Support 1. Competitive Pricing, Compliance, New Market Development; 2. Consolidation of diverse primary and value added produce for the end consumer Traders (Exporters, LMA, NMA,etc ) 1. Market Linkage and contracting, Market Intelligence; 2. Procurement 1. Product consolidation 2. Competitive pricing and information 3. Creation of markets 4. Satisfy market demand by accessing certified, traceable products. Wholesalers (Massmart, Fresh produces markets, etc) 1. Provide storage, distribution network and logistical support 1. Easy access for marketing agents and consumers 2. Act as a distribution hub Processors (Millers, Dehydrators, Canneries, Packhouses) 1. Value addition to primary products 2. Provide market for the raw products 1. Diversification of markets for primary products 2. Gaining Economies of Scale and gaining access to a large pool of suppliers Increasing market demand for the value added product Transporters/ Contractors 1. Provides Logistical support and supply chain management 1. Creation of competitive advantage ( cost efficiency and timeous supply of produce) 2. Provide efficient cartage services 3. Provides mechanization Producers (Karos, Seloane, Nwanedi Tomatoes, Nkuna) 1. To produce quality, secure and traceable products 1. Satisfy market demand, compliance to local and international standards 2. Improve efficiency of production 3. Creation of vibrant agricultural sector 4. Generating Sales, and Sustainable Income Input Suppliers (Sasol, Panaar, Intervet, Kynoch, Agricol, Du Roi etc) 1. Supply seeds, fertilizers, medicine, pesticides, energy to the producers, R&D, etc. 1. Increased producer base 2. Bulk supply of certified input Improve the volume and efficiency of agribusiness
Value Chain – Supporters and Influencers ParticipantRoleBenefits/Interest Government Capacity building and policy 1. Leverage additional capacity for skills improvement 2. Increase BBBEE participation NGO's (Land'o Lakes, Limdev, FAMU, Technoserve, UFF, etc) Networking, lobbying and advocacy 1. Leverage additional capacity for skills improvement Increase SME participation National Business Chambers Leverage with large corporates 1. Increased BEE & Corporate participation 2. Increased BEE participation 3. Diversify supply and sales to corporates Financial Institutions IDC, Dev & Com Banks Provide access to finance and risk mitigation strategies 1. Deal flow 2. Access to government facilities 3. Access to CAPEX 4. Access to production finance 5. Access to large pool of BEE SMEs, 6. BEE complicity Business Consultants & Service Providers Business plans; Training; Capacity building; Mentor-ship Capacity building Donor Agencies (USAID) Funding, Lobbying, Advocacy, Credibility 1. Leverage, influence, trade opportunities, Poverty reduction, growth, business opportunities, job creation. Dev Agencies (GEDA, GEP, TIL, TIKZN, TISA) NDA, SEDA CEF Policy implementation and process support 1. Increase the number of SME participating 2. Improve the environment in which SME operates Capacity building of SME to ensure implementation of government policies & strategy
Complicated Value Chain in South Africa CHANNEL 1: SMALL/SURVIVOR CHANNEL 2: EMERGING & COMMERCIAL CHANNEL 3: LARGE CORPORATIONS Nurseries Large Vertically Integrated Farmers Small Holders Bakkie Trade Informal Traders Commercial Farmers Large Pack House Facilities Export Marketing Agents Municipal & Fresh Produce Markets Processed Products Grower Self Export & General Marketing Large Retail Stores Direct Stores Product Export Markets Juiced/Canned Dried/Processed Product Local Markets Commercial Pack Houses RetailingWholesaling Packaging PROCESSING Sorting Producing CONSUMER MARKETS Root Stocks /Trees
Clear Business Strategic Position for SME Competitiveness Price relative to competitorsAbove Average Product QualityPremium Product QualityPremium Brand ImageHigh Profile Brand Image High Profile Uses of Cost-chain RebatesMedium/High (Economies of Scale) Uses of Cost-chain Rebates Medium/High (Economies of Scale) Overall Business StrategyBest Cost/ Overall Business Strategy Best Cost/ Premium Quality Premium Quality Service to CustomersSuperior Service to Customers Superior
Key Success Factors Attunement to market signals, incentives, value chain intelligence, competitors, regulatory, policy and compliance frameworks and specifications; consumer habits; patterns and trends Adaptability to market, technological systems, process, cultural, ecological shifts, trends and standards Alignment of capability, systems, instruments and processes, research and development to mast benchmarked globally competitive factor conditions and productivity levels. …SCM Participation in trade shows, co operative shipping and group representatives Sharing knowledge, logistics, contacts without sharing IP
WHAT YOUR WCFFI MEMBERSHIP MEANS TO YOU Access to Sector Information & Knowledge Management Food Industry Service Providers (Database) Programs covering Capacity Building and Skills Transfer; Best Practices; Innovation & Technology; Market Development, Research & Intelligence; Enterprise Development & Competitiveness; Preferential Market Access & Export Promotion; Value Chain rebates …..Economies of Scale. Trade Shows, Trade Missions, Trade Exhibitions (with Partners) In the Future…….E-commerce opportunities…….AND MORE!!!! SIGN UP NOW!!!