Retail
"We have been working with retailers since 2000 and things have gone very smoothly. We rented a warehouse and slowly began supplying supermarkets. Around 75% of our profits now comes from supermarkets and the rest through delivery to traditional markets or re-exporting. Our main countries for export are the Baltic states, White Russia, The Ukraine, and Russia. Fresh World International also export local fruit and vegetables to the European Union." Fresh World supply many well know supermarket chains including Tesco, Biedronka, Kaufland, Auchan and Carrefour. Erik explains that relationships with supermarkets are different to how it was twenty years ago. "We were on our own then and we had something to say but now that is not the case. There is a lot of competition from large Polish growers who deliver directly to supermarkets. Retailers expect us to provide more service, such as packaging and stickers, but don't want to pay for it, so it is sometimes difficult to work out what is the best way forward. We definitely want to invest in the future with new product lines or possible extensions, but some parties react erratically and do not make long-term arrangements."
Erik van Vugt
Lead
He says that they were the first to trade in a western manner. "We also had a big lead, but it only lasted a few years. We invested in many things, such as modern infrastructure and a packing station, but more competition always followed. Due to the increasing competition and supermarkets buying directly, the last few years have been increasingly difficult. The 80 million Euro turnover for 2013 was a nice result. On average we do 2000 pallets a week."
Low prices
He says that prices of most products are at a lower level than in The Netherlands. "You notice that it is still one of the poorer countries in Europe, but the economy is growing. The difference with other European countries gets smaller each year and supermarket prices are also lower. There are also promotions with Dutch products but Poles don't really appreciate them. Local produce is valued more, which is the case in every country."
Russia
Fresh World have been exporting for four years. "I believe that there are opportunities to grow, but you can also see how precarious the situation is at the moment. The whole situation with The Ukraine will change things, but we don't know how and Russia can be very difficult. More than half of Polish apples go to Russia and if the border closes it will be very difficult. If things had stayed the same in 'the Crim' then maybe it would be ok but they are again being difficult with the border. Poland is very sensitive to land grabbing so they are very supportive to The Ukraine, but if you shout too loudly Russia can be very strange."
"Should the Polish fruit and vegetables sector no longer supply Russia, then that will be difficult for everybody. Polish apples are cheap, but they would be even cheaper. A lot of tomatoes also go to Russia. If Russia continue as normal and keep eating them then there will be no problem; Russian supermarkets are very hungry. However if a ban occurs then Poland will go to Western Europe and that will lead to a tricky situation, added to by them offering cheaper products than The Netherlands and Belgium. We don't know what is going to happen. It is a tense situation."
Apples
In recent years apple production in Poland has grown enormously. "And not only the production, but also in quality," explained Erik. "There has been giant investment through subsidies, and those new buildings are, of course, not going away. Poland has all the same modern technology which can be found in The Netherlands and Belgium and they are very professional. Quality is generally good and they have nothing more to learn. In my opinion Dutch and Belgian apple growers should forget about Russia. It is also becoming more difficult with the Baltic States where they are produced for half the price and you can't beat that. The Dutch may have a leg up with their varieties but in 5 years that will be over."
Pears
According to Erik pears have always been the neglected child and lots are imported. "We have also invested heavily, production is growing by 30% a year and we have also noticed how prices have increased. It is not as easy to grow them here because sometimes there are night frosts in March and April, though in recent years, that has not happened as much. It is already a few years since we had a really hard winter, before it was not uncommon to have two months of snow. So I see a growth for pears but apples are still better and it will get tougher for The Netherlands."
Tomatoes
According to Van Vugt the pepper is one of the few products grown in The Netherlands which sells well in Poland. "They don't use greenhouses for them here, just tunnels, and the season begins at the end of June. We have now stopped with those from Spain and Israel and will have Dutch peppers for the next three months, which still sets The Netherlands apart." Along with apples and pears, Poland are also strong in tomatoes. "The season is later but that doesn't really matter, there are greenhouses full. Tomatoes are cheapest here in July and August." He remarks that in Poland there are a few large tomato growers with areas covering 20 to 40 hectares. "Those are companies who supply supermarkets directly. They have many varieties, from small to large. One popular variety is the pink tomato, the Malinova. I think that production this year is a quarter of the total. There has also been a growth in plum tomatoes." He thinks the tomato situation in The Netherlands is unhealthy. "The market is artificial, people continue producing because it costs less if you go bankrupt. The Rabobank is the largest grower in Westland. Even the Poles don't stop with production here and grow for less. The ground, workers and transport are cheaper."
Future
For Poland the crisis was mild. "I think that the difficult period is now over and we can get back to business. Poland will grow and will focus on home and abroad. The supermarket situation remains difficult, but we will find a way through," he concludes.
For more information:
Erik van Vugt
Fresh World Int. Sp. z o.o.
ul. Świerkowa 3A, Bronisze
05-850 Ożarów Mazowiecki
Polska
tel.: +48 22 33 76 200
fax: +48 22 33 76 222
info@freshworld.com.pl
www.freshworld.com.pl