New markets don't just pay better prices than the European Union, they're also less strict when it comes to food safety. Importers like Total Produce notice that, Michel Jansen said yesterday at the opening of Brightbox in Venlo. Growing trade barriers play a part.
Importers
Jansen notices that Europe's position has changed. "Europe has a harder time competing with international markets," he says. "Not only are new markets able to pay better prices, but we also have quite a few demands when it comes to food safety." That's playing a part, now that competition has changed. "25 years ago, we competed with importers from Rotterdam and Barendrecht, 15-20 years ago with the Britons. Now it's importers in China, Ecuador and Oman," he says. But there's more to it, both in import and export. Jansen sees growing trade barriers. "In Brussels, there's a struggle for South African citrus. Plant diseases are a problem. You also see it in the situation with Russia. Trade barriers hadn't been a problem for a long time, but we're seeing them grow again."
Michel Jansen, Total Produce
Retail
Retail also takes up an important position when talking about the changes in the fruit and veg sector. "70, 80, sometimes even 90% of fruit and veg is sold through retail. When you know there are five large chains on the German market that have the power, you'll understand that they can be seen as dominant, powerful and demanding." But retail isn't in a comfortable position either. In non-food, newspapers are reporting on struggling companies. "The middle segment in particular is struggling. The bottom of the market is gaining thanks to a focus on price, the top, thanks to the focus on certain consumer groups. That's also the case in food retail," Jansen says. "Tesco, Carrefour and Albert Heijn are having a difficult time. Their market share is under pressure from aggressive competitors like Lidl and Aldi, but also Jumbo."
Jansen emphasizes that retail isn't homogeneous. "There are as many strategies as there are retailers. Some focus on price, others on offering a complete range. Some work with central procurement, others with decentralized procurement." The way in which retailers try to get the lowest price also varies. "Some retailers try to enforce the lowest price very centrally by playing parties off against each other," Jansen says. "Other parties, like Lidl, do things differently by looking for efficiency in the chain." As many strategies as there are retailers – but what they have in common is that they try to buy as cheaply as possible, trying to use their power there. That's why Jansen can also understand that growers have the feeling they're being milked by these organizations. "That has to do with proportions." The search for efficiency is also found everywhere. Anything that doesn't have value, goes out. Thirdly, retailers are also looking for distinctiveness.
Distinctiveness
In that search for distinctiveness, there are opportunities for Dutch horticulture. To illustrate this, Jansen looks back to the Dutch textile and shoe industry. "Forty years ago, the Netherlands was also a production country. But when you look at the efficiency in China, it's clear that trying to realize productivity in the Netherlands is a mission impossible." Jansen points out shoe manufacturers like Van Bommel and Greve. They opted not to focus on productivity, but on distinctiveness, marketing and consumer demand. "I think that's where these parties are successful. Focusing on mass production is a dead-end street for the Netherlands."
Distinctiveness
In that search for distinctiveness, there are opportunities for Dutch horticulture. To illustrate this, Jansen looks back to the Dutch textile and shoe industry. "Forty years ago, the Netherlands was also a production country. But when you look at the efficiency in China, it's clear that trying to realize productivity in the Netherlands is a mission impossible." Jansen points out shoe manufacturers like Van Bommel and Greve. They opted not to focus on productivity, but on distinctiveness, marketing and consumer demand. "I think that's where these parties are successful. Focusing on mass production is a dead-end street for the Netherlands."
Read more about the opening of the BrightBox here
Pull and push market
Along the same lines is the change from a push to a pull market. According to Jansen, horticulture is a push market: production made what they thought the market wanted, and that was pushed on the market. "That's also a dead-end street. The only argument you have is price. If you're facing a powerful party, there's not much you can bring to the table." The pull market, on the other hand, has the customer's wishes as its starting point. "And how you can respond to that as horticulture. Today's trends," Jansen says, although that's also something retailers are struggling with. As examples he gives themes like flavour, health, convenience, interactivity, entertainment, exclusivity, but also sustainability and quality marks. "That won't go anywhere. Don't see it as limiting, but view them as opportunities."
Things like a Brightbox, where cultivation can take place without daylight in a fully controlled climate, contribute to that. "You can go for specialities instead of commodities, opt for specific products if that's what the market wants. And managing flavour with the light recipes also offers opportunities. You're cultivating more for demand rather than supply." The Brightbox also highlights the change Dutch horticulture needs to make. "Not mass production, but selling expertise."