Changes in the banana businessRobert Wells, CEO at SH Pratt Group grew up in the banana business and took over the company from his father. He explains some of major changes over the years, "One change is the way the fruit is shipped, it is now all palletised which reduces handling. This change came about just as we were building the current Luton site, it was good timing for us as we were able to make sure it was able to handle the pallets.
"The dismantling of the import regime, was another big change. Before this, the import licences were in the hands of a few big importers or people who had gone out of business and for companies like Pratt's who were growing it was very difficult. At that point retailers also changed how they sourced bananas, instead of using importers they went right back down the chain and sourced straight from the growers."
38 loads of green bananas arrive every day, 7 days a week
Now Pratts act as a service provider for the retailers, looking after the bananas from the port until they arrive at the stores.
"We run two businesses here," explains Robert. "One as a service provider and one as a traditional importer. Five years ago our main customer, Tesco, changed from the traditional model where we sourced fruit for them and had it shipped to the UK, to sourcing it themselves. I think that at that point we lost a lot of our sourcing responsibilities and we are now rebuilding those responsibilities for our other customers. At the time it was a big decision to move to just being their service provider and we had to make a quick decision. It was tough, but I am glad I took it."
10 from every 1000 boxes are check for quality
The end of banana boxes?
At the moment bananas are packed straight into banana boxes which reduces handling, but Robert believes this may change to plastic crates in the future. It was tried before but commercially it wasn't that good but technically it worked, according to Robert the commerce side needs to be worked out then it may happen.
There are fears that the Cavendish banana will eventually die out from disease and at the moment there is no replacement variety for it. Robert believes that if it gets to that point the industry will find something to replace it. "Good, strong growers don't have a problem with disease. There is too much value in bananas to let them die out.
Each ripening room can be controlled from here, the display shows the ripeness in each cell
Diversifying supply
Pratt's diversify their sources to limit risk, but also not all countries have what is required. "Costa Rica don't have a great deal of Fair Trade or organic bananas, where as the Dominican Republic do," explains Robert. "Also the UK market has a strong demand for small fruit which you will not find in Ecuador, but in the Caribbean."
He does not see Asia as a potential source as it is too far away and doesn't provide anything which the traditional countries don't. Also the traditional South America countries have been growing bananas for years and have great set ups.
Climate change"El Ninio has effected supply but, according to Robert, it has not totally destroyed it. It is just parts of individual countries which have been affected. He admits that it is problematic but not a disaster.
Competition
"We just have to make sure we are leaner and fitter than the rest, obviously bigger companies can make use of economies of scale, but there is no great difference in shipping costs."
Fair Trade: a necessity or sales gimmick?
"I think any retailer in this country felt until recently, that it had to have a Fair Trade line. If you go back a few years Fair trade was used to help direct the industry to promote good working practices, but now there is so much being done to protect worker's conditions. Retailers work directly with growers to ensure that working conditions are good, they get paid a fair wage and work in safer conditions. There are people who want Fair Trade bananas, but I don't think retailers necessarily need it in the same way that they used to."
Logistics
Logistics is a big growth area for Pratts, they have increased the fleet and undergone rebranding.
"I have always believed that it is an important part of the business, bananas are a volatile product and there is always big pressure to deliver the fruit at just the right quality. Having your own transport means you can keep control. We are now moving it on to the next level and although bananas have priority, they only account for 50% of what is carried in our vehicles.
If there are any quality issues the bananas are graded and repacked
Brexit and currency
"The pound is going to give us some headaches as it is low against the Dollar at the moment. It is an issue for any fruit importer to the UK in the coming months. It is a volatile situation and we don't really know what will happen. Voting to leave the EU was a surprise, and the effect on currency is difficult but will need to be reconciled.
"We have a lot of non UK workers so Brexit is a concern, but we have not been short of labour in the 20 years we have been here. We need to be a good employer and I think we will keep the workers we have and support them where possible."
Samples are kept in case of quality issues
History
Robert took over the business from his father, who started the banana ripening business around 1960. It was previously based in Kings Langely, in a rented warehouse by the railway as at that time bananas were delivered by train from the docks. They then moved to Hemel Hempstead and eventually to the current site in Luton around 20 years ago, when they out grew the premises. The Luton site was built especially for banana ripening and has room for expansion. Logistically the Luton site is well placed, right next to the M1 with a good north/south connection, also Luton is an old industrial town which lost a lot of its industry and has a great source of labour.
Simon Bianci - Head of operation has been with the company for 28 years
The loading bays, after the bananas have been ripened they are put on truck and sent around the country. 200,000 boxes a week leave here. When the photo was taken work was done for the day, but at 6am there are 160 people at work.
For more information:
Robert Wells
SH Pratt Group
Tel: +44 1582 436511
Email: robertwells@shpraatgroup.uk
www.shpraatgroup.uk