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Lesage Champignons buys out Champi-Fresh

"Takeover means we can spread the risk in these very tough times"

Lesage Champignons has taken over all Champi-Fresh's business activities. In these tough times for mushroom cultivation, this Belgian company saw enough advantages to make the move. "It also allows us to spread some of our risks," begins Michel Lesage.

"The acquisition came about when, in the summer, Champi-Fresh indicated it would be shutting down entirely. We'd been in contact before, but when that happened, we quickly made a deal to incorporate all their activities into our company. They also had a very nice client portfolio, which certainly piqued our interest."

"We're well represented locally, but Champi-Fresh's customer base gives us access to areas like Germany and Wallonia. You can't go wrong with a little risk diversification in times like these. We soon decided to continue business one-on-one, which we did," says Michel.

That caused a bit of chaos for Lesage Champignons, especially initially. "The immediate demand was quite surprising, and we had to pull out all the stops to get things on track in the short term. We wanted everything to run as smoothly as possible for those extra buyers so they'd notice little of the transition. I think our hard work helped us achieve that successfully. We had little experience with that at that point, but I think it was a fun puzzle that's now falling into place very nicely."

Nearly unavoidable price increase
The takeover comes at a time that many mushroom growers find extremely challenging. "That obviously applies to us too. There are increased transportation, raw materials, and especially energy costs," continues Michel.

"Those are putting intense pressure on the market. No one has ever experienced anything like this; the production cost rise is almost insurmountable. It's genuinely a matter of surviving month to month."

"What saves us is the high demand for mushrooms. We grow white and chestnut mushrooms, which are relatively inexpensive and extremely healthy products. As we enter fall, these remain very popular. People are increasingly counting their pennies, and mushrooms are a perfect, nicely-priced meat substitute or healthy vegetable," explains Michel.

Despite this popularity, these are worrisome days for the entire industry. "Volume-wise, it's definitely going well, but margin-wise it's very dramatic. With all the increased costs, we're quickly reaching more than €0.50/kg that we have to add. That creates such tight margins that most companies are almost at the end of their ropes. Something has to happen, and soon."

A punnet of mushrooms for €0.10 to €0.15 more?
According to Lesage, the solution lies mainly in careful energy and raw material usage. "Alternative energy sources aren't possible. Everyone has systems you can't replace that easily. We, and our customers, have to find constructive solutions. Fortunately, they're willing to brainstorm with us."

"For example, supermarkets marking their mushrooms punnet prices up, just a little, would be most welcome. Shoppers won't balk at a €0.10 to €0.15 increase, but it would mean a world of difference to us. Our neighboring countries have already adjusted those prices; that has to start happening here, too, to save the sector."

"Luckily, mushrooms are in the right corner regarding health and prices, which means that on the demand side, we have absolutely nothing about which to complain. I hate to think what it's like for greenhouse growers of more expensive produce, which consumers are now abandoning. Mushrooms indeed have a bright future; those in the sector just have to survive to see it," Michel concludes.

For more information:
Michel Lesage
Lesage Champignons
79 Kervijn Street
8531, Harelbeke, Bavikhove, Belgium
Tel: +32 (0) 567 12 288
Email: info@lesagechampignons.be      
Website: www.lesagechampignons.be      


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