adc africa business briefing lord charles hotel 5 th march 2013
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ADC Africa Business Briefing Lord Charles Hotel 5 th March 2013 “An Overview of the Western Cape Fine Food Initiative”. What is food?. "any substance or product, whether processed, partially processed or unprocessed, intended to be, or reasonably expected to be ingested by humans.” ….. EU - PowerPoint PPT PresentationTRANSCRIPT
ADC Africa Business BriefingLord Charles Hotel
5th 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 NASFTNational 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 lines2008 Idea of an Association conceived at meeting at Blouberg’s Blue Peter Hotel
Steering Committee Elected
2009: Strategic Planning Interim Board ElectedStructure and Organisation
2010: Implementation, Project ManagementSection 21 Company, Constitution,Programs & Events identified
2011: Membership of 50 TOP FINE FOOD CO’SSustainable, Self FundingParticipate in Events (SATH, FFS) Appointment of CEO
2012: Series of Capacity Building Workshops Towards Full Corporate Governance ComplianceImproved Strategic Partnerships3-Year Budget AGM
Partnerships & AssociatesPartnerships & AssociatesWestern Cape Department of Economic Development & TourismSupporter of WCFFI from inception – ongoing commitmentProvides funding, people and facilitation supportStrategic Partner in the spirit of a Public Private PartnershipWCFFI 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 SACorporate SA – – as Associate Members as Associate Members
OPERATIONAL & OPERATIONAL & OVERSIGHT STRUCTUREOVERSIGHT STRUCTURE
Industry Development Officer
Business Service Providers
WCFFI Board
Chief Executive Officer
Admin assistant
Shreef Abass Chair PersonDebbie Payne Deputy Chair PersonNazeem Sterras Acting CEOLarry Dolley Board Member
Dingaan Goodwell Board MemberEarl Starr Board memberShelldon Breda Board memberAmina Abrahams Board Member
ObjectivesObjectivesManage, promote and protect the interestsinterests of the Fine Food Industry;
Create close linkslinks between suppliers, producers and retailers;
Share information on trainingtraining provision to fulfill the needs of the organization;
Create a conducive environmentconducive environment for the development of the Fine Food Industry by means of a membership-based platform.
Promotion of services, operations and functionsPromotion 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;
Promote the protection of consumers by adhering to international food safetyfood safety standardsstandards and the Consumer Protection Act;
Promotion and implementation of innovative measuresinnovative measures in line with local and international requirements;
Adhering to the transformationtransformation chartercharter 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 & EVENTSPROGRAMS, SERVICES & EVENTS
LOGISTICS TRAINING & SKILLS DEV. MACHINERY QUALITY ASSURANCE INVESTORS
RSA Agro-Processing Value Chain Matrix
Processed Products
FruitFlowersEggsVegetables
Seed OilsFuel EnergyWaste Management
Selected Sectors/Sub-SectorsSelected Sectors/Sub-Sectors
Agri Business
Fresh Produce Benefication Technologies
Milling – Grains,OilseedsDehydrated Products – Soups, Sauces, Spices,Dried FruitNon/Alcholic Beverages - Wine,Tea,JuiceCanning – Fruit,VegetablesMeat – Poultry,Red.Wool
DEMAND SIDE
Needs of target GroupNeeds of target Group
SME & CORPORATE SUPPORTSME & CORPORATE SUPPORT
SUPPLY SIDE
Small, Emerging, Commercial Enterprises
Small, Emerging, Commercial Enterprises
Large Agribusinesses & Commercial Corporations
Manufacturing, Sorting, Packing Agro-Businesses
Large commercial retailers, export & consumer markets
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Trai
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Six pillarsof 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 progressNo progress REFER to
STRATEGIC PARTNER
SMEs competent to bid and deliver on standards required by large corporations
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
SMESME
Product/supplier
Market/Buyer
BalanceBalance
DilemmasDilemmas
Trend 1: Sense of Simplicity: 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
Trend 2: Sustainable Gathers Steam: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 TRENDSWorld food TRENDS
World food TRENDSWorld food TRENDSTrend 3: Inherent Nutrition 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
Trend 4: Functional Superstars: 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.
Trend 5: Going ImmuneGoing 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 TRENDSWorld food TRENDSTrend 6: New Delivery for EnergyNew 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
Trend 7: “Free From” Rises:“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.
Trend 8: Continuing to Cook at Home: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 Development Profiles for 2013 Ingredientsblack garlic, padron chile, horseradish, quail eggs, durian, ramps, pine needles, fish milt, whey, seaweed, ashes, sawtooth herb, green chickpeas, kimchi, fermented everythingFlavorsdukkah, sumac, sour, torridly hot, smoked, turmeric, barrel-aged hot sauce, gochujang (Korean hot sauce), Japanese katsu sauceVegetablescenter of the plate, sunchokes, raw winter vegetables, cauliflower, broccoli romanesco, parsley root, chiogga beets, pumpkin, baby sweet potatoes, turnip greens, beet tops, collards.Fruitcherries, baobab, huckleberries, finger limes, calamondin, rambutan, heirloom apples, grapefruit, white strawberriesGrainsfreekeh, farro, bulgur, noodles (udon, soba, cellophane, rice), millet, teff, buckwheatDessertsDoughnuts, artisanal soft serve, push-pops, savory flavors, boozy dessertsDrinks Tea (the new coffee?), coconut waterSnackspopcorn, homemade snacks, popped grainsAuthentic EthnicNordic, Middle Eastern (my favorite!), Asian, Nex Mex (high-end Mexican), South American (Brazil, Argentina, Peru)
Overcoming export barriers for Overcoming export barriers for South African SME'sSouth African SME's
TRADE AGREEMENTS: DOHA Round suspended EU local import duties waivedFree Trade Agreements signed with Mexico (2000) & Chile (2003)Generalised System of Preferences (GSP) in placeNegotiating Bi-Lateral Trade Agreements with Brazil and India….and others (not RSA)
FOOD SAFETY LEGISLATION New impetus after 1990’s food scaresGeneral Food Law – placing responsibility with the industryHACCP, BRC, GlobalGAP, EurepGAP, Nature’s Choice, FairtradeStronger role for European authorities
STRICTER FOOD LAWSContaminants, including MRL’sLabeling & Consumer Alertness (allergens, nutritional & health claims)Additives & FlavouringFull Ingredient StatementsOrganic FoodsGenetically Modified Foods (GMO’s)
Preservatives (Long-Life stabilisers)
Growing control of Growing control of LARGE RetailersLARGE 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 AnalysisValue Chain AnalysisParticipant Role/Contribution Benefits/Interest
Retailers (PnP, Spar, FreshMark, Whole Foods, Tesco, Woolworths)1.Merchandising of produce;2. Channel products to satisfy consumer demand3. 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 consolidation2. Competitive pricing and information3. Creation of markets4. 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 consumers2. Act as a distribution hub
Processors(Millers, Dehydrators, Canneries, Packhouses)1. Value addition to primary products2. Provide market for the raw products
1. Diversification of markets for primary products2. Gaining Economies of Scale and gaining access to a large pool of suppliersIncreasing market demand for the value added product
Transporters/ Contractors 1. Provides Logistical support and supply chain management1. Creation of competitive advantage ( cost efficiency and timeous supply of produce)2. Provide efficient cartage services3. 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 standards2. Improve efficiency of production3. Creation of vibrant agricultural sector4. 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 base2. Bulk supply of certified inputImprove the volume and efficiency of agribusiness
Value Chain – Value Chain – Supporters and InfluencersSupporters and Influencers
Participant Role Benefits/Interest
Government Capacity building and policy 1. Leverage additional capacity for skills improvement2. 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 participation2. Increased BEE participation3. Diversify supply and sales to corporates
Financial InstitutionsIDC, Dev & Com BanksProvide access to finance and risk mitigation strategies 1. Deal flow2. Access to government facilities3. Access to CAPEX4. Access to production finance5. Access to large pool of BEE SMEs, 6. BEE complicity
Business Consultants & Service ProvidersBusiness 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 CEFPolicy implementation and process support 1. Increase the number of SME participating2. Improve the environment in which SME operates Capacity building of SME to ensure implementation of government policies & strategy
Complicated Value Chain Complicated Value Chain in South Africain South Africa
CHANNEL 1:SMALL/SURVIVOR
CHANNEL 2:EMERGING & COMMERCIAL
CHANNEL 3:LARGE CORPORATIONS
NurseriesLarge Vertically Integrated
Farmers
Small Holders
BakkieTrade
Informal Traders
Commercial Farmers
Large Pack HouseFacilities
Export MarketingAgents
Municipal & Fresh Produce Markets
ProcessedProducts
Grower Self Export&
General Marketing
Large RetailStoresDirect Stores
ProductExport MarketsJuiced/Canned
Dried/ProcessedProduct
Local Markets
Commercial Pack Houses
Retailing Wholesaling
Packaging
PROCESSINGPROCESSING
Sorting
Producing
CONSUMERCONSUMERMARKETSMARKETS
Root Stocks /Trees
Clear Business Strategic Position for Clear Business Strategic Position for SME CompetitivenessSME Competitiveness
Price relative to competitorsPrice relative to competitors Above Above AverageAverage
Product QualityProduct Quality PremiumPremium
Brand ImageBrand Image High ProfileHigh Profile
Uses of Cost-chain RebatesUses of Cost-chain Rebates Medium/High Medium/High (Economies of Scale)(Economies of Scale)
Overall Business StrategyOverall Business Strategy Best Cost/Best Cost/ Premium Premium
QualityQuality
Service to CustomersService to Customers SuperiorSuperior
Key Success FactorsKey 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
Membership Application Process Flow
Fail
Pass
Fail
Pass
Fail
Pass
Application for WCFFI Membership
Obtain & Check
Application in Office
CEO Submit for Authorisation
Conduct Onsite Assessment
(Accredited BSP’s)
Board Approve
Application
Conduct Initial Audit/Assessment - Desktop
Review Results/Membership Criteria Satisfaction
Board Accepts/
Rejects
Approval Process
(Letter, Unique Member No, etc)
Issue Certificate & Logo Usage Guidelines & Website Access
Codes
Issue Member with Copy of Constitution
Member Toolkit/Folder
(Events Calendar, Vouchers, etc)
Send Pre-Approval and Member Criteria
Basic Corrective Actions/Missing documents
Serious Corrective Actions
& Interventions
WHAT YOUR WCFFI MEMBERSHIP
MEANS TO YOUAccess 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!!!
Thank You