Morrisons has revamped its South African supply arrangements as it steps up its global direct sourcing policy.
The supermarket has been sourcing citrus this year on a trial basis through Global Pacific Produce’s (GPP) new South African division, which was set up in March 2010. It now plans to roll out sourcing of new season stonefruit, grapes, apples and pears via the group, which is based in the US and has offices in the UK, Spain, France and Chile.
Some industry insiders claim the move is a reaction by Morrisons to direct sourcing initiatives instigated by Asda and Tesco. However, others argue it is a natural extension of Morrisons’ long-established direct supply approach, with the supermarket already operating a largely integrated supply chain.
Rory Antrobus, managing director of GPP in South Africa, said: “The advantage of GPP is you are cutting out the UK importer/facility. It’s a direct to depot route that Morrisons wants to develop in South Africa. We have started off from scratch and [Morrisons] are looking to challenge Asda and Tesco.
“But you can’t do everything by direct sourcing and their intention is not to work only with Global Pacific.”
Antrobus said there was “no plan at this stage” for Morrisons to take over Global Pacific in a similar way as Asda did with International Produce.
As part of the switchover to GPP, Morrisons dumped Colors Fruit as a source of top fruit and citrus in the last fortnight, following its decision in August no longer to take grapes from the supplier. Colors is, however, continuing to supply Morrisons with stonefruit, according to the company’s Riaan van Wyk.
“Morrisons’ different strategy with Global Pacific is working very well for them and they want to continue to work with that,” van Wyk said.
Another source said Morrisons was looking for “more than good fruit and great service” in South Africa and was keen on extending its vertically integrated supply chain. But he also stressed that the model was not exactly the same as those of Asda and Tesco as Morrisons was still using a third party supplier in the shape of Global Pacific.
