What are the biggest differences between Rungis today and 40 years ago?
There have been several big changes over the last four decades. The three most important are the market share cornered by the supermarkets, the ongoing rise in the number of meals eaten outside the home, and the internationalisation - a term that I prefer to globalisation - of produce sourcing and the clients of Rungis Market.
Other trends have also had some effect. I am thinking in particular of the way that the hygiene and food safety issue has developed. It goes without saying that in 1969, this issue was not even on the radar, but it has gathered pace due to industrialisation, food manufacturing and the growing demands of consumers on the matter. The BSE crisis and, in France, the issue of hormones in veal during the 1980s, led to crises of confidence that adversely affected the food industry. The market authority and the businesses at Rungis have responded to these new demands on food safety.
I like to think that Rungis today is a combination of tradition and innovation.
When Semmaris redistributed its funds, what changes did it bring?
There were two main reasons behind this decision. First, we had a mortgage that we received in 1969 when the new site was built and that was repayable to the government. In 1969, Semmaris certainly did not have the funds to pay off this capital, which for a long time weighed heavily on our accounts. The entrance of a private shareholder meant that this charge disappeared and our own funds rose by €30 million (£27m).
The second reason for redistributing the funds was our feeling that the market could develop at an international level. However, a financial structure with the state as the majority shareholder would be poorly adapted for this development - the examples of France Telecom and Gaz de France (French Gas) are there to remind us of this.
Do you understand the worries that emerged here and there among certain traders on this subject?
Change often gives rise to concern. The administrative council embarked on an investment plan of €290m until 2012.
This move allows us to modernise and make the market attractive, and to embrace the important changes needed for its development, such as the extension of the site into a part of the adjacent zone called Senia.
At what stage are the different phases of the market’s extension?
The market’s expansion policy has reached a crossroads. In a year’s time, we estimate that the Euro Delta zone will be complete. I must highlight the incredible work that has been undertaken by the Semmaris team on this, in a context of scepticism, indeed sometimes hostility, especially at the beginning of the project.
Eventually, we will have 45,000sqm of occupied modern warehouses, which gives us credibility for the other arm of the extension, in the adjacent zone of the market, called Senia. We want to develop on 20-25 hectares of the 118ha available in this zone. However, the scale of this project means we are entering into the framework of an urbanisation and transport plan, so therefore it is the subject of a study that should deliver its conclusions at the end of the year.
We will know more then, but I do not see why what we have achieved on 12ha in the Euro Delta zone, we could not replicate on 25ha in Senia.
How is Rungis tackling the environmental issue?
Sustainable development has always been a subject dealt with at Rungis - air quality, gas links, hygiene, energy savings, thermal isolation of the buildings, etc. We also work on the salvage and recycling of waste. We have gone from generating 90,000t of waste in 1994 to just 40,000-45,000t today.
The next buildings to be constructed will meet high environmental standards. We are also conducting a study on the viability of putting solar panels on the roofs, despite claims that north of the Loire, the return on investment is reportedly two times less than in the south of the country.
In terms of logistics, how do you gauge the position of Rungis?
Logistics is a crucial element of the market’s activity. Substantial work has been done to streamline the rail terminal, and the new version will become functional in June. It will have two platforms of 380 metres.
Around 250,000t of fruit and vegetables arrive in Rungis each year from the south of France, along with certain lines from the southern hemisphere - bananas, for example.
Railfreight company Fret SNCF is also thinking of using the site for return freight, and not necessarily for food. I think the trend will move on from using airfreight towards using railfreight, and we have the appropriate facilities for this.
How important are international links for Rungis?
This is a fundamental step for us because it allows us to develop the export function of the market. We are involved in the construction and development of new wholesale markets around the world. In 2008, we worked with Peru, Odessa in Ukraine and Vietnam, along with our projects in China and Russia. And we are set to work with different countries in the next few months.
If we receive positive feedback it is, I think, because we are almost the only ones in the field to bring an expertise in terms of market concepts, combined with the solid experience of working on a wholesale market.
Do you intend to pursue the work you have started with New Covent Garden Market in London?
The reason for putting an ambassador for Rungis in New Covent Garden was that we wanted to be up to date and better understand the UK market. After a year, we feel that our mission can be accomplished without a permanent presence on the market. Charles Davous is our brand ambassador for Rungis, and the operators on the other side of the Channel now know him well and appreciate his efforts.
Charles will write a regular information letter and we are going to launch a website dedicated to the UK as a reference base. There are undeniably strong cultural differences between French and English wholesalers. However, although their approaches and their mindsets might be different, if there is a common interest, a partnership will work. It is the same case in China - it all boils down to a question of learning.
In your opinion, what is next on the agenda for wholesalers?
I think that wholesalers must pay attention to two trends over the next few years. They should first make sure to secure their supply. The concentration of the sector upstream means there are certain groups who keep the value of their produce as high as possible. In that sense, Rungis will remain an attractive market. However, wholesalers will need to be cautious and ensure that this concentration does not block their sourcing abilities and prevent them from offering a wide range of produce.
The second risk comes from uniformity of taste across certain products, one of the effects of retail distribution. At Rungis, we defend produce that is in season, knowing that at the end of the day, the consumer will choose the product they like.
How the multiple retail sector develops in the future will be fundamental to our business. The hypermarket format may go through a difficult patch. I think that certain wholesalers will be able to serve the new type of urban centre that could emerge, but it will remain difficult.
The role of Semmaris is to listen to the market and act as a facilitator for wholesalers, while also being on the look-out for consumption trends that will help maintain the longevity of the market’s businesses.
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