When the demerger of the general produce and distribution business of Fyffes took place in late December 2006, its potential impact on the wholesale sector in the UK was not immediately evident. Once the newly formed company - Total Produce - had added Redbridge to its fold in the following month, however, the implications were there for all to see.
Both companies brought wholesale strength to the table within their extensive cross-sector portfolios, and the combined force set about cherry-picking companies it felt fitted its own strategic direction.
Denis Punter, Total Produce’s executive chairman, has been unequivocal in his statements about the UK wholesale sector. “We believe in the wholesale sector and we need to make suppliers believe in it again too. To compete in the foodservice and independent retail sectors, we have to source the best product we possibly can, and the only way to do that is to keep on pushing the boundaries,” he says.
The Total Produce approach, he adds, is akin to category management in the supermarket sector. “We want to work in different ways with our suppliers; to explore how they can increase their market penetration through us, by providing us with the right product to grow our market share.”
Total Produce has wholesale operations in Birmingham, Liverpool, Bristol, Cardiff, Gateshead, Glasgow, Leicester, Southampton, Wigan, Wolverhampton, Stoke, Sheffield, Nottingham and Norwich, as well as Edinburgh.
Regional director Gerry Price runs the division that contains its operations in Gateshead, Glasgow and Edinburgh but, as is the case across the Total Produce wholesale portfolio of companies, each firm is run completely autonomously.
Secure future
Facilities like the Edinburgh site are not yet commonplace, but as the sector continues to evolve, they are “the future”, according to Total Produce Edinburgh’s general manager Robin Spinks. The 35,000sqft Bankhead Way site is a fully secure, ecologically friendly set-up, with no keys and no light switches, ensuring that energy is used only when absolutely necessary and no-one has access to areas of the building that do not concern them. The entire warehouse operation is temperature controlled - a far cry from the facilities previously available in the city’s wholesale market. And it was built with expansion in mind.
The 18-month-old building looks immaculate, inside and out, thanks to a continuous approach to cleaning insisted upon by Spinks. “This is still pretty much a brand-new facility, and I believe in meticulous housekeeping. It has made a real difference to all of us to have a proper, clean working environment, that we can all be justifiably proud of.”
Location, location, location
The depot is ideally located for all points on the Scottish compass. The M8 (west Scotland), the Edinburgh City bypass (for Glasgow and southern deliveries), the M9 (north to Stirling), and the Forth Bridge route (to Aberdeen and Dundee) are all within a short driving distance.
“Because of where we are, I don’t think it is that important where the customer is,” says Spinks.
“It has been fantastic to have a purpose-built building into which we had input from the start. We have changed things a little since we got here, but initially we knew what we wanted and asked for it.”
Typifying the purpose-built nature of the new set-up, the modern office space is right on top of the product which, allied with the centralised stock control and purchasing systems, gives both the distribution and wholesale arms of the business a very hands-on feel. “We have a chat with all of the sales and procurement team at the beginning of every day,” says Spinks. “We like to give something back to the customers and, by communicating with each other, we are improving our service all the time.”
Spinks is in the midst of taking his team through the BRC accreditation process, which is only available to facilities once they have passed a year in age. “We have seen the auditors and, while there are a few minor things to tidy up on, generally the facility is fine,” he says. “There are a lot of tenders that you cannot even enter without BRC, so accreditation will open up a few new opportunities to us. It is also not just a sales tool, but a good exercise in discipline for us, giving us parameters and specifications to work within.”
Taking stock
Stock is reconciled every day at 10.30am in the wholesale set-up and at 4am for the distribution side of the business. “I learnt very early on in my time in the fruit trade that effective stock control is key to the success of the business. Controlling the product through the system enhances its quality and also its longevity,” says Spinks.
Emphasising the newfound similarities between wholesale and supermarket approaches, new quality-control officer, Janine White, has recently been appointed, brought in from Tesco’s Livingston RDC, and her first priority in the role is to upgrade quality specifications for the customer base, and communicate that throughout the supplier network. “Janine is planning ahead, to make sure that all buyers understand what specs we are working to, and she will also spend time with suppliers, to ensure that the messages are getting through to the grower base,” Spinks says.
Wholesale delivers
The cash & carry wholesale operation in Edinburgh opens at 4am, six days a week, after the night shift sets the day up. Around 200 customers a day wheel their trolleys around the 10,000sqft warehouse. “Approximately 30 per cent of our wholesale trade is delivered, but most customers would still rather see the product on the floor than in the van. Walking around the stand gives them the knowledge of what is happening in the trade, and the face-to-face contact and negotiation is still crucial,” says Spinks.
Alan Rooney, who heads up the wholesale department, says that leaving the market has not dimmed the ability to price product competitively. “Of course, we miss playing against the market sometimes, but so much trade is done on the phone these days you know when you are at the right price,” he explains. “The customers are very clued up; with so many faxes and emails flying around there is no shortage of information available to them. So they will soon tell us if they think the level is wrong. The trading day is different, but customers have definitely recognised the benefits of this facility. There is no sweep of produce, but all product is now in a temperature-controlled environment, which is big improvement on what went before.”
Spinks adds: “The wholesale business has grown slightly since we came here, after a difficult start. We have fought back, and concentrated on ensuring that our range and availability are very competitive. Why drive the 57 miles to Glasgow if you have access to all of the same lines in Edinburgh? With the price of fuel, customers are looking for the right deal closer to home and it is our job to communicate that we can give them that.”
Graham Broomhall, operations director of Total Produce’s UK wholesale business, agrees, explaining the Total Produce wholesale philosophy: “In a traditional market, we believe you have to add value to the specific market environment,” he says. “The supply base must cater for the customer base, and we must back up both ends of the supply chain more than has traditionally been the case.”
Unique set-up
“In Edinburgh, where we have a unique set-up for Scotland, we have become much more than a wholesale stand where the product is bought by the customer, by trying to personalise the facility to the customer base,” Broomhall adds. “And there is a lot of emphasis on enhancing relationships with growers, to suit customer demand. We have become the ultimate middleman.”
Spinks adds: “Our endeavour is to foster relationships with growers that put the type of product through our business that will benefit everybody - particularly the end consumer. In the foodservice sector, we are building business by providing continuous supply of good product. The markets can have a bit of a ‘Del Boy’ image, but by putting product into a box that suits all parties, we can fix prices on a long-term basis and take out some of the market fluctuation. That way, the producer knows his margin, we know ours and we can be honest with the customer about that, enabling them to plan their own margins better.
“Already, quality has improved dramatically. The ability to control temperatures has made a big difference to the life cycle of our produce, and also enables us to stock a wider range of products and pack sizes. The potential to widen the range just wasn’t an option before.
“We are giving the customers something different,” says Spinks. And Broomhall adds, referring not just to Edinburgh but the entire Total Produce network of wholesale businesses: “The range we carry has become so important, particularly since we have had this facility. You have to go from A to Z and make sure that you have exactly what is important to each individual customer,” he says.
“We still have a good mix of customers in Scotland,” says Spinks. “Some retailers have obviously found it difficult in recent years, but there is a big catering sector and a strong nucleus overall, particularly around Edinburgh, which has a big populace.
“The creation of Total Produce gave us a truly nationwide service to tap into, with deliveries now from Bodmin up to Inverness, and everywhere in between,” says Spinks. “We cover 99 per cent of Scotland from this depot, either directly or through partnerships in remote areas where it is less economically viable to do it ourselves.”
Spinks adds: “Our size also gives us the opportunity to increase the volumes we buy. We can now benefit from buying full trucks of apples direct from the Loire, for instance, without paying groupage and knowing we can guarantee temperature control throughout, before adding value with our QC, packaging and labelling operation.”
The labelling and packing facility in Edinburgh is used by customers including Booker and Spar, and allows each customer the capacity for specific promotional efforts and on-pack information. An exclusive marketing relationship with the Greenery, which began with Total Produce buying the Greenery’s UK wholesale branches and now also sees Total Produce sell all of the Dutch grower-owned group’s product that goes through the UK wholesale sector, sees specific lines labelled for specific customers in the Netherlands. “Services such as this are adding value to our customer base, adding to supply chain efficiency, and raising the quality bar by implication,” Spinks says. “There is no way we will put product into branded packaging in the Netherlands unless we are certain it will meet our customer’s requirements when it gets here.”
Brand-new clothes
One step further than labelling is branding, and in the last couple of months, the Total Produce brand has begun to make its presence felt across the company’s wholesale network.
Brands already played a part in the Total Produce mix, with the Redbridge-developed Britfresh (UK-grown vegetables and salads) and Continentalfresh (European fruit) both a standard offer across the wholesale market portfolio.
The company is launching a new brand this month, TOP, which will be pan-European in usage and is intended to span not just wholesale, but other sectors of the industry. Broomhall says: “We recognise that if we can bring a brand into the business that represents quality and value, and deliver consistently so that customers make repeat purchases, we will be achieving what we want to achieve. Sources, of course, have to be chosen carefully, but that is inherent in what we already do in terms of traceability, for our foodservice customers particularly.”
As well as Total Produce - let’s grow together, another brand - Earth Fresh - has been added to products for participating customers, as Total Produce starts to define both its own identity and that of its suppliers’ products.
Pre-packed potatoes are perhaps the most prominent product to carry the marque so far in Scotland. The 20kg sacks add value to all links in the chain, says Spinks. “There is a cost involved, but it is not that high, and this is in effect-free advertising. We can also build partnerships that work both ways; we are tied into the grower and they are guaranteed the business with us, as long as their product meets the strict specifications that allow it to be sold under the Total Produce brand.”
Also in the branded sphere, 5 A DAY fruit boxes, started by Redbridge with WH Smith and now sold into Scottish outlets of BP, Spar and Boots, among others, are packed in Edinburgh. “It all works very well,” says Broomhall. “We offer full traceability and print our own box ends, and rejections are down to zero. There is still room to expand further.
“From a wholesale point of view, branding is arguably less important. There are a lot of brands on display every day. But as we establish the Total Produce name through our distribution division, our own brand will be a very important ambassador.”
Staff
When the company relocated, a few members of staff were inevitably lost in the process but, for most, the move actually reduced their journey to work. Another 20 staff have joined the team in the last 18 months, and Spinks is under no illusions that the success of the company rests on the quality and consistency of its employees. The age-old problem of attracting youngsters into the trade has not disappeared, Spinks says, and while an upgrade in facilities helps, one factor of the wholesale business is not about to change. “Wholesale hours won’t change, and that is still an issue for some people, but we have brought several managers into this business from outside the fruit trade since we moved here and it is easier to entice people to this environment. There was a [generation] gap appearing in the sales team and we have actively tried to redress that balance. We are also keen to bring people through the ranks who have started with us at grass roots level; my first job here was as a stock clerk, and it is a plus when staff understand exactly what we are and what we want to collectively achieve - that comes largely with experience.
“Retaining and promoting staff also makes training a lot easier, and we are in the middle of reassessing our approach to training, as it is recognised that it has a big bearing on staff retention, as well as performance.”
Local heroes
North of the border, as across the rest of Britain, the demand for domestically grown fresh produce is on the climb.
“Some customers are very keen on local produce and some are not bothered either way - it has always been like that,” says Spinks. “But a lot of the smaller Scottish growers are struggling and we can give them a very good option to get their product to market. We have a mushroom supplier for instance, between us and Glasgow, who sells us all of his crop. We know we can sell the volume and, not only do we pay a fair price, we pay on time. That really makes a big difference to a grower.
“We are a Scottish division, capable of supplying Scottish product day one for day two, and we would be foolish not to sell ourselves on that basis to growers and customers.”
The range has begun to expand outside of the core fruit and vegetable area, and Spinks recognises that, to crack more of the catering business, this will have to continue. “Dealing with independent customers can of course be very cut-throat. We would like to work more into the groups, servicing the hotel and restaurant sector, and to do that we will have to do more bacon, cheese, bread and dairy products,” he says. “We already do a lot of prep work, primarily for Sodexho, and the view is, if our customer wants something we should be prepared to go and source it for them - that’s what the procurement team is for.”
McBRIDE FUELS EFFICIENCY
Operations manager Jake McBride is responsible for the transport and distribution side of the Edinburgh business and, as such, faces a multitude of issues. At the tip of the iceberg, fuel costs have risen by 35 per cent in the last 12 months overall - from a starting point of 91p a litre, fuel now costs £1.11, having reached as high as £1.19.
With a fleet that covers almost 500,000 miles of Scottish road a year, that represents a serious headache for McBride. He says: “The fleet is only a year old, so uses less fuel than an older fleet doing the same mileage would. We try to be a bit more prudent with the order frequency and order values that we send out. Double and triple deliveries happen more often.”
But they are not always the answer when the vast majority of wholesale customers want fruit and veg delivered to their door by 7am. “Our customers are facing similar issues and are very understanding, but it is important that we have all the right disciplines in place,” says McBride. “Route planning is always difficult, and the nature of our business is that routes are often changing during the day. We have to tailor runs to suit the needs of the customer, but forward planning enables us to be more proactive when we need to be. We have been able to increase the amount of product we backload, or bring through for Glasgow.
“The whole process has to be micromanaged,” he adds. “We track fuel usage meticulously and it helps that we have a great team of drivers, who are on the same runs most of the time. They are central to what we do, they are all uniformed, so deliver the promise on our behalf, they are ambassadors for the company and they are extremely helpful in monitoring everything. We have a regular dialogue, and they will flag up any issues.”
The fleet will probably be renewed on a three-yearly basis, he says, but a regular maintenance plan in the meantime sees each vehicle fully inspected every six weeks, combined with daily temperature and routine checks by each driver. A flexible contract with the vehicle supplier allows the company to add or subtract vehicles as required. “Obviously, we hope we are adding, but they know they are dealing with a large group, so it gives them the confidence to deal with us flexibly,” McBride says.
The hope is that, by employing that renowned Scottish prudence, Total Produce can avoid a route that some of its competitors have been forced down recently. “Some companies have introduced a surcharge, but I’d prefer not to do that,” says McBride. “Certain customers have a delivery charge included beforehand, and obviously we need to recover additional costs somehow, but we don’t think a general surcharge is the way forward.”
NEIL FOCUSES ON FUTURE BUSINESS
Wilson Neil is commercial manager for Total Produce in Edinburgh, and undoubtedly one of the key differentiating factors that the company has over many of its Scottish competitors. Neil is not hands-on with the sales or procurement team in Edinburgh; his concern is not the products themselves per se. Neil’s focus is on business development; maximising the potential for fresh produce sales among Total Produce’s Scottish customer network through raising awareness of the products at all levels.
Taking the ‘glass is half empty’ view, he is pushing water uphill, with the poor diet in Scotland perhaps best epitomised by the current two-a-day fruit and veg intake of its inhabitants. Neil’s glass is half full, however, and while accepting that changing the situation needs a seismic long-term cultural switch, he points to significant initiatives from the Scottish Executive to raise consumption as the base on which to build his own efforts.
“I believe you cannot just give customers the product and expect them to sell it; you have to follow that up and give more value by working with the customer at their coalface,” says Neil. “With a stand-alone facility like the one we have here in Edinburgh, we have to operate a lot differently to how we did as part of a market. We have actually found that we can do a hell of a lot more for the customer.
“There is a hell of a lot of hassle involved in running a convenience store and traditionally the fresh produce offer has been poor, particularly as there are very few independent fruiterers left in Scotland now. There has been some progress but, in truth, the fruit and vegetable sections are still mediocre. We want to allow convenience-store operators to offer a credible alternative to supermarkets and to do that, we have to train them to look after their fruit and veg better,” he says.
Neil has already seen some phenomenal results from his work, which is trying to raise the level of c-store shoppers buying fresh produce in Scotland from a frankly pathetic 2.2 per cent. “One store we worked with in Annan saw its participation grow to around six per cent very quickly,” he says. More dramatically, a store in Summerhill, Aberdeen, was wasting more than £250 of its produce turnover every week, until it moved the fixture to the front of store and saw sales grow to £1,500 and waste tumble. Neil says: “That is reality. We believed we could increase fruit and veg sales with the right offer.
“The store manager has to learn to keep the fruit right and retain its eye appeal. If it looks the part, people will buy it. Our job is to leapfrog into the store and face the consumer with our products. There is more often than not a very positive effect when any c-store makes a real effort.”
Targeted and highly strategic promotional work in store is also crucial. “Well-placed healthy eating logos and mix-and-match product offers have encouraged impulse buying of a wider range of lines,” Neil says. “Being part of a group has increased the Edinburgh team’s potential to design bespoke promotional runs for all of our retail customers, with pre-determined margins inbuilt, based on advance knowledge of supply and price patterns.
“We run three-week promotional cycles for customers and also weekend 99p price flashes, which have allowed us to introduce a number of exotic lines to Scottish c-stores alongside staple lines. Simple changes to pack sizes and product specifications can make a few per cent difference in sales, and we recognise that most c-store operators are more often than not multi-tasked and unlikely to have the expertise or knowledge base to do that themselves, as they continue to focus on newspapers and milk.”
The promotions work too. “Five years ago, if I had gone to a c-store and told them to stock a four-pack of Ya pears for 99p, I would have been laughed out of town,” says Neil. “We sold 400 cases when we had them as part of a promotion last year. Avocados and sharonfruit are other very good examples. The potential is there; it is all about belief.”
Total Produce is in effect responding to the understandable lack of skills in the in-store workforce by deskilling the stores. Product is predominantly pre-packed, so handling is minimal, and it is all barcoded, so it can pass through stores like the low-maintenance tin of beans.
But at the same time, there is a push in Scotland to re-skill the consumer, with the Scottish Executive using its Choose Change, Choose Health banner to encourage the country’s citizens to improve their diet in various ways, including upping their fruit and veg intake. Total Produce has been able to use specially designed in-store fixtures, some permanent and some mobile, but all funded by the Executive, to showcase its products in more than 200 stores across the country. “It is one of the most positive things done for our sector for years in Scotland,” says Neil. “It’s not just a fruit and veg message, but that is foremost in peoples’ minds when they think about healthy eating, and it enables the c-stores to raise their game and give shoppers an alternative to the multiples.”
Again the results can be outstanding. One chain put a stand into almost all of its stores, and increased sales by 24 per cent in a year.
Flowers have been a minor part of the Edinburgh business for some time, reflecting the traditional peaks and troughs in the calendar, but a deal struck with J van Vliet - the New Covent Garden Market Floral Trader of the Year at this year’s Re:fresh awards - is destined to change that. From next month, the supplier will provide flowers and plants of the month on display stands tailored for the c-store sector in Scotland, with bouquets made up in the Scottish capital. “It will certainly enable us to offer our customers a far wider choice than ever before,” says Neil, with the obvious implication being that when consumers are given a wider choice of quality product, they too will respond.
His unstinting enthusiasm for the cause is based on pure hard-nosed philosophy. “I want to make people in stores look after my products. Their sales and my sales are the same thing - we are in it together,” says Neil. “Any store that sells fruit and veg, we would like to supply them and improve their results as well as ours.
“I am always very keen to emphasise that profit is not a dirty word. It is not all about selling on price. We all have to earn out of the products, right along the chain, and the way we are doing things here now is taking the speculation out of the business. All in-store initiatives are much more ordered and have an end objective in mind - to grow sales and make a return for everyone, while giving the consumers value.”
PROVIDING SPAR WITH FRUIT SPUR
When FPJ visited, Neil was preparing for the next day’s visit of 20 of the sales team from CJ Laing, the Spar-owned chain of Scottish stores.
A room is set aside for training purposes, designed to raise the awareness of fresh produce among the team, and in the temperature-controlled warehouse, Gordon Airth, CJ Laing’s manager, pictured, is setting up a series of shelving units to replicate in-store conditions. Total Produce will use the fresh produce fitting to demonstrate handling and merchandising techniques.
“CJ Laing has 400 stores across Scotland, 92 fully owned and the rest independent. We can help them optimise their ranges, and give their customers the value for money that allows Spar to compete with the major supermarket chains,” says Neil.
CATCHING THEM YOUNG
Total Produce Edinburgh distributes fruit for schools in the country’s second city, Glasgow, on a three-year contract with Glasgow City Council. It has also been reappointed for the same term to provide the same service to South Lanarkshire, and has joint arrangements in Stirlingshire and East Lothian. Most areas are restricted to fruit lines, but children in East Lothian have been treated to a variety of convenient veg lines too.
As Scotland’s schools went back to work this week, orders double and even treble on some days and the team springs back into action after the summer lull.
The service, much like the service to c-stores and caterers, does not end there. Regular visits to schools, with samples of a range of Scottish and imported produce, and a 15-minute talk to pupils, have invariably brought a great response from kids. “We let them taste the product, ask questions and take part in a competition - and we get great feedback,” says Neil. “It is beneficial to us, of course, as we hope to maintain and expand our business in the future.”
No comments yet