When margins are tight and budgets come under pressure, training is one of the first areas to be scaled back. So says Guy Moreton, founder of recruitment and training company MorePeople, which specialises in the fresh produce industry. “When times are tough the first thing to go after the marketing budget is the training budget,” says Moreton.
“We are trying to engage clients in training but many businesses are not quite ready to have a conversation about training yet, which I can empathise with because people have different priorities in difficult times, but it is frustrating.” According to David Macaulay, managing director of Eden Search & Select, there is a real shortage in the fresh produce industry of people with category insight and category management skills. Training in these areas is badly needed, he claims. “As much as there is a movement towards direct sourcing models, streamlining the supply chain and cutting costs, there is still within the leading four supermarkets a demand for suppliers to get closer to the retail customers.”
Where produce companies have invested in these skills, the payoff has been huge, says Macaulay. “There has been real value delivered by suppliers understanding the retailer’s customer better than the retailer does, and therefore being able to justify different innovations, different ranges, because they really understand the category. A great example of that is Greenvale, which launched the Greenvale Farm Fresh brand.
“That brand within Tesco has done very well and got national distribution. Brands in the produce category are very hard to come by but Greenvale has managed to do that successfully because they really understand their category and were able to create a really strong business case.
“That is why further training and development is needed to get closer to customers because that is driving innovation, driving the packaging developments, driving the range reviews, and that is why fresh produce businesses that are thinking about marketing are ahead of the curve,” Macaulay adds.
However, according to Moreton, the only area of training performing well is negotiation skills. “Negotiating programmes are easier to sell because it is something where you see an immediate return. So salesmanship, telephone selling skills, how to negotiate better prices, these are all performing well.”
Max MacGillivray, managing director of Redfox, agrees. He says fresh produce companies are finally recognising the value of having skilled negotiators on their sales teams. “A number of our more astute clients realised that when retailers take in new buyers, they train them to the hilt then nine times out of 10 they will win any form of negotiation. Our clients seemed to realise the issue that if they didn’t get their staff trained up on negotiation they were always going to have this problem of coming off second best with the retailers.”
In fact, he goes so far as to claim that decades of failing to recognise the importance of these skills has done considerable harm to the fresh produce category overall, with far fewer brands than other categories, and fewer long-term collaborative relationships with retailers.
“Fifteen years ago if people in the fresh produce sector had had more orchestrated commercial negotiation training, the fresh produce companies could be in a far better place,” says MacGillivray. “They could all have had a branded product within a retailer, instead of just having retailer own brand. And they might even have had better margins. And I think people are waking up to that fact and many of them are seeing negotiation training being offered to them and that is why it seems to be very popular.”
The negotiation training offered by Redfox covers everything from the psychological impact of the way in which you enter a room to begin talking, through to trying to ensure you have a long-term relationship, through to how to settle on genuine win-win agreements.
“Negotiation is about forming a partnership with the customer so there is a long-term benefit,” says MacGillivray. “Traditionally fresh produce has had a trading mentality about selling the product today.
“If you take branded goods, some products will take upwards of a year from conception to launch, whereas if you picked a lettuce, tomato or a flower it is a dying crop and it needs to get on to the supermarket shelf within two days, so the focus has traditionally been on getting it on the shelf and not about the branding and marketing and long-term benefits of having more of a partnership with the customer.
“But that is fundamentally wrong, it should be about how we can grow the business together and that is in some respects what the negotiation training does – it sets up a long-term view about a partnership that is going to be of benefit to both parties. “
So while some produce companies are clearly buying into the need for training, there is huge potential to further grow the skills of those within the industry. Time will tell whether the economic environment will allow produce companies to make that investment. —
