Friday, March 29, 2024

New Zespri chief picks up reins

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Zespri’s chief executive of nine years Lain Jager stepped aside last week for new executive and long-time company man Dan Mathieson. Mathieson spoke to Richard Rennie about where he sees the marketer going after a period that has included the worst of times and the best of times for the industry.
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Only four days into his new position Dan Mathieson is having to think hard about how he will balance the local, supply-focused challenges of growing more fruit in Bay of Plenty and beyond with the rocketing market growth being experienced out of the company’s Singapore marketing hub.

To help achieve that he intended to spend his time split evenly between head office in Bay of Plenty and the Singapore base he had headed up as Zespri’s global sales and marketing manager.

He said that split reflected as much about where Zespri was heading as it tries to manage growing demand for fruit as it did about the proportions of staff it employed.

“We now have about 220 staff out of 500 who are based offshore and we will get to the point soon where we have more out of New Zealand than in it.”

North Shore raised and educated at Auckland University of Technology, Mathieson spent much of his professional life offshore, firstly working for Japanese companies then moving to Zespri in 2003.

He spoke fluent Japanese, admitted to some faltering Mandarin and was picking up Te Reo but brought a very Asia-centric view as the marketer’s new head.

“Singapore is now proving to be a centre of excellence for our sales and marketing team, close to all markets. It also means we can focus on building those strong relationships with distribution partners and ensure quality is there right through the supply chain.” 

Mathieson’s sound sales and marketing background reflected something of a shift in the company’s focus as it pivoted from a traditional collector-exporter-seller of fruit to a branded food company.

It was one that wanted to have an exact understanding of its consumer’s needs and the ability to control the category by retaining a branded premium, helped by guaranteeing surety of supply.

Mathieson inherited an enviable dilemma from his predecessor as he worked to achieve that.

Psa in 2010 chopped the burgeoning high-value Gold category off at its knees, more than halving supply for two years.

However, thanks to one of the most rapid biological retoolings in cropping history anywhere, the industry’s 2011 regrafting of the Psa tolerant SunGold fruit had proved highly provident.

SunGold tasted better, fruited heavier and packed better than the earlier version and had taken Asia, Europe and the United States by storm.

Mathieson had been credited with managing the delicate balance of keeping supply constant to high-value markets despite tight supplies as the fruit volume continued to ramp up.

That juggling act was likely to continue for at least another five to eight years as the industry chased a target of doubling to $4.25 billion of exports by 2025.

“It is an ambitious target but the timing is good.

“We are seeing an exciting trend in global markets for fresh food products and Zespri’s strategy fits perfectly with that, providing good taste, convenient eating from a very safe food source.”

But with the lift in consumer expectations delivered in a premium fruit brand came the need to ensure year-round supply. With that was another reason for Zespri’s chief to spilt houses between Singapore and NZ.

“Consumers are saying they do not want Zespri product for just seven months of the year.

“They want it all year round so our efforts have been on working to grow crop in the northern hemisphere in France, Italy, Japan, Korea and eventually China.”

This week marked the start of the harvest of Zespri SunGold in Italy with volumes expected to kick up 25% on last year’s harvest to five million trays.

About 15% of Zespri’s total crop was sourced offshore and Mathieson could see that ultimately forming about 30% of its total supply.

“The fact is the Bay of Plenty remains a very special place for growing the fruit and will always be key for us.”

He was aware of a recent report on the impact of climate change on Green kiwifruit growing in Bay of Plenty and the possibility it would be near impossible in 40 years’ time.

“But the industry has always proven very innovative in the past in dealing with these challenges,” he said.

Supplying Zespri labelled fruit from China was still some way off but the company was making inroads in small trial orchards. Into the future India might also offer potential as demand for the fruit started to ramp up there.

But Mathieson was also conscious Zespri’s story could not be solely a SunGold fruit story. The “steady as she goes” nature of Green had to be maintained.

“We want to keep a portfolio of products out there so we want to have a healthy Green business but we will see more steady growth, of about two million trays a year.

“The good thing is consumers want to have different eating experiences.

“They like the higher fibre content of Green, the sweet flavour of SunGold and the extra food safety security of Organic.”

Despite the growth, Mathieson was acutely conscious kiwifruit formed only 0.22% of global fruit consumption and to grow further would require significant, ongoing consumer and brand investment.

“This year we spent $150 million on our marketing programme globally.

“The main headwinds are likely to be more competition arising from other countries also growing kiwifruit.”

He also saw that coming from other well-funded fruits, hence the importance of maintaining shelf space 12 months of the year.

And the Chinese competitive spectre loomed.

“Chinese people are very proud of China and the quality grown there is improving.”

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