PROGRESSIVE DISCIPLINE FOOD SERVICES ANNUAL ORIENTATION, FOOD SERVICES DIVISION August 11, 2015.
Food & Services...Food & Services Division Nigel Garrard Managing Director – Food & Services 16-17...
Transcript of Food & Services...Food & Services Division Nigel Garrard Managing Director – Food & Services 16-17...
Food & Services Division
Nigel Garrard
Managing Director – Food & Services16-17 October 2008
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6 Key Issues to Cover
1. Australian SPCA Manufacturing Restructure
2. The Drought and its Effects
3. Creating the Goulburn Valley Master Brand
4. New Products to counter Private Label Challenges
5. International Strategy
6. Grinders Growth Trajectory
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The SPCA Manufacturing Restructure
� Previously announced restructure, results in consolidation of fruit production at Shepparton site
� One-off restructuring charge of $26.4 million to be taken in H2
� Estimated benefits $8-10 million pa for full year 2009
� No financial impact in 2008 as benefits offset by restructure costs
� Progress is on plan and on budget – will be completed by end November – well before 2009 fruit season
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What does the Australian Manufacturing Restructure involve?
Shepparton Mooroopna(only3-4 months of wet production)
� Production
� Peach ����
� Pear ����
� Fridge Packs ����
� Juice/Paste ����
� Baked Beans/Spaghetti ����
� Tomatoes ����
� GV “Erca” Snacks ����
� Distribution ����
� Kyabram site not affected
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And where do the cost savings come from?
� Casual Wages
� Only running one plant (the most automated of the two) allows significant labour efficiencies across the plant
� This is a further step in a 5 year cost reduction and efficiencyprogram
� Reduced Overheads
� One factory management structure (given Mooroopna only on
3-4 month operation)
� Reduced trade waste, power, gas, maintenance
� Improved plant efficiencies
� with 1 plant running at close to full capacity
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Full Time Equivalent Staff Numbers at SPCA Down by 30% Over 4 Years
800
900
1000
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1300
1400
1500
2005 2006 2007 2008E 2009E
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Australian Manufacturing Restructure - Why not close Mooroopna altogether?
� The drought will not last forever. We need to preserve capacity. The drop in AUD will open up export opportunities once drought breaks
� No fruit preparation at Mooroopna – Erca (Goulburn Valley fruit snacks) fruit will be transferred from Shepparton
� Space at Mooroopna will be utilised for additional warehousing
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No Sign of Victorian Drought Breaking – yet!
NOT
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Fruit Sourced from Two Key Regions
Murray Irrigation
Goulburn Irrigation
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Allocations already down on 2007/08
Allocations at 1 October 2008
System %HRWS In 2007/08
Murray 13% 16%
Broken 0% 15%
Goulburn 9% 23%
Campaspe 0% 1%
Loddon 0% 5%
Bullarook 0% 0%
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Recent Year Water Allocations at Historical Lows
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/ 93
1993
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/ 97
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1999
/00
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2008
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Murray Goulburn
?
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SPCA – Managing the Drought effects well
� Water entitlements used by permanent plantings (most efficient use) at expense of annual crops and dairy
� Subsidies and loans to grower suppliers have helped ensure SPCA’s fruit intakes
� For 2009 fruit season:
� Have acquired sufficient temporary water entitlements to
underwrite tomato requirements.
� Expect to receive all the fruit that is required
� Growers have adapted well to less water, changing agricultural practices
� Expect intakes to be in line with 2008 but unlikely to be better
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Leveraging SPCA – The Goulburn Valley Brand
� Joint initiative of food and beverages to leverage the Goulburn Valley brand and CCA’s distribution capability
� Increased consumer awareness, improved distribution, coordinated marketing – all provide group benefits
Creating a
”Power Brand”
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MORE
TOCOME
Power Brand Build
+
+++
+
+
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Overall Goulburn Valley brand sales have increased by >50% since CCA acquisition
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20
40
60
80
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120
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160
2005 2006 2007 2008
$ Million
Sa
les
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Utilising the CCA Network – 1+1 = >2
� Over 3,500 Convenience & Petroleum customers now serviced via CCA distribution
� Transitioning SPCA Agencyagreements in
� PNG
� Fiji
� Pacific Islands
to CCA Sales & Merchandising teams
� Changeover planned for October 08 with strong support from local CCA beverage teams
� Reviewing opportunities in Indonesia to use existing CCA relationships
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New Products help combat Private Label growth
� Private Label offerings from major retailers have increased foothold over last few years, across most of SPCA’s categories
� SPCA supply some of these Private Label products where we can supply profitably. Some customers have shown preference for Australian sourced products
� Private Label is here to stay! Heightens the requirement for NPD and investment in our brands
� Strong brands will be well placed to take advantage of retailers range/supplier rationalisation
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Range of New Fruit & Snacks Products Launched – over 25 in total
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International Strategy continues to develop
� Leverage SPCA’s market leadership in packaging innovation across selected international markets
� Develop a branded business using “SPC Nature’s Finest”
� Transition out of sole Australian supply to include mix of sourcing countries
� Provide multi-country sourced, multi-product variety offering to selected retail customers
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Diverse International Relationships
JV - Deciduous
JV - Tropical
Exclusive Supply Agreement
Exclusive Supply Agreement
Strategic Alliance
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And the results are coming!
� UK market is the stand-out performance
� SPC Nature’s Finest now No. 2 brand in packaging fruit in UK
� Listings in all major retailers
� Appointed category captains by Tesco and Sainsbury
� Trials underway with vending and convenience channels
� Next priority is to roll out in other European countries. Canada showing promising early signs
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The New Sainsbury UK Fruit Fixture
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The New Tesco UK Fruit Fixture
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Germany – Off shelf Displays in Product
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Grinders Volume Comparison 2008 v 2007 v 2006
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200
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700
800
900
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Month
Tonnes
2008
2007
2006
Volume Growth
23.7%
Volume Growth
20%
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� Rainforest Alliance
� Being heavily promoted by
McDonald’s
� Over 30 outlets already signed
New Brand Launch – September 2008
Protecting the environment,
wildlife, workers and local
communities
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Our Coffee Business now comprises
Premium offering
Corporate offering
Core ofbusiness
Environmentally friendly
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SPCA Priorities for 2009
� Complete implementation of the rationalisation of Australian manufacturing. On plan to deliver $8-10m of savings in 2009
� SPCA is well positioned vs industry peers
� Drive growth of Goulburn Valley brand in conjunction with Beverages
� Continue to reduce the reliance on Australian sourcing by fast-tracking the international business
� Pro-actively manage the drought and its effects
� Continue to drive NPD to deliver ongoing sales growth
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