Business Insights

Food And Beverage

Bridging the Gap

Knowing where your food comes from bridges the gap between the paddock and your plate.  But there is a growing sense of unease about agriculture in this country, particularly in urban areas, where many people don’t understand where their food comes from or how it is produced.

American agricultural biotechnologist Jack Bobo summed it up well when he said “consumers have never cared more, nor known less, about where their food comes from.”

They are the ones who choose what they buy – and increasingly this is a conscious choice - buying food they feel has been produced in a way that aligns with their values. 

How do consumers place a value on what you do if they don’t know your story?

Last time you bought a pumpkin or squash at the supermarket, did you know where it came from, when it was grown, who grew it, how the farmer uses water or rotates crops to promote soil health?  

Probably not.

At the point of sale in New Zealand, there is often little or no information for the conscious consumer who isn’t already armed with a back catalogue of brand names they know and trust. 

So you wouldn’t be told at the point of sale that the squash displayed in the supermarket was produced in Hawke’s Bay or Gisborne and came from a New Zealand company called Three Good Men.  Or that it was farmed sustainably with care for the soil health using little water resource and natural bee pollination.

Two years ago, three companies (the ‘three good men’) joined forces to create a brand that was bigger than just one grower. 

Growing, packing and exporting New Zealand squash, their business is built around the three promises of consistent quality, total traceability and customer happiness. 

Japan, Korea and increasingly China are where Three Good Men’s happy squash go, some 20,000 tonnes every year.  And when you buy an exported happy squash you’ll be educated about the quality, taste, origin and grower story.

At the point of sale in Asia the consumer demands a completely different experience than in New Zealand – and Three Good Men recognised this.  They’ve invested in understanding what the consumer wants and that has dictated how they tell their story.

They’ve designed and implemented a system to record the full story of everything they produce. 

The promise to their clients is the reassurance of being able to trace details of the squash they import and sell to their customers.

And Asian retailers have really embraced this. At point of sale consumers see the grower story, through photographs, video and food tastings, and are educated about the product they are buying.

We’re really proud to say we play a small part in the Three Good Men story and ANZ sees a great opportunity for the broader sector.

Horticulture forms a significant part of the New Zealand economy and it continues to grow.  The most recent data puts the value of the sector at NZ$8bn (including wine) with over NZ$5billion of exports.  In 2016 horticulture contributed 10.3% of New Zealand’s merchandise exports.

Whilst wine, kiwifruit and apples dominate, it has huge diversity of product from onions, squash and peas to avocados, cherries and berry fruit. The corresponding diversity in land use, business models and markets make the sector an attractive growth proposition.

The key to success will be focussing on efficient and sustainable production systems producing consistent and high quality products, combined with a deep understanding of consumer and market demands and the ability to tell a clear and compelling story.

That will ensure a premium market position that will continue to attract investment but we need to take consumers with us.

Urban populations will continue to grow and each generation will be further removed from the production of our food. 

So bridging the gap between the paddock and the plate will become increasingly more important for horticulture brands in NZ.

 

John Bennett is General Manager, ANZ Commercial & Agri for the central region.

 

This material is provided as a complimentary service of ANZ.  It is prepared based on information and sources ANZ believes to be reliable.  Its content is for information only, is subject to change and is not a substitute for commercial judgement or professional advice, which should be sought prior to acting in reliance on it.  To the extent permitted by law ANZ disclaims liability or responsibility to any person for any direct or indirect loss or damage that may result from any act or omissions by any person in relation to the material.


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