Merger brings co-op closer to retail business
Merger brings co-op closer to retail business
One potato co-op has taken a novel step in getting
closer to the market. And it wants new members
to benefit. Edward Long reports
AFTER a period of painful rationalisation the potato production and marketing company born from the merger of Anglian Produce and Greenvale now offers worthwhile benefits to the 200 members of Anglian Potato Growers (APG).
This is the view of Norfolk potato grower Tony Bambridge who is vice-chairman of the co-op which contracts out its services to Greenvale AP. He also represents shareholding grower-members of the group on the executive board.
"The aim of putting the two companies together last year was to make significant cost savings, and bring growers closer to the retailing side of the business," says Mr Bambridge, who is joint managing director of Aylsham-based B&C Potatoes and grows 160ha (400 acres) of ware and 100ha (250 acres) of certified seed.
"The old Anglian Produce provided agronomy advice, marketing and back-up administrative services to co-op members which Greenvale duplicated for its customers, so there was scope for a cost-cutting merger.
"But the potential benefits were much wider. While AP members wanted to get closer to the retail markets, Greenvale wanted a dedicated grower base. It seemed logical to merge. We have now come through this, the dust is settling, and we are all in a stronger position to face the future."
The main focus is on finding marketing opportunities for growers to add value to produce. This does not involve supplying only the company packhouse. APG is an independent co-op so supplies significant tonnages to other packers, and a large slice of the 400,000t produced on 7700ha (19,000 acres) goes for processing.
Around 10% of members potatoes goes through the company packhouse. This is purely a commercial decision but the proportion is likely to increase. As growers are now active participants in the supply chain they have direct access to marketing initiatives involving Greenvales retail customers. By understanding customer needs the group aims to become more professional and more crops will be slotted into production schedules for specific customers before they are planted.
The enlarged company has what could be the largest technical department for potatoes in the country with a research budget of £80,000 this year.
Before the merger AP had a highly successful import/export department. Following the link-up this has become even more powerful and could increase export marketing opportunities for UK produce.
"We already export seed to France, Spain, Portugal and Majorca from Norfolk on the back of reciprocal trade through Greenvale. Ware potatoes have been shipped to Norway, Sweden, Iceland, Germany and the Far East. If we get the £ back onside there could be even bigger opportunities to export our crop and improve prices."
The most significant recent move is the formulation of a revised levy structure to fund practical research and to explore new value-added market opportunities. Details of the new arrangement will be given to growers over the next few weeks. This is at the core of a package designed to attract worthy new members to the group.
"The strategy of AP Growers is to remain a strong, dynamic, and independent group. We are keen to recruit new members who bring strategic advantage to it. This could include those with organic production, or those with the type of land needed to meet quality-conscious pre-pack markets. But this does not exclude efficient processing potato producers," says Mr Bambridge. *
Marketing opportunities which add value are the main focus at APG, says Tony Bambridge.