How to turn your fruit sourcing into a competitive advantage...
Updated: Oct 26, 2020
Now that COVID has forced brands to compete for the same retail shelf, it is more critical than ever for manufacturers to pay special attention to the value they are offering their consumers and retail partners.
Reducing unnecessary costs is key to ensuring market competitiveness. Buying fruit in season is one option we at INNODELICE often recommend to our manufacturing partners as it allows for a triple win: cost reduction while improving quality and operational security.
Fruit is an essential element of an ice cream recipe, whether it is incorporated as a flavour or as the basis of a sorbet, for example. Hence, buying the right fruit at the right time is key for ice cream businesses in order to achieve the best quality, availability and price each season. To learn to leverage frozen fruits in your business, let us dive into the dynamics of the fruit market, the common mistakes and alternative practices.
There are 3 important characteristics about fruit purchasing that are important to grasp:
Fruit availability is irregular and mostly unpredictable. Most of us understand that fruits have a limited harvesting window and that mother nature will affect the abundancy of such a harvest. What we tend to forget however is that harvesting manpower also influences the availability of fruit on the global market, an important factor during COVID travelling-restricted times.
Fruit origins tend to change the taste profile. Soil and sun do make a difference, Therefore, not all strawberries taste the same. Same goes for mangos and so on.
Fruit is a global market. When buying fruit, you are competing with buyers from around the world, across industries. Purchasing power and speed-to-market make a huge difference to the final cost.
When adding these elements together it is easy to understand how highly competitive this market is, yet most manufacturers do not treat it as such and are at risk of committing costly purchasing mistakes that then puts their capacity to compete at risk as well.
COMMON FRUIT PURCHASING MISTAKES
It’s always better to learn from the experts! We asked Freddy YAHCHOUCHI, who is working as the Senior International Food Trader at Charles Masson Inc, what are the most common mistakes manufacturers tend to make when purchasing fruits? This was his response:
Firstly, “trying to buy all fruit requirements on one bid. Different fruits come in at different times of the year. At the moment of the crop, buyers have the best chance to obtain the best quality, the desired volume at the best price. As time goes by, fruit pricing increases driven by reduced availability and increased storage fees.”
Another common mistake lies in “qualifying only one source of fruit”. This inevitably increases business vulnerability in market dynamics and can result in costly operational impacts (e.g. supply disruption) and/or consumer impacts (e.g. change of product profile taste/quality). All of which can be mitigated via better purchasing practices.
BETTER PURCHASING PRACTICES
The good news is that optimizing fruit purchasing costs is within every manufacturer’s reach.
Here are a few recommended practices that will give you a jump start:
“Following the season and purchasing fruit items in their season is a critical tool to ensuring you are buying your fruits at the best price” says Freddy Yahchouchi. It is important to ensure that you anticipate your fruit needs well in advance. In order to help you maintain control and stay ahead of the game when choosing the types of fruit you need every year, we have included below a frozen fruit calendar including the recommended purchasing period for each based on the experience of the global partners in our ecosystem. For example, right now you should be planning for the purchase of Blueberries, Mango, Pineapple and Raspberries as we near their recommended purchase period.
“Any good fruit supplier should have multiple sources of fruit. To increase business agility and ensure fruit quality while maintaining low costs, manufacturers should qualify more than one source of fruit” says Freddy. In fact, by qualifying additional sources of fruits with the same fruit supplier you can mitigate supply risk without adding complexity to your supply base and back office operations. A simple and effective sourcing practice.
Finally, choosing a trusted and reliable supplier is key. When evaluating your fruit supplying alternatives ask yourselves, or better yet ask them: “What experience have they accumulated in fruit sourcing?”, “What expertise have they developed during such time?”, “Which geographies do they focus on?”, “What level of risk do they assume?”, “What purchasing power do they have?”, and finally, “What other services will they provide? (e.g. quality certifications, consignment warehousing, etc)
LEVERAGE INNODELICE ECOSYSTEM
“When Covid hit and fruit availability became scarce, some of our partners requested our support to avoid supply disruptions while maintaining costs low.” says Andrea Montreuil, co-founder at Innodelice. “By understanding the current purchasing habits and market dynamics, it became obvious to us that INNODELICE could bring more value to the frozen dessert industry by:
Scouting and choosing the right fruit sourcing supplier (so that our partners don’t need to do it);
Negotiating a better commission rate for all Innodelice partners by leveraging the scope and potential of our worldwide ecosystem;
Educating our manufacturing partners on crop cycles and common purchasing mistakes; and finally,
Connecting our partners, helping all involved grow their respective businesses, quicker and safer.
We at INNODELICE strongly believe global problems require innovative approaches. Through our global food network, we bring fast and concrete solutions to food manufacturers, brand owners & importers so that each can gain a competitive advantage in their respective markets. In the face of this year’s global fruit supply shortage, we were driven to be part of the solution.
With strategic partnerships and transparent collaboration, we have improved purchasing costs for our partners by 10-15% for the same fruit specification. Having direct access to their fruit sourcing and improved prices results in our partners being more confident in their business continuity.
Start rethinking your fruit sourcing with INNODELICE! Should you need support, more expertise in this field, or would simply like to check if what you are currently paying for your frozen fruit is correct, we would be happy to assist! Reach out to Nicolas or Andrea via the emails provided below and we would be happy to connect you with expert suppliers in our network.
Alternatively, you can connect with us through our LinkedIn page where we post regular updates and relevant information.
Founded by former executives in the Ice Cream industry, INNODELICE aims to create a worldwide ecosystem of solutions within the frozen dessert industry. Thanks to the relationships fostered by INNODELICE, manufacturers, brands, importers, distributors and suppliers can discover, buy and sell solutions to GROW their business. These solutions include co-manufactured and branded products as well as innovative and competitive ingredients, packaging and services. Our collaboration model generates lower costs and fewer risks for our participating partners while optimising their time to market. To learn more about INNODELICE, contact Nicolas MARIE (firstname.lastname@example.org), Andrea MONTREUIL (email@example.com) or visit www.innodelice.com.