Current Issue 52
Fruit & Veg City has earmarked the DRC, Zambia, Kenya, Ghana and Nigeria as its next expansion routes as it continues to introduce a fresh approach to food retail to an increasingly large audience
Freshness and Value at a Premium
Writer: Matthew Staff
Project Manager: Callum Philp
Fruit & Veg City has spent more than two decades bringing new levels of freshness to South Africa and the surrounding sub-Saharan region, and has maintained its strong entrepreneurial flair in broadening its presence further in 2015.
Incepted in 1993 by brothers Brian and Mike Coppin, the business remains a family one to this day, facilitating the kind of flexibility that has been required for a Company striving to continuously update and innovate its model in order to keep ahead of grocery trends and retail opportunities.
This is further driven through the attendance of continentally- significant events such as the African Retail Congress which helps keep the business firmly ahead of the industry curve, but any knew knowledge is always applied back to its core values established from day one.
“Since the beginning it has always been a family business, with emphasis placed on good old family values such as wholesomeness, trust, honesty and integrity,” the Group states on its website. “The brothers’ vision was to create a store that would resemble a marketplace of old, where farmers brought their fresh produce from their farms to be sold to the public. This was how their first store in Kenilworth, Cape Town was run, and this is how every Fruit & Veg City store that has opened since is also run.”
Nearly 23 years later, and 130 stores throughout Southern Africa - as well as Australia - have followed this philosophy, with the refusal to rest on its laurels evident each year via a series of new store openings, business expansions or international ventures.
In 2015 alone, 15 new stores have been introduced, taking its total to 130 in South Africa; complemented by 40 franchised stores, 200 convenience stores and 30 international outlets outside of South Africa. All of which strongly symbolise the ethos on which the initial business model was built by the two brothers all those years ago.
The Company continues: “The dedication to freshness at an affordable price has always remained one of the cornerstones on which Fruit & Veg City is built.
“Today there are more than 100 Fruit & Veg City stores throughout Southern Africa, and even as far afield as Australia. Yet, it remains a family business with brothers Brian and Mike still running the day-to-day operations of the Company.
“Their vision is still visible in every Fruit & Veg City store, where freshness and value are placed at a premium.”
Theatre of food
Not only has Fruit & Veg City expanded in literal terms via its ever-expanding outlet portfolio, but it has done so under an equally diversified range of brands in order to fully capitalise on the acclaim that its core service offering was receiving in the region.
The first of this four-pronged evolution was seen through its Food Lovers Market, as the Company explains: “The next step in the evolution of Fruit & Veg City was to create a modern eatery where food aficionados could indulge in a range of gourmet foods.
“It was this vision that finally gave birth to the Food Lover’s Market, a theatre of food that was designed specifically with connoisseurs in mind. The Fruit & Veg City team crossed the globe in search of the hottest international trends in food.”
Visiting places as far afield as the US, Europe, Australia and East Asia, Fruit & Veg City ultimately brought back a stylish and modern food emporium incorporating the freshest tastes from around the globe for the benefit of the most refined pallets in South Africa.
It is this balance of meeting customer expectations, while also bringing them something a little bit different that continues to make the Company such an appealing prospect, while also endearing itself to high profile business partners in the process; as was seen through the formulation of its Fresh Stop subsidiary which came about via a strategic alignment with Chevron.
“These trendy stores, located at selected Caltex service stations, feature a variety of innovative departments and products that focuses on the ever-increasing, time conscious demands of consumers,” the business notes. “True to its name, Freshstop at Caltex is a one-stop shop for fruit and vegetables, with an extensive fresh produce section that is supplied and stocked by the Fruit & Veg City distribution network.”
A 50 percent stake in Diamond’s Discount Liquor in July, 2012 resulted in a similarly successful joint venture under the new Market Liquors brand - a retailer and wholesaler of both liquor and soft drinks - while the Company’s vision to be the best import and export Company in Southern Africa was driven by the introduction of FVC International, which has subsequently led the business as far afield as Australia.
Fruit & Veg City adds: “Our vision is to...offer a complete hands-on facility, and ensure that our products are grown, picked and packed in perfect conditions.
“Over the years we have established strong relations with farmers who have vast experience in growing, harvesting, storing and packaging fresh produce for exporting. Our buyers oversee operation at the pack houses, closely monitoring that the fruit is packed according to specifications, and cooled at the correct temperature.
“FVC international also has its own logistics company in partnership with two of South Africa’s largest fruit growers, which ensures that orders reach their destination in the shortest possible time, in perfect conditions.”
A synergy of values
Constantly looking for potential gaps in the market for new, lucrative opportunities on which to capitalise, the aforementioned franchising and wholesaler routes have proved especially prominent for Fruit & Veg City in recent years as a way to expand its influence in a quick, yet relatively risk-free manner.
Arguably the most significant of all these examples, however, was its 2012 decision to expand its grocery range to include international food products from British retailer, Waitrose.
Strategically introduced as a way to once again differentiate the business in an increasingly-competitive food retail industry, the South African operator took on more than 200 of Waitrose’s food products in order to not only meet consumer demand, but to once again unveil something a little different to the ordinary offering.
“We felt very strongly that we wanted to offer a range of Waitrose products in our stores. We saw a synergy with the brand as their core retail values of offering high-quality food products and innovation in retail are so closely aligned to ours,” said Chief Executive, Brian Coppin at the time.
“The retailer expanded its range from fresh food to include non-food grocery items in 2012 and plans to convert all Fruit & Veg City outlets to its premium brand, Food Lover’s Market,” added a business report analyst. “In some locations Food Lover’s Market competes with Woolworths Food stand-alone stores, which have stocked fresh produce, groceries and non-food products for more than a decade.
“Food Lover’s Market will be stocking a range of Waitrose’s ambient and frozen products, including frozen ready meals, tarts, cakes and ice cream, as well as rice, pastas, coffee and canned foods.”
While this slide away from the traditional Fruit & Veg staple seemed drastic at the time, Coppin assured that this was a diversification and expansion rather than a transformation, and this has subsequently set the tone for the Company’s more recent strategic acquisitions, partnerships and expansions; with a more well-rounded consumer offering to rely on in entering new domains.
A lovely business model
Looking forward, and this bedrock of unrivalled reputation in the region, coupled with the same entrepreneurial, family-driven ambition that has propelled the Company for the past two decades, will undoubtedly see Fruit & Veg City become a household name on an even vaster scale in the future, with countries across Central, East and West Africa all in the crosshairs.
Kenya, Ghana and Nigeria are very much areas of interest moving into 2016, building upon a very recent announcement of its decision to set up a wholesale centre in Kasumbalesa, the border town between the DRC and Zambia.
The Company’s Head of African Operations, Frans van der Colff explained in a recent interview: “I have stood at that border and [watched] trucks arrive and stand there, and they are emptied; they sell everything on the truck before they even cross the border.
“And people don’t come through the border post, they just run through the bush on the side, buy… and then simply run back and sell on the other side.”
Described as a “phenomenally busy” border crossing, this decision is yet another example of the kind of out-of-the-box thinking Fruit & Veg City has become so renowned for, and the plan may come into fruition just as quickly as the decision was made, while the retailer consolidates its Zambian operations.
“Almost everything in the DRC is brought in. So the thinking is one sets up a more wholesale type operation – like a Fruit & Veg City ‘Makro’ (South African wholesaler) – where people can buy in bulk whatever they want for their smaller shops on the other side,” Van der Colff continued.
“I think it is a lovely business model, and in that area specifically it will work very well.”
Sector analysts anticipate that this latest move will be another subtle tweak on the established Fruit & Veg City model; opening itself up to a large array of local retailers as opposed to opening one or two of its own Food Lover’s Market outlets in each new country as it establishes its supply chain networks.
However, with the African footprint vast, farming partnerships across the continent firmly established and the vertical integration capabilities to fall back on, the Company is seemingly on the verge of unveiling yet another string to its tantalising bow.
“It is about establishing a base in a country first and then growing from there,” Van der Colff concluded. “It doesn’t all happen overnight... [but] we’ve got the space, the ground, the fertile soil and there is water in most instances. It is just literally about supplying the seeds.”