Fri, 30/10/2015 - 12:20
Current Issue 77
Securing further capital investment, products and expertise from a strategic partnership with US-based Company, Land O’Lakes will enable Villa Crop Protection’s vision to grow
Firmly Rooted in African Soil
Writer: Emily Jarvis
Project Manager: Callum Philp
For the past 21 years, Villa Crop Protection (Villa CP) has significantly contributed to South Africa’s agricultural industry via its unique and innovative approach to crop protection. Through massive investment in the development of its product portfolio, targeting products mainly towards “permanent crops”, or “export crops” – such as citrus fruits, table grapes, apples, pears - the Company is helping to protect the seeds of continued growth of the country’s strong agriculture exports.
Agriculture remains a critically important industry in South Africa, and indeed many other African nations, not only as a provider of job opportunities but also from a food security perspective. Nearly 80 percent of arable land in South Africa is used for agricultural production, which amounts to more than 97.6 million hectares.
With the sector contributing around 2.5 percent (US$8.7 billion) to South Africa’s GDP, Villa CP is keen to capitalise on this market segment, investing heavily in product development in order to provide a total solutions approach to crop protection, as opposed to providing standalone products to the market.
After growing its turnover by 23 percent in the 2013-2014 financial year, Villa CP is now more confident than ever in its ability to invest its profits back into the business for the purpose of market share gain. “Based on the size of the local crop protection market at wholesale level, it is estimated that we currently hold a market share of just over 20 percent,” details Andre Schreuder, Managing Director (MD) of Villa CP.
Further bolstering its aspirational growth plans, October 2015 saw Villa CP sign an exclusive partnership agreement with Land O’Lakes Inc; marking the US-based Company’s first move into Africa and giving rise to a fantastic platform to further grow the Villa CP business both in South Africa and beyond via its “Rest of Africa” strategy.
Villa CP can now provide virtually the full product portfolio across the entire South African agriculture market, with key retailers across the sector to facilitate further market growth, and a strong team backing of more than 200 employees; a number which is touted to grow in line with the new partnership.
The Land O’Lakes joint venture model provides Villa CP with a fantastic platform for further growth in South Africa, but most importantly, to begin making progress on its continent-wide growth plan to deploy its products and services across Africa.
Schreuder comments: “The deal is to radically change our business for the better, and will see two likeminded organisations combine together two complementary portfolios of productivity-enhancing crop input products and services to help farms of all sizes to sustainably improve their yields in Africa.”
Operating for more than 93 years, Land O’Lakes is one of the most respected brands in agribusiness and food production. Its crop input and insights business, WinField Solutions is a leading distributor of seed and crop protection products and has built a leading reputation in adjuvants, plant nutrition and technological insights.
Schreuder details: “A key challenge for us has always been constraints on capital to keep our growth momentum going, while retaining a price competitive product offering. With the backing of Land O’Lakes and its WinField product range, we have the support of a US$17 billion entity to pursue worthwhile growth opportunities.
“But the relationship brings much more than access to new capital. The most exciting component of our new venture is the ability to tap into new expertise across a wide range of aspects, ranging from collective product procurement, skills transfers, sharing product formulation expertise, access to decision supporting information technology and other aspects such as quality control expertise.”
While the two companies continue to integrate and merge their expertise in the coming months, the short-term focus will be to oversee the local registration of the impressive range of Winfield products including adjuvants, as well as the Winfield range of plant nutrition products. The introduction of seeds into the local market will also be explored.
Selling a solution
Selling a solution, rather than a standalone product, has gone a long way in ensuring the Company stays ahead of the competition, subsequently remaining sustainable and realising international growth aspirations; something that can only be accomplished by enhancing capacities to cater for demand.
“These solutions will typically take the form a season-long spray programme consisting of an integrated crop protection programme, such as integrating insecticides and fungicides sprays, ensuring the correct usage of adjuvants with relevant products, creating an integrated plant nutrition programme and providing the appropriate decision-making data,” Schreuder says.
In order to provide the “ultimate solutions package” to clients, employees are able to utilise the Villa Academy, an in-house training facility with more than 30 short courses available at present, with a Diploma and Certificate in Crop Protection to be introduced as soon as it receives accreditation.
“We view the Academy as a critical component to our success,” the MD adds.
From a facilities perspective, the Company is to expand its warehousing capacities via the addition of more than 9,000 square metres of space. Capital investments are planned for Villa CP’s formulation facility, Fountain Chemicals and this has also allowed the Company to expand not only its research and development capabilities - with more than 900 fully-replicated trials planned each year – but to install additional formulating plants, automated filling lines and laboratory upgrades over the course of the next three years.
Schreuder continues: “Modern agriculture is technology-driven and requires high levels of expertise, and we see Villa CP playing a role in both these areas.
“With the backing of Land O’Lakes and the Winfield brand, we are now in a position to share our knowledge and expertise through a skills transfer model and employee exchange programme.”
As the portfolio of Winfield products increases, and Villa CP places a more concerted focus on expanding beyond the borders of South Africa, the Company also plans to increase the size of its team across all areas; placing more emphasis on HR in particular so as to ensure “optimal efficiency and professionalism at all times”.
“We also have a bursary scheme for agricultural students in order to provide a source of young talent in the industry, encouraging them to join Villa CP after completion of their studies,” Schreuder affirms.
Rest of Africa
Villa CP continues to strengthen its brand promise by making sure it does not lose sight of the customer at any stage of its investment. Living by its mission statement to provide high quality, cost-effective crop protection solutions that add value and creates wealth for its stakeholders - while also satisfying growers’ needs for sustainable crop production - Villa CP is targeting international expansion through a programme to register a wide range of crop protection products in neighbouring countries such as Namibia, Botswana and Mozambique.
“Given that we now have the backing of Land O’Lakes, our ‘Rest of Africa’ strategy is currently under review and will be developed on a country-by-country basis in due course, and we hope to find new, likeminded partners who are keen to share in our vision.
“Aligning ourselves with the synergies of Land O’Lakes and the WinField brand will form an important part of the next few months, and we need to make sure that our customers understand how our new structure and revised strategy can further enhance these critically important relationships,” Schreuder explains.
He concludes: “These are exciting times for Villa CP. By the end of 2016, we will have a significantly bigger presence on the continent, a bigger team, larger facilities and a wider range of products that cover associated industries such as fly control solutions, rodenticides, a home and garden portfolio and an industrial weed control portfolio. Ultimately, our goal is to grow our market share and continue to develop in line with industry trends in order to sell a complete value-adding solution to our customers.”