Global Thinking

Originally printed in the January 2020 issue of Produce Business.

With each New Year, the innovative retailer must take stock of the overall operation and ensure the business strategy incorporates all the opportunities available around the world.

When discussing such a review with upper management, often there is a lack of support for such an action. The reply to this concern is often, “You don’t need to concern yourself with the world. All you need to know is where to get the best produce in this hemisphere.” This shortsighted and limited thinking once again proves that when it comes to produce, upper management “just doesn’t get it!”

At one time, it was enough for any good produce executive to understand and be an expert on all of the production areas in the United States, Canada and Mexico, but the world has changed. It is no longer satisfactory to be able to source the best quality product and the widest variety available by concentrating solely on the Western Hemisphere. With the advent of improved transportation, increased production and development of the produce industry around the world, an entirely new realm of sourcing is available to the innovative retailer. To compete in the new world of retailing, it is not enough to know where the best produce is produced in the United States as well as what time of year the best quality product is available. The knowledge of which area should be used at what time within our hemisphere is only part of the grand strategy necessary to compete in the modern world of a retailer. The truly successful operation must have a complete knowledge and understanding of all available supplies around the globe throughout the year and not only in the “off-season” of the United States.

For those who might be new to this way of thinking, a good place to start is studying and understanding where the various produce commodities are produced around the globe. We all know of the areas that we have presently been using during the “off season” in the United States, including South America, New Zealand and Australia. However, it is imperative to open our eyes beyond what we know presently. It requires a deeper dive into the machinations and economic trends that drive the global market.

We must be able to source product at its peak of quality from anywhere in the world — including Europe, the Middle East, Africa and Asia — to be certain we are offering the best quality product. The number of production areas around the world and the product — including new varieties — produced is the key to understanding the advantages and benefits offered by each of the areas. Along with the vast variety and high quality available, understanding global production and markets helps determine if these opportunities in other producing areas offer true value to your operation. Real value requires an honest evaluation of the feasibility of moving product to stores utilizing any and all advantages in transportation or accessibility and selling them for a competitive price. As is always true in produce, the value equation must be satisfied before any strategy can be initiated.

At one time, it was enough for any good produce executive to understand and be an expert on all of the production areas in the United States, Canada and Mexico, but the world has changed.

To be truly successful in the global market, the analysis must include the knowledge of the global supply base and its unique characteristics and special conditions. The successful retailer will need to understand each of these production areas as well as the ones most familiar to us in the Western Hemisphere. The learning curve includes knowing when each item is in production, when production peaks, when is the best time to buy, and when is the best time to exit the area and move on to the next. A good example would be in the world of grapes — where we all know how to start with grapes from Mexico then move to California for most of our season in the Western Hemisphere, and then onto imported grapes from Chile. In the new world of the global market, one must determine whether to utilize grapes from Chile, Australia or South Africa, or even from the Middle East, or better yet a combination of all the areas ensuring the best possible product available at a specific time. This is the advantage that can be gained from all areas in the global market through conscientious study and an understanding of what is available to your operation at varying times of the year.

It is a fact of life that we are now part of a truly global industry. To continue as we have before is a monumental and fundamental mistake. To survive we must integrate our operation into the entire global market to remain competitive — not only in our own marketplace but within the global sourcing of fresh produce. If we turn our heads and don’t take action it is highly likely we will not survive in an unfamiliar marketplace. By investing time and energy as a serious student of the global marketplace and its inherent opportunities, one can help ensure a produce operation will remain viable for many years to come.

Don Harris is a 41-year veteran of the produce industry, with most of that time spent in retail. He worked in every aspect of the industry, from “field-to-fork” in both the conventional and organic arenas. Harris is presently consulting. Comments can be directed to [email protected].