The repercussions of the economic downturn are still being felt for suppliers of winter produce from Central America and the Caribbean. Suppliers say they are trimming costs and looking for new ways to provide value and keep sales flat this year.
“We’re hoping that there has been a little boost of the economy,” said Lou Kertesz, vice president of Fresh Quest Produce, Inc., Pompano Beach, Fla., who said the industry is also hoping demand will pick up in what is becoming a smaller marketplace for exporters. “Every year less and less growers are involved in the Central American deal. It is survival of the fittest, down to three of us as main shippers.”
Larry Leighton, president of Caribbean Fruit Connection Corp., Miami, said many in the industry are working extremely close to their margins, and the risk of credit is becoming especially poignant right now.
“We are being very, very prudent on our sales and extension of credit, and our customers are telling us that they are doing the same. So that activity in itself tends to contract the market,” he said. “You hear people say, ‘We sell what we know we can collect for.’”
Charlie Eagle, vice president of business development for Southern Specialties, Pompano Beach, said by paying attention to what customers are asking for, his company has still been able to grow programs and attract new customers.
“You have to pay attention to what the economy is saying to you, the market,” Leighton said. “People are making choices in what it is they’re buying. Green bananas are selling extremely well because they are a traditional starch that you can substitute for some of the other stuff at a much lower price.”
Mark Vertrees, marketing manager for M&M Farms, Miami, said mainstream tropicals for Asian and Hispanic customers, such as root vegetables, are probably increasing while other commodities are holding steady.
“Everyone is hurting, and people are being careful of what they are buying,” he said.
Many suppliers talked about efficiencies created, improved customer service and other ways they are preparing for the economy to be back on track.
“We are focusing on what will help make us a better company six months from now, a year from now, five years from now and beyond,” Eagle said. “We’ve been maintaining our diversification of customer base, and we’ve attracted the attention of several retailers that are interested in private-label programs.”
Eagle said progress during a down time was due to investments in infrastructure, personnel and attracting “top-notch people.”
Vertrees stressed the importance of maintaining marketing and advertising expenditures, and added participation in conferences has been helpful for M&M Farms.
“We participated in (the Produce Marketing Association’s Fresh Summit), and we found that to be busier than we anticipated,” he said. “Next year, we are doubling the size the of our exhibit booth because it is back in the Southeast again (Orlando).”
Vertrees also noted M&M Farms is gearing up for the March Southeast Produce Council conference in Tampa.
“We see that as a very good convention. It’s like a mini-PMA,” he said. “There is a lot of good personal time with the retailer and food service buyers and executives.”
Marketers of Central American and Caribbean produce say that they are keeping their advertising budgets steady despite the economic downturn.
“We have a very progressive marketing program both on the consumer and the retail level,” said Larry Nienkerk, partner and general manager of Splendid Products LLC, Burlingame, Calif., who described a litany of programs to push wintertime mangoes. “We are doing what we can to promote specials, doing what we can to get editors in the papers in the country [to place] stories about mangoes.”
Nienkerk, elected chairman of the National Mango Board, Orlando, Fla., in November, also said the board is working to promote mangoes with processors and restaurant chains, and the board hopes research programs at the U.S. Department of Agriculture extension services show the nutritional value of the mango that corroborate its distinction as a superfruit.
Mark Vertrees, marketing manager for M&M Farms, Miami, said companies that scale back marketing in bad times are those that are going out of business.
“We have maintained our advertising and increased our adverting versus previous years,” he said. “A lot of companies are cutting back on marketing, and that’s really the last thing as a marketing director that you should be cutting back on.”
Vertrees said educating retailers helps give them solutions to offer new customers.
Mary Ostlund, director of marketing for Brooks Tropicals, Homestead, Fla., uses the free advertising of e-mails and the blogosphere to gauge public opinion and promote Brooks Tropicals produce.
“It’s very anecdotal, but I do find people talking about tropicals quite a lot,” she said. “To me, it’s showing a general acceptance. I am answering probably a dozen questions a day about tropicals.”