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ABN Amro: ‘Spending farm shops remains high

Farmers and horticulturists who deliver to consumers through specialty stores such as farm shops are benefiting from the changed consumer spending due to the corona crisis. At the beginning of this year, this increased by about 30 percent at specialty food stores. This is evident from ABN Amro debit card transactions.

farm shop

For this year too, spending at specialty food stores will remain high due to the corona crisis, ABN Amro writes in the sector forecast. ‘Shopping at the farmer or horticulturalist has turned out to be a welcome outing now that a large number of people are confined to their homes. Moreover, people have more money to spend. After all, nothing is spent anymore in the pub or restaurant. In addition, the farm shop meets a need that has been gaining momentum for some time: consumers want fresh, authentic and local food. ‘

It is precisely the income in multifunctional agriculture that is influenced by the corona measures and changing consumer behavior, the bank notes. A number of these multifunctional agricultural activities are benefiting from the corona crisis, while others are being disadvantaged. ‘Corona has two faces for multifunctional agriculture.’

Side activities

More and more farmers have secondary activities. Last year, the Netherlands had 22,000 multifunctional companies, about 40 percent of the total number of agricultural companies. Four years ago there were 14,000 agricultural businesses with a secondary activity such as a farm campsite or farm shop.

Last year, more than 7,000 agricultural companies sold their products via the short chain. These are farmers and horticulturists who deliver directly to the yard or via an intermediary link to the consumer. This could be, for example, a restaurant, a market trader or garden center. The number of companies trying to reach consumers via the short chain has also increased significantly, ABN Amro concludes, based on CBS figures.

In 2017, approximately 11 percent of agricultural businesses generated part of their turnover from short-chain sales, by 2020 this percentage had grown to approximately 14 percent. Short-chain sales have become an important part of their revenue model for these companies. On average, these companies generate one third of the total turnover from this secondary activity.

Local intermediaries

Yet increasing consumer spending in farm shops does not tell the whole story of short-chain sales, says ABN Amro. Where farmers and horticulturists, who supply to consumers via specialist shops, benefited from the closure of the catering industry and the changing consumer spending, some of the entrepreneurs who sell to consumers through intermediaries are hit hard.

‘The part of the short-chain turnover that depends on direct delivery to consumers is small. Most of the turnover is generated through the delivery to intermediaries, which in turn sell to the consumer. On average, a company earns almost 300,000 euros by supplying one of the aforementioned intermediaries. The company that sells directly to the consumer gets an average return of 50,000 from this. It is therefore positive that consumer spending at farm shops is increasing, but more important is what will happen with sales through the local intermediary this year. ‘

farm shop

‘The sale of flowers and plants is affected by the closure of garden centers this year. Sales through ‘click & collect’ are unlikely to make up for much of the blow that sales through this channel take. Farmers or horticulturists who supply directly to the catering industry suffer from the catering closure. In total, food gardeners convert around 330 million euros through short-chain sales with one intermediate link. About 70 million euros is earned by delivering directly to the consumer. ‘

Agrotourism

In addition to entrepreneurs working in the short chain, farmers engaged in agrotourism are also experiencing the consequences of the corona crisis. Last year, nearly two thousand agricultural entrepreneurs were partly dependent on operating a bed and breakfast, camping site or renting space for, for example, business events and weddings.

The vaccination policy plays a major role in how this side activity unfolds this year, ABN Amro expects. ‘If the corona outbreak is sufficiently contained before the summer, these activities in the yard will undoubtedly increase again. Especially when the farmers also have opportunities to receive German and Belgian tourists. ‘

‘If the corona virus is not sufficiently contained, the Dutch will, just like last year, mainly recreate in their own country. In 2020, the turnover of Dutch residential recreation increased during the summer holidays compared to the summer holidays in 2019. But this did not make up for the loss of turnover in the other holidays, such as the May, Whitsun and Easter holidays. ‘

Optimistic

ABN Amro is optimistic for this year. A lot is already being booked. The prospect of nice spring weather, negative travel advice for abroad and a longer-than-expected lockdown are currently leading to more bookings by Dutch families and homeworkers.

‘The other activities will be less successful if, in all likelihood, a number of restrictive measures remain in force even in the summer months. The bookings of group accommodations and the rental of accommodation for business or personal meetings will then, in the best case, pick up again later in the second half of the year. However, this will no longer make up for the lost turnover of earlier this year, ‘expects ABN Amro.

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Labelling

“Natural Branding”: Made in Germany

The term “Natural Branding” was applied by the Laserfood company as a word trademark, but not as a technology. However, on 5 May 2020, this trademark “Natural Branding” was declared invalid by the EUIPO (Invalidity No. 000029701C) due to its descriptive character. For this reason, EcoMark – as well as any other company – is allowed to use the description “Natural Branding” for laser marking of fruits and vegetables. The proceedings are currently still pending in the court of appeal. It is expected that the new decision will confirm this, as no new evidence was presented in the appeal.

The mentioned regulation 510/2013 is about the use of iron oxides and hydroxides (E 172) as contrast enhancers after fruit laser processing, not about the laser process itself. The use of laser technology for fruits and vegetables is not a protected process and is therefore permitted to virtually anyone. In this respect, there can be no question of “fraudulent behavior by competitors”. The only protected process that exists is a patent (see also Regulation 510/2013) for spraying fruits and vegetables with a special liquid after laser treatment. However, the liquid is not approved for organic products, and there is no connection to the term “natural branding”. That is why, in the organic sector, only the pure laser technology is used, which is not patented.

In 2018, EOSTA won the award for sustainable packaging, not with the technology of the company Laserfood, but for the basic use of laser technology instead of packaging. At that time, EOSTA was also already in possession of a Natural Branding machine from the company EcoMark Ltd.

The term “Natural Branding” had demonstrably been used by EOSTA and EcoMark for a long time when Laserfood was still using the term “natural light labeling”. It was not until “natural branding” had become accepted as a term for the laser labeling of fruits and vegetables that the company Laserfood applied for the trademark “natural branding” and only then used it itself.

The Laserfood company is not the inventor of the technique for laser branding fruits and vegetables, nor is it the market leader. The technology has also been continuously optimized for use on fruits and vegetables. For example, EcoMark now offers special laser techniques for specific products that are not offered by any other machine manufacturer.

“Building your own laser makes no economic sense when there are good systems ready to buy,” says Richard Neuhoff, managing director of EcoMark Ltd. “Sure – it saves money to buy the laser components cheaply,” Neuhoff adds. “However, the development effort for a good laser is high, and to offer worldwide service for it is not possible for small companies like EcoMark,” he said. That only leads to dissatisfied customers!”

Bild2eco

EcoMark Ltd focuses on developing its own software to achieve competitive advantages in handling and for processes, ultimately increasing productivity. There is currently no faster product recognition than EcoMark. “With our concept, we can easily respond to customers’ needs and thus increase productivity. After all, in addition to the environmental reasons for Natural Branding, it is productivity and thus the profitability of the marking that is decisive in the end. That’s where EcoMark can score with the new “NB 12003 Professional” machine.” The fast 3D camera evaluation for product recognition combined with 120W laser power could already sell EcoMark several times.

“Currently, our NB machines are mostly used for organic product marking. However, due to their cost-effectiveness, they are now also increasingly requested for conventional products. It is not possible to mark more cheaply than with a laser, especially for large quantities.”

EcoMark’s claim is that every customer is able to react immediately to the degree of ripeness of the fruit, for example, or to create new products with new logos themselves. After all, this is the daily routine for our customers. If help is needed, however, it is usually very quick, so that the support is usually not charged for. “In the meantime, we live from our good reputation and further recommendations,” says Richard Neuhoff, managing director of EcoMark Ltd.

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Asia

Fruit salon – prices are the same as in a jewelry store: the most expensive fruit store operates in Japan

The Japanese are more than extravagant people, they always come up with something, go ahead of the rest of the world. This time they distinguished themselves with the world’s most expensive fruit salon.

Sembikiya is essentially a fruit shop, but the goods here are so expensive and the interior of the store resembles a jewelry salon, so “fruit salon” is a rather apt name.

This is the main store of the Japanese fruit giant Sembikia. It has been run by the same family since 1834. At the time, it was an ordinary fruit shop, but one day the second generation wife of the owner of the shop decided that they could make money in another way.

So, this is more of a gift shop than a store. About 80–90% of these goods are bought as a gift, because in Japan it is customary to give expensive fruits for official events (weddings, business negotiations and hospital visits).

Square watermelon – for only $ 212.

$ 69 for a package of royal strawberries (12 pieces).

Or a watermelon denuke for $ 127 ???

By the way, in 2011, farmers from Hokkaido were very sad because the price of these watermelons fell: the most expensive of them was then sold for “only” $ 4,000. Only 100 of these watermelons are grown in Hokkaido every year.

Yubari melons (one for $ 160 or two for $ 265). These are the most expensive fruits on earth. Once such a melon was sold at an auction for $ 23,500.

What’s so special about them? First, they are grown in ideal greenhouses and covered with hats to keep them from drying out in the sun. Each plant produces only one fruit, and to get the sweetest fruits, farmers cut the fruits ahead of schedule.
The Sembikia family claims that it was she who started the tradition of giving expensive fruits.

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Market

Generational change at KWS

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At this year’s Annual Shareholders’ Meeting, seed specialist KWS will be initiating a generational change to be implemented in several steps. Continuity, family tradition and expertise are the focus of the future Supervisory and Executive Board line-ups.

Andreas J. Büchting (74), Chairman of the Supervisory Board of KWS SAAT SE & Co. KGaA and general partner KWS SE, will resign from his position as scheduled at the end of his period in office in December 2022. At the request of the KWS SE family shareholders Büchting and Oetker, the current spokesperson of the Executive Board, Hagen Duenbostel (51), will be recommended as his successor starting in 2025 at the Annual Shareholders’ Meeting on December 6, 2022, and will subsequently begin the customary two-year cooling-off period on this date. It is intended that the former spokesperson of the Executive Board, Philip von dem Bussche (71), will assume the office of Chairman of the Supervisory Board on an interim basis through the end of 2024.

Felix Büchting (47) will succeed Hagen Duenbostel as the Executive Board spokesperson. With these decisions, the two top management positions will be filled for the long term.

Overview of the intended changes in the Executive Board and areas of responsibility:

  • End of 2021: Léon Broers will leave the KWS Executive Board as scheduled. Felix Büchting will assume responsibility of Research and Breeding. Peter Hofmann will assume responsibility of Cereals, Vegetables, Oilseed Rape/Special Crops & Organic Seed.
  • January 2022: Nicolás Wielandt, currently Head of Corn Europe, will join the KWS Executive Board. He will take over responsibility for Corn Europe (Peter Hofmann) and Corn South America (Hagen Duenbostel).
  • Fiscal Year 2021/2022: Responsibility for Corporate Governance, Compliance and Risk Management will be allocated to CFO Eva Kienle.
  • January 2023: Felix Büchting will assume the position Spokesperson of the Executive Board and responsibility for Group Strategy from Hagen Duenbostel. Nicolás Wielandt will take charge of Corn North America and Corn China and will therefore be responsible for the entire Corn segment.

KWS is a seed specialist among the world’s leading seed companies and has been independently managed and sustainably developed by the founding families since 1856. With the appointment of Felix Büchting as a seventh-generation representative of the founding family, and Marie Th. Schnell, who in 2016 succeeded her father Arend Oetker as a member of the Supervisory Board, the Büchting and Oetker shareholder families have underpinned their personal dedication and commitment to the company.

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