Amidst our frequent discussion of change at Wal-Mart, we have chronicled the exodus of produce expertise and leadership from its executive ranks:
DiPiazza Resignation Raises Questions About Wal-Mart
Wal-Mart’s Bruce Peterson Resigns
Wayne McKnight To Leave Wal-Mart
Wal-Mart Loses Another Star: South Africa’s Danie Kieviet To Leave
Now comes word that Steve Tursi, Merchandise Manager for Vegetables at Wal-Mart, has submitted his resignation as well. He is going to be joining Seald Sweet, working out of New Jersey.
To those following Wal-Mart, the only surprise is that he exited before a few other folks said their farewells.
We are sure that well-respected Seald Sweet CEO Mayda Sotomayer has big plans for Steve. We also recognize that there is a super upside for him in being associated with Seald Sweet’s parent company Univeg, which is growing fast including having just bought the giant German distributor Atlanta AG from Chiquita. We also suppose that a chance to return home — Steve is a Philadelphia boy — was mighty appealing.
Yet the truth is that with the changes in Wal-Mart’s procurement system and the cultural shifts at Wal-Mart, there was no place for Steve to go in produce at Wal-Mart.
No replacement has been named yet, and it will be interesting to see the direction Wal-Mart goes. Once upon a time Wal-Mart used to promote internally in the produce ranks. Lately it seems as if everyone is an outside hire or a transfer from some unrelated department.
Back in June 2005 Steve was the recipient of a PRODUCE BUSINESS 40-under-Forty award. Here is what Pundit sister publication, PRODUCE BUSINESS, said of him at the time:
|Steve Tursi, 36|
Merchandise Manager for Vegetables
On the fast track for seven years at Wal-Mart Stores, Tursi has played a key role in shaping and driving a wide range of consumer, food safety and supply chain initiatives.
Wal-Mart executives describe Tursi as having a solid track record for recognizing and developing multi-faceted partnership alliances to drive comprehensive produce industry business solutions.
Tursi was not only awarded the coveted Wal-Mart Stores Produce Buyer of the Year but also the Perishable Buyer of the Year for 2002. “Working for Wal-Mart has enabled me to be instrumental in two areas where the agricultural industry has experienced significant change in the past seven years contracting versus traditional FOB as the pricing model, and alternative packaging RPCs,” he explains.
Tursi’s active participation in industry organizations includes speaking for United and PMA on RFID technologies. He is an original member of the Southeast Produce Council and also dedicates time and commitment to educating current and future produce leaders by participating as a repeat guest lecturer at the Cal Poly Agriculture Business School. “This has enabled me to give something back to the agriculture industry and possibly help future agriculture industry employees,” he says. He also gives back to the community through fundraising activities for the Children’s Miracle Network and Big Brother organization.
In his hometown of Philadelphia, Tursi began his produce career, stocking shelves for Acme Markets during high school, and continued working there through his college days. After college he moved to Florida and worked as a buyer for American Stores, before Wal-Mart came calling. A United Leadership Program graduate, Tursi has a master’s degree in business.
While continuing his career at Wal-Mart, Tursi says, “Long-term I would like to be an adjunct professor at an agriculture university or for a food marketing program.
Hopefully I would be able to influence the leaders of tomorrow.”
Since that recognition, Steve has gone on to bigger and better things. He has become a member of the Board of Directors of PMA and married the ever-charming Nicole Reznik.
Wal-Mart has done well recently, partly because stressful economic times have expanded its market and partly because a decision to slow growth by reducing the speed at which it rolls out supercenters is de facto the same thing as raising the return hurdle rate on new investment.
Yet our sense is that Steve Tursi made the right move. His heart was in a way of dealing with vendors and thinking about produce that could be traced back to the Bruce Peterson regime. For better or worse, that is not the future at Wal-Mart.
For a man not yet 40, a brighter future lies in trying new things.
We wish Steve every success.
Here in the United States, the analysis of Tesco’s Fresh & Easy division has focused a great deal on operations — where are the stores located, why are out-of-stocks so high, how are consumers reacting to self-checkout and the Fresh & Easy brand, etc.
In the United Kingdom, on the other hand, much of the analysis is performed by investment bankers interested in the value of Tesco’s stock. Mostly this is spreadsheet work and putting estimates into models to ascertain valuations, which all rest on certain fundamental assumptions. These assumptions typically were whispered into the ears of the analysts by Tesco itself.
For example, we ran a Special Issue analyzing some research produced by a London-based institutional stockbrokerage known as Execution Limited. Much of our piece was a critique of the data collection methods utilized, but the report was filled with interesting background on the things Tesco was claiming for its concept. For example, this line told us how Fresh & Easy should be benchmarked:
Last November Tesco told us that F&E aimed to be as good as Walgreens for convenience, as good as Wal-Mart for price, as good as Whole Foods for freshness and as good as Trader Joe’s for differentiated products.
Convenience, freshness and differentiated products are subjective matters very difficult to research. Price, however, is pretty straightforward.
Although hundreds of commentators have given opinions on Fresh & Easy’s pricing, the comments all seemed anecdotal. We were unaware of any published efforts to systematically assess the price competitiveness of Fresh & Easy.
PRODUCE BUSINESS, the Pundit sister publication, rose to the challenge. In its May 2008 edition, PRODUCE BUSINESS took its rolling, multi-year, research project that studies the price competitiveness of different retailers vis-à-vis Wal-Mart and decided to look at Los Angeles, which provided a perfect opportunity to include Tesco’s Fresh & Easy concept in the comparison.
The methodology used was simple. PRODUCE BUSINESS went into a Fresh & Easy — it used the one in Arcadia — and wrote down the price of every item in the produce department.
We eliminated those items that could not be fairly compared — proprietary fresh-cut blends for example — and then visited four neighboring stores: a Vons (Safeway), a Wal-Mart Supercenter, a Ralphs (Kroger) and a Stater Bros. store.
Fresh & Easy typically sells packaged produce by the piece or pieces and most of its competitors sell bulk, so PRODUCE BUSINESS had to equalize weight to make them comparable. In some cases we actually purchased items, weighed them and calculated the price based on weight.
The comeuppance: Fresh & Easy isn’t even in Wal-Mart’s league when it comes to price on fresh produce.
It is not the most expensive in the market, however. That “honor” goes to Ralphs, which comes in at a whopping 24.92% over Wal-Mart’s prices. On the other end, Stater Bros. is the closest to Wal-Mart coming in at 7.70% over Wal-Mart in produce pricing.
Even Vons beat out Fresh & Easy, coming in at 13.57% over Wal-Mart. Other than Ralphs, Fresh & Easy was the priciest in the market, coming in at 15.09% over Wal-Mart’s produce pricing.
Fresh & Easy actually did worse than the raw data implies. Many of its competitors were selling well known brands, such as Dole, Chiquita, Del Monte, Sunkist, etc., and Fresh & Easy offered almost exclusively its own brand and no well known consumer brands.
It is difficult to firmly set a value here, but we generally found Fresh & Easy selling smaller sizes. Its bananas, for example, were smaller and under the Bonita brand. These products typically sell for lower prices on the wholesale market than do the larger bananas under the Del Monte or Chiquita brands being sold in the other retailers.
This leads us to think that Fresh & Easy would actually need to be lower priced than Wal-Mart for consumers to see it as an equivalent value.
Although the study focused on pricing, a side effect of the methodology is that we gather information on assortment, and Fresh & Easy offered the most restricted assortment of all the stores studied. The SKU count comparison in the produce department provided a striking difference between the stores:
State Bros.: 655
Fresh & Easy: 215
Although a big chunk of the difference is accounted for by dried fruit, nuts and other dry items, the assortment numbers do say this. If the consumers don’t value Fresh & Easy for its prices, they are unlikely to do so for its assortment.
It is a fascinating and important study. So often, we seek out complicated explanations when simple ones will suffice. Perhaps Fresh & Easy isn’t doing well because it isn’t offering consumers that good a deal.
You can read the article and see the complete price comparison charts here.
If you would like to subscribe to PRODUCE BUSINESS, we will include a back copy of this issue containing the price comparison in LA. You can subscribe right here.
Sustainability and social responsibility have been an important focus for us, especially over the past several months. We ran a series of pieces built around an effort to create an industry standard on sustainability utilizing the American National Standard Institute, or ANSI, process:
Sustainability Standard Being Steamrolled — Does A Sustainable Vision Encompass Only Organics?
The Imperative For Action (Part 1)
No Standardization Without Representation (Part 2)
The Produce Industry Strikes Back (Part 3)
Pundit’s Mailbag — Organic Icon DiMatteo Weighs In On Sustainability Standard
Pundit’s Mailbag — SCS Takes Exception To Analysis of Sustainability Standard
It quickly became clear, however, that the vision being promulgated, which included a highly proscriptive standard to define sustainability across an enormous range of crops from biofuels to fresh produce, was unlikely to ever attract a consensus.
This has led to an industry search for alternative models to use in pursuit of sustainability.
Tim York, president of Markon Cooperative, had provided an intellectual framework for this pursuit in a piece we entitled, A Call For An Industrywide Sustainability And Social Responsibility Initiative.
Then Tim, jointly with Jeff Dlott, President and CEO of SureHarvest, expanded on this topic in an article we entitled, Sustainability Goes Beyond Best Practices. We followed up that piece with an interview with Jeff to see how some of these ideas were playing out in work he has been doing with the wine industry. We call that piece, Sustainability Expert Provides Insights To A Similar Industry.
Another approach being discussed in the industry is being moderated by The Keystone Center and is focused, at least initially, on the wheat, soybean, corn and cotton industries. The effort is called Creating Sustainable Outcomes for Agriculture. You can find the press release announcing the initiative here and you can read the Foundational Context and Principles here.
Here is a slideshow that explains the initiative:
We are going to be speaking to several people involved in this initiative and thought it might be advantageous to start out by speaking with an executive from the Grocery Manufacturers Association who is on the executive committee of the initiative, since the GMA also interacts with supermarkets. We asked Pundit Investigator and Special Projects Editor Mira Slott to find out more:
Q: As the produce industry analyzes how to best incorporate sustainability practices into its businesses, we have reached out to others who have expertise in pursuing progressive strategies in complementary fields. Jeff Dlott of SureHarvest provided insight on the innovative sustainability program employed by the wine industry.
Jeff mentioned that he currently participates in the peer review process of the Keystone Initiative for sustainability in agriculture, which is focused on the four program crops — wheat, soybeans, corn and cotton. In terms of acreage, these are very important, but they are much less complicated from a production standpoint compared to most fresh produce crops. Still, Jeff says there will be many lessons that can be shared from the Keystone Sustainability Initiative that will have value to the produce industry. Beyond that, we’re interested to explore what role the produce industry might play as the initiative evolves.
How and why did you become involved in the Keystone Initiative? What does GMA hope to gain with this connection?
A: Our involvement in the Keystone Center’s agricultural sustainability initiative is predicated on GMA’s background in addressing sustainability issues and imperatives facing our members. GMA has its own initiatives related to food processors and retailers. GMA and the Food Products Association (FPA) collaborated with Deloitte Consulting to benchmark what retailers in the industry were doing with sustainability, and to better understand how to balance opportunity and risk. [Editor’s note: You can read Deloitte’s Executive Summary and Full Report here].
We ran a major summit in January 2008, with over 6,000 people attending, to talk sustainability. It was a diverse group of trade associations, individual companies, learning providers, academics, etc. Along with our sustainability effort, we have reported on climate change, water issues and packaging through internal groups at GMA.
Q: How do these GMA initiatives relate to the Keystone Initiative? Are they complementary or overlapping in their goals?
A: The Keystone Initiative, or its working name for now, Creating a Sustainable Outcome for Agriculture, is complementary to what GMA is looking to accomplish. There is no point in duplicating efforts with other groups where we see good alliance-building. GMA is focusing on food retailers and processors. Keystone is focusing on growers down the food chain. We thought it lucrative to form alliances with groups we’re not directly related to. I’ve been a participant at Keystone as a member of its executive team and in working groups. I’m one of the team players because I have a background in biotechnology and agriculture, so I’ve been interfacing others’ objectives and goals for the overall program.
There are folks in leadership roles at GMA who could better inform you of GMA’s positioning. Steve Sibert, Senior VP of Industry Affairs, is the lead person for all our sustainability efforts at GMA.
Q: How did the Keystone Initiative actually come about? Was this an effort by a few leading, influential stakeholders who cultivated strength as word of the program got disseminated?
A: The Keystone Center’s executives had working relationships with agricultural groups, and dialogue got started about the need to create measurable sustainability metrics. The Keystone Center convened the process and orchestrated stakeholder identification based on who would want to be at the table; at the onset they looked to the main commodity groups because they represented a major part of production going on the ground.
Primary stakeholders were targeted, but this is not an exclusive process, rather a collaborative effort. There are other grower organizations that have expressed interest in joining. Membership is initially concentrated on the large commodity crops, but all agricultural groups are being met with to learn from and garner their involvement. It’s not restricted to these four groups [corn, soybeans, wheat and cotton]; this is just how it started out.
Q: What is the Keystone Center’s role? How are decisions made? Are there methods in place to insure a fair and balanced process?
A: The Keystone Center is a neutral, non-profit facilitator; the people driving the initiative are the Executive Committee. [Editor’s note: According to Keystone, the Executive Committee is made up of one representative from each of the four sectors, corn, soybeans, wheat and cotton, and a fifth at large elected by the steering committee. The steering committee is 25 members from different sectors; food and retail, agribusiness, grower organizations, and conservation groups. The structure was determined by the group].
Interested parties came together and agreed to be participants and set up membership principles. The vision is a supply chain initiative, which naturally involves agribusiness, growers, and food and retail consumer-facing organizations. Conservation organizations represent other concerns, environment, health, and socio economics.
Keystone is the facilitator to keep things rolling, but the actual decision-making is done by team work groups, which report to the steering committee that meets a few times a year. Executive Committee top leadership represents members in their sectors. The metrics being worked on are a product of the group, drawn from existing literature, and through contacting other experts.
Q: Has it been difficult to reach consensus?
A: We have diverse interests, but luckily people are working for the common good. In many early on discussions to form the Keystone Initiative, it became quickly apparent that taking on agricultural aspects as a whole was a very complex and broad project. You’re dealing with varied industries and issues. Do you want to stay U.S.-centered or go international? What crops should be included? Do you take on animal agriculture as well as plant agriculture? It is mind-boggling how you would tackle all these areas at once.
Part of the initial activity was determining what do we want to focus on and invest our efforts in, knowing that later we could expand the scope.
Commodity crops were the focus; we needed to start benchmarking and this would prove the simpler task, and we had more information available to start with. We want to benchmark where we are today, compare to the past, and plan forward on how to measure improvements.
Since this is scientific in nature, a major reason why GMA wanted to get involved was to help develop the metrics. The Keystone Center is huge; it brings organizational structure, sets up meetings, helps to facilitate, but it’s not really the brainpower. There’s a wide group of decision-makers. This has to do with the producers, the eventual users, conservation organizations, non-government organizations, industries like ours, individual companies as well as trade associations that represent different sectors.
[Editors note: Entities participating in the initiative include:
Q: I noticed McDonald’s has taken a prominent seat at the table.
A: McDonald’s is smart to get involved. It wants to see how this will play out in the long run, interface between food product companies and consumers. It is looking to see what we need to do at the farm level and translate that into something meaningful to its customers. We must keep that horizon in site because the consumer is judging the impact of sustainability. McDonald’s shows some insight in joining the process early.
Q: What are the main challenges you see in building a sustainable agricultural system?
A: We all want to see a positive impact in agricultural sustainability, water and land use, but that’s just part of it. When we think about future food use — feed, food, fiber — where is this going to come from? How will we meet these needs in the future? Population will be doubling, challenging our current systems of food production. How will we adapt to these new demands in the framework of sustainability?
We can produce more by using up our resources, but collectively we agree this is not a good way to go. We need to put the whole expansion within the framework of sustainability goals. How will we do future farming while meeting and embracing sustainability goals? This is why we are trying to engage farmers at their level.
Q: Is that the structural framework in place through the Keystone Initiative?
A: The way we’re approaching sustainability now, we’re not using the mandate approach from top down, which has occurred in other sustainability efforts — Wal-Mart’s efforts with its suppliers comes to mind. This is an opportunity to come from the bottom up; the performance at the farmer level is the driving impetus here. If they had in their toolbox more ways to measure themselves against the regional average, then they could utilize best practices to move themselves up. Productivity is a driver now. Maybe rainfall is better than using water, for example. When they start to put information into the system and see how they are doing compared to neighbors, they can improve productivity as well as sustainable growing practices.
On more of an academic level, we can develop a sustainability index that sets targets and goals on where commodity groups have gone and are going, looking at wheat, corn, soybeans, and cotton practices on both a regional and national basis, and how can we make an impact. Macro and micro strategies work together. At the grower level, I know where I am in my community and county and then can look at the big national picture. We can have all these farmers making improvements, benchmarking progress through the sustainability index.
Q: How do you get this information? Are participants willing to share their results?
A: A lot of the information to feed in the index comes from government and academic studies, built from available data being mined and granular information that can be assembled. The initiative team is building the index and then it will be peer reviewed.
Q: Is there an opportunity for produce executives to become engaged in the process at this time?
A: Unfortunately produce folks won‘t be involved right up front. What produce folks can do is look at the systems and tools and start to formulate the next step of Keystone’s evolution to minor crops. Push to get involved in the initiative now, so when priorities are formulated for what’s next, they’ll have a voice at the table. The steering committee is open for people to join in and have influence on what transpires in the future. It could easily turn to animal agriculture; that may not occur if produce people are at the table to follow along this path.
Q: Does the produce industry need to get more involved in GMA’s sustainability programs?
A: Our GMA initiatives are more at production and retail level — energy use for processing, affects of climate change, looking at packaging and water use from a manufacturing standpoint, etc. We’re addressing best practices for recycling. From our standpoint, major food companies and retailers have initiatives in the working groups; Kraft, Unilever, Pepsico, McCormick, maybe some of the grain companies.
I don’t see fresh produce people involved, but that’s not to say they couldn’t be involved. They can get on the list of working groups. There is no exclusion on these. Some of the other trade associations are included, so we’re not working at cross purposes. By getting trade groups involved like United Fresh and the association for frozen foods, various industries are not developing whole guidelines that are at cross purposes with other trades. Being on the same track is where we want to be. We don’t want to duplicate efforts or oppose each other. That’s just counter-productive.
For example, we see synergy with the packaging groups, which are addressing industry issues. We see the sustainability packaging coalition has done considerable metrics work and development of principles. We don’t need to repeat that; we’re building strategic alliances. There is no need to reinvent sustainable agriculture. Let’s join strategically encourage that activity to continue and foster. It would be silly for us to reinvent rather than adopt sound practices.
The Keystone Initiative is expanding the steering committee; they have the growers, the conservation organizations and industry organizations, and that’s the opportunity for produce business to get involved.
Q: What’s happening going forward?
A: Keystone has computer systems at the grower level they’ll be piloting in the fall, several hundred folks to evaluate grower tools and see how to improve them. The other part is the sustainability index for commodity crops, pulling in the data from different resources to benchmark the past and see what needs to be in the future. The task can be daunting; crops have different requirements based on growing areas and other factors.
We’re very pleased to be part of the initiative that will have an important impact on the future. This is a task supported by 30 different groups that are participating in it now. We have an alliance to build a well-recognized initiative.
Q: Is the government involved?
A: Government representatives have been at the table a couple of times in an advisory role as well as a listening role, keeping up with what is going on, but without membership status.
Sometimes industry sets standards and they turn into regulations, but we’re a long way from that occurring. That could be one end point. Sometimes the government appreciates the industry taking the lead. If you wait for government, things often get bogged down and may never get done.
We have to build incentives for farmers to want to take steps forward in sustainability. Unless productivity aspects are there, you can’t expect people to join the cause. We have to design a system to make it economically viable. We’re trying to use grower-level interface to allow growers to look themselves in the mirror and compare their own sustainability practices to those in their community and region.
Q: From your work at GMA, is there any discussion about retailers or food service operators limiting their suppliers to those implementing sustainable practices? Providing additional incentives?
A: There has been some talk about that on the buying side; a retailer or restaurant chain would capitalize on the fact they are purchasing from farmers that use the Keystone Initiative as part of their overall sustainability program.
Q: Would there be some kind of independent, third-party audit or Keystone sustainability certification to validate the participants’ efforts?
A: In regard to auditing and certification, the benefit has to be balanced against the cost. If it adds cost to the system through certification, you have to pull costs out through productivity. You have to weigh the value. By using the grower model approach, maybe that amounts to enough evidence.
Right now we need to focus on the grower interface to let them put data in and get their data out. They’re participating, we’re getting data from the company and we see the productivity improving. If you get third party certifiers going farm to farm, that could add significant costs to the system. We’re steering away from audits. Getting/giving data should be sufficient, at least for now.
Q: In addition to the immediate productivity aspects, is the Keystone Initiative dealing with social aspects, worker rights, etc.?
A: The Keystone Initiative has that in its charter, not only the productivity piece, but also economic and social aspects. Once again, we are narrowing the scope initially and operating in phases to get up and running. On the social side, for the economic well being of farming agricultural communities, productivity is a key area.
Issues like worker rights and food safety and nutrition are on the shelf now, not to be ignored, but not a major area of influence at the beginning. The metrics have to do with productivity; there have to be incentives for the farmer to participate. If it costs too much money and is burdensome, we won’t get him to take part. He has loans to pay, banks to satisfy, and productivity quotients he has to meet. Once the train’s on track, these other issues can be incorporated.
Q: What is your take on marketing sustainability measures to consumers?
A: Each company sets its own sustainability objectives. Some companies are much more aggressive, while others are working behind the scenes and not in your face. Each company will choose its program and how to promote it. Whether you want to be out there promoting, or in the wings doing your thing and doing right is an individual choice. However, if you’re out there too far and things don’t go your way, it would be easy for consumers to get a bad taste.
Many of these sustainability programs are complex. The issue of food miles is an excellent example. It takes a whole lifecycle analysis of a product to understand its impact on the environment compared to other alternatives. When a study was done to calculate whether people in the UK would be doing more for the environment by buying local produce versus flying it in from Kenya, the results were not as expected.
It doesn’t do the industry much good if a company makes sustainability claims that turn out to be unfounded, and consumers call foul on you. If you try to promote your sustainability practices, you better be sure they don’t blow up in your face, because that won’t be helpful to anyone. The food companies are moving slowly, piloting case studies, which is a more conservative way to go than mandating XYZ, which could come back to haunt you later.
The Keystone Initiative is an enormously powerful approach because it provides a way to square the circle.
On the one hand, highly proscriptive standards won’t work on an industrywide basis for the simple reason that there is no consensus in values. Even within the environmental sphere, if one farm invested in a system that enabled it to reduce synthetic pesticide use by 80% and another farm invested in a system that had no effect on pesticides but, instead, reduced water use by 65%, which farm wins the award as more sustainable? The answer is that there is no answer to that question. It is just two farms focused on different aspects of the environmental sphere of sustainability.
If we add in the tension between the environmental, social and economic spheres typically attributed to sustainability, the notion of dictating one standard becomes absurd. How do we weigh one farm that places its priorities on increasing production so as to feed more people with another farm that focuses its efforts on reducing its environmental impact? How do these farms stack against a third that focuses on improving its financial performance so it can pay farm workers better and build a much needed rural hospital in its community?
There is no way to compare these things.
This has led experts to look to a much more positive, uplifting and inclusive version of sustainability built on a model of continuous improvement.
In this perspective values are not dictated and all are free to join the journey from wherever they happen to stand, and the journey is not expected to be the same for everyone as we recognize and respect that different people and organizations are in different situations and have different values.
Yet continuous improvement, without any way of measuring improvement, can quickly evolve into littler more than a marketing slogan.
Efforts such as those being undertaken by the Keystone Center are important because by developing industry metrics, they provide a yardstick by which continuous improvement can be measured and tracked. This turns sloganeering into serious work and serious efforts at improvement.
This is surely a long term effort; Dr. Barach touches on the tensions inherent in efforts to sustain the population with food, while sustaining the environment. He freely admits that much has been put to the side, including controversial issues on some aspects of social responsibility. This is, however, a clear step in the right direction.
Dr. Barach laid out a guideline for the produce industry to get involved with this effort and warned of the consequences if the industry does not:
Unfortunately produce folks won‘t be involved right up front. What produce folks can do is look at the systems and tools and start to formulate the next step of Keystone’s evolution to minor crops. Push to get involved in the initiative now, so when priorities are formulated for what’s next they’ll have a voice at the table. The steering committee is open for people to join in and have influence on what transpires in the future. It could easily turn to animal agriculture; that may not occur if produce people are at the table to follow along this path.
This seems like a clear charge to the industry and its leadership. Let us get ourselves lined up for the next projects so we can begin gathering information.
The brief comments Dr. Barach made on food miles, a topic we have discussed here, here, here, here and here, and the necessity for complicated life cycle analysis, a topic we discussed both here and here, point to the danger of proceeding in ignorance.
Despite some people’s predispositions, only careful research will tell us about the sustainability or lack thereof of organic growing practices or of shipping things from distant points of the earth or using greenhouses.
If we are smart, we will start gathering this information now. Doing so in conjunction with The Keystone Center is a very reasonable approach.
Many thanks to Dr. Barach, the Grocery Manufacturers Association, The Keystone Center and all involved with the Creating Sustainable Outcomes for Agriculture Initiative for sharing their thoughts and learning on this matter with us all.
Way back in 1992, the Pundit received a call. Would he be willing to come to Australia and give the Keynote Address at the Australian United Fresh Conference in Newcastle?
As the trip developed, it wound up including many other speeches, tours of early fresh-cut facilities and wholesale markets. For the most part, as Woolworths, the largest supermarket chain in the country, was increasingly buying direct, our job was to explain how growers and terminal markets in the US had survived the transition to direct retail buying.
The trip also included several regional workshops for the staff at Woolworths — not surprising since they paid the bill. The man behind the trip was a fellow named Peter Pokorny, who ran produce for Woolworths back then and was wise enough to see calming the waters in the grower-shipper and wholesale communities, communities deeply concerned by the implications of direct procurement, as a form of enlightened self-interest for Woolworths.
Yet showing that what goes around comes around, when Coles/BI-L0, the Number Two competitor in the market, whose produce operation was then run by a fellow named Martin Kneebone, asked if we could do a workshop for them as well, Peter said yes.
Now, some 16 years later, Peter sends an e-mail:
Trust this e-mail finds you well and in good spirits.
While it has been many years since we last met up, I must admit I feel like I have kept in contact as a regular reader of the “Perishable Pundit” — I really enjoy it!
I am writing to let you know that I am joining the Wesfarmers Group — owners of Coles Australia — as the General Manager of the Produce operation.
I left Woolworths in 2006 and spent the last 18 months as Chief Strategy Officer with a family company called Harris Farm Markets — a terrific independent produce retailer.
I hope to be in the States this year and trust we might renew our friendship at that time.
Woolworths has become enormously dominant in Australia. So accepting this kind of position with Coles is a sort of “ultimate challenge,” but the Australian press is full of reports of new hires for Coles — people who have worked at ASDA, Tesco and Sainsbury’s. The plans for fresh produce and thus the importance of Peter’s new position is hinted at in these lines:
WESFARMERS has hired the former boss of fresh foods at Woolworths to help turn around its newly acquired Coles supermarkets business.
Peter Pokorny, formerly general manager of fresh foods at Woolies, will join Coles in an identical role next month.
Wesfarmers has flagged an increased focus on fresh food as it seeks to close the performance gap between Coles and Woolies, which has been steadily expanding market share at the same time as earnings margins.
Wesfarmers chief executive Richard Goyder said Mr Pokorny had more than 30 years’ experience in Australian retail.
“Peter’s great experience in this area and his intimate knowledge of the Australian fresh food market will be invaluable in improving the Coles offer now and in the future,” he said.
Fresh food was key to the turnaround at British retailer Asda which was engineered in the early 1990s by then-boss Archie Norman, who has now been hired by Wesfarmers as a consultant to help transform the Coles business.
And so it goes around the whole world today. As we said at the founding of the Perishable Pundit:
“…that perishables are, and for the foreseeable future will be, the crucial arena for differentiating competition in the food marketing business.”
We wish Peter good fortune and know our many friends at Woolworths realize nothing helps the great stay great than a vigorous sense that the competition is catching up.
As Intel’s Andy Grove said: Only the Paranoid Survive.