A further slowing in growth
The Fresh Produce Group has built its burgeoning Asian export business by expanding on what they already did very well – international trade, economies-of-scale, and customer-centred delivery.
After decades of selling high-quality fruit and vegetables to export markets, Robert Nugan’s Fresh Produce Group had lots of contacts and a thorough understanding of what Asian wholesalers and customers were after. So when it came to expanding their business by producing premium table grapes, Nugan and his team knew exactly what they needed to deliver. Now, following significant R&D, they’re also growing and exporting berries to meet the demand in Asia.
When the time came for Robert Nugan to strike out on his own in 1992, his family’s long heritage in packing and growing combined with his passion for marketing and international trade to create the successful import and distribution company Fresh Produce Group (FPG).
The Nugan family’s association with fresh produce goes back three generations to Alfredo Nugan, who emigrated from Spain and in 1940 started a small fruit and vegetable packing operation in Griffith, becoming a pioneer of the Australian produce industry.
Nugan began working for the family business (the Nugan Group) during his school holidays and throughout his tertiary studies. After graduating with a degree in International Economics, Nugan commenced working full-time in the family business before deciding to start his company.
Today, FPG has offices in Australia and Asia, over 200 employees and more than 40 produce varieties. Its network spans from farms in California to restaurants in Sydney and supermarkets in Hong Kong, an expansion driven by Nugan’s ambition to source and deliver the best fresh produce that Australia and the rest of the world have to offer.
Never one to stay satisfied with being the ‘tallest dwarf’ in the small domestic market, from the outset Nugan set his sights on category managing produce from farm-to-plate for the Asian market, especially Singapore.
“With their customers demanding year-round availability of produce, supermarkets needed suppliers who could guarantee the quality and quantity of produce – at a reasonable price – 12 months a year,” he says. “Fulfilling that meant controlling the entire supply chain from farm to supermarket shelf. So, when an old grape vineyard came up for sale near Mildura, we bought it and started our first farming operation with table grapes.”
FPG already had sophisticated storage, supply chain and distribution logistics systems in place. Acquiring both wholly-owned farms and entering joint venture farming operations were the last steps in FPG’s vertical category management chain and a major strategic growth area within their integration strategy.
To meet year-round supply, FPG supplements their Mildura grown Trevisio grapes with produce from their recently established FPGWA vineyards plus selected suppliers in Queensland and South America.
“We want to be known for delivering quality produce in full, on time and in specification. And we’re unapologetically leveraging our international supply chain to help with that,” says Nugan.
FPG farms have pre and post farm-gate facilities for cool storage, packing and prepacking on site, as well as providing the ability to execute Intellectual Property on the exclusive varieties they are breeding.
“We need economies of scale to stay competitive and consistently meet demand, so having the capital to invest certainly helps – but you still have to be smart about it,” he says.
Australia’s ‘clean and green’ reputation is respected in Asia, which has helped build the business.
“The demand for Australian produce is always there, and we rely heavily on export to get scale and growth with sustainable returns,” says Nugan. “Even on our scale, we still maintain traceability of our produce and residue test to ensure we meet Euro Group Certification – the highest standard there is.”
However, to continue succeeding FPG understood it had to do more than supply ‘clean and green’.
“We need to add value wherever we can,” adds Nugan.
And with their decades of experience selling to export markets, FPG has acquired a deep understanding of what Asian wholesalers and customers are after – “which is being trusted to deliver quality produce in full, on time and to specification,” emphasises Nugan.
FPG’s track record of delivery and the solid relationships throughout the produce chain that helps them maintain it are valued points of difference with their Asian customers. Once again, Nugan isn’t satisfied with leaving things as they are.
“We’ve been around a long time, are still a private company, and we’re ensuring FPG is sustainable for the long term.”
So, in his quest to continue adding value through category management, FPG are now targeting the next big growth area in Asia – berries.
“It’s about developing a cocktail of how to grow things that are right for export,” he says. “It’s a different capital structure to table grapes. We’re starting with blueberries and then who knows. It’s a big category that’s ripe for exploring – one step at a time.”
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