The Italian Connection

Majors Group

As the crow flies, some kilometres separate Perth from Milan, Turin and Genoa. The Italian industrial triangle is a kind of culinary heaven. Food manufacturing equipment made there is the envy of the four corners of the globe, and the ice cream industry is no exception.

That is the view of Tony Venema, Chief Executive Officer of Majors Group, Australia’s top supplier of everything you’ll ever need to make ice cream and related products on a commercial basis.

Every single piece of equipment comes from Italy. Tony says that, “the mandate we have is first to represent on an exclusive basis and secondly, it has to be the best. In our field we don’t know anything about coffee or tinned tomatoes. We specialise purely in the ‘discretionary treats’ industry – ice cream, frozen yoghurt, granita and such, and we have fought tooth and nail to ensure we have whatever brand is the market leader worldwide, and we have them.”

Indeed, the brands have been at the top of their industry for over 50 years. “They are like Ferrari. The equipment is equally beautifully built and outlasts you and I,” says Tony. They are not cheap but convincing serious people who are serious about the business that the premium is worth it is not a big hurdle, he says – “they know what they are talking about and they know what they want. But people coming into the industry are more of a challenge. They are new and green and yet to be hurt by imported knock-offs.”

Majors Group was established in 1993 as a company distributing ice cream supplies to “every single ice cream store in WA.” Tony purchased the business in 2006 and since then it has only continued to grow, with offices in Perth, Melbourne (head office), Sydney, Brisbane, Caloundra, Auckland, Christchurch, and Singapore. Majors Group now supplies equipment to more than 70 per cent of the market, with all of the major players and franchises counted amongst the company’s profitable and successful customers. “We have been working in this industry for 20 years and in 2013 we celebrate our 20th anniversary.”

A pivotal stage in the point in the growth and indeed the success of Majors Group was in 2008 by way of the introduction of Director and partner Mr Luca Naldoni. Luca brought to the company the intellectual property, desire and ability to ensure that the relationships with the European counterparts were strong, successful and secure. “Luca is the lynchpin of our operation” says Tony, “and our success and future is looking strong as a result of his involvements and partnership.”

“In ice cream and gelato manufacturing and display equipment, we have a great presence,” says Luca, “and in the frozen yoghurt industry, we have all of the international and national brands that are serious about the industry as our customers. They rely on our innovation, support and collaboration for their success.

“Quite simply, our machines are designed and made by suppliers who only demand the best in componentry as well as functionality.” states Luca. “All Italian ice cream machine manufacturers have a clear mandate from the Italian Government and the EU to manufacture machines that have the high capacity and performance of their competitors but with low power consumption.”

In the same way European cars have to conform to fuel usage guidelines, the Europeans lead the way in the economy / power discussion, explains Luca. “The eco-conscience of our suppliers sets the bar very high. They are the world’s #1 leader in this field. It is very important to understand the importance of this fact, as the performance is as high as or higher than the competitors, but considerably less in power requirements. Working with our suppliers to ensure that we are always cutting edge and innovative, married with the right price, is my constant mission, and one that I love.”

The business is vertically integrated, able to offer machines for the small corner store, full factory setups and just about everything in between. All the market leaders are Italian. “There are only three factory equipment suppliers in the world: Technogel is the best and we are their representative,” explains Tony. “The biggest gelato scoop cabinet company in the world, ISA, is ours too.” Around half of the company’s business is in supply of ingredients, nearly all of which are also imported from Italy. “If our business hinged on just selling ice cream-making equipment,” says Tony, “we would not be nearly as successful as we are.”

Importing powder and pastes from more than 13,000 kilometres away seems odd at first, but as Tony points out, the modest size of the Australasian market makes it impractical to manufacture locally – and in any case, the quality from Italy is just so good that the argument is won and lost on perfection. Don’t forget the classification of these products as ‘discretionary treats’; this means that most customers will rank quality higher than price when they buy. So while there is a market for cheap-and-cheerful, there is also a healthy market for far better tasting varieties even though they may carry a price premium. In short, if you want top quality, you have to buy imported, so this is not an issue of whether the dollar is strong or weak.

Ingredients such as milk powder and sugar, however, are readily available locally, so Majors has an arrangement whereby it imports what is called the ‘mother base’ for its powder products – the essential ingredients that make them the best, including the flavour profiles. Then, at a factory part-owned by Majors, Australian milk powder and sugar or other sweeteners as required are added to moderate the price and impart a little bit of local flavour.

By the time this feature appears, Majors will be on its way home from the premier food-industry exhibition in Sydney where the company was making ice cream daily, giving it away throughout the day. Tony says support from Italy is fantastic – general managers and owners of the equipment manufacturing companies and ingredient manufacturers attend the show each year and help out. “We get fantastic support from them and enjoy an awesome relationship with them,” he shares.

Business is brisk all year round, Tony explains, not just in the peak season starting September when temperatures rise and those with a sweet tooth want to cool off. The company is incredibly busy during the winter while everyone gears up for what is known as ‘the upcoming season,’ for example. The lion’s share of equipment sales takes place during winter and Tony explains that, “September becomes frenetic, with installations and training and so on. Majors is fully national, so Tony takes account of demand in Broome or Carnarvon on the west coast and north Queensland on the east where demand is already “going bananas” even before September while Melbourne and Sydney sulk in the cold and damp.

The Australian palate differs from that of Europeans, says Tony. Perhaps surprisingly, we like our discretionary treats less sweet, so recipes need to be adjusted accordingly. That is a minor fine-tuning exercise; more major is the changing trend of product itself. For instance, Tony describes the growth of frozen yoghurt in the Australian market as “explosive”. The concept originated in South Korea and US (leading brands there being Red Mango and Pink Berry), where it became the new taste sensation. Now it is taking Australia by storm.

In the run-up to last Christmas, Majors put multiple machines per site for this product into more than a hundred stores. With the shift comes a change to a self-service pattern in which the customer takes a cup, fills it with his or her choice of flavour(s) to the level desired, adds toppings and takes the result to the till where it is charged by weight. “What’s going on in this sector is, honestly, phenomenal,” enthuses Tony. “We are selling 200 machines per month.” He forecasts that in Melbourne alone, Majors will have had more than 50 customers opening new shops in September alone to sell frozen yoghurt. “We love it. We have customers with up to ten machines in a row. It really is a phenomenon.”

Of course, training is important in this sector and Majors runs what Tony terms the GPS – Gelato Professional School, a means of teaching budding gelatistas (if there is such a word) which tours every state on a monthly basis. In most states (as well as New Zealand and Singapore) there is a fully-fledged kitchen with training facilities at each of Majors’ offices; four dedicated ‘gelato masters’ are employed to spread the gospel according to ice cream. Part of their brief is to update Australian customers with the latest styles, techniques and flavours coming from Europe, the taste leader. Such activities serve to stimulate the overall market for cold discretionary treats; Tony believes Australians’ consumption is surprisingly modest and there is plenty of scope to increase – indeed, he cites one international brand, which Majors supplies, which is planning a further 50 stores before the end of 2013.

Majors is undeniably a leader in its sector and Tony says the company supplies “at least 70 per cent from the ground up in terms of equipment and ingredients.” Part of the secret is not to diversify, he says. So no coffee and tea, no fancy espresso machines or kitchen equipment (although Tony would like, given more time, to look into the supply of gelato-makers for domestic applications). “We have a couple of worthy competitors here, but the ice cream part of their business is a fraction of their portfolio; some are bigger than us in turnover but for us, ice cream is a hundred per cent of the business.” If it is possible to live and breathe ice cream without just getting messy, Tony and his team achieve it.

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January 18, 2019, 3:29 AM AEDT