Quality and Freshness for Three Generations

Piñata Farms

Piñata Farms is one of Australia’s leading growers of fresh tropical fruit. The company is the largest pineapple grower and ranks third in Australia for the volume of its strawberries and mangoes. Now third generation pineapple growers, the business was started by the father of current Managing Director Gavin Scurr. This industry is rife with challenges, but through extensive research and development, Piñata Farms has not only survived but thrived, with good business management and a solid plan for the future.
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Gavin’s father Geoff started farming pineapples in the late 1960s and the business is presently run by his two sons – Gavin and Stephen. The company did not, however, start by plan; as a builder in the 1960s, Gavin’s grandfather, Jack bought a half dozen blocks of land on which he built houses. Not being able to sell them at the time, he swapped two of those blocks for a farm and became a farmer until the economy improved. More than fifty years later, Piñata Farms is still here.

Piñata Farms is focused on growing quality fruit with great flavours. The key here is to have consistent volume with consistent flavour. “Fruit that people eat and enjoy and want to come back and buy again. If you can do that on a consistent basis, the consumers like it and, more importantly, the retailers like it. You can build a relationship and grow a business. This doesn’t happen in five minutes. We have been working on it for 20 years.”

Gavin explains that the company separates itself from the competition through flavour, taste and consistency of volume and quality. Rather than having too much or too little fruit at any one time, the constant supply comes from having different growing regions and different varieties.

Piñata farms grows most of its own produce, however, it also uses third party growers. These are selected based on an ability to fit in with a supply chain that may not need them to grow fruit all year. They can, however, grow an agreed volume and quality when needed. “We use third party growers to bolster our production, but try to grow our own fruit throughout the year in different regions,” says Gavin. “Due to the scale of production needed, we don’t see ourselves ever growing it all.”

The third party growers the company uses are all family farmers. “Family farmers are excellent farmers. They are very passionate when compared to corporate growers who don’t have the same flexibility or passion for their product. We see third party family farmers as integral to the ongoing expansion of Piñata.”

The relationship is mutually beneficial. By growing large tracts itself, Piñata understands production issues. From the third party grower’s perspective, they appreciate that Piñata understands the challenges of what is involved. “From a marketing perspective, the customers appreciate that they are actually dealing with us as growers, rather than a marketing company that doesn’t have a vested interest in the production side.”

One of the biggest challenges faced involves the cost of production. Australia has some of the highest labour and farmer costs in the world. These run at about $22 to $27 per hour. That is considered a standard wage for people who pick and pack tropical fruits like pineapples and mangoes. Because these fruits mainly grow in the tropics, it also means that the third world countries are the main producers and have low labour costs at a fraction of what is paid out in Australia. These might be in the area of $2 to $8 per day compared to the Australian equivalent of approximately $200 per day.

“We will never be an exploitative company. We will give the people what they deserve for the work they do, and we should.” Unfortunately, high labour costs makes Australian fruit and vegetables very expensive on the world scene due to the amount of labour required. These fruits are still hand harvested because of their delicate nature. Machines have yet to be developed that can handle them gently enough.

Another challenge has to do with Australian labelling on the process side of the industry. “The game we play most is in the fresh side of the business where people buy whole fruit. There is a requirement whereby the country of origin has to be on the ticket.” In this way, the consumer is aware of where the fresh fruits and vegetables are coming from and can decide what to purchase.

For any fruit or vegetable that’s processed as frozen or canned, however, there is no requirement to state the country of origin on the packaging. It will simply say: ‘Made from local and imported ingredients’. Consumers have no idea where processed fruits and vegetables come from.

“It’s a challenge for us, is as Australian farmers with our high costs. We believe that wherever it comes from, it should be written on the package. If it comes from China, then put China on it. Don’t hide behind this local and imported bit. Don’t mislead people or hide behind it!” Consumers want to know, and do care, yet there are no requirements for companies to put the relevant information on the fruit that is packaged.

To keep up with the latest trends and stay ahead of competition, the research and development department is one of the most important facets of any company. Piñata has extensive research and development projects in mangoes and pineapples. For pineapples, there is a breeding program with new varieties of pineapple. Part of this is within the framework of a co-investment with the Australian government through Horticulture Innovation Australia which matches investment funds on genuine production research and development.

“We are looking at trying to understand the fruit fly’s cycle so that we can grow mangoes with less chemicals. Also with mangoes, we are looking at ways to increase the marketable yield and develop a better quality.” Piñata spends about $400,000 per year on research and development and, as the business grows, that amount will go up accordingly.

Looking to the future, Piñata wants to expand its pineapple program. This part of the business has grown by eight per cent to ten per cent per year, and there are no signs of a slowdown. Now production is happening in the off season as well. “Rather than grow when it’s easier to grow, we try to grow on the shoulder seasons when there is less competition and a gap in the market. We have been working on doing year-end strawberries as well.” Lulls in strawberry production occur in Oct/Nov and again in April/May, leading to market opportunities. At these times, the slower production means that expansion is something to seek out in order to even out supplies and produce more consistent produce volume. Piñata is relatively new in the market to mango production which has been a part of the business for only twelve years. Mangoes take five years to produce and eight to ten years before the trees are in full production.

Social media is a good way to promote the company and its product. Piñata is still feeling its way through this and in the last twelve months a concerted effort has been made. Its website has also been revamped to make it far more interactive and updated. There is a recipe section on its web page; the most popular are contingent upon the season. Consumers in general are looking for new ideas for things to do with fruit.

Pineapples are incredibly versatile. “You can eat them raw, cook them, puree them, put them in smoothies, freeze them for ice blocks, have them for breakfast, lunch and dinner, drink them. For strawberries, it’s more how you can actually cook with them. One of the simplest ones that I like is to fry them in a pan with port or sherry, stir them through to soften up and within two minutes you can pour them on ice cream. It’s absolutely fantastic!”

Now excuse me, while I go out to get some strawberries!

Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

April 24, 2017, 9:42 AM AEST

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