Avoco is planning for a future that will require even greater discipline and collaboration to cope with a global avocado export market facing uncertainty and new challenges.
The global pandemic has caused widespread disruption to shipping and logistics in 2020 and, despite international borders reopening, ongoing quarantine restrictions at the New Zealand border are preventing Avoco marketing staff travelling and meeting with customers in both Australia and Asia.
Marketing and communications manager Steve Trickett says, like everyone in the industry, Avoco’s team conducted business via video-link in the ‘new world’ of COVID-19 and that was likely to continue over the next few months.
“It remains uncertain how long it will be before we can travel and meet with customers again which is important for both our existing markets and those we’re looking to develop or increase volumes into.
“This uncertainty makes planning for the future more difficult and is only one consideration among many when it comes to developing our next five-year business plan.”
The past five years have seen Avoco focus on exporting New Zealand avocados to feed a hungry Australian market primarily, where growers receive the best returns for their fruit. Notwithstanding current Trans-Tasman vessel and port disruptions, risks associated with shipping across the Tasman are also relatively low.
This strategy, combined with below-average volumes of avocados grown in Australia, means less fruit has been allocated to Asian markets, with the 2020-21 season likely to result in just under eight per cent of its total supply exported there.
Steve says Australia will always be the main platform of Avoco’s export strategy, but it is inevitable that a focus for the next five years must also be developing Asian markets.
There is also growing confidence in the ability of New Zealand growers and handlers post-harvest to follow best practice guidelines and supply fruit that holds up under the pressure of longer distance shipping.
Fruit quality has been the avocado industry’s Achilles’ heel over the past three seasons but efforts by the industry and Avoco’s quality and technical team to focus on best practice is turning variable fruit performance around.
“We have learnt this season that some new disciplines implemented in our AVANZA quality business plan have seen improvement in fruit quality based on out-turns of fruit that has spent longer in the supply chain than is ideal.
“We may have turned things around, albeit with smaller volumes supplied over shorter periods than usual.”
Collaboration with other exporters, particularly in the area of alternative shipping arrangements, may also be a feature of the new way forward in growing New Zealand’s avocado sales in Asia.
“This may involve both airfreight and sea freight arrangements, looking at what others such as Zespri are doing in the same space, and coordinating some market delivery options with them.
“We’re looking to think outside the box.”
Development of Avoco’s business plan will involve a complete SWOT analysis and a reset of objectives, with a strong focus on how to get Asia back up to absorbing 20, 30, or 40 per cent of the company’s total volume at value, says Steve.
“We will be reviewing brand strategy and market servicing requirements, including the need for in-market resourcing. We’ll also look at pricing expectations and market development tactics in the face of increased access and attention being given to more Asian markets by South American suppliers.
“We have a lot of work to do, but given Avoco’s scale and experience in the market, we are well positioned to deal with the challenges that lay ahead.”