As CFO of Citronas and FruitMasters, Carlo Broeren knew the tricks of the trade in the fresh produce trade. Nevertheless, from 2007, he mainly held financial positions in tourism and food ingredients. All those years he remained active as supervisor of Total Produce Rotterdam, to which last year, after being asked for various jobs, he indicated that he was ready for a new job. In September 2018, Carlo made a comeback in the fresh produce sector as managing director of Total Produce Haluco Holding. "The fruit and vegetables always retained my interest."
Let's look back first, how do you look back on your years in the fresh produce?
I have experienced the years at Citronas as a fantastic adventure. At the time, we bought the company ourselves through a management buy-out when Albert Fisher ran into financial difficulties. Subsequently, we were able to grow the business considerably and also set up and take over new companies, such as Indigo in France and Kardol in Waardenburg. As an overseas specialist, after Kardol we finally ended up with FruitMasters firmly in the Dutch fruit. I have experienced it as a very energetic and active period. The relationship with Total Produce Rotterdam has always remained because I remained active as a supervisor. That was a familiar situation, because most of them came from the confluence of the former employees of Citronas and Velleman & Tas. As a supervisor, I looked over the shoulders of the management and I also had contact with the Irish Board. Because of other functions I never was able to do anything for them if they had a job, but in the spring of 2018 I indicated: If you have an assignment, I want to give it a chance, otherwise we will miss out again. I really did want to work for Total Produce.
Was it a big step from fruit to the greenhouse vegetables?
Of course, vegetables with their shorter shelf life have a completely different dynamic. Fruit can often be stored for a while, so it is much more prone to speculation. In addition, fruit growers are also a completely different type of grower than greenhouse vegetable growers. But Haluco nowadays markets many more products than just greenhouse vegetables. Just look at the grape packaging line that we have installed. We only want to further expand this assortment of overseas fruit in the coming years. We also want to push our limits when it comes to sales. We see the world as our customer, both in terms of import as well as export, and we will certainly not limit ourselves to Europe.
What was your assignment as managing director of Total Produce Haluco Holding?
Last year I started at Haluco in mid-September and first of all I made an analysis of where the organization stood and where it should go. The entire sector has to deal with shorter chains, whereby it remains the art for trading companies to be the connecting link between supplier / grower and buyer / customer. In that playing field you have to prove your added value. Haluco has always been a product-driven organization. I thought we had to make the move to a market-driven organization to work in a more customer-oriented way while maintaining a strong sourcing as a basis.
A number of changes were necessary to make that happen. For this we have, for example, devised a training program. But we also had to do something about the cost level and we took action on that. For example, the Delicious location in New Amsterdam proved to be insufficient in terms of added value. That is why we closed that branch where seven people were employed. People have been made redundant at the location in Bleiswijk, as a result of which we have replaced a total of twenty positions. These are not nice measures, but we have done them in the interest of the company to work cheaper and more efficiently and in this way achieve a future-proof organization.
My role is to further shape our identity to the market and for that we have initiated a process of change under the motto ‘market minded, source based’. The key question is what the customer wants and we also want to keep a strong role in cultivation. As a party between grower and retailer, we must show our added value by providing the customer with a good product with the desired service and paying the grower a payout price in line with the market. We believe in the Van Nature model and we will certainly continue to focus on this in the coming period. Our growers strive for the best quality and we are fully focused on getting the best out of the market for the growers. That is a pure win-win situation.
How did you get the support from the rest of your team in this process of change?
Although the decisions we made were not easy, it was accepted very well in the company. We communicated the desire for change fairly quickly with a core team. This ensured that it no longer was a management idea. I can conclude that the employees are very loyal to Haluco and believe in the future. If you look at the history of Haluco from the family business that it was with a strong product-driven organization, then it really is a big step to change to a market-driven organization. Adding integral values from customer to grower and vice versa is a bit different than putting a lot of products into the market. That requires a completely different way of thinking. In our view, middle management had remained underexposed in history. By strengthening the middle management on sales, you create a completely different focus. That has brought a lot of empowerment to the company. Something like that is easily said, but it has been a fairly extensive process and it will certainly remain so. It is very important that you involve people in the things you do and the changes you make. The core of this is to let your team contribute to this. That is easily said, but the trick is how you get people motivated to get them involved in the changes. Internally our strategy is now clear, externally this should become even more visible in the coming period. But in the meantime (mid-April) the Dutch season has started and also the money has to be earned again ...
As a managing director, do you also get involved in a lot of day-to-day operations?
Laughing: I tend to get involved in everything. We have of course imposed a lot of change on the employees, then you will also get very involved in operational matters. All the more so because I fill the position of operational manager because our vacancy for operational manager has not yet been filled, but it will soon be. But that is also a nice process, because you learn a lot and quickly in a short time.
From whom did you learn the most in your career?
The danger with such a question is that you forget people, but the two people who first come up are Michel Jansen from Total Produce and Henk van Koeveringe from Roompot. Michel was already my colleague at Citronas and I found him an example in strategic matters. I learned a lot from Henk van Koeveringe in the field of entrepreneurship and fighting mentality.
Did you gain much from your experience outside the sector?
Certainly! I did quite a number of interim jobs, which often focused on change processes. Now, change is not a goal in itself, but you only do that to achieve improvement for the longer term. I have worked in various sectors where changes were necessary due to pressure on cost price, consolidations in the chain, changing customer wishes or transformations of companies. In my position at Roompot, for example, the emphasis was on professionalizing the organization and preparing for the next exit. Now the fresh produce sector has its own timing and dynamics, but here too is great pressure in the chain and much will happen in the chain in the coming years, both on the retail and supplier side with everything that is in between.
So Haluco takes distance from its image as a volume pusher?
That is indeed changing. Now our company will always keep a certain volume, simply because we work with a cost pattern which requires a certain volume. But we will increasingly undergo a transformation to the role of service provider. The point here is that you add value. If that is with volume, then it is with volume. If that is with a certain product specialty, then it is with that. In any case, it is clear to us that it will no longer be exclusively with volume. It is much more important to deliver what the customer wants.
Don't you find the number of intermediaries in the fresh produce sector amazing?
On the one hand, quite a number of players in the fruit and vegetable trade have disappeared. Extensive consolidation has already taken place in the supermarket channel and we expect new developments. Growers will also continue to strengthen themselves, so that you automatically have fewer parties to deal with. But in part that trade will also continue to retain its value. Most of the production goes from grower to supermarket and there is always a party that can add its added value to it. Of course you now see large producer organizations switching directly to retail, but often there are still partners among them. A condition is that they operate in a fully transparent manner and provide added value, whether in the field of financing, inventory, business relations or products. Smaller companies with little overhead and a certain specialization and knowledge will also have a right to exist. Because let's be honest, even the biggest players in the European fruit and vegetable trade are currently having a difficult time. There are probably all kinds of reasons for that. The question is what size should the ideal organization have.
Are all those companies that fall under the Total Produce group now finding synergy amongst each other or is it every man for himself?
Total Produce has a fairly slim organized head office and has a lot of autonomy with the operating companies. Everybody has to make his own margin and be profitable, while there are many similarities, especially on the customer side. In recent years we have seen that more is being done together and the necessary synergy benefits have also been achieved. Last autumn we also started with project groups from several operating companies to stimulate the synergy within Total Produce. This generates mutual trust. All major successes come with small steps, but I expect positive things to come out of this ..
Brexit has now been postponed for another six months. Are you well prepared for it?
We follow developments in the industry with a working group and are therefore well informed. I think we are well prepared for the things that can be prepared. The difficulty remains what will happen with our products when they have to wait a long time before the border. That is the ultimate risk. You can organize processes and communication, but if a truck cannot continue to move, you have a problem. It is therefore hoped that the Green Lane, for which the GroentenFruit Huis has lobbied, will function well later. As Haluco, with a Brexit we may have even more flexibility than other companies thanks to the Total Produce locations in the UK.
Haluco was one of the first in 2006 with an automated Warehouse Management System. To what extent is automation a priority for you?
I see automation as the core to being able to efficiently execute our processes. Operationally, this applies to our WMS, but we are also busy with office automation for our daily processes. We are fully committed to using our data for decision-making information, also on a daily basis and we will continue to do so!
Will it be a challenge for the future to hire enough good people?
We have just come here from a phase of reorganization in which we have been contracted, but fortunately we have also been able to keep many good people on board. We offer people with potential a personal training plan. Finding good staff may not be easy, but again it is not impossible. In terms of recruitment, we have a number of pillars. For example, I strongly believe in a trainee program. We already worked with that at Citronas and I have always seen good results. Sometimes you will also attract people from the sector if you want to achieve something quickly.
Like recently Ton den Boer?
Indeed, we saw Ton becoming available and since we want to do a number of things differently, we asked him if he could, with his experience, play a significant role within the commercial team. As Sales Director, Ton will strengthen the current management and will focus on key accounts, in particular on customers that are served from Venlo (Nedalpac).
Finally, this open communication. Is that also part of the Haluco change process?
It is true that in the past we have always kept a fairly low profile. That may be a great strategy, but sometimes it is also useful to tell something more than we did in the past. We are busy with many things and you will be going to hear a lot from us!
This article was previously published in edition 4, 33rd year of trade journal AGF Primeur. See www.agfprimeur.nl for this.
For more information:
Haluco
Carlo Broeren
www.haluco.nl
cbroeren@tphalucoholding.nl