Horizon: 3-5 Years – Parveen Mehta

Parveen will speak about 3 areas:

  • Marketplace
  • Consumer trends,
  • Food security and supplier base.

Introduction

Parveen Mehta of Minor Weir & Willis is now speaking to us. He joined in 81, graduating with a physics degree.

At the time, it specialised in importing fresh produce for the AfriCaribbean community. At that time, there were seven employees.

They are now a 300 million pound business – involved in growing around the world, specialising in the servicing the food retail sector. He says business margins are between 0-2per cent. “You have to do a lot of running to get to where you are.”

The changing business

Following the recession, there have been big changes – these are now being accelerated by Brexit. This includes consolidation in the business, which is now happening at a faster rate. It’s forcing businesses to strip costs out of the supply chain and allowed new entrants in the market – such as Aldi and Lidl “Until two or three years ago they were not on the horizon. They are appealing to demographics and will carry on growing.”

With lower cost supply chains and more sensitivity to the market they are making significant inroads to the traditional retailers market share.

The impacts of consolidation in the business include:

  • There are also significant skill shortages in the business
  • Fewer, larger and leaner relationships with our partners. If you are to survive you have to add value, he says.
  • Survivors in this market will have strong balance sheets – because risks are being passed down the supply chain.
  • Shorter supply chains: unless you add value you’re going to be driven out.
  • It will also drive innovation.
  • Going to create new markets.
  • We are also becoming a grower, he says. “The business is capital intensive. And has its risks.”
  • You’re going to see whole-grow deals. Once we only built size-12 mangoes. Now, increasingly we’ll be buying the whole of the crop.

 

Parveen will talk briefly about Brexit and what it will do to the business.

Brexit

Over night there has been a 10 per cent change in costs – which was a shock. Lookng forward it will be difficult, particularly labour.

“Even this week I’m losing people, because the exchange rate doesn’t work for them.”

Finally, sustainability: we are competing for the same resources as other parts of the world, which creates competition.

We are also concerned by political risks – such as food terrorism. “If you want to survive you have to reinvent yourself.”

Leave a Reply

Your email address will not be published.

The Birmingham Food Council is a Community Interest Company registered in England and Wales number 8931789