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With investments in varietal development, expanding growing operations across the globe, and a flagship example of a direct sourcing model, Muñoz Group is a retail supplier for the 21st century.

As part of Spanish parent company AMC, Muñoz Group (in the UK) comprises five separate companies, three of which deal solely with the UK. FPJ Big 50 company MMUK, which has a recent turnover of £320 million, is based in Chatteris and manages citrus and grapes for M&S and Aldi, as well as grapes for Sainsbury’s. Allied to the fruit supply is supermarket flower supplier MM Flowers. Half an hour’s drive away, based at a packing facility on the site of haulage giant Turners, is the newest addition to the Muñoz family – AMT Fruit – established last year solely to supply fruit to Tesco.

It is this last company that perhaps best embodies the company’s driving principle – adapting to, and meeting the needs of, core customers. Despite sounding like corporate cliché, it appears Muñoz Group has put its money where its mouth is – this customer-driven ethos is what led to the establishment of AMT, along with a five-year commitment to supply 100 per cent of Tesco’s citrus (the wider group was previously supplying 80 per cent), as well as melon and grape volumes.

Despite the wider group already boasting a longstanding relationship with Tesco, the new company, which has an estimated turnover of £130m for 2015, nevertheless had some new ground to cover. By overcoming challenges such as the initial contract negotiations, and “new ways of working”, AMT Fruit has cemented Muñoz Group’s position as a modern-day supplier with an ambitious vision for the future.

Matt Warren, speaking on behalf of Muñoz Group, explains: “We work hard to ensure all our relationships are solid, but a contract – especially considering how rare these are in the produce industry – takes this to a much higher level. It shows faith and focus from the retailer as well.

“It is a massive commitment from Tesco on how they want to manage the supply chain, and I think Tesco would feel that it brings them a lot closer to the grower, which is important for them and for the grower.”

If current challenges in the retail supply chain are to be overcome, and consumption increased, the AMT Fruit platform may just be a snapshot of the future of retail supply. The contract has essentially removed any barriers to complete collaboration, so both retailer and supplier are now engaged in growing the collective cake. “We have had to adapt our mindset, and it does take time to get there – it’s not like we’ve just gone from A to B, there have been lots of stages in between,” says Warren, who is also account director at AMT Fruit.

“I think that now we’re there, it is clear what we have to deliver, and we also feel that we are now working very closely with Tesco on all decisions, which is really positive.”

Muñoz Group works to maintain close relationships with all its retail customers, in the UK and overseas, something Warren says is “imperative” as more consolidation is likely within the industry – evidenced by recent developments such as the Primafruit-Waitrose deal and the Produce World JV with Lincolnshire Field Products.

“My only advice to other suppliers thinking about the future, from our point of view as the Muñoz Group, is to understand what your customer wants and what they need, and work with them to help deliver that,” he explains.

“It can be very different to what you’re used to, but ultimately, if they’re passionate about where they want to get to, you need to be equally passionate and flexible to try and deliver that for them.”

Warren is confident that the AMT Fruit model is a positive move in Muñoz Group’s relationship with the UK’s largest retailer. “Tesco has received some negative press of late, but in produce they’ve got a very clear plan about how they see things moving forwards, which we think is very positive,” he adds.

As a significant global player, Muñoz Group is also making the long-term investments necessary to improve the categories it operates within more permanently, through investing in both breeding and planting. Its two varietal development companies – SNFL for grapes and Citrus Genesis in citrus – are focused on improving quality through developing better varieties. Particular attention is on new varieties that can improve fruit quality at the edges of the seasons, as well as extending them where possible.

“We believe it’s vital to invest in varietal development to ensure we are constantly improving the quality of what we’re offering customers. Great quality product drives repeat purchase, which in turn ensures strong sales. At the start and end of the seasons it can be much more difficult to deliver that,” Warren says.

“Within citrus, the focus on varietal development tends to be on easy peelers as that’s the current growth market. Seedless, pigmented, very easy to peel are some of the key attributes for new varieties, and there are windows at the start of seasons that we’re focusing on in terms of quality, as well as seasonal extension in products like satsumas.”

With its roots in citrus growing – AMC has over 2,500 hectares of owned production in Spain – Warren says the company is increasing its focus on primary production. “We’re now making significant investments in the US, in grapes predominantly. In South Africa we are investing in citrus and grape production, and last year we invested in our own packhouse in South Africa.

“We’ve also got farming investments in Peru, Chile, and Israel. South Africa is the biggest in terms of hectares, followed by the US.”

Varietal development

Last year, early season Clementine variety Octubrina was launched through AMT Fruit into Tesco, and aims to replace early-season varieties Marisol and Arrufatina.

A similar example in grapes is late-season black grape Melody, which ripens just before Autumn Royal but has a better flavour profile and consistency of colour.