Tesco is urging Asian suppliers to get up to speed on international certification standards, as the retailer looks to boost its direct procurement strategy from the region.
In a session at last week’s Asiafruit Congress in Hong Kong, organised by Asiafruit Magazine, Johnathan Sutton, produce group sourcing manager for Tesco Asia & Oceania, told delegates: “Asia has never been on the radar in a huge way for the UK and Europe, but [Tesco] is changing that.”
Sutton has worked closely on the development of direct exports into Tesco stores from Thailand, including a promotional drive for exotic fruits such as mangosteen, rambutan, lychees and dragon fruit that took place in the UK in June. He said: “This campaign aimed to put exotics back into the mindset of the consumer. Exotics are popular but are seen as expensive.
“However, they are a huge opportunity, as customers like innovation and change. They are willing to try new things, but they need the help to do so.”
Other Tesco direct sourcing campaigns from Asia highlighted by Sutton included Indian grapes and Thai orchids supplied to the UK.
Along with its Asian hub, Tesco also operates direct sourcing operations in Chile, South Africa and Spain, giving the group “a unique point in the retail world”, according to Sutton. “We believe it is important to be where the products are from, [in order] to reduce our reliance on agents and importers,” he said.
In the panel discussion after his presentation, Sutton added that although Tesco cannot deal directly with all its supplying farmers, it is “pushing out to the supply base more and more”.
But it is crucial for Asian shippers eyeing up the UK and European markets to ensure they are up to speed when it comes to international certification and pesticide residue requirements, Sutton insisted. “Retailers are difficult to deal with and Tesco is no exception,” he said. “But we have tried to make things simple. Good agricultural practice should add value to the business...
“As we move closer to the supply chain, growers are closer to the consumer, so it is important that the standards mean something.”
Adding value to Tesco’s direct sourcing hubs will form a major part of the process in the future, said Sutton. “This doesn’t just mean doing something cheaply… Quality, taste and flavour are very important in the UK, and we also want to increase yield, quality, pack-out and shelf life...
“Standards are critical to the whole equation,” he added.
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