Delta farmer Terry Bremner is rapidly increasing his sales for both juice and wine in Asia after recently attending trade shows in Korea and China.
His ambitious growth strategy is one that the Centre for Food in Canada (CFC) urges in its June report Valuing Food: The Economic Contribution of Canada’s Food Sector.
The report forecasts relatively flat food sales in Canada for the foreseeable future thanks to:
- slow population growth;
- a population that per-capita requires less food because it’s aging and increasingly working at sedentary jobs; and
- food price inflation that keeps pace with income.
“Canadian food sector companies seeking to expand significantly must focus on growing their business through exports,” according to the report.
“There are greater opportunities for growth globally as demand for food and an increasingly urban and relatively wealthier consumer emerges in a number of developing countries.”
Bremner told Business in Vancouver, while he was on a business trip in Hong Kong, that he expects his 15,000-case production to grow 25% in the next year thanks to a $500,000 investment in a bottling line for his Bremner’s-branded 100% pure not-from-concentrate blueberry, cranberry, black cherry and other juices.
So far his production on that line is at 10% capacity.
He invested a further $500,000 in new buildings on his 55-acre property in Delta.
Bremner expects to increase his $1.5 million in annual sales significantly in central Canada and Asia by appealing to a consumer who wants a premium product.
Sales in Asia for his juice have grown from nothing last year to about 15% this year. He now gets 5% of his sales for his Wellbrook Winery-branded wine from China. That’s also up from nothing last year.
This success comes partly from the rapidly growing nouveau riche in Chinese cities who can buy more premium products.
Bremner, however, warns producers of non-premium products to have a carefully honed strategy of what Asian consumers to target or they may wind up wasting their money.
“It’s an expensive proposition to expand sales in Asia,” Bremner said.
“But the Asian population is looking for quality, premium products.”
Bremner attended the Sial China 2011 trade show in Shanghai May 18 -20 as well as a trade show in Korea in April.
His pure cranberry juice sells for about $13 per litre in Vancouver.
Ocean Spray cranberry juice, in contrast, contains about 15% juice with the rest being water and sugar.
Korea slaps a 50% duty on Bremner’s juices but, even with that handicap, Bremner has managed to find traction by appealing to high-end shoppers.
“It’s an interesting market. It’s greater competition than in Vancouver because we have products here [in Hong Kong ] coming from Japan, from Australia and from New Zealand. It’s more competitive. Typically in Canada we don’t have juice from Australia,” Bremner said.
Another prong in his strategy is to capitalize on the trend of people wanting to know where their food comes from and what additives it includes.
The melamine scandal in China, which involved milk producers adding the toxin to milk to make the milk appear to have a higher protein content, has fuelled that trend in Asia.
Bremner’s pomegranate juice comes from Turkey; his blackberry juice comes from Chile. He puts that on the label as well as that it is certified organic by North American and European certification bodies.
“I can buy fruit in China cheaper than I can buy it or grow it locally. It would reduce my costs but I won’t do it,” said Bremner, who puts on his labels where his fruit was grown.
“We don’t try to hide anything. Some do.”
Food labelling has been a hot-button issue with consumer advocates who succeeded in 2008 at getting the Canadian government to change regulations so that in order to put the words “product of Canada” on a label, 98% of the item’s ingredients and processing must be conducted in Canada.
The result, however, is that those words rarely appear on labels, according to the Conference Board of Canada.