South Australian Produce Market strengthens relationship with major supermarket chain

Source: Fresh Plaza

South Australian Produce Market (SAPM) has re-signed a long-term agreement with a major independent retail chain, Drakes Supermarkets in the state, which will see the retailer continue to work closely with SA’s largest growers and wholesalers.

Drakes Supermarkets have committed to a longer-term lease in the Adelaide precinct and SAPM CEO Angelo Demasi says it will allow them to continue to play a pivotal role in the supply chain.

“The ‘just in time’ principle is what the market is all about, so they are getting produce in the warehouse and it can be on the shelves later that morning,” he said. “It doesn’t need to go to a big distribution centre and get sorted and moved around over the space of a couple of days. It is also a benefit for them when supply is tight or in abundance; they get the benefit of negotiating the best produce available at the most competitive price on the Market floor. When we have got an oversupply and when we can’t find product, they have suppliers on their doorsteps they can work with.”

Another benefit, according to Mr Demasi, is that they can work with a cluster of growers to ensure they have the right product and quantity when they need it.

“It is about the flexibility of having your suppliers right next to you also taking advantage of fulfilling last-minute orders from retailers when required,” Mr Demasi said. “You can’t do that when you run a centralised DC. So, through those efficiencies, we are benefitting from having them on-site, and our tenants also benefit because they have a customer who they can continually supply. We also have Metcash (wholesale distribution company), which provides the confidence that the market system is strong, and still working with people to roll through the supply chain.”

He added that about 30 per cent of the market’s fruit and veg is sold through to independent retailers, so it puts a lot of effort into the ‘Pick A Local, Pick SA’ messaging, which has been a great campaign.

“They are important to the supply chain,” he said. “What we found through COVID-19 was that there was a move to our independents. People wanted to buy local and people wanted it to be trustworthy. We also saw a move because people were going out prior to the pandemic. The hospitality sector of our fresh business went from 12 per cent in 2017 to 19 per cent in 2019 due to the Uber Eats phenomenon. During the pandemic, we saw the hospitality sector move from 19 per cent to 17 per cent with Independent Retailers increasing their market share by 1% in South Australia.

An opportunity has also become available for the first time in 15 years, a prime cold storage facility within the Market precinct is available for lease.

“It’s a great facility and is around 7,500sqm with 10 loading docks, and by August 2021 we hope to have leased the facility,” Mr Demasi said. “I think it will be a great state of the art distribution centre for someone who wants to be within the fruit and veg precinct. It can be a transport or food-related distributor with an online platform being strategically located 10km within the CBD and exceptional Interstate road linkages. We have two property agents working with us, Leedwell Property Group and Colliers International so we are confident the property will be leased and is a key area for us.”

The Market will next week be holding the first-ever Hort SA Conference at its precinct, with more than 350 registered people coming.

“It is a mini-Hort Connections, which will be a month out from the big event in Brisbane,” Mr Demasi said. “We have speakers from the supply chain to (market data company) Nielsen, to supermarkets. There will be a tour, as well as over 30 exhibitors. So, we have to transform the market from being operational in the morning to an exhibition the next morning. We offered out the market tour to chefs Retailers, media and food industry people to promote our suppliers to a wider audience. As we are not a public market, a lot of people don’t know that we are here. So, it’s a bit of profiling of the market and potentially getting some new buyers in to see what goes on. Basically, there will be a market tour and small showcase in the morning and then from midday, the conference kicks off.”

The event will take place Tuesday, May 18.

For more information
South Australian Produce Market
Phone: +61 8 8349 4493