Page 24 - December2018
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The Challenge Of Direct Global Sourcing
International buying programs can be dif cult, but some retailers seem intent to press on.
The sands have shifted since direct produce sourcing was pioneered for North American retail more than a decade ago by the likes of Walmart and SuperValu, following in the
footsteps of their counterparts in Europe.
The model is no longer just a question of taking on risk to cut cost and shore up supply, and thanks to hybrid applications, it has ceased to be
the exclusive domain of retail’s top dogs.
The plant biology that’s literally at its roots, combined with
the existing supply chain ecosystem, makes a purely direct global sourcing plan that includes every key region and commodity nearly impossible. But the idea itself is a spark for new approaches in the marketplace, along with upstream and downstream consolidation from traders and growers alike.
Claudio Canziani’s company, Safoods, headquartered in Santiago, Chile, is a perfect example of how the direct procurement concept has transmogri ed into new forms. Connecting both small and large growers with retailers who may not wish to invest in an overseas of ce, Safoods facilitates direct sourcing for prominent U.S. supermarkets.
“The biggest chains in the United States are buying directly,” says Canziani, whose company also has operations in Peru, Argentina and Mexico. “Every day, retailers are more open to  nding ways to ensure the fruit can go directly from the  eld to the shelf as quickly as possible within their speci cations and with the greatest control possible.”
He says what supermarkets have realized is that import capacity allows them to better compare with offers they receive daily from importers.
“Once you understand what is happening, you have a lot more information. And information is power,” he says.
Canziani’s motto is to never let the fruit stop after harvesting. With
U.S. regulations around the Food Safety Modernization Act (FSMA). “Before the fruit arrives at its destination, the responsibility lies with the grower-exporter,” he says. “We inspect every load that leaves the Southern Cone [the southernmost areas of South America, south of and around the Tropic of Capricorn], and if a load doesn’t meet the
speci cations, it doesn’t leave.”
“If there are accidents or problems that can happen on the ship,
whether it be the temperature, leaking petrol or if the ship has prob- lems in another port, any of these eventualities is covered by the growers’ insurance in case the fruit is lost.
“Only once the fruit is inspected and approved by the retailer does it become their responsibility,” he says, emphasizing a supermarket is going to keep consistent specs, regardless of whether fruit is from an importer or their direct sourcing partners.
His Chilean compatriot, Manuel Alcaino of Decofrut in Santiago, claims there is “only one de nition” of direct procurement – a retailer setting up a program with an exporter or grower in another country. But he clari es there are many ways to operate, whether it’s a retailer setting up an of ce abroad like Walmart has in Chile or importing through a service provider.
“Retailers are entering this terrain more and more buying loads, and I think there is an advantage for everyone, so long as commitments are kept,” says Alcaino, whose group provides quality-control services with
Claudio Canziani
Manuel Alcaino
a faster speed to market, the result is less shrink in stores. “The cost of the fruit isn’t just in the price of the fruit, but rather in the shrink,” he explains. “And the difference between fruit that goes direct to the shelf vs. one that passed through many hands, that makes all the difference.”
The  rst step in a program like this is establishing a protocol that ensures paperwork is in order for shipping and that the retailer-importer complies with

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