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Adam Boot

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Adam Boot last won the day on April 23

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About Adam Boot

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  1. My apologies if that is how you see my comments. It is not supposed to be a list of why it won't work. It is supposed to be a range of questions that require answers for it to work. Of course Co Op's, in some cases can work. It may well be a good thing to have a Co Op. It doesn't mater what my view is. The point is, it does not matter how much money you get from the government or how much each member puts in. It is still business and if the fundamentals are wrong it will not work. The subsidy will not last forever. The questions remain un answered. How is the Co Op going to reduce cost, increase efficiency, reduce hive numbers, increase yields. How is it going to get the market to pay more for the product. The global market is not going to change because New Zealand has created a honey Co Op. If I walked in your shoes I would want to see a formidable business plan (including funding model) and equally solid long term marketing plan before I jumped in? I would want to know who the decision makers were and what there motives and credentials were? I would want to see that boxes were ticked and scenarios though through? This may well be going on? Every beekeeper involved may have been sworn to absolute secrecy? I can only go from what I here in the industry and what I read in this forum. All I have heard is lots of worm fuzzies about a wonderfull idea. I have not heard or seen anything constructive to this point. In response to: packer that you have religiously supported for many years tells you sorry son but we don't want your product today, and probably not tomorrow. 🤢 I assume that for many years this relationship has been symbiotic? The packer has also religiously supported your business? The packer is hurting just as much as you are.
  2. Wow, that is a little bit heavy for me and certainly not what I was referring to at all. Geopolitics and tension is not the cause of NZ honey industry issues. Remember we produce 20,000 tonnes in a 2 million tonne market. Negligible. If we can't find a market for such a small quantity of superior quality product it is our problem and no one else. The NZ market has enjoyed over inflated prices for non Manuka honey. Previous lack of international export worthy Manuka Honey standards fuelled this. The MPI Manuka Honey Science Definition for Mono Floral has rightly forced a correction. The historical inflated prices made NZ non Manuka unsalable on the global market and longterm partnerships, contracts and markets were lost. With price adjustment these markets will become available again over time and will continue to grow. The second part of the NZ problem is a legacy of the Manuka boom. Many investors piled into a market that they did not understand and before they understood the effect of the approaching MPI regulation changes. A lack of due diligence has been rife. Companies valued on hive numbers and inflated yields of expected Manuka have created a debt bubble. Much of the expected harvests are not at forecast yields and are no longer considered Manuka Honey. Business models were built on false revenue value expectations with debt burdens that are now inappropriate. Banks understand the over valuation problem now. They understand the honey markets and values better. The fact is that every man and his dog thought that there was quick money to be made. Then they all thought they could make more by putting it in a jar themselves, putting a label on it and believing they had a brand. The reality is that very few labels have had tangible market penetration and fewer have become or are brands in the true sense. Consolidation and collapse is happening a rapid rate. What is left will be stronger more efficient and will take the industry to a more sustainable next level.
  3. There is nothing that can't be done or achieved. There are no comfort zones and there is no need to get down and dirty. It's about working clever with clarity of vision and focus. Marketing by committee will not work. it cannot and will not. The members need to drop their marketing ideas at the door and employ and accept expertise. Members need to focus on what they are good at or should be good at - producing honey. A Co Op will not provide an excuse for uncompetitive production or production of unsaleable product. You can create markets where they do not currently exist, but you cannot do this overnight. The operation has to be super efficient from day one. It will need very significant working capital and a very significant marketing budget. If and it is a big IF that the Co Op gets $30m from the government it will probably need another $90m in funding to support an organisation of this size and the cash flow time delay. The Co Op will be short on assets as these will be owned by the members. Bank funding will probably not be an option. How much cash input are the members providing? Can they provide the upfront $90m extra working capital to support this venture. Who is vetting the Membership? This is critical. Entry must only be for those that are financially stable. The Co Op must start from a position of strength. If it is a band aid for multiple companies in trouble it will remain the same - a company in trouble - just bigger. There are many beekeeping operations and many labels on the verge of collapse. There are casualties every week and some are well known organisations. There are many that are haemorrhaging at unsustainable levels and the end is a when? not an if? Industry consolidation will probably continue through 2020. This maybe sad but it is not a reflection of the global market strength it is a reflection of the NZ honey industries position within it. Industry consolidation is a good thing and an inevitable phase for any industry. It will happen again and again through the maturation of the industry and always the cream will rise to the top. By 2021 the landscape will be very different. Many of the old guard companies and some big brands will have gone, merged or morphed. Can the Co Op be strong enough to be one of the new guard. From the outside it is the appearance of being the last option rather than one of the options? It looks like it may be an act of desperation and saviour to all in trouble? That might not necessarily be a good starting position? I only go by what I read and hear and I may be way off the mark? I am not part of this and am not in the mix or in the know. I can only speculate and provide opinion from the outside. We all have views on how this should work or can work and the chances of success or failure. My vision maybe or is probably alien to everyone else and all those involved. It will be a wonderful and intriguing display of market forces I am sure.
  4. I have not seen glitzy companies in the New Zealand honey industry. Seriously. This is hardly silicon valley! I see a few companies that make significant strides to make themselves relevant on the world stage and provide the required reassurance that international purchasing teams expect to see. I see investment in facilities, laboratories and technicians. In functional white cleanrooms and state of art production and packing equipment. I see polished food grade stainless steel and a highly skilled workforce. I see world class traceability, QA and compliance. I see significant investment in science, R&D and NPD with a view to raising the value of New Zealand honey above the global commodity norm. I see $ millions invested in stock to ensure customers and consumers receive continuity of supply. I see improving standards and enhanced testing regimes. I see marketing $'s as the awareness delivery mechanism. A necesity for encapsulating this effort and achievement and delivering the New Zealand honey message to a challenging global market.
  5. I am sure it is! The new Co Op will have a plan I am sure and all these questions and many more will have been thought through? I will be interested to understand the pitch to Shane Jones? Is this a loan or grant proposal. What is in it for the Government? The question is: If the government gives you $30m today. How will that change the market price of honey tomorrow? Or will the $30m end up being a subsidy? I am still waiting for the explanation: How will the Co Op manage to get the global market to pay more for a kg of honey? If the answer to this question has not been determined then the Co Op can not be successful.
  6. I am here. Reading with interest and following the tone of the conversation. I love the enthusiasm and the excitement that the concept generates. I look forward to seeing the business plan and the structure of the organisation? Presumably someone is developing the marketing strategy, the product offering, future NPD direction and the value proposition? Presumably this is/will be geared deliver both volume and added value? What is the vision? Is there a consensus on the vision? Time line? 1, 3, 5 year planning? Goals and objectives? Is the organisation selling bulk honey or finished goods or both? What products, ranges, brands? Which markets, which channels? Where is the infrastructure, how will this be managed and coordinated? What is the funding model and structure? How will the board be appointed? Who is/will be the CEO? It will be fascinating to observe the processCheers Adam
  7. Strong. Differing by grade and by C4 levels
  8. You are now getting into an area specific to each companies valuable IP. I do not think any major producer is going to give an explanation of blending complexities. We can all apply a little common sense though. Honey does not arrive in beautifully prepared 2 of 4 tonne batches ready to go into a jar and the specific grade required. Barrels are 320kg and production runs are in tonnes. The combined tonnage has to pass the MPI definition DNA and all four markers and then all be at a specific grade requirement. 5+, 10+, 15+ etc Also 99% of all high grade Manuka is creamed. It is unlikely to look as it was when extracted.
  9. It is definitely perceived as a health food and natural medicinal suppliment. Consumed as part of a healthy diet and wellness lifestyle. That is a very broad statement and not entirely accurate. Some companies are not buying or buying in reduced quantities. Other companies are buying and buying in increased quantities. Those that are buying are being more selective and discerning. Quality and marker levels are paramount.
  10. Hi Denis There is a lot of non Manuka business out there. It is a very busy and competitive hunting ground. Clover, clover blends and bush honey of varying forms are prolific. Global prices in this market are very low. High volume is available at very low margin. I am happy to take a crack at any market if it can deliver value. there is no sought that consumers will pay a premium for New Zealand honey. The premium though is small, maybe 15-20%. If you look at some of the prices via this link you can see honey retailing at less than the NZ bulk price. Always good to get a but. No apology needed. You have a good point. However I come from the position that New Zealand is a small producer on a global stage. If the world honey market is approx 2 million tonnes per annum, we as New Zealand Honey Inc have to find a market for less than 2% of the global demand. Within that demand there is honey sold at $100+ per kg and honey sold at $4 per kg. The majority is sold at far less than $10 How good are we at creating a value proposition that resonates? How good are we at selling and developing markets? How good are we at New Product Development? How good are we at marketing? In answer to your question - 'With your market knowledge, is there any chance of creating a sustainable international market for 10000T of native bush flavoured non Manuka honey in next two years that can pay a living return of a minimum $6-$9kg ex gate' Yes - You will need a multiple of companies coming up with great ideas and marketing strategies and value propositions that creates a tangible reason for the consumer. A reason that supersedes price by the required %. There is a big difference between $6 and $9 it may be that market penetration requires $5 - $7 for a period. Have we got enough companies capable of this?
  11. My apologies for the delayed response. I have just had a very busy and rewarding trip, bouncing around the world promoting wonderful New Zealand honey. I can only give my opinion and view on this topic. There is no single answer that explains the current market position of Manuka honey and the demand both domestically and internationally. There is no doubt that change is occurring and that some markets are maturing and new markets are emerging and others are just starting to really blossom. Whether you are busy and successful or not is dependent upon your brand or brands and the markets you choose to target. I see growing awareness, acceptance, appreciation, reputation and want for Manuka Honey in more and more large international markets. I also see buyer confusion and concern over standards and quality. I still see confusion with labelling and grading systems. Anecdotal, word of mouth, positive feed back for Manuka Honey is spreading faster than I have seen before. Yet, as an industry we are not ready to capitalise on the opportunity. We are not unified in our direction and approach. As an industry we are very immature and a short term, fast cash get rich quick mentality still permeates many quarters. We are very poor at self policing. In fact there are plenty in the industry that treat standards and labelling laws as a burden and costly interference. There will never be a $billion Manuka industry for NZ while these people companies exist. As fast as markets emerge and grow they will be the first to undermine and cause long term damage. I have just travelled extensively and the junk I have seen offered and portrayed as Manuka honey is in my opinion a disgrace and embarrassment. Firstly lets put to bed the Australian issue. It does not look smell or taste like real Manuka. It is like treacle or molasses. It is just honey with MGO. On its own this would be no threat to a united industry with fortitude, foresight and 20+ years of science. As it is, not only can we not agree and join together and garner Government support for the defence and the protection of the name Manuka. We actually have New Zealand producers trading in and offering Australian Manuka as an alternative at a lower price. What does this say for our position? What does it do for our argument? Next we have companies that flaunt the essence of the law. Those companies that ship bulk honey off shore to knowingly pack under far looser, less stringent labelling requirements. The MPI Manuka Honey definition is there for a reason. Like it or not it is there to formalise compliance and strengthen the New Zealand Manuka honey brand and reputation for quality. Those that look for legal grey areas to avoid or get around the standard, simply reduce respect, quality and value of the industry. Next we have the often deliberate confusion and false, detrimental marketing surrounding the use of variable grading systems. UMF and MGO still cause confusion. While UMF appears to be strengthening standard requirements, MGO on its own seems to be often used to confuse. There are many brands that promote MGO 30, 50 and 70 as Manuka honey with the words 'blend' or 'multi floral' very small, unclear or obscurely positioned. The UK is a prime example of a large market that has been saturated with lesser quality product, poor product education and now has a unnaturally low perception of the real value. Then we have China. The golden goose. The number of brands available are countless. Most I have never heard of. Most will not be there next year or the year after but will probably be replaced by the next brand who thinks the market is easy only to realise that the only marketing tool they posses is price. Even the biggest brands seem to be forever chasing volume at the expense of value and credibility. Buy 1 get one free, 50% discount, buy 2 get one free etc etc is common place. I did not see the same discounting for top Champaign, caviar, perfume and branded clothing etc So back to New Zealand and Manuka Inc. One year does not define a market and direction. There are some major corrections taking place. Some very large producers and brands are suffering or reversing and have reduced or stopped buying. Previous errors and direction are coming home to roost. The converse is that other companies and brands are emerging and defining a new standard and direction and value proposition. Genuinely exciting New product development will move Manuka honey to a new level and into new markets. I see growth opportunity every where I look and many untapped markets. From a personal perspective we see multiple new business enquiries every single day. The majority are Manuka related. Many have agressive price expectations. Some tick all the boxes and are worth developing. Time scales are often quite long for new business development but I see a very strong sales pipeline for the next three years. I am not looking beyond that at this point. Adam
  12. Not really. The tougher the position the more important the marketing becomes.
  13. Yes you are correct. The fact that it does not go away is the problem. The fact that NZ business is involved in this is a problem. No they are not. They have nothing like the MPI Definition. Like it or not, it is the cornerstone of NZ honey industry. It opens doors and has put our honey on the map. We drive other floral variety honey sales of the back of Manuka Honey in many markets. Without Manuka our industry would have a fraction of the value and potential that it has currently. We need to protect it!
  14. This is an interesting one and I am not sure of the motivation behind the original deal? I presume you are talking about Costco? They are an extremely good operator in the low value discount bulk end of retail. I am not sure why a 'Brand Leader' of a premium product would enter this channel and forever after position themselves at this end of the market? Particularly in a market the size of the US. I imagine the short term gain was considered worth it at the time? Possibly a lack of due diligence as well? Costco are very good at introducing a known brand to their channel and establishing a product line. Later the develop their own brand in the same space. This may be what has happened.
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