Beef­ing up the brand

One of only two SA meat ex­porters to have achieved EU ac­cred­i­ta­tion

Finweek English Edition - - Kap international - 56 FIN­WEEK

FOR OB­VI­OUS REA­SONS, the sprawl­ing Krugers­dorp fa­cil­ity of iconic SA meat com­pany Bull Brand Foods is not a favoured des­ti­na­tion for veg­e­tar­i­ans. Built on its “bully beef ” brand, Bull Brand has be­come syn­ony­mous with red meat.

To add economies of scale to the com­pany, over the past few years, Bull Brand has di­ver­si­fied into fresh meat and new value-added prod­uct ranges.

Lou Cam­pher, Bull Brand MD, says the in­jec­tion of cap­i­tal by KAP In­ter­na­tional four years ago saw the group re­cap­i­talised, with a re­newed fo­cus on build­ing economies of scale, ra­tio­nal­is­ing cer­tain el­e­ments of the busi­ness and con­sol­i­dat­ing all the com­pany’s op­er­a­tions un­der the Bull Brand Foods name.

Added to its canned meats un­der the Bull Brand, Speke­nam, Gants and Apex la­bels, the com­pany now boasts a full shop­ping bas­ket of fresh beef prod­ucts, as well as lamb, sheep, and pork prod­ucts. Th­ese are sold un­der the Sam’s Ten­der Beef, Bull Brand Grain­fed and Bull Brand Ten­der brands.

The ex­pan­sion into the fresh meat sec­tor has paid div­i­dends, and to­day the com­pany is the lynch­pin of KAP’s con­sumer di­vi­sion, rep­re­sent­ing more than 63% of its rev­enues.

In 2006, the group boosted turnover 21,3% to R881m on the back of higher canned sales and ris­ing meat sell­ing prices.

The driv­ing force be­hind pro­duc­tion is found at the Krugers­dorp premises, which pro­cesses and pack­ages both the canned and fresh meat prod­ucts. Cam­pher ex­plains that the op­er­a­tion is laid out ac­cord­ing to Euro­pean Union spec­i­fi­ca­tions, in terms of an ex­por­tap­proved cer­ti­fi­ca­tion. “We are one of only two SA meat ex­porters to have achieved EU ac­cred­i­ta­tion, en­abling us to in­crease ex­ports into Europe and other in­ter­na­tional mar­kets.”

The fa­cil­ity has also been ac­cred­ited for Kosher slaugh­ter­ing by the Beth Din and is af­fil­i­ated to the SA Na­tional Halaal As­so­ci­a­tion (SNHA) for Halaal slaugh­ter­ing. To en­hance ef­fi­cien­cies, a great deal of at­ten­tion is be­ing paid to up­grad­ing tech­nol­ogy and bring­ing in the latest equip­ment.

Out­side of its Krugers­dorp fac­tory, the com­pany also runs two feed­lots, Hur­land in Ma­galies­burg and Taai­boschbult in Potchef­stroom, which have stand­ing ca­pac­ity for al­most 40 000 cat­tle. It’s a mas­sive un­der­tak­ing, in­volv­ing in­vest­ment in feed for­mu­la­tion tech­nolo­gies, the main­te­nance of an en­vi­ron­men­tally se­cure en­vi­ron­ment, and con­tracted spe­cial­ist ve­teri­nar­i­ans.

Farm­ing per­for­mance has been ex­cel­lent in the past year, Cam­pher notes, with the group in­ves­ti­gat­ing the pos­si­bil­ity of fur­ther in­creases in the herd. How­ever, with meat prices volatile, the tim­ing must be cor­rect and any in­vest­ment must also jus­tify the in­flu­ence on work­ing cap­i­tal, he em­pha­sises.

An­other move that could have a pos­i­tive ef­fect on Bull Brand go­ing for­ward is KAP’s pend­ing ac­qui­si­tion of a 60% stake in Bren­ner Mills.

The milling busi­ness, which is still sub­ject to ap­proval by the Com­pe­ti­tion Com­mis­sion and due dili­gence, would sup­ply feed di­rectly to the herds, lead­ing to lower costs. At the same time, the two groups have syn­er­gies in their dis­tri­bu­tion chan­nels that could also be ex­ploited, ex­plains Cam­pher.

In tan­dem with the pro­duc­tion lo­gis­tics be­hind the coun­try’s most dom­i­nant tinned meat com­pany, Bull Brand is con­tin­u­ally look­ing to in­crease its range of prod­ucts fo­cused on the “con­ve­nience” end of the food chain. This in­cludes re­cently launched fi­bre-added prod­ucts such as “Cow­boy King” burg­ers, as well as Bull Brand Bil­tong, Salami and Dry Wors Snax.

“Mar­gins are wider in th­ese value-added prod­ucts,” Cam­pher points out.

He says the com­pany is mov­ing away from be­ing strictly prod­uct-driven and is now fo­cused more on sat­is­fy­ing the needs of its cus­tomers. “The trends to­wards con­ve­nience meat prod­ucts are very ev­i­dent.

South Africa has an ex­pand­ing mid­dle class, and we are po­si­tioned at the head of the class. We’re con­fi­dent our brand will move from strength to strength,” adds Cam­pher.

And that’s not bull.

Ex­pan­sion into the fresh meat sec­tor paid div­i­dends. Lou Cam­pher

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