Bio Foods eyes to become US $ 100mn...
Bio Foods (Pvt.) Ltd, an emerging leader in the global biodynamic, organic and fairtrade agriculture industry, plans to become a US $ 100 million revenue per year company, empowered by its recent partnership with GLS Bank Germany, the world’s first socio-ecological bank as well as the largest green bank in Europe.
Speaking to Mirror Business at the celebration of Bio Foods’ 25th anniversary last week, Bio Foods (Pvt.) Ltd Founder Chairman Dr. Sarath Ranaweera revealed that GLS Bank recently partnered with Bio Foods by purchasing 36 percent of shares of the company for around 7 million euros and GLS Bank plans to purchase further 4 percent of shares of the company in the near future.
Bio Foods (Pvt.) Ltd was established in 1993, aiming to change the culture of agrochemical-ridden conventional farming, by starting chemical-free organic crop cultivation.
According to Dr. Ranaweera, the company’s current annual turnover is around US $ 25 million and has interests in export of tea, spices, vegetables and various other organic products.
The company invests 15 percent of its revenue annually and invents at least three new products per year. Bio Foods aims to almost double its research and development (R&D) spending to 30 percent in the future.
“We first identify market vacuums, market requirements and market changes through a business intelligent system and then we move to R&D to meet the requirements of the market.”
Dr. Ranaweera said that one of reasons for their partnership with GLS Bank was to fund future expansions, as the company is trying to cope with the growing demand for its products in the United States and in European markets.
“We cannot cope with the demand; we need more funds to build an automated plant, tea factories and we can expand towards the farmer.”
Bio Foods’ business model spans from directly training and certifying underprivileged farmer groups in many rural parts of Sri Lanka, to their own certified processing plants to packing units.
The company also stands out by managing the complete supply chain from the farmerlevel to the final value-added product, in a transparent, sustainable (for both environment and workers) manner.
The company was also among few local companies chosen for implementation of Rs.270 million World Bank impact project, involving small-scale farmers in the Northeast. Dr. Ranaweera expects this project will help Bio Foods to strengthen its supply chain to increase its exports tremendously.
Bio Foods currently works with 10,000 farmers across the country, impacting 30,000 livelihoods directly and indirectly.
The company has also come up with a successful model for tea plantation based on the outgrower model.
“We have developed a plantation model where we have given 820 acres of plantations to 411 farmers and every farmer gets a twoacre land. When the farmers own the land, you pluck 30 kilos, otherwise they pluck 12 kilos,” he said.
Bio Foods has indentified organic tea as one of the fastest growing agricultural crops in the world and the company plans to boost export of tea.
“Our value addition in tea is 625 percent. When you sell typical bulk tea for US $ 2 or US $ 3, we sell at an eight or nine times higher through value additions—for about US $ 20 per kilo on average through packaging and fairtrade practices.”
He also revealed that Bio Foods has emerged as the largest pepper exporter of Sri Lanka. However, he noted that contrary to the majority of pepper exporters in Sri Lanka, who export to India, Bio Foods pepper export market is in Europe and the United States.
He said that the key is to improve the quality of pepper harvest at the primary level, which will enable Sri Lanka to export pepper to European and American markets rather than exporting low-quality pepper to India or Pakistan.
“Organic is not only about being environment friendly but it’s also about being culturally sensitive and economically viable as well as socially just.”
Hence, he said that Bio Foods has decided to create awareness of organic food among Sri Lankans while increasing access to its export quality product line to local consumer, which is vital for being socially just.
“We have over 500 products. We will initially supply the local market with 50 products. We really want to give an opportunity for Sri Lankans how organic tea tastes like. We also have ideas to manufacture gluten-free bakery products,” he said.
These products range from teas, spices, herbs, fruits, vegetables, coconut products, to whole grains and will be accessible to discerning, ethically-minded, healthconscious consumers in Sri Lanka.
Speaking to Mirror Business, Bio Foods (Pvt.) Ltd Chief Marketing Officer Madusha Ranaweera said that Bio Foods would shortly relaunch its website with an e-commerce portal, allowing Sri Lankans to directly purchase Bio Foods products online.
She further said that the company is also considering launching a restaurant next year to promote the organic food culture in Sri Lanka.
Bio Foods also appointed entrepreneur, philanthropist and activist Otara Gunewardene as the company’s Brand Ambassador.
Bio Foods (Pvt.) Ltd has received various international recognitions over the years and one that stands out is Dr. Ranaweera, being awarded with the first-ever ‘World’s Fairest Fairtrader Award’ presented by the World Fairtrade Labelling Organisation.
Presented in 2014 in Bonn, Germany, Dr. Ranaweera was selected from over 80 worthy candidates who were recognized for their special efforts or innovations within the global fairtrade system.
Dr. Ranaweera also chairs the Sri Lanka Council for Agricultural Research Policy National Committee on Organic Agriculture.
The key figures of Bio Foods (Pvt.) Ltd headed by Dr. Ranaweera include, Chief Executive Officer Lilanthi Herath, Chief Marketing Officer Madusha Ranaweera, Bio Foods, HNB Assurance PLC as well as Candor Group of Companies Director Ravi Abeysuriya and Bio Foods Director and GLS Beteiligungs AG and Gls energie AG Managing Director and Board Member Nikolaus von Doderer.