The lobsters are tagged for traceability. Photo / Supplied
Fiordland plans to be the most innovative firm in its sector writes Tim McCready.
Better known in New Zealand as the crayfish, the New Zealand rock lobster are found throughout coastal areas of New Zealand. Unlike many subtropical or tropical lobsters which have very soft flesh, the cold-water New Zealand lobster has flesh that is sweet and firm, making it suitable for serving in a variety of ways. It also looks like a red dragon — a symbol of prosperity and luck in China.
Fiordland Lobster Company is New Zealand's largest exporter of live rock lobster — sending about 950 tonnes offshore each year.
The company obtains its lobster from suppliers in both the North and South Islands, with around 85 per cent of the catch from the South Island, and the remaining 15 per cent further north — particularly off the Wairarapa coast and Mahia.
The lobster are transported to the company's export facilities — either by helicopter (from the Fiordland region) or by insulated trucks — ready to be air-freighted offshore. The fast export, receipt of product and on-sale to Chinese consumers has been made possible because of the increase in air services between China and New Zealand.
Chief executive Alan Buckner says though the quota management system means export numbers of the New Zealand industry can't grow, good sustainability practices mean the company can have certainty around availability when it is required.
"But those sustainability practices also provide scarcity," says Buckner — and it is that scarcity and the lobster's use for special occasions that results in a huge price elasticity for the product.
"Sales into China peak in the two weeks Chinese New Year is celebrated. Other key events like May Day celebrations and lucky days in the Chinese lunar calendar also see sales pick up dramatically," he says.
Such a dynamic sale price means Fiordland Lobster Company is constantly resetting the price paid to fishermen, based on what is happening in the marketplace.
"It's a high value, highly perishable product. We manage the inventory between boats and marketplace via pricing," says Buckner.
To take advantage of the lobster's unique attributes, Fiordland Lobster Company recently rebranded its product — from "Kiwi Lobster", which has been in use since the late 80s — to "Wild Legend": a legendary product that is caught in the wild.
The company's new branding has been used for its front-facing consumer work: selling cross-border directly to restaurants, online through e-commerce giant Alibaba, and in the Chinese online-to-offline supermarket chain Hema — also part of the Alibaba Group.
To date, the majority of Fiordland Lobster Company's lobster volume has been imported directly by traditional wholesalers in the large, affluent tier-1 Chinese cities, who then on-sell the product to distributors or directly to restaurants. But the use technology is helping to connect the Wild Legend lobster directly with the companies and customers who will ultimately use and consume the product.
"We think that there will be a lot more activity going forward directly to restaurants and event management companies," says Buckner. "This will progress over time — and it is technology that is driving it."
Through its WeChat channel, Fiordland Lobster Company is able to bring its lobster to the attention of potential buyers, sharing the company's story, images and demonstrations on how to cook and consume the lobster. These moves are an integral part of the company's new mission, which Buckner says is "to be the most innovative lobster company on the planet".
"Keeping up with the curve in terms of technology — and being better connected to the consumer — provides us with an opportunity to improve the profitability of the entire industry," he says.
"Because we've had to become adaptable with the changing marketplace in China, it has really pushed innovation as a key component of our company culture."
Buckner says that this innovative culture is evidenced in all components of the business.
Traceability and authenticity of food is becoming increasingly important — particularly in China, and is an area benefiting from Fiordland Lobster Company's innovation drive. By tagging its lobsters with QR codes, consumers can scan the tag to be directed to the company's WeChat presence, and learn more about the integrity and origin of the product.
Buckner says the company has plans to extend the technology: "Eventually, we can imagine each lobster having its own unique QR code, which will tell consumers where and when each lobster was caught — what coastline, what boat, and how it got to China."
The company is about to embark on a blockchain trial in conjunction with ASB Bank and Mainfreight, to further strengthen supply chain traceability and transparency of its product.
Another area of innovation the Fiordland Lobster Company is working on is the optimisation of its cold chain, including the relationship between humidity and temperature to improve the welfare of the lobster.
It is also considering sustainable alternatives to replace polystyrene containers in the supply chain, trialling products derived from plant matter.
Fiordland Lobster Company began 30 years ago, when 15 Fiordland fishermen formed a partnership with Mt Maunganui Seafoods, which was then pioneering live cold water lobster exports to Japan.
Fiordland Lobster Company is responsible for 35 per cent of the New Zealand industry for this species of lobster. The company's growth strategy has seen it move beyond New Zealand shores and into Australia — Tasmania, South Australia, and Victoria's coastlines all have the same species of lobster. The company has been present there for seven years, and its operations now make up around 20 per cent of the Australian industry for the species.
Nowadays, China is Fiordland Lobster Company's key market. This year it expects it will send around 1.5 million live lobster to China, bolstered by a rebrand of its product and innovation throughout the supply chain. Its success in China saw it take out the supreme award at the NZ China Trade Association (NZCTA) Business Awards last month. It was also the winner of the New Zealand Trade & Enterprise award for trade between China and New Zealand.
The supermarket said its staff caused her public embarrassment and distress.