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Home / Hawkes Bay Today / Business

Rockit science - Bay apple is a little beauty

By Patrick O'Sullivan
Hawkes Bay Today·
30 Mar, 2015 03:57 AM7 mins to read

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The Havelock North Fruit Company has an exclusive license to sell the Rockit variety globally.

The Havelock North Fruit Company has an exclusive license to sell the Rockit variety globally.

Sitting down with 10 Philippine supermarket executives, Phil Alison said he knew "the game they were going to play".

The Havelock North Fruit Company founder was pitching his small Rockit apple variety, increasingly popular around the world.

"They had a little clamshell of Chinese Fuji and I knew they were going to tell me how cheap they were," he said.

"I said to them, there are other little apples but they are only rubbish."

He asked for a knife and board and proceeded to cut up both varieties but was told to stop so the Chinese apples could be washed. He invited them to take a bite from each.

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"What do you think of the apples? The Chinese one is cheaper but which one do you want to eat?," he asked them.

"By the time we had finished the tasting, the Chinese flesh was brown."
He signed the chain.

"That was fantastic. God, it was fun."

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He is no stranger to pitching his award-winning snack apple, uniquely packaged in a tube.

His company recently moved into new premises with high-tech innovations, thanks to a Dragons' Den-style pitch to Angel investors.

"I made sure the timing was right, so we had fresh apples. There was quite an empathy because there were a number of them with connections to kiwifruit.
"I got a very good reception - you know that because they ask you questions - and they arranged to have a further meeting in a nice, quiet boardroom where they can ask you questions."

He said he traded a chunk of his company for good governance as well as finance.
"You have to give up a fair element of control. You have to have a really clean company - clean balance sheet with no family loans kind of stuff.

"A little bit of IP always works really well, I have a global exclusive licence."
He is relieved to have the board's expertise.

"How do you have a strategic planning session with yourself? Your bean counter or lawyer is not in a position to do that. "That has been a huge part of this whole process - focusing on the things we want to do well - having the debate with different viewpoints."

He had a "hell of a job" convincing the board the new packhouse should be high-profile in Havelock North, "with almost Auckland prices".

"We are trying to be a consumer brand. To do that you need to be visible."
Packaging apples in a tube was his idea.

"I spent ages in supermarkets watching what the confectionery industry had done. Over time they downsized their portions and gave people more opportunity to spend at the counter in places like gas stations. You can't go anywhere without a chocolate bar on the counter."

He had "joined the dots" before embracing the Rockit.

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In the middle of the last decade fruit and vegetables "were getting beaten up" by the confectionery industry but obesity came to greater public attention.

"The whole food industry sat up. From a timing point of view, it couldn't have been better. It absolutely hit the spot. "It was the start then of the healthy snack fad. I put it all together in my head and went from there.

"Naming it was four months' work. Finding the tube was four months' work. There was an enormous number of hours. I had a group of people - friends and family and a few consultants - and we lubed up and came up with some hairy ideas."

The former Apple and Pear Marketing Board chairman already sold his fruit worldwide and leveraged his contacts for Rockit, bred by Plant and Food in Havelock North.

He said the programme's licensing agent, Prevar, no longer gave exclusive licences, which was a mistake.

"Nobody develops a new product and commoditises it by saying 'you can invest in it but you can't own it'. Therefore the investment becomes minimal.

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"You can't get ours from somebody else at a lower price - we can name our price.
"That allows you to do a whole of other things. You can develop markets, you can promote it, you can cut prices to launch it into market or grow the market. You can do those things with confidence, knowing that you might take a hit for a year, but we are looking at this long term.

"You can't afford to do that when you have somebody competing against you with the same piece of fruit."

The industry's biggest player, Mr Apple, employs 1700 at the height of the season. The Havelock North Fruit company employs 200 but growth is "phenomenal".

With that growth came speed wobbles establishing systems. Trying to get a suitable finance package and integrate export IT systems with pack house production "is a challenge".

A government Callaghan Innovation grant of nearly $30,000 was "brilliant".

Commodity apple varieties came with known technical parameters such as maturity.

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"We don't have that history so we have to run trials. There is a massive amount of knowledge we did not have at our fingertips."

Before Angel investors helped establish its new Havelock North facility, packing was done by Crasborn.

"They packed for us for three years and did a good job but the gear had it shortcomings, which they were perfectly upfront about.

"We either stayed there and committed long term, in which case they would have made the investment, or we could make the investment and have it fit in with a whole-company strategy. That is why we came here."

Teething problems have been experienced with software which measures apple height and width for optimum tube fit. Sometimes fruit is sent back into the sorting system, which further polishes and cleans until it gleams.

"We don't need to wax our fruit here. It's a practice creeping more and more into the industry."

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Hiring Kiwis was a priority. Other producers used Recognised Seasonal Employer (RSE) workers "too easily".

"I'm a Kiwi and we are a Kiwi company. Yes, I support the RSE scheme because it has helped lift a whole lot of other things, but if it's a Kiwi that wants a job then the Kiwi gets the job over and above any RSE worker, at any time."

His staff also wanted to employ locals "so they are prepared to go the extra mile". Seasonal staff were offered training in orchard operation so once they finished packing they could go out pruning and thinning.

"We do a lot of development work and they will be offered that first."
He said there were "no dumb ideas".

"Staff are actively encouraged to throw ideas on to a whiteboard. With an innovation company you are more about ideas: what if and what could be?"

He is ambitious to continue growth. With a million trees growing in the UK, US and Europe consumers will be able to buy fruit year-round through licensed distributors.

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"We are offering them skin in the game. They can develop the markets and it is all under long-term contract. That gives confidence we are not going to appoint another distributor in another 12 months after they've done all the donkey work."

The company has bought its Havelock North property and leased the one next door.

"This will be a showcase. It will suffice for at least two years but by year three we will be stretched at the seams. "There are options. I think we'll end up 24/7 in the pack house and coolstore with service providers.

"We want this to be a bit of a showcase, so we can bring people here. That is very important to us."

Fruit quality was the company's main strength.

"We could trip up, there will be copycats - there are already some trying to shift small fruit - but we know it is just inferior fruit.

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"There are a lot of people that still don't understand us and say it's just a fad."

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