Content brought to you by Fonterra
Shanghai may have come to a standstill but that hasn't stopped Fonterra from forging ahead with a new sales model.
The city has been in a strict lockdown due to China's zero-Covid policy and people have not been allowed to leave their houses for almost two months.
This changed how Shanghai functioned, especially when it came to grocery deliveries, Fonterra's Greater China CEO, Teh-han Chow said.
Advertisement
Advertise with NZME."At the beginning of this lockdown, there was a serious shortage of supply in the city because the usual delivery services that we had were all suspended," he told The Country Sport Breakfast's Brian Kelly.
There was also a lack of trucks and drivers with permits to make deliveries.
This resulted in purchase orders requiring a minimum volume, which meant that goods had to be delivered en masse, Chow said.
"Everybody in an apartment block, or compound, had to work together to buy these groceries in bulk ... and immediately, it was kind of like every community was buying this way - so we called it community purchase."
Fonterra soon saw an opportunity to help out with a new system.
"Real credit goes to the Fonterra Brands team because they acted quickly and they got their foot in the door so to speak."
So far, Fonterra had sold products to more than 30,000 Shanghai households.
There was also an interesting behind the scenes story involving "Community Captains".
Advertisement
Advertise with NZME.These Co-Captains ordered goods on behalf of their communities and were a pretty well-connected bunch, Chow said.
"A minimum order size is something like 50 families or more and the captains usually have some sort of channels or access to buy the supplies and ... arrange the deliveries."
One of the co-op's Shanghai salesmen stepped up to the plate and became a Community Captain - with a Fonterra twist, Chow said.
Listen below:
"He saw that there was a need for milk and other dairy products in his own community - so he became a Dairy Captain."
This Dairy Captain soon discovered there was a widespread shortage in dairy deliveries, so he, along with the entire Shanghai sales team, came up with a solution, Chow said.
Advertisement
Advertise with NZME."They worked with our supply chain team, our marketing team, external affairs functions and later some of the community-purchase e-commerce platforms."
The team paved the way for a smooth supply chain, from promotion and selling through to delivery from warehouses to consumer compounds.
As a result, supply chain teams, who were used to shipping truckloads, now sent trucks out for small deliveries offloading product around Shanghai, Chow said.
While the community purchase system worked well for the current situation in Shanghai, Chow was unsure if it would be utilised outside of lockdown.
"As the situation is lifted I'm somewhat doubtful that this model will continue in the same way."
Overall, the whole experience had been a "silver lining" in a challenging environment for Chow, especially since his wife became a Community Captain.
Advertisement
Advertise with NZME."My wife and I have gotten to know a lot of our neighbours [through] helping with deliveries. We moved into this compound last year and we really only knew a handful of people."
He hoped Fonterra's brands would now be associated with a positive experience during a tough time for Shanghai residents.
"Hopefully ... they remember our brand providing them some sort of joy, whether it's [through] baking products or drinking milk."
