The just-food interview - Anthony Pile, Blue Skies
Blue Skies, a UK-based produce firm, sets out to help growers in developing countries get a fair return for their labour. However, the company's reliance on air freight has left it in the firing-line of some green lobbyists, while the Soil Association's new standards for air-freighted organic produce, unveiled last week, could also cause problems for the company. Blue Skies founder and chairman Anthony Pile spoke with Ben Cooper about the company's ethos and future plans, and why he believes the Soil Association needs to think again.
"You learn to trust people," Anthony Pile says of his experience as an officer in the British Army. The observation comes rather out of left field. There would appear to be many assets useful for a business career to be gained from military experience - management and analytical skills, self-possession, composure, clarity of thought - but that one might not spring to mind.
However, trust is clearly central to the ethos of Blue Skies, the company Pile founded ten years ago and still leads. The idea behind Blue Skies is simple. Fresh fruit is cut and pre-packaged in the country of origin and shipped directly to retailers.
By shipping an added-value product, Blue Skies' Ghanaian, Egyptian, Brazilian and South African workers and partner growers are gaining a far better return for their labour than simply by shipping a commodity. "Adding value is only way you return the value to Africa," Pile says.
From a development standpoint, the model is an enabling and empowering one for poor countries. "We said we weren't going to be philanthropists. We would give people work and pay them fairly," Pile adds. Nevertheless, it required putting faith in the ability of the local workforce to take control of their own destiny.
And the trust has to work both ways. Being able to convey to people that "you mean what you say and you will do what you say", something Pile also attributes to his military background, was enormously important in establishing a relationship with farmers, he says.
Pile, who attended the London Business School after leaving the army, came up with the idea of setting up a plant in Ghana to cut and pack fresh fruit while he was managing director of fruit specialist Orchard House Foods. "I went to Ghana and wrote a paper and submitted it to the board," he explains. "It got the thumbs down so I got on my bike and went and did it. I wasn't a born entrepreneur. I found myself with an opportunity and was able to take it."
Having failed to gain bank finance for the venture, Pile turned to friends and private investors, sold cars and mortgaged his house. Today, Blue Skies employs 2,500 people, principally in the four production sites but also including about 16 in the UK and Europe, and has annual revenues of GBP25m. The company has between 170 and 180 product lines, dealing in both cut fruit, notably pineapple, mango, coconut, papaya, melon and grapes, and fruit juices and smoothies.
In examining how Blue Skies has progressed, some may take issue with Pile's assertion that he is not a natural entrepreneur. In particular, his early identification of the potential of organic produce suggests shrewd business instincts, though he maintains that far from being an inspired strategic choice, it was a glaringly obvious course of action.
"The concept of organic fruit is more natural to Africa and Brazil than it ever will be in Europe," he says. "The idea did not occur to me until I got there. Africa is raw; it's a wonderfully raw continent…He [the farmer] doesn't have access to chemicals or logistics. He's going to use what he has around him."
Organic still only accounts for 10% of the company's business but it is a growing area, and Pile is eyeing some ambitious targets. "My aim is to take us well past the 50% mark," he says. "There are challenges because we're in a very competitive market."
Blue Skies founder and chairman Anthony Pile
It is not only competition which might inhibit growth. As ironic as it seems for a company with Blue Skies' ethical credentials, both in social and environmental terms, its reliance on air freight puts it in the firing-line from certain environmental lobbies. Indeed, last week's announcement by the Soil Association of new ethical standards for the organic certification of air-freighted products may set the tone for new thinking in this area.
Pile believes the focus on air freight by pressure groups does not take sufficient account of the social good that companies such as Blue Skies are doing, and the importance of organic farming to Africa's agricultural future. He also believes that appraisals of the comparative impacts of air-freighting fresh organic produce and sea-freighting whole fruit have been simplistic. "Organics are right for Africa," he says, "and the truth is there are an awful lot of things closer to home that are far more damaging than a short air journey from Africa to Europe."
While Pile is confident that Blue Skies' own business would pass any ethical audit, allowing it to keep its Soil Association organic certification at least for the time being, an additional measure requiring the retailers also to be audited may be a problem. He is hopeful of persuading the Soil Association to change its view on that during the next consultation phase, and also believes switching to another certification body may be a possibility.
Clearly, Pile seems determined that last week's events will not interrupt the company's growth plans. Blue Skies already deals with 16 retailers across Europe, as well as two in South Africa, and Pile is planning to grow the business "quite dramatically" over the coming ten years.
"We are still small but we are growing fast. We have set our course for a dramatic increase in our volumes but based on the same arrangement; that is to provide a network of operations in the developing world to supply the best possible product in the quickest possible time, in the freshest possible state to consumers."
Looking beyond the UK to Europe, the company is building its business with continental retailers. It is already present in France and Germany, where Pile sees excellent growth potential, the Netherlands, Switzerland and Italy, while the company is expecting to enter the Spanish market soon. In addition, Pile expects the company's production operations in Brazil to open up opportunities in North America and Japan. In terms of expanding its production base, the next move for Blue Skies may be into Rwanda.
It will be a fascinating story to follow, particularly in the context of the development challenges facing the countries where Blue Skies operates. Pile is proud that Blue Skies' plant in Ghana is visited regularly by agencies working in countries such as Malawi, Rwanda and Uganda, and is being viewed as something of a model to be followed in other developing countries.
As a soldier, he witnessed at first hand the political unrest in Kenya in the years after it gained independence from colonial rule. Indeed, his army career coincided with the final phase of the colonial extraction which had been a significant area of military engagement for the British Army after the Second World War.
Freedom from colonial power is no longer the issue for those countries but true economic emancipation most definitely is, and there is a certain poignancy in the fact that Pile is now participating in that struggle so directly through the work of Blue Skies.
Companies: Soil Association
Blue Skies, a UK-based produce firm, sets out to help growers in developing countries get a fair return for their labour. However, the company's reliance on air freight has left it in the firing-line ...
The Soil Association has hit out at its critics and defended proposals to include "food miles" on the labels of organic foods flown into the UK....
The UK's organic watchdog, the Soil Association, has faced heavy criticism over proposals to include details of food miles in its labelling system....
- Maspex: M&A opportunities in eastern Europe
- The just-food interview: Bega Cheese CEO
- Nestle's 2014 results: 10 Things to Learn
- Sustainability Watch: The US packaging challenge
- Why "simple" and "real" will be industry buzzwords
- Gruma FY earnings surge as margins improve
- UPDATE: Mondelez confirms Irish plant changes
- WhiteWave launches "Australian-style" yoghurt
- Bright Food "to buy 70% of Tnuva"
- Kerry Group CEO expects more M&A in 2015