Italian wholesaler Ecor: holistic approach

Ecor, the wholefood wholesaler with the highest turnover in Italy, is increasing its production arm. In addition to business partners abroad, the beneficiaries will be the company’s own retail customers (more than 1,000), the organic supermarkets of its partner NaturaSi (more than 60) and the smaller customers of the wholesaler Baule Volante (3,000) that was taken over last year. The farm Di Vaira in the Molise region in southern Italy has 500 hectares and is so big that 50 % of production is earmarked for export when it is operating to full capacity. The managing director of Ecor, Fabio Brescacin, wants to develop the Fattoria Di Vaira into a training centre for bio-dynamic agriculture, a destination for eco-tourists and a research establishment. Our editor Karin Heinze spoke to Mr Brescacin about his plans.
(Picture from left: Fabio Brescacin, Ecor; Roberto Zanoni, NaturaSi)
First of all, Mr Brescacin, congratulations – the Fattoria Di Vaira is a wonderful stretch of countryside. But it is not usual for a wholesaler to get involved in agriculture. Have you been planning this move into primary production for a long while?

Our roots go back to agriculture, and that’s where our original interest lay. A big concern for us is caring for the land. We’ve got another farm in Conegliano, which is our headquarters in Veneto. The wholesale business came later. The reason we are producing our own crops is because we want to give our customers the best possible quality by using bio-dynamic methods. Another point is that we have been increasingly worried in recent years about the quality of produce. When checks were carried out, we found increased levels of residues. Organic is big now, and many new farms have joined in. Sometimes all that’s missing is technical skill. Ecor-NaturaSi are100 % organic and want to support market development to the best of their ability, so we thought about how we could get things organised.

Problems of quality – aren’t the contracts with your suppliers long-term?

Of course, we know our suppliers and have been working with many of them for ages. In the case of fruit and vegetables you have to be very flexible, since bottlenecks keep occurring because of seasonal factors and the weather. The problem is that, instead of our partner farms growing everything themselves, they buy in produce, and the result is less transparency. We now want to raise the level of traceability, and we are introducing a system that will do just that. Another thing we’ve done is to organise an advice service for the farmers who supply us. We’ve now got two specialist advisers who visit farms. It was in this phase that we were offered the farm Di Vaira in 2007, and we grabbed the opportunity. The conditions are optimal for establishing a Demeter farm. The farm is very varied – we have more than 500 ha of land, our own water supply, a cow shed and other buildings.

Who were the previous owners, and was the land already farmed organically?

The land belonged to the church; Di Vaira was owned by the Bishop. 100 ha have been cultivated organically since 2004, and since 2007 we’ve been converting the rest to Demeter. The farm had been losing a lot of money, and the decision was taken to sell Di Vaira and to lease the land. Something that is interesting and fits our concept perfectly is the fact that there’s a school building on the farm. It’s a school that was founded in the 1950s for training farmers. It was abandoned years ago, but now we want to breathe new life into it and create a training facility for bio-dynamic farmers,

Who is financing this huge project?

A number of our retail customers have become shareholders, investing from 10,000 to 100,000 euros, and there are some private individuals, plus of course Ecor-NaturaSi. We’ve got about 30 shareholders who have raised 1.2 million euros, and the Banca Etica and a local bank have both supported us with loans. So far, we have invested 2.5 million euros in Di Vaira, and we are hoping more investors from the business world will come forward as well as private individuals who want to invest their capital long-term in something with substance. In my opinion, agriculture is one of the best and soundest investments today. And we, I mean the organic movement, ought to be giving something back to the original idea and philosophy of healthy agriculture, shouldn’t we?

How far have you got with Di Vaira?

We’ve bought animals – cows, goats and pigs – and machines, and we have built a warehouse. We employ 50 people on the farm – farmers and gardeners. It’s all labour-intensive because we’ve got 80 ha of vegetables, 70 ha of grapes and 20 ha of olives that we process ourselves to produce oil. 120 dairy cows plus 180 calves and bulls, 350 goats and 100 pigs have to be looked after, and some products are processed on site too. The farm is really complex, and the local people are pleased that Di Vaira once again has a future. We’ve kept on all the workers, and we’ve even created new jobs because the way we operate is so intensive.

What products will Di Vaira supply, and what activities are you planning?

We produce mainly winter vegetables – fennel, broccoli, cauliflower, leaf beet, beetroot, etc. - cow’s milk cheese and goat cheese, wine in collaboration with-growers, olive oil and cereals. There’s green fodder and hay for the animals too. And we operate eco-tourism on a small scale. Consumers should see where products come from and experience agriculture first-hand. We would like to open the farm to visitors. We organise, for example, a summer camp for children, and in the autumn we held the bio-dynamic annual general meeting at Di Vaira. As I said earlier, Di Vaira is going to be a place for the training and further training of young farmers.

Have you got enough capacity to go beyond supplying your own customers to supply the market as well?

Ecor-NaturaSi needs a lot of produce – we have over 1,000 customers, big stores plus the roughly 3,000 smaller outlets of Baule Volante, the wholesaler in Bologna that we took over. However, not all of them have to be supplied with fresh produce. All of these will account for about 50 % of production. The other 50 % is for export to customers like Dennree, Weber Naturkost in Munich and the wholesaler Odin in Holland. This arm of our business can be expanded, and we are looking for more business partners, because the farm at our headquarters in Conegliano/Veneto has been producing vegetables like leeks and fennel for many years, and some of these also go to Germany. With vegetables, we concentrate on the autumn and winter season, because in the summer there is too much competition from farms in the north of Italy. In the summer season, at Di Vaira we restrict production to juice tomatoes and water melons, but on a small scale. Apart from that, we prepare the soil with green manure for sowing and planting the winter vegetables. (Picture: The San Michèle farm at Conegliano)

Will your production have any effect on the prices in the trade within Italy?

Our philosophy isn’t to reduce prices. We have to run the farm at a profit, and we’ve got to see how things turn out at Di Vaira. In any case, our approach isn’t to use price but to use quality to market our products.

As well as producing crops at Di Vaira, you’re also going to carry on research.

That’s correct. We’re collaborating with the Swiss seed firm Sativa and we’re growing cereals on test plots for them. And we’re getting into propagating organic grain varieties like spelt and durum wheat, and some types of vegetables too. We’re also experimenting with vegetables – we’re growing non-hybrid varieties to test how suitable they are for large-scale cultivation. We’ve gone a step further and started experiments with machines that have been specifically developed for use in organic agriculture.

What are your plans for Baule Volante? Will it be integrated into the Eco-NaturaSi enterprise?

We have taken over Baule Volante, but we don’t intend to shift its location. Its headquarters will stay in Bologna. We’ve got a new warehouse there, and all the structures have been brought up to speed. Baule Volante will continue to supply the small shops. We’re planning a marketing programme for these customers along the lines of the Ecor concept B’io. The idea behind this concept is to support the shops and enable them to expand their premises and increase their sales. (Picture: Ecor headquarters)

What about Ecor-NaturaSi’s activities abroad?

Products from Di Vaira like vegetables and dairy products are exported. And for a long time now we’ve been supplying businesses in Rumania, Croatia and Slovenia with dry goods – for us that’s almost regional. Some products go as far as Greece and Australia but, apart from Di Vaira, we don’t have a real export strategy in terms of expanding our supply activity. We would rather be on the look-out for interesting products and projects abroad. That’s how we intend to create more transparency – for example, we are looking for farms producing sugar, basmati rice and dried fruits that would be interested in collaborating with us as partners and marketing the products jointly. But, as I’ve said already, Ecor-NaturaSi is fundamentally concentrated on Italy.

My last question – what’s your assessment of the general development of the organic sector in Italy, and what’s Ecor-NaturaSi planning for 2009?

At the beginning of 2009 Ecor posted growth of 20 % and NaturaSi 24 %. We may be in the middle of a serious worldwide economic crisis, but the organic sector still has great potential. A survey has shown that in Italy many towns and regions do not have adequate supplies of organic food. In our experience, when a shop opens the customers are there. There isn’t any cannibalism, and there’s enough room for new shops, because we can see a certain change of values taking place, and people are putting more emphasis on healthy food. And there’s healthy growth potential ahead too. The share of organics in the food market in Italy is only 1 %, so there’s plenty of scope for us, especially in the south of Italy. Our shops in Palermo, Catania and Bari are doing very well. Ecor B’io and NaturaSi are planning 15 to 20 new start-ups in 2009. In 2008, Ecor grew by 15 % and NaturaSi by 18 %.

Ecor NaturaSi spa (plc) was created in 2005 from the exchange of shares between the wholefood wholesaler Ecor and the organic supermarket chain NaturaSi. The companies merged to form the joint stock company Ecor NaturaSi spa at the beginning of 2009. Ecor was founded in 1998 by amalgamating several wholesalers, including the retailer/wholesaler Ariele/Gea that was founded in 1987 with their headquarters in San Vendemiano/Conegliano (Veneto). In 2008, Ecor took over the wholesaler Baule Volante in Bologna. The managing directors are Fabio Brescacin and Claudio Fave. Number of employees: 190 Customers: about 800 + 250 associated stores “B’io” Products: 3,800; 400 Ecor own brand products, premium brand 1Q Turnover 2007: 83 million euros, +15 % in 2008 Activities: Demeter farm San Michèle, Fattoria Di Vaira, extending the warehouse facilities in San Vendemiano from 8,000 m² to 24,000 m², issuing the customer magazine b’io magazine and the magazine V – Valore Alimentare, involvement in building the Waldorf school in Conegliano.