Schwan Regiofruit stores a wide range of regional products and goods from all over the world in 1,500 square metres of refrigerated space and a further 3,000 square metres of dry space. Despite a number of challenges, including weather-related ones, the company has not experienced any bottlenecks. "Greece is an important origin for our grape range. However, the fires and subsequent extreme rainfall in Greece led to massive quality problems," says Managing Director Hendrik Schwan. He has been running the company, formerly known as Kartoffel Kuhn Großmarkt, since 2021. During a visit to the company, Schwan spoke about the development of various products from his range and some of the milestones the company has achieved under his leadership so far.
(from left to right): Salesman Mike Cunningham, Managing Director Hendrik Schwan and Buyer Vincent Gärtner. Cunningham has been with the company for 32 years, while Gärtner joined in March 2023.
Difficult potato and apple year
"The market situation for potatoes was also challenging this year. As far as I know, there has never been a potato year as expensive as the current one, which is also due to the weather conditions. Apples are again very small this year. As a rule, we mainly sell large-calibre apples, which are of particular interest to Russian chains," observes Schwan.
In addition to regional produce, Schwan Regiofruit also sources goods from farmers in Italy and Spain, such as butcher's onions.
"The summer was quite rainy, but as soon as the hot days arrived, the quality of the produce suffered. In and of itself, that's nothing unusual. However, I think it will be more difficult in the future as the summers are getting hotter and hotter. I'm curious to see whether it might even be possible to grow vegetables in the Palatinate all year round at some point in the future. That would at least be one of the few positive aspects of climate change."
Chestnuts from France are also currently on offer. "The chestnut season started a week later. The price level is a few cents lower than last year," says Cunningham. "But the quality is very good. There have been no problems with delivery either."
Two tonnes of asparagus to Dubai
With regard to citrus fruits, Schwan expects normal quantities, but few to no large calibres, such as clementines. "What has changed, however, is that the price of Italian grapes is so high that we are already resorting to overseas produce."
Schwan was rather cautious about the export business. "In 2022, we sold two tonnes of asparagus to a wholesaler in Dubai that supplies Michelin-starred restaurants, among others. This year, however, we had more than enough to do with our day-to-day business, which is why we are still keeping a low profile with regard to the export business." Nevertheless, the company is open to new ideas.
Lack of longevity of branded products
Bimi broccoli and pak choi have established themselves as trend products in recent years. Although there are no products for which demand is declining in principle, Schwan suspects that some major brands lack the longevity to develop new products, despite their good quality. "Some companies are relying on the fact that attractive packaging is enough to be able to charge €0.40 to €0.50 more. The problem here is that they are working with outdated business models. However, it is important to constantly scrutinise your business model and develop it further, regardless of whether you are dealing with retailers, customers or employees."
Profit margins are shrinking
In terms of turnover, there is nothing to complain about, but it is becoming increasingly difficult to keep the business going. "We are making excellent sales. I would like to pay the producers more money, but of course we also have to look at how we can generate the money accordingly. If I only get €0.50/kg from my customers, I can't give the producer €0.60/kg. The market is undergoing major changes anyway. The large farms are getting bigger, while smaller farms are increasingly disappearing." Schwan identifies clinging to outdated structures as one of the main problems.
Growth thanks to ordering app
"Some traditional companies in particular are realising that young ideas are lacking. Communication is the be-all and end-all in this business. The fact that a lorry is sometimes late is part of it, but it has to be communicated accordingly," says Schwan. Since this year, Schwan Regiofruit has been offering an ordering app that customers can use to buy goods around the clock.
"The response to our ordering app has been extremely positive. Customers who previously shopped with us once a month now shop with us twice a week thanks to the app. It also offers advantages for us: On the one hand, we save on staff costs thanks to the app, and on the other, the error rate for orders is almost zero." The app can also be used to track the route of the lorries making deliveries. "Collaboration with customers should be as simple as possible. This gives us an enormous competitive advantage."
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