Staying cutting edge in business

Marc Driessen last spoke to FCI when he was setting up his own business for Beekenkamp’s offshore cutting production in Ethiopia. Now repatriated to his homeland of tulips and windmills and a new member of the board of executive directors at Beekenkamp Group, he cherishes the memories of his time in Africa but tells us he is ready to take up new challenges. “Staying cutting edge in the young plant business requires excellence in genetics, product quality, logistics performance and spreading risk,” he says.

Based in Maasdijk, Netherlands, Beekenkamp Group is a family-owned plant breeding and propagation business. The company has grown from strength to strength since its foundation in 1951. Four specialised divisions (Beekenkamp Vegetables, Beekenkamp Ornamentals, Beekenkamp Packaging and Deliflor Chrysanthemums) hit a combined turnover of more than €125 million in 2018.

Marc Driessen, aged 53, spent 14 years establishing Beekenkamp’s presence in Ethiopia by setting up a cutting farm, 130km southeast of Addis Ababa. From commencing a training contract at Beekenkamp in November 1995, the company helped Marc develop his career by offering him the opportunity, eight years later, to form a 50:50 joint venture in Ethiopia: Maranque Plants, a contraction of Marc and Anke, Marc’s wife.

FCI: From a business start-up in a very remote location, Maranque Plants grew into a mature business. That must have been quite a journey?

Marc Driessen: “The cutting farm and the sector as a whole got off to a flying start. Major Dutch and Israeli investments in 2005 provided a boost for Ethiopia’s horticulture industry with the Dutch government being particularly active through its PSOM funding programme. However, it was Sher’s giant development that put Ethiopia on the map as one of the world’s major flower producers. From 2010 on, new companies emerged while existing farms grew by 20 or even 30%. ”

How would you describe Ethiopia’s investment climate today?

“The country continues to be an attractive place to invest in Africa. The country’s government is committed to opening up the economy for international businesses to establish themselves. In Ethiopia, there’s time and opportunity for everything especially for those companies which broke into the market first. However, I believe the time of first movers making the greatest returns is over. More recently the country hasn’t paid off the way it once did. Bangladeshi clothing factories and Chinese manufacturers have also found their way to Ethiopia putting the labour market and land prices under pressure. For example, at Maranque, our knowledgeable head of exports left when four years ago a clothing company offered him a job in his home town ending his years of a long commute.”

The Maranque farm evolved through a life cycle, marked by times of happiness, but unfortunately enough also by periods of instability, ethnic tensions and even violence.

“Of course, I, and my family have fond memories of the country’s exquisite natural beauty and overwhelming wildlife, its people and market potential. But the road to bloom was not only sprinkled with rosy petals. Being affected three times by malaria definitely takes a toll on your health. And in 2005, the country seemed to be on the verge of civil war. I remember that I talked it over with my wife and we both agreed that we would not live in a country that was at war. Then in 2016, violence engulfed the country with people waving their knives and guns in front of our gates. That was a bridge too far. Seeing wounded soldiers and the fact that the only access road to our farm was blocked with huge stones was too much. Having a 50% share in the company not only gave me a sense of ownership but also a huge sense of responsibility for the 1,200 people who worked at Maranque at the time. I remember how our local staff went into a blind panic. Some of them had very young children living in Addis. I needed to convince them to stay at the farm as I knew it was too dangerous beyond our gates However, I instructed all the staff on how and where to flee in case things spiraled out of control.”

How do you cope with these kinds of things?

“I talk about it when I feel it’s necessary. Months after the events, I was still unable to sleep for any more than three hours but that has improved a lot now. Overall, I am more on the qui vive for signs of danger. Ethiopia’s government foiled an attempted coup attempt in June this year. But one should not focus on the negative. The country is halfway to refinding its stability. Remember Ethiopians are resilient people. Just a couple of months after the 2016 events, it was amazing to see how quickly daily life picked up and how, as Europeans, we were once again treated in the usual way.”

Meanwhile, Beekenkamp Group continued a thorough market analysis of other countries. Why is spreading risk so important?

“Perfectly aware that some crops were only grown in either Ethiopia or Uganda we looked at ways to spread our portfolio across more countries even though we realised that operating from three instead of two farms would increase production costs. We even considered moving to Colombia with higher workplace productivity but transport costs to the European market proved to be a bottleneck. Eventually, three countries remained: Kenya, Tanzania and Rwanda. Tanzania faces a lot of restrictive red tape and in Rwanda we struggled to find an affordable alternative to our plastic bags of cuttings. East Africa, as a whole, is known for having introduced the world’s toughest ban on plastics so that is something to monitor closely. Eventually, we found a perfect spot in relatively expensive Kenya. In Kimana, a 5-hour drive southeast of Nairobi and situated at the foot of Kilimanjaro, Beekenkamp is in process of taking an option on 25ha of land and right at the heart of this a 10ha cutting farm is planned. Scheduled to be operational at the beginning of 2021 the Kimana greenhouses will be predominantly dedicated to the production of Chrysanthemum cuttings with more crops to follow later.”

Kimana might bring back Maranque’s pioneering years as the new farm finds itself in an extremely remote area. Aren’t you afraid of missing out on the benefits of agricultural clusters such as Naivasha?

“With plant health being our top priority Kimana offers different benefits. By being in an isolated location with no other greenhouse operations in the vicinity reduce the possibility of cross contamination. Think of Maranque’s first pioneering years with only desert around us and a complete absence of thrips and leafminer.”

As well as the new farm in Kimana, Beekenkamp Ornamentals’ own breeding line of Begonia, Campanula, Celosia, Dahlia, Lavandula, Osteospermum and Poinsettia is another example of how the company invests in its long term future and stays competitive at a global level.

“The start of our breeding activities in potted plants coincided with the opening of Deliflor’s headquarters in 2007. Right away there were synergy benefits with Deliflor having such a long track record in Chrysanthemum breeding. We realised how important it was to have your own genetics and acquired breeding company Florema in 2008.” Overall, more and more dependence exists among seed firms and breeding companies with the risk of breeders claiming specific series exclusively for themselves.”

In 2017, you sold your shares in Maranque Plants to the Beekenkamp Group whose board of executive directors he joined one year later. What is your vision and strategy for the future?

“I believe that the competitive strength of today’s young plant producer is not only determined by the quality of starter plants but also by the operations and actions that place the products timely onto the growers’ bench. The routes can be extremely bumpy. Think delayed or canceled flights. Even worse are internet blackouts which impede the ability of handling agents to track shipments en route. As such Beekenkamp offers its customers satellite internet reliability. More progress can be made. With regard to the North American market, one of our biggest issues is that our young plants can freeze in winter during the final distribution leg. In summer it’s the other way around when we add ice to the boxes before they leave Africa.

What does it take to yearly move 700 million cuttings from Africa to Europe?

“An unbroken, well-oiled cold chain and technical sophistication. We add temperature loggers to all our shipments to Maasdijk. As for air freight, we lean on different carriers. Addis Ababa is slowly but steadily emerging as Africa’s major hub with Ethiopian Airlines dominating the market. We use direct flights from Ethiopian Airlines to Liège Bierset and Brussels Zaventem airports. For outbound flights from Uganda we work with AF KLM Cargo. They do a good job although capacity on passenger aircraft is limited. In accordance with IATA rules, the first thing to get bumped is cargo. As such we already split our air cargo shipments before they leave the farm.”

Beekenkamp manages a global supply chain for collecting, handling and assessing cuttings from all over the world to ensure the best quality reaches the customer. What is quality?

“Keeping a constant eye on quality is vital and takes vigilance. Elite and strict hygiene facilities form the backbone of our global production locations. In terms of crop protection products, as far as I am concerned, I am a real plantsman, someone that perfectly understands that applying chemicals on your plants automatically results in slower growth and that chemicals impede IPM activities in case of a pest outbreak. Insects are a big concern and therefore we have IPM scouts supervising our Elite greenhouses. They use Scarab Precision, a software-based service for protected cropping which includes high precision pest and disease maps, charts and tables.”

How does consolidation impact your business?
“We are increasingly surrounded by bigger companies. For some of them, breeding is the main focus. We believe that breeding, propagation and supply chain management must go hand in hand and as such can create a competitive advantage. Giant breeding companies may have access to more funds and thus advanced breeding techniques but with more collaboration in the sector there’s still an awful lot more we can achieve. Speaking of breeding, construction of a new breeding technology centre will begin next year. It will be situated only 500m from our Maasdijk-based headquarters and is due to be completed in December 2020. The new research centre will give a huge boost to innovation and will mark the transition from classical to technology-driven breeding such as marker assisted plant breeding.”

Family business

Founded in 1951 by Mr G. Beekenkamp who specialised in the production of vegetable transplants, Beekenkamp Group today employs 2,600 staff globally growing over 2 billion young plants (vegetable transplants, chrysanthemum cuttings and ornamentals cuttings combined). Currently, the company is owned by second-generation Annie and her sister Margriet Beekenkamp. Everyone who has visited Beekenkamp’s FlowerTrials knows that upon entering, the company feels like a big family right away with CEO Annie Beekenkamp always ready to shake hands and have a chat.

Pondering over the real values of a family business Driessen says, “It’s about sustainability based upon running the business properly and having a clear vision and long term goals in place. Our employees are very committed, not only to our own firm but also to our customers – growers. As suppliers of plant material, we are perfectly aware that we are part of our customer’s business too which brings huge responsibility. I think family businesses tend to focus more on long term goals and continued investment even in economically testing times. The family character of the business, for me personally, was one of the decisive factors when I joined the board of executive directors.”