White Paper:
South Africa's fresh fruit industry: optimising export performance and securing sustainable exporter-importer relationships
The fresh fruit industry in South Africa is a powerhouse, driving the agricultural export sector and providing vital employment opportunities. However, navigating the complex landscape of competitive pricing and foreign market regulations presents significant challenges for fresh fruit exporters, putting a premium on the importance of building and maintaining strong exporter-importer relationships.
Authors:
- Professor Daniël J. Petzer (Henley Business School Africa)
- Professor Marianne Matthee (Gordon Institute of Business Science, University of Pretoria)
- Dr Stefanie W. Kühn (Stellenbosch University)
- Ms Vickey de Villiers (Henley Business School Africa)
Understanding exporter-importer relationships
Empirical research on export performance measures that acknowledge the importance of relationship marketing constructs and relationship-building behaviours has been sparse. That's why Henley Business School, in association with the Gordon Institute of Business Science and Stellenbosch University, embarked on this comprehensive collaborative study. The study looked at the interpersonal dynamics among 65 fresh fruit exporters in South Africa and their foreign buyers, and unpacks findings designed to help improve export performance and drive long-term sustainability in this critical industry.
The white paper reveals key insights into the behaviours and strategies that support export success and the sustainability of an export relationship. The authors explored export performance through the lens of quantitative targets and measures, shedding light on the essential inter-firm relationship behaviours that drive the best results.
Why fresh fruit is big business
South Africa’s fresh fruit export industry is the most significant contributor to agricultural exports in terms of value, generating a combined foreign exchange revenue of over US$3 billion, alongside the vegetable industry. Not only does the industry play a crucial role in direct job creation, accounting for 28% of employment within the agricultural sector, it also exhibits the highest multiplier effect in the agricultural sector, creating over 400,000 employment opportunities across the broader agricultural value chain through backward and forward linkages.
But fresh fruit exporters in South Africa face an intensely competitive landscape and grapple with numerous challenges. In addition to the logistics of preserving quality and freshness over long distances, fresh fruit exporters must navigate complex regulatory requirements. Compliance with phytosanitary, marketing, and other standards is essential to guarantee the acceptance of their shipments.
All of this increases the financial burden on exporters and makes it ever more important that they nurture strong and reliable exporter-importer relationships with their foreign buyers. Clearly, a weak relationship is vulnerable to termination. By contrast, a loyal and supportive relationship between growers and foreign buyers provides long-term sustainability, greater trade efficiencies, reduced uncertainty, efficient process changes, greater profitability, and growing market share.
A model for exporter success
With more than 90% of South Africa’s fresh fruit production exported – the largest exporter in the Southern Hemisphere – intense focus must be placed not only on growing quality fruits, but also sound relationship management with key buyers around the world. By better understanding the various factors that shape positive relationships and hinder negative ones, these relationships can be strengthened. It is therefore vitally important to continue research into what makes importer-exporter relationships successful and sustainable. This white paper aims to do just this, and set a foundation for more research to follow, to help consolidate South Africa’s place near the top of global fresh fruit production and exports.
