Cargill Specialty Asia—The Story Of Success

Friday, September 22nd, 2017

In just three years, Cargill Specialty Asia has grown into a very profitable business unit. Yusuf Wazirzada, business unit leader, and Andre van der Wulp, technical director, shared the company’s business philosophy and story of success.

MG 1879

Three years ago, the senior management of Cargill took a look at the specialty ingredient business in Asia and quickly realised its potential, especially in China. The end result is the founding of a new business unit— Cargill Specialty Asia.

The company has the vision of becoming a trusted partner that delivers unrivalled value through specialty food ingredients and innovative food safety solutions by leveraging on its capabilities globally and assets across the Asia Pacific region.

“A lot have happened since then and we have grown a lot,” said Yusuf Wazirzada, business unit leader of the newly created company. “We have seen growth in earnings, strengthening of the team and improvement of our technology and technical capabilities.”

In addition, the company has continued to increase its assets and investments, while cutting away business that has not been performing so well.

Currently, the company employs over 400 professionals and has five manufacturing facilities, 10 sales offices and five research and development centres across Asia.

“When we first started, we were not very profitable, but now we are making major earnings after just three years,” he added. “We feel happy with the work that the team has done.”

By combining its technological leadership and high quality food ingredients with a deep understanding of the opportunities and challenges of its customers, it is able to develop customised solutions without compromising the eating and drinking experiences.

Product offerings from the company include specialty starches, hydrocolloids, lecithin, nutritional ingredients and functional systems for industries such as bakery, confectionery, convenience food, dairy and baby foods.

Good Today, Better Tomorrow

The success of the company has been built on its strong emphasis on talent and constant strive for improvements. Mr Wazirzada believes that the critical element for long-term business development is to continue to improve and not stand still.

“If we are good at something today, we have to be better tomorrow. We will continue to bring in new talents, be more responsive to our customers’ needs, continue to look at ways to be more efficient and deliver solutions fast, and look at our assets and plants to achieve excellence in operation.”

Most importantly, the company is always on the lookout for the latest trends in order to stay relevant to customers. As a world leader in processing agricultural raw materials, the company has a competitive advantage as it manages a global agricultural supply chain. With operations and manufacturing facilities across the world, the company is always aware of factors that will have an impact on the supply chain, such as weather conditions, crop plantings, potential harvest and where the supply and demand are growing.

“We understand the corn and soy bean costs in the US, South America, China and around the world. We understand the supply and demand. Based on those decisions, we can create a model that makes most business sense,” he explained.

Customised Innovations

Customised Innovations

The company has focused its efforts in Asia on three major markets: China, Japan and Indonesia. “We view China as one of the most, if not the most, important market in the Asia Pacific region,” Mr Wazirzada said. “Overall, China is the most critical market for us to grow and be successful. Even today and in the future, a bulk of our investments is in China because the majority of the market is there.”

With expansion in mind, the company will look to be making investments in two ways. One way is through the building of facilities like the large starch factory in China and the expansion of the company’s facility in Tianjin. The other method is to grow through merger and acquisitions.

For the past one and half years, the company has been carefully assessing potential targets that are relevant tothe markets and industries it operates in. “That will be our major area of focus for the next 6-12 months.”

“In China, there is growing demand for a lot of industries,” Mr Wazirzada said. “The middle class has continued to grow and the standard of living has become better even when the GDP is a little bit slower. People have continued to consume more products as they move more and more towards processed food. The demand for process foods has continued to grow, providing the opportunity to develop local assets.”

As the lifestyle of Chinese consumers become busier and with more dual-income families, there is a greater demand for processed food. Looking ahead, the company will help its customers develop products that are convenient and take less time to prepare.

There is no one-size-fits-all solution and the company is always committed to helping its customers create products that are most suitable for their targeted markets.

“In Japan, people are getting older. The country has more elderly than China. Therefore, Japan’s demand for processed food is different. We will always look at how consumer demands in different parts of Asia are changing.” In fact, the offering of customised innovations for its customers is one of the reasons that the company is able to achieve huge business growth in the last three years.

“Our major customers, such as Yili and Nestle are looking for innovations,” Andre van der Wulp, technical director of the company, said. “We have innovation programs that develop technologies to help customers improve their product. When we look at a product, we look at its stability, viscosity, lubricity and tribology.”

Based on these factors, the company has developed a proprietary technical measurement system that distinguishes products in terms of key components, such as mouthfeel and taste.

Mr Wazirzada said that in 2015, the company will continue to focus on talent, technology and financial performance building. “We will continue to build and improve development to help existing employees grow and be more effective. In addition, we will enhance our processes to achieve greater efficiency and build on the foundation that we have established in the past three years.”