The food service staples of cream and cheese in different forms would be joined by more dairy protein products, many of them in drinks.
He was speaking during an Anchor Food Professionals event at Fonterra’s Auckland head office to mark its $2 billion annual revenue achievement and 27% growth in sales volume in the 2017 financial year.
More than 200 industry guests sampled the cakes, savouries and drinks made from Anchor products.
When he started at Fonterra six years ago the value-add production and sale of food service items was a non-dedicated part of the dominant New Zealand Milk Products ingredients division, Spierings said.
Its beginnings were in the 1990s, a category identified by the NZ Dairy Board as an evolution of the old cheese division.
He quickly realised the potential of catering for the growing out-of-home food sector, with its hotels, bakeries, cafes, aeroplanes and quick-service restaurants.
Former Fonterra Brands leader Sanjay Khosla had alerted him to the rapid growth rates already being achieved.
Spierings then went to the Fonterra board in 2012 with $250 million of capital expenditure proposals to boost food service processing capacity.
As demand continued to grow $850 million was spent or committed in the last five years here and in Australia.
The NZ manufacturing plants included Te Rapa for cream cheese, Edgecumbe for butter sheets, Waitoa for UHT creams, Eltham for sliced cheese, Whareroa for block mozzarella and Clandeboye for individual quick-frozen mozzarella.
Anchor Food Professionals, as the food service division was renamed last year, was now the sixth-largest NZ export business after tourism, dairy, meat, forestry and fruits.
“We are now in a very good space with processing capacity, skills and intellectual property,” Spierings said.
In advance of the commissioning of Clandeboye mozzarella cheese plant three, Darfield cream cheese plant one and the extension of Waitoa’s UHT cream capacity, all due next year, Fonterra’s food service capability was fully used.
Global growth of food service and out-of-home eating was growing at 5-6% a year and Anchor Food Professionals was growing at 10 times that rate.
Global consumer and food service chief operating officer Lukas Paravicini said Fonterra was dealing with 10,000 bakeries across Asia, providing products and solutions from its 56 in-house chefs.
“The gross margin from food service is two or three times what we can earn from basic ingredient products,” he said.
The chef-led business model was based on providing solutions from customer insights, helping to delight their consumers, reduce waste, save time and cope with labour shortages.
Paravicini, less than six months into his new role after four years as chief financial officer, said he was confident of reaching the target set for food service of $5b revenue by 2023.
“In the United States more than 50% of all spend on food and beverage is now out of home and in China the market has grown by 30% over the last five years.
“As a result, the global industry is predicted to be worth US$3 trillion in 2021.”
Food service global director Grant Watson said the business was arranged in channels.
“This provides food service kitchens around the world with ingredients for some of the largest categories in the business – Asian style bakeries, Italian kitchens and quick-service restaurants.
“Our ingredients include our extra stretch mozzarella, UHT culinary and whipping creams, laminated butter sheets and cream cheese.
“We know the smallest things can make a difference so we make our products last longer, stretch further, work faster, waste less, withstand more.
“We bring together world-class dairy products and the deep expertise of our people to work alongside the passionate, talented and innovative food professionals who are driving the food service industry to new heights,” Watson said.
In China, AFP had four demonstration kitchens and staff members in 76 cities and its sales volume growth last year was 48%.
On a visit there last week, Spierings and Watson said AFP China’s ambition was to more than double its reach to 176 cities.
The demand for tea macchiato, made with blended cream cheese and UHT cream, was extraordinary and had transformed traditional Chinese tea houses into hip cafes.
