Certhon has recently had some exciting new developments in places in which Controlled Environment Agriculture (CEA) is not so well established. At FTS we believe that CEA is a suite of technologies and practices that can be applicable in many markets and regions, according to context and need. However, there have been various barriers to adoption. So we took the time to have a chat with Edwin Vanlaerhoven (who also sits on the FTS advisory board) about the potential for expansion into emerging markets, and find out how FTS can help encourage and nurture their adoption of CEA.
FTS: Hi, thanks so much for agreeing to discuss this important topic with us. Along with established markets such as the Netherlands, Certhon has had projects in Poland, Romania, Slovakia and Russia, among others. Could you tell us a bit more about the potential you see in these kinds of regions and markets?
Certhon: With Certhon we have been doing global business for more than 100 years. Before Cofid we already saw a big demand/trend for locally grown produce (local for local) mostly driven by consumer needs. After Covid this is even stronger as local governments want to secure the availability of (fresh) food in their countries. As our climate is getting more and more unpredictable and there is a trend for people living in big mega cities in difficult climate zones we see a big demand for controlled-high-tech-growing-enviroments. Certhon focuses on high tech turn-key greenhouses and indoor farms.
FTS: So there’s a lot of potential, which is great! But what have been the barriers that you have seen and encountered to entry and scalability in these emerging spaces? And how have you been able to address those challenges to lower those barriers?
Certhon: For greenhouses there are not many barriers (sometimes the sum of the investment) but in most cases we know quite well what is happening in the world and potential customers know where to find us. There is big demand for locally grown fresh produce and the return on the investment is mostly very good. For indoor farming this is different as that market is much more fragmented and there is still a lot to learn. Especially now, when travelling is difficult or simply not possible, we need to invest more in marketing and new sales channels do find potential customers and partners.
FTS: Clearly, each country or region will have its own specific context and needs. As much as this is true for the CEA operations, it must also be true in terms of the end consumer in the marketplace. How have you adapted your strategy to reach these potential customers, and to enable them to meet theirs in turn?
Certhon: The Certhon brand/name is well known in the horticultural industry. But because of the lack of travelling we are investing in our global local partner network. Also with our new shareholder Denso (www.denso.com) who became co-owner of Certhon we are looking about how we can use their network for accountmanagement en after-sales. We believe in the think global (the world is our playing field) but act local (adapt the business to local cultures) way of thinking.
FTS: As a company with expertise that spans across the CEA sector, from glasshouse to fully controlled indoor growth chamber, how do you see the balance of these different approaches and technologies developing in the coming years. Will we continue to see rapid expansion of vertical farms, will greenhouses continue to be as important as they have been up to now?
Certhon: We think there will be room and growth for both options. It can be a different solution for the same business case but indoor farming can also bring new possibilities (fe. Functional food or growing in places where a greenhouse does not create the optimal climate). When we have a customer looking to invest in horticulture we always look with them for the best possible solution mostly focussing on the return of the investment.
FTS: Thanks so much for taking the time to answer these questions. We’re delighted to have Certhon as FTS members, and we look forward to working with you on these and other questions in the near future!
Certhon: It was a true pleasure to have this interview and we are looking forward to make a big success out of indoor farming together with FTS!
FOR CERTHON
EDWIN VANLAERHOVEN - HEAD OF STRATEGIC BUSINESS DEVELOPMENT
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