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Soft drinks giant Coca-Cola is adding another Australian drinks company to its portfolio with the announcement of a minority stake in beverage company Made Group.

Coke has purchased a 45 per cent stake in Made Group in a joint acquisition with local drinks distributor Coca-Cola Amatil.

Made Group is known for leading Australian beverage brands including Cocobella, Rokeby Farms, Impressed and the company’s first brand, NutrientWater, which was launched in 2005.

Their portfolio appeals to Australians looking for healthier beverage options including cold-pressed juice, high-protein smoothies, probiotic milk and coconut water as well as cold-brew coffee and yogurts.

The deal, for an undisclosed sum, will see co-founders Luke Marget and Matt Dennis remain in charge of the business with support from Coca-Cola Australia and Coca-Cola Amatil to grow market reach and distribution

madecoke

Made Group co-founder Matt Dennis said that the investment was a significant milestone in the company’s 13-year history.

“We are extremely pleased to have such experienced partners in helping unlock scale and growth, while we continue to focus on product innovation to match emerging consumer trends,” Dennis said.

“Our focus on improving the everyday lives of Australians aligns perfectly with Coca Cola’s strategy of becoming a total beverage company,” he added.

Dennis revealed plans to expand manufacturing in Melbourne with a state-of-the-art production facility which is in the final stages of development.

President of Coca-Cola Australia Vamsi Mohan said that the investment is another example of how Coca-Cola is transforming into a total beverage company.

“We are always looking to offer the new beverages that Australians want. Globally Coca-Cola has shown that we can build successful new brands through both acquisition and our long history of innovation. This investment is a perfect example of our desire to keep doing this in Australia,” Mohan said.

“The Made Group’s capability in agile innovation across its range, which includes premium juices, dairy and coconut water, is the perfect complement to our existing portfolio and growth plans and will help us ensure we provide Australians with beverages for all occasions,” he added.

Alison Watkins, Managing Director Coca-Cola Amatil Group, said the investment is an important link in the Accelerated Australian Growth Plan for Coca-Cola Amatil and Coca-Cola Australia, which aims to bolster performance in attractive growth categories and embrace innovation.

Retail giant Wesfarmers has requested a trading halt pending an announcement on its planned $20 billion demerger of supermarket chain Coles.

On Friday morning, the Perth-based conglomerate requested a trading halt until Tuesday, or until it made an announcement about Coles.

In March, Wesfarmers announced its “once in a decade” move to spin off Coles Group, its largest division which it bought in 2007, and list it on the ASX.

Coles accounts for 60 per cent of the conglomerate’s employed capital, but only 34 per cent of earnings.

In August, the company said it would retain 15 per cent of Coles post-separation in order to facilitate growth initiatives and retain a strategic alignment, while also telling investors the sale would allow it to focus on generating cash for its leading stores moving forward.

Wesfarmers suffered a 58 per cent drop in FY18 net profit after taking more than $1.3 billion in costs and losses on its disastrous Bunnings UK exit and a $300 million writedown on underperforming Target.

“Following the decisive actions taken to address underperformance and reposition the Group’s portfolio, Wesfarmers is well placed to deliver sustainable growth in earnings and improved shareholder returns,” the company said in a statement.

Coles, which is expected to be spun off by November, recorded a 6.8 per cent drop in earnings to $1.5 billion for the last financial year.

The demerger will be effected by a scheme of arrangement, under which eligible shareholders will receive one Coles share for every Wesfarmers share held.

When the demerger was announced, Deustche Bank analyst Michael Simotas said it was a positive move.

He said it showed Wesfarmers managing director Rob Scott was taking an “active approach” to portfolio management.

The group recently proposed the appointment of three non-executive directors to complete the new board of Coles, adding to the four previously announced.

Wesfarmers is expected within the next few days to release the key details around its planned $20 billion demerger of Coles, forcing analysts to reconsider the investment opportunity for the nation’s second-biggest supermarket chain and its competitive edge against Woolworths.

Coles is expected to emerge as a newly listed independent company with superior store sales growth compared to archrival Woolworths, although the chain will face the headwinds of costs associated with the phasing out of plastic bags at its stores.

Coles also gained an advantage over Woolworths thanks to its popular Little Shop collectables campaign that was mostly paid for by suppliers and, while it was highly successful, it is expected to have triggered extra labour costs as demand for the collectables was higher than expected, which required more staffing to stock shelves.

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Investors are awaiting the demerger documents from Wesfarmers that will provide the most insight and detailed financial information ever seen of the Coles business since it was bought by Wesfarmers in 2007.

JPMorgan analyst Shaun Cousins said in a note to clients yesterday that Wesfarmers had disclosed little on the subdivisions within Coles but this was expected to be disclosed in the demerger scheme booklet.

That booklet could be published as early as this week, with Coles to issue its first-quarter sales results on October 15.

JPMorgan is forecasting EBIT margins for Coles will remain below Woolworths in food, liquor and convenience. Mr Cousins said that, based on EBIT including new corporate costs (as a stand-alone Coles) and a 10 per cent discount to the Woolworths EBIT multiple, JPMorgan ascribed a value of between $18.3bn and $18.6bn for Coles.

Mr Cousins has revised upwards Coles’ first-quarter like-for-like sales growth, and revised downwards the first-quarter performance for Woolworths with Coles’ lead expected to extend into the second quarter.

JPMorgan is tipping Coles to now report first-quarter same-store sales growth of 4 per cent, up from an original forecast of 2.5 per cent, and for Woolworths to post 1.3 per cent growth, down from an original forecast of 1.8 per cent.

It would mean that Coles would regain crowing rights of having the fastest same-store sales growth, after being beaten by Woolworths for the past seven quarters, and comes at a perfect time as investors ponder an investment in Coles when it lists on the ASX later this year. But Coles would still face some headwinds, Mr Cousins wrote in his note.

“For fiscal 2019, the strong start to the first quarter is expected to be a positive with Little Shop expected to be break even due to significant supplier contributions, but plastic bag costs are a headwind,” he said.

“Plastic bag changes required additional labour (more hours due to slower checkout processing, more training due to the change in bags), which is expected to have offset the gain from no longer providing free plastic bags, with the profit on the sale of new plastic bags donated (as with Woolworths).

“Little Shop drove volumes more than expected such that more inventory was required in store to meet this higher demand, which in turn required more ­labour to stock shelves and working capital.”

There was also increased ­labour costs for Coles from a new EBA deal.

Mr Cousins said looking forward to the second half of 2019 and beyond, he forecast a return to leadership by Woolworths.

“Although expect periods of sustained success by one player or another to be less likely with less obvious mistakes, which have riddled both retailers over the past decade,” he said.

“However, we suggest that Woolworths is more likely to do better. We think Woolworths retains the superior long-term strategy, with Coles tactically ­better but risks remain with its strategy.”

One in five samples of local honey sourced along the eastern seaboard of Australia, including boutique brands, has been found to be fake, deepening the global scandal over the impurity of honey.

The study, which tested five raw samples of honey and 95 local and global-branded honey, found 27 per cent were adulterated. But the big shock was Australian honey. Of the 38 honey samples sourced from supermarkets and markets, 18 per cent, or almost one in five, detected adulteration. The states implicated in the scandal include Victoria, Queensland, NSW and Tasmania.

Professor Mark Taylor (right) and student Xiaoteng Zhou at Macquarie University have completed a survey of 100 samples of honey that shows Australia has adulterated honey.
Professor Mark Taylor (right) and student Xiaoteng Zhou at Macquarie University have completed a survey of 100 samples of honey that shows Australia has adulterated honey.
Photo: Wolter Peeters
It found that 23 per cent of the nine samples tested in Tasmania were adulterated, one out of two samples sourced from NSW were adulterated, a third of the six samples sourced from Queensland weren’t pure honey and 29 per cent of the seven samples sourced in Victoria were fake. Samples sourced from South Australia and Western Australian tested pure.

The testing was undertaken by the same high-security government lab used to test drugs seized by Border Force, the National Measurement Institute.

The scientific team, led by Professor Mark Taylor from the Faculty of Science and Engineering at Macquarie University and PhD student Xiaoteng Zhou, as well as Helen Salouros and Shiva Prasad, also highlighted issues with mis-labelling of geographic regions.
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The findings come weeks after the honey industry was put under the spotlight in a joint investigation by Fairfax and 7.30 in relation to imported honey. It embroiled some of the country’s biggest supermarket chains and Capilano’s Allowrie brand, which blends local and imported Chinese honey.

The latest study, peer reviewed and published in the Nature journal, Scientific Reports, and provided to a joint investigation by Fairfax Media and the ABC’s 7.30 ahead of its release, warns that mis-labelling compromises the confidence of customers and raises health and safety concerns.

“Blended honey of unknown origin has been known to contain antibiotics, toxins, irradiated pollen or even alkaloids with the potential to cause organ damage,” the study says.

It is titled "Authenticity and geographic origin of global honeys determined using carbon isotope ratios and trace
elements". Its findings are expected to put pressure on authorities to start testing local honey.

In Australia, authorities only test imported honey – 5 per cent is tested using the C4 sugar test
which is decades old and can’t detect syrups such as rice syrup which are used by fraudsters to
dilute honey.

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'No bees, no crops': The problem with 'diluted honey'
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Fruit and vegetable magnate Robert Costa says it's important to protect the beekeeping industry, otherwise we could face trouble with food security.
Peter McDonald, the chairman of the Australia Honey Bee Industry Council (AHBIC), a peak
body for the industry, said local honey was not tested by the authorities.

A sticky situation.
A sticky situation.
Photo: Matt Golding
“It is up to the individual companies that actually buy the honey to then test,” he said.

Mr McDonald, who was briefed by Professor Taylor on the results of the study, said he didn’t believe Australia had a problem with honey adulteration and said customers should be confident what they are buying on the label is pure honey. “They should be very confident," he said.

“I would say there is not a problem in Australia, I am fully confident the Australian honey bee industry is clean and green and we have the best product in the world,” he said.

When asked why he was so confident, he said “I’m a beekeeper and I’m also chairman of the Australian honey bee industry council and I know bee keepers and they are honest, hard-working people and they are just using what nature is providing, bees are providing and they are producing it in a pure form and providing it to people to market.”

But he did concede that he couldn’t know that all beekeepers or producers were doing the right thing.

Professor Taylor said he was surprised at the findings from Australian-sourced honey. “We know that the issue of adulteration is a prevalent problem but we didn’t think it would be that persistent in Australia for Australian-produced products.”

He said the research was robust but believed the results could be conservative given the official honey test, the C4 test, was used, which has come under attack for its inability to detect substances used by fraudsters to beat the tests.

Peter McDonald, chairman of the Australian Honey Bee Industry Council.
Peter McDonald, chairman of the Australian Honey Bee Industry Council.
Photo: ABC
He said he used the official test used by authorities because he wanted to see whether there was a systemic problem in the honey industry.

“The only way to guarantee that you are getting real bona fide honey is to buy it from a local producer where you can see it coming out of the hive or you produce your own honey yourself. That’s really the only deadset guarantee at this moment in time,” Professor Taylor said.

The only way to guarantee that you are getting real bona fide honey is to buy it from a local producer where you can see it coming out of the hive or you produce your own honey yourself.
Professor Mark Taylor
The earlier investigation into imported honey tested 28 honey samples in a German lab that specialises in detecting fake honey using a new test known as Nuclear Magnetic Resonance (NMR).

Capilano denied its Allowrie blended honey brand wasn’t pure honey and criticised the NMR on the basis it wasn’t the official test for detecting honey authenticity and that the results of NMR testing between labs was inconsistent. It also criticised the size of the NMR database.

But the study prompted the Australian Competition and Consumer Commission (ACCC) to launch an inquiry into imported honey.

Professor Taylor said the survey did include some boutique brands and it came from a range of providers.
Professor Taylor said the survey did include some boutique brands and it came from a range of providers.
Photo: Wolter Peeters
Professor Taylor has sent his latest study to the ACCC for investigation.

He declined to reveal the names of the scores of brands that were sampled on the basis it would detract from the study, which was to prove that adulteration is a global problem.

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“The study is not really about particular brands, it’s about looking at the persistence and prevalence of authenticity of honey,” he said.

“It did include some boutique brands and it came from a range of providers,” he said. “And we also tested some Manuka honey and that failed. That is a boutique brand. But as you know there is something in the order of about ten times the amount of Manuka honey sold as there is produced.”

It was part of a broader investigation into honey, which previously looked at urban contaminants in native bees and European bees.

Phd student Xiaoteng Zhou said she decided to test Australian honey after a honey company was fined in Australia in 2016 for selling fake honey.

“And two years ago in 2016 a commercial honey secret was revealed on Facebook and the honey sold in the supermarket might be toxic. It was claimed to be an Australia product but it was actually imported from overseas,” she said.

“These samples were analysed in Germany labs so we were thinking can we do the analysis in Sydney then we designed this project and we collected samples and developed this method,” Ms Zhou said.

Food fraud is a $US40 billion a year industry and it is getting bigger as criminal gangs exploit weak regulation and outdated government tests. Honey is the third most adulterated food in the world, behind milk and olive oil.

The international fraudsters produce the fake honey and sell it to unsuspecting suppliers at a higher price, making a fortune along the way. Chinese vendors use website Alibaba to sell rice syrups and other syrups that claim that they can pass official honey tests. They sell for $US500 a metric tonne, which is vastly cheaper than honey.

Minister for the Environment, The Hon. Melissa Price, today launched the Australasian Recycling Label and announced the government’s National Recycling Targets at a milestone industry event in Melbourne.

The Minister was joined by leaders from packaging, retail, manufacturing, recycling and waste management businesses in a pledge to better manage packaging waste and improving recycling in Australia.

Australia’s 2025 National Packaging Targets include making all of Australia’s packaging reusable, recyclable or compostable and for 70 per cent of plastic packaging to be recycled or composted by 2025.

Unnecessary single-use plastic packaging will be phased out through design, innovation or introduction of alternatives and 30 per cent of average recycled content will be included across all packaging by 2025.

Minister Price congratulated the Australian Packaging Covenant Organisation (APCO), Woolworths and the initial working group of key business leaders including Coca-Cola Amatil, Goodman Fielder, Nestlé, Pact Group, Simplot and Unilever in tackling Australia’s waste challenges and supporting these ambitious targets.

The new labelling system was developed by Planet Ark, PREP Design and APCO to help consumers better understand how to recycle packaging. With more than 200 recycling labels currently being used in Australian packaging, the new system is designed to combat confusion and reduce the levels of contamination in the waste stream.

In a statement today the Minister said she was “delighted” at the response of Australian businesses to the recycling challenges. To date more than 50 Australian businesses have committed to the program, with the label now being used by brands including Woolworths, Nestlé, Blackmores and Unilever.

“The Australasian Recycling Label provides people with easy to understand recycling information when they need it most, in those few seconds when they are deciding what bin the package goes in. The label removes confusion and reduces waste,” Price said.

Toward 2025 - Panel Discussion

Unilever ANZ CEO Clive Stiff welcomed the recycling initiatives in a statement today, saying it is a “critical step towards greater collective action” on recycling.

“As a consumer goods company, we are acutely aware of the consequences of a linear take-make-dispose model and we want to change it,” Stiff said.

The FMCG giant recently announced that bottles of its popular products like Dove, Sunsilk and Surf will soon be made with at least 25% Australian recycled plastic.

Stiff said this is “just the start” for Unilever and that “heavy lifting” is required by everyone from suppliers to packaging converters, brand owners and retailers.

“We need a complete shift in how we think about and use resources. Plastic packaging waste represents an $80 billion loss to the global economy every year. The benefits of the circular economy approach are clear for business and the environment – the more effective use of materials means lower costs and less waste. It means new sources of value for customers and consumers, better risk management of raw materials, and improved approaches to the supply chain,” he said.

Private equity firm Adamantem Capital has bought New Zealand-based smallgoods maker Hellers in a deal believed to be worth about $200 million.

It is understood Adamantem told investors on Monday night that it had signed a deal to take a controlling stake from Kiwi private equity investor Rangatira Investments, and would invest in partnership with Hellers founder Todd Heller.

The deal is expected to complete early next year and is subject to regulatory approvals.

Hellers is New Zealand's largest bacon, ham and small goods manufacturer.

It was marketed to potential buyers as about a $NZ20 million business at the earnings line, as part of a sale handled by Kiwi firm Cameron Partners.

Adamantem is expected to grow Hellers in Australia and New Zealand via new distribution channels and product categories. Adamantem told investors it wanted to make the well-known brand more widely available through food service channels and quick service restaurants.

It's another partnership-style deal for Adamantem. Todd Heller retains a stake in the company and a board seat, while Hellers will be run by its existing chief executive officer John McWhirter and chief financial officer Brent Ford.

Hellers joins Adamantem's investment portfolio alongside Kiwi aged care business Heritage Lifecare, horsefood business Hygain and data analytics firm Servian. Each is a partnership-style deal with the previous owners or founders.

Hellers was established in 1985 by Todd Heller, who grew the business from a single butchery to New Zealand's largest producer of processed meats including sausages, bacon, ham, salami and the like.

The company has about 600 staff.

Time-poor Sydneysiders will be glad to hear about the arrival of a new app which promises grocery delivery from multiple stores in under two hours.

Unocart connects customers with a personal shopper who will deliver the order in under 2 hours. Currently up and running in the greater part of Perth, the service will be coming to Sydney in November.

Inside FMCG spoke to Unocart co-founder Tyler Spooner to find out exactly what we can expect when it lands.

Inside FMCG: Where did you get the idea for Unocart?

Tyler Spooner: The idea for an Uber-like grocery delivery service just made a lot of sense and has seen a lot of success in other parts of the world. With online groceries set to boom in the next 5 years, Australian consumers will want a convenient and fast way to order groceries online. The concept was originally called ‘FeedmeeNOW’ and was an add-on service to our recipe discovery website. But after huge demand from consumers, we decided to rebrand and have it as a stand-alone service.

Inside FMCG: So explain to us how it works!

TS: Unocart lets you order from local grocery stores online, then sends a personal shopper to pick up and deliver your order to you the same day. You can order using our app or website, our shoppers hand-pick only the freshest groceries and deliver to your door in as little as 2 hours.

Inside FMCG: What happens if you order something that’s not available?

TS: If the substitutions are not available, the shopper can easily decide based on other suggestions from your previous purchases. The personal shopper will then text you to confirm all substitutions before checking out.

Inside FMCG: What about picking produce in terms of ripeness?

TS: The shoppers are extensively trained on picking produce. When you place your order, you can note what term of ripeness you want for each item, whether you want green bananas that will last you all week or you want ripe ones to bake banana bread.

Inside FMCG: Is it the same concept as Uber in terms of drivers?

TS: Yes, similar to Uber our shoppers are independent contractors and are able to set their own schedule, take time off, or work extra when it suits. Unocart thoroughly vets Shoppers by conducting in-depth interviews, records, performing background checks and online training.

Inside FMCG: What makes Unocart different from a supermarket home delivery?

TS: Convenient delivery time in as little as 2 hours. Quality and handpicked produce by your own personal shopper with live communications for substitutes of out of stock items. Multiple store shopping in one order i.e Coles and Woolworth’s weekly specials in one shop.

Inside FMCG: Is the service exclusive to certain stores?

TS: We support popular stores in each city where we offer delivery. While we source groceries from local stores, Unocart’s services are not affiliated with the individual stores or is it exclusive to stores. Currently, we only offer Coles, Woolworths and Aldi but are always happy to work with smaller local supermarkets as well.

Inside FMCG: What’s been the reaction from customers so far?

TS: Reactions have been great and we have seen 258 per cent growth in the last 6 months with customers really loving the convenience, the saving from multiple stores and the freshness of the produce.

Unocart-Time-poor Sydneysiders will be glad to hear about the arrival of a new app which promises grocery delivery from multiple stores in under two hours.

Unocart connects customers with a personal shopper who will deliver the order in under 2 hours. Currently up and running in the greater part of Perth, the service will be coming to Sydney in November.

Inside FMCG spoke to Unocart co-founder Tyler Spooner to find out exactly what we can expect when it lands.

Inside FMCG: Where did you get the idea for Unocart?

Tyler Spooner: The idea for an Uber-like grocery delivery service just made a lot of sense and has seen a lot of success in other parts of the world. With online groceries set to boom in the next 5 years, Australian consumers will want a convenient and fast way to order groceries online. The concept was originally called ‘FeedmeeNOW’ and was an add-on service to our recipe discovery website. But after huge demand from consumers, we decided to rebrand and have it as a stand-alone service.

Inside FMCG: So explain to us how it works!

TS: Unocart lets you order from local grocery stores online, then sends a personal shopper to pick up and deliver your order to you the same day. You can order using our app or website, our shoppers hand-pick only the freshest groceries and deliver to your door in as little as 2 hours.

Inside FMCG: What happens if you order something that’s not available?

TS: If the substitutions are not available, the shopper can easily decide based on other suggestions from your previous purchases. The personal shopper will then text you to confirm all substitutions before checking out.

Inside FMCG: What about picking produce in terms of ripeness?

TS: The shoppers are extensively trained on picking produce. When you place your order, you can note what term of ripeness you want for each item, whether you want green bananas that will last you all week or you want ripe ones to bake banana bread.

Inside FMCG: Is it the same concept as Uber in terms of drivers?

TS: Yes, similar to Uber our shoppers are independent contractors and are able to set their own schedule, take time off, or work extra when it suits. Unocart thoroughly vets Shoppers by conducting in-depth interviews, records, performing background checks and online training.

Inside FMCG: What makes Unocart different from a supermarket home delivery?

TS: Convenient delivery time in as little as 2 hours. Quality and handpicked produce by your own personal shopper with live communications for substitutes of out of stock items. Multiple store shopping in one order i.e Coles and Woolworth’s weekly specials in one shop.

Inside FMCG: Is the service exclusive to certain stores?

TS: We support popular stores in each city where we offer delivery. While we source groceries from local stores, Unocart’s services are not affiliated with the individual stores or is it exclusive to stores. Currently, we only offer Coles, Woolworths and Aldi but are always happy to work with smaller local supermarkets as well.

Inside FMCG: What’s been the reaction from customers so far?

TS: Reactions have been great and we have seen 258 per cent growth in the last 6 months with customers really loving the convenience, the saving from multiple stores and the freshness of the produce.