The magazine for alumni and friends of Massey University.
Issue 14, April 2002

Company Founders
Anton Masutti & Murray McCallum
Bachelor of Business Studies

A growing success

Business partnerships are often said to be the best way of killing a friendship, but Anton Masutti and Murray McCallum are better mates than ever.

“ We’ve done the very hard yards together from day one,” says McCallum. “We don’t always agree and often disagree, but we have deep mutual respect and it never becomes personal.”

The old university mates, both business graduates, came up with the concept for their produce trading company, Delica, over a few beers and set out with just $80,000 in capital six years ago. It now turns over $55 million annually.

Delica exports 35 different fresh fruit and vegetable varieties throughout the world, supplying international markets year-round. It has divisions in New Zealand, Australia, China and the United States.

Says McCallum: “We have become known as a one-stop shop for asparagus.” Importers in Taiwan, Japan or Korea know that the Delica group can supply asparagus 12 months of the year from Australia, New Zealand, Mexico, California, China or Washington. Over 4200 tonnes of asparagus were sent to Japan and Korea in 2002.

Delica also sends stone fruit, strawberries, onions, avocados, blueberries and citrus to markets such as Japan, North America, Asia, Europe, the Middle East and Australia.

When Masutti and McCallum teamed up, friends were initially sceptical. They are different. “He’s the master of time management and organisation and I’m not,” says Massutti.

Masutti describes McCallum as possessing a terrier-like propensity for pursuing opportunities – an ex-rugby hooker characteristic.

McCallum sees Masutti as a people person. “He lives for his family and his friends – and he has a tonne of them. He will always go the extra yards for people. Growers are, in the main, a very down-to-earth lot and really appreciate and value this quality.”

What they do share are bedrock beliefs about the importance of people and relationships in business. “And this I guess is a big factor in our company’s growth,” says McCallum.

Masutti talks about ‘win-squared’ relationships. Companies that take their suppliers for granted and don’t fulfil their financial commitments have jeopardised the industry, he says. Delica makes a point of looking after its suppliers, listening to their needs, and paying promptly.

“ It all comes down to relationships,” says McCallum. “The relationship is a partnership between the grower and us and Delica and the importer and even the importer and their buyers or end consumers. If all of these relationships are based on trust and the long haul then selling fruit and vegetables becomes much easier. Everyone has a vested interest.

“ When we set out we recognised there was an opening for the likes of us to show some enthusiasm and initiative and give the growers and importers what they wanted. It comes back to this partnership philosophy, not the ‘us versus them’ attitude that seems to be so prevalent in a lot of business relationships. Business is really quite easy. I find it unbelievable so many companies do it so badly,” says McCallum.

Where appropriate, Delica practises vertical integration. Masutti says this means a more consistent product because the operation can be controlled from the grower to packing, all the way to market. The company owns more than 50 percent of its two pack-house operations here and in the US and it has recently invested in a South Auckland organic orchard.

But they only ever become involved when their own growers don’t have the critical mass or they simply can’t find the right growers to form a partnership relationship with, says McCallum.

Sourcing product from Australia and the US as well as locally means the company can’t always use the New Zealand ‘clean green’ tag. “We do capitalise on that image when we market produce from New Zealand. But lots of countries are clean and green. Since the late 1980s everything New Zealand has exported has been promoted as clean and green – it’s losing its gloss.”

He says it’s more important to sell on quality at a higher price, which is the only way to recover the additional costs in labour and transport of getting New Zealand produce to market.

The company’s meteoric growth has been its biggest challenge. There are now 32 full-time staff and 11 subsidiary or joint venture companies under the Delica umbrella. The structure is intended to encourage staff to become shareholders in the businesses they work for. “It means good people can be on your team, instead of against it,” says Masutti.

Masutti keeps a daily watch on the balance sheet, “so I can sleep at night”. Consolidation is an aim – “though we say that every year and then some opportunity comes up”.

Their plan is to focus on kiwifruit and apples in the short-to-mid term and to acquire more tangible assets. “We don’t just want to be a trading company. Take away the people and you’ve got nothing. We want to build up the assets of the group,” says Masutti.

The potential of the business is only limited by the energy of the directors, says McCallum. “This business is all-encompassing and requires high energy levels. Burnout is an issue, that’s why we constantly need young people coming through the ranks.”

And many of the people Delica works with happen to be Massey people. In 1985 Masutti was on the same rugby team as Michael Hardy and Clifton Shaw. Shaw was also a Palmerston North flatmate and friend. Philip Bird was another friend.

These days Clifton, Shaw and Bird are the majority shareholders in Integrow, which exports squash and onions, and in which Delica itself has a small shareholding.

Among other Massey alumni are Snow Hardy, the managing director of Delica Apples and a major Delica shareholder, and Chris ‘Mungi’ O’Neil, who jointly owns Delica’s organic apple orchard.

But, acknowledges Masutti, his consciousness of the importance of relationships perhaps coming to the fore, there are non-Massey graduates as well. Sarah McCormack, who has been with Delica from the start, and ex-King Country prop Alastair Hulbert get special mention. “ We could not have done it without them,” he says. “And they do have to put up with the Massey culture.”