We don't pretend to be the biggest, just that we have the best products
In more than 50 years from a local West Flemish flax company to an international player. It’s not obvious. But how? By stubbornly and step by step concentrating on everything you are good at and at the same time being open to innovations that present themselves or impose themselves. Managing directors and owners Iris and Bruno Vandaele experienced it all from the front row. So get ready for a 'master class in international business' full of learnings and anecdotes. Must-read for everyone who is personally active in the international business world!
From local flax company to international player
The origins of what is now the Damaco Group go back a long way. It all started with the family's flax company, here in Oostrozebeke. Iris Vandaele: 'The import of the Russian flax companies caused prices to plummet here at the end of the 1950s. Like so many companies, the family business suddenly had to switch to a completely different line of business. It was no longer feasible for our local industry. In the early 1960s, the company made a U-turn. My aunt was married to a chicken butcher, so there was a lot of knowledge there. That gave our parents the push to go in the direction of the meat industry.'
A tradition of entrepreneurship
From flax to meat, that can count, in terms of reinventing yourself. Bruno Vandaele: 'Such a switch was quite incredible in those days. It wasn't exactly easy back then, but it probably wouldn't be possible now. It shows how entrepreneurship is in our blood. But we were certainly not the only ones. There are many similar stories from entrepreneurial families here in the region.'
“Entrepreneurship is in our genes, we grew up in it and take this for granted.”
Poultry as a basis
Kipco started out as a chicken slaughterhouse, and in those early years everything revolved around poultry. And in fact this is still the core business. Iris Vandaele: "We started from the food industry - meat processing - and distribution (import, wholesale, local distribution, retail and food service). It was not labeled this way, of course. Only much later was nutrient science added: the food and livestock feed for aquaculture, pet food, proteins, and other new applications and specialties. These have in the meantime become our three business units, which we now market separately and with our own focus, albeit under the roof of the Damaco Group. If you take a broader view, you can say that the three units essentially have the same origin: poultry.
Bruno Vandaele: 'Of course we didn't stop at poultry and we diversified further. Based on the strength and reputation of our company name Kipco-Damaco, we also made it a brand name and started a product range of 'frozen food products'. We started with chicken and turkey, then expanded to French fries, vegetables and fish. But our core business remains the frozen food chain.'
Nutrient science: the future
The third and most recent unit, nutrient science, probably has the most potential. Bruno Vandaele: 'Nutrient science is the best guarantee for the future of our company and it puts us on the road to new markets. For example, we have now developed new types of additives - additives for animal feed and aquaculture. But we are also creating totally new segments, such as foliar fertilization and biostimulants.'
Circular before its time
Iris Vandaele goes back to her childhood to outline how Damaco Group is also an innovator in other areas: 'We were already working on circular economy before the term became trendy, and we have been focusing on sustainability since 1982. Father had already succeeded in separating meat from carcasses, at that time an unprecedented technology. Prototypes even had to be built. I experienced it as a child, the search with all its problems, and with my parents discussing how to handle it.
Bruno Vandaele: 'Father was very technically savvy. He was a jeweler and watchmaker by training, started experimenting and eventually found a way to valorise the residual flows. Quite a guy. Later we added our sustainable poultry processing with Empro. Our company as such is literally built in a sustainable and ecological way, with attention to economical energy consumption and energy recuperation. Just think of our water management and water reclamation in general: the collection of water, water cooling, water heating, we put a lot of effort into that. Reducing our ecological footprint is not only the future, it is already extremely important. Even more: with us it is already the past, we did this avant la lettre.'
Reducing the ecological footprint is now hype, but we started doing it back in 1982.
Expansion into more than 150 countries, down-to-earth West Flemish attitude
Over the past decades, Damaco Group has grown into a large international group. Iris Vandaele: 'We don't pretend to be the biggest, but we do have the best products. We are unequalled in our niche, but on a down-to-earth, West Flemish basis. We profile ourselves more as a Belgian SME of considerable scale that is branching out and organizing internationally. In this sense we are actually following our markets, which are also developing further and further. With good reason one of our slogans is 'operate globally and think locally': we have a strong local presence. We work and think internationally, with many nationalities.
American colleagues recently called Damaco Group the strongest at certain destinations. Nice compliment, but we don't intend to exploit this.
This local presence has many advantages, according to Bruno Vandaele. But the challenges are not insignificant either. The time difference, for example, and the cultural differences, which should not be underestimated. Sometimes they can be quite big. For what we say in one sentence, they need five sentences for in say, Brazil. The Middle East and Asia also have their own typical way of doing business. We are now active in more than 150 countries. That's great fun. Who would have dared dream years ago that we would one day be competitive in that region? Especially with a giant like Brazil, which is our biggest competitor in poultry. And yet we succeeded, we're doing it anyway'.
The kick when it works
We set a target and then we go for it. Often with trial and error, but that's okay. Look, if you do nothing, you can never fail and the more you do, the greater the risk of failure. It's all logical, but you have to take the occasional setback with you. When you do succeed, wow, that gives you a huge kick. Iris Vandaele: 'It is also a growth process, every company that grows experiences this. But when the results are good, it gives everyone, every employee, a boost.
Quality label Belgium
Internationally, the Belgian roots mean an asset for Damaco Group. Iris Vandaele: 'In culinary terms, Belgium has a high-quality image in the world, thanks to classics such as beer, chocolate and French fries. That is certainly to our advantage in our sector, the food business. The VLAM strongly promotes the Belgian quality label, we see this constantly at trade fairs and of course we take advantage of it. Belgium is generally known as a country of quality food products on the world market. Small but fine. At the international fairs we wear our pin showing a Belgian flag and people immediately recognize that. In addition, the VLAM and other organizations are also active in the promotion of Belgian fries, vegetables, meat ... and that all helps. But in the end, of course, Damaco Group has to make it true. Fortunately, our prospects and clients know well enough that our products are of high quality: our products are the best advertisement for themselves.'
Interaction with customers helps to get better
'Customers first' is Damaco Group's basic philosophy. But anyone can claim that. Bruno Van-daele explains how Damaco Group lives up to this in practice: 'Our customers help us and improve us. Whether it's the product, the packaging or whatever, it's a permanent interaction and every aspect helps us further in our process and in improving the product itself.'
The long term pays off
Iris Vandaele: 'For this you need a very good contact with your customer. You have to understand what your customer does, how you can help and support him and in this way create a kind of synergy. As a supplier, we find it important to develop a long-term partnership with our customers - the time of 'shopping' from one short-term solution to another is really over. It always revolves around these questions: 'What are your difficulties, where can we support you and what are our capabilities?' And so we look for that synergy to help each other. Synergy means that both parties benefit: if the client gets a good return, so do we.'
If the customer grows, we grow together with him
From support to trust
Bruno Vandaele: 'We have all the tools to support the customers, so we are sure to keep them in the long term. We deploy our own people to improve and adapt the customer's internal processes, so that they get a better product. And also our price has to be in line with the quality they set and market. There are many examples of customers who started with 5 tons a week and are now at 50 tons. That's nice right?’ Iris Vandaele: 'The return and growth at the customer's site are key, with an approach that pays off in the long term. We want to earn their trust every day: in our product quality, in our knowledge of local markets and local challenges. That and our personal contact are what make the difference. With us you are not a number or a target, we just try to build something.' Bruno Vandaele: 'The personal contact and feedback from the customer are sometimes worth more than the business you can do.'
The wow feeling with the customer
Iris Vandaele: "Customers feel when they come to our exhibition stand that there is something alive with us. In English they say 'vibrant' - that feeling of 'something is happening here' attracts people. I now spontaneously think of a customer who bought chicken parts from us. At a trade fair I had presented him with solutions that we had already developed for other customers. He believed and trusted me and I advised him to just give it a try and see if it caught on in his market. Then, with our technical support, that customer started a meat processing plant out of nowhere. Now he has become a very big producer, ready to export in his region. And look, he is now one of our biggest customers. It is a matter of trust, and of knowing what you are doing, of not promising things you cannot make true. That's what we mean by creating a wow feeling for our customers: together with our team and their team, our technologist and theirs, putting the right product at the right price in the marketplace. That's how customers come back with a further question and develop further.'
We never promise things we can't handle.
Sharing knowledge creates interplay
Bruno Vandaele: 'Customers also quickly understand that they can rely on us for very broad support: marketing, production, the technical part, the knowledge of production and so on. Sharing knowledge and interplay are essential. Our business units, for example, are present in different markets, but by using the power of cross-fertilization between those departments of the Damaco Group and between ourselves and the customers, we grow together.'
Interplay helps to grow further together
Continuous innovation focuses on maximum return
In addition to the good customer relations, the pioneering drive and the hard-working mentality at Damaco Group, its success is based on constant innovation. Bruno Vandaele clarifies: "Examples abound. Innovation does not stop in our company, it often involves processes outside it. The rule is: the more innovative you think and work, the more challenges and innovations will follow in terms of products, production processes, etc. Our innovative ideas often originate from the 'chicken' concept, because that is where we come from, and because it is a healthy and sustainable product with a lot of potential.
The less that is lost, the better
At Empro, for example, we started processing poultry into by-products,' Bruno Vandaele continues. 'These are getting better and better. At Kipco-Damaco we have succeeded in making maximum use of our waste flows, our by-product flows, and in valorizing them. Hardly anything goes to waste. We make bone meal from the bone, we use the bone meal to make stock, and we extract proteins which then re-enter the food chain. That is how we have always approached it: with a focus on maximum profitability.
MDM: a unique and patented process
It may not be in the nature of West Flanders to do a lot of 'boasting', but if there is one thing the company can be proud of, it is MDM (fresh or frozen deboned meat). Iris Vandaele: "Our MDM itself is unique and patented. Just like everything we do in nutrient science. There, too, we base ourselves on patented processes. The production lines we use to separate MDM are proprietary and we developed them ourselves.' Bruno Vandaele: 'We can also offer much more than our competitors. Just think of cooling with CO2, which we also do here in our company. Or the development of our plastic detection system. This guarantees that no foreign objects end up in the meat. This way, we are always taking further steps. Our goal is to always be one step ahead of our competitors.'
Being able to switch quickly is also a form of innovation
Iris Vandaele: "Take distribution and trading. When our parents started, they only had a slaughterhouse, followed by a cutting plant and later processing. And then suddenly in 1999: there was the dioxin crisis. There was nothing we could do about it, but suddenly we were not allowed to sell anything anymore! Instead of sitting in a corner mourning, it meant the opportunity for us to evolve more in the direction of trading, not only chicken but also pork and then beef, including French fries. That, too, is a form of being innovative: moving quickly, turning a threat into an opportunity.'
Instead of growing sad, we see an opportunity in every threat.
Even halal buffalo meat
'In India, we started our own brand and processing of buffalo meat, under the brand name Al Raed. This means 'the leader' in Arabic. With this buffalo meat we are targeting the Middle East market. I don't think there are any Belgian companies doing that anymore. It typifies our continued pioneering role in the development of new products. We can and dare do a lot, from branding to developing private labels, depending on the market, or at the specific request of a customer. Our good reputation also plays a role here: people trust us and know that we deliver what we promise.'
From poultry to French fries: a small step
Bruno Vandaele cites another example: 'At a certain moment the poultry market in the Middle East crashed. A customer who was active there panicked. We advised him to take the step to French fries. He would never have thought of it himself. However, it is not as big a step as he first thought because both poultry and fries involve a frozen chain. So why not try it with one container of fries? We gave him the tip to distribute it to his better customers and see how they would react. To make a long story short, from one container he quickly got to ten a week and even more. It's just one illustration of a customer who trusts our innovative way of thinking, and Damaco Group that doesn’t betray that trust.'
Multicultural company with 21 nationalities
To be successful in over 150 countries, Damaco Group has always been able to empathize with other cultures, religions and local customs. Iris Vandaele: "Color, religion and politics play no role for us, we look past that. Only respect and cooperation are important. Whatever your background or nationality, it's all about connection and trust. We have always focused strongly on local anchoring. Our employees abroad are locals. A total of 21 nationalities work for us. Personally, I think that is one of the best things about my job. Meeting so many people from all over the world and still finding that same 'drive', that click, that same feeling.’
The challenge of finding people from all over the world with the same drive is why we do it for.
The Belgian, a chameleon
You always have to adapt a bit, of course', Iris Vandaele continues. As Belgians, we are used to behaving like chameleons. In terms of product quality, there are a number of requirements that you can't escape. We have to be approved for export by the veterinary services of the country of destination. Secondly, you have to undergo audits for certain countries. This way we get a country approval for each country. But that is not all. There is also the packaging of the goods, the language and description on the labels according to the country of destination... There is a lot to consider.’
Always adapting to new circumstances
In addition, there is the specific issue of halal. It is always quite an exercise to trace all our products according to the rules of each destination country. There are also factors that are beyond your control. I'm just saying: an outbreak of African swine fever in Europe or of avian influenza. Oh well, nothing we can do about it, it's all over our heads. The only thing we can do is to make sure we are top of the class, are innovative, continue to automate and continuously improve our processes.’
A business of, for and with people
Approaching prospects in new foreign markets is a craftsman's job in itself, this experience has shown. Bruno Vandaele: "It starts with language skills, which fortunately we are good at in Belgium. That aspect together with building up long-term relationships. Trade fairs are indispensable for this. Our customers are all present, and that human contact is very rewarding. It's a pity that in the past Corona years there were no or hardly any international trade fairs, as we went to 20 of them every year. Since Covid, however, we have been focusing more and more on digital marketing. We often spent the budget for our exhibition stands on this. Iris Vandaele adds: "Apart from the fairs, I am grateful that we have such good collaborators, also at the local level. They are motivated, want to grow with us, and have a vision, which is great. We select them mainly on mentality, and of course also on knowledge.
Building customer relationships: a bit of entertaining too
The concrete interpretation of customer relations differs from region to region. Iris Vandaele now knows the best way to go about this. In the Middle East, for example, you have to be a bit more entertaining. It helps to go for a quiet coffee and keep in close contact. In Asia, too, you don't sell immediately after the very first contact; first you build up the relationship, step by step, and only in the long term does buying and selling follow. It is precisely because of these local finer points and sensitivities that we have set up a network of independent sales offices: for the first 15 years in Singapore. Later in Vietnam, Bangalore, Manila, Moscow, Dubai and Sao Paolo in Brazil, and in October 2020 in Hong Kong and Poland. Our offices do both sourcing (buying) and selling. Sometimes we start from sourcing, like in Brazil. This country is becoming the number one chicken and meat supplier in the world and our presence is required to offer our customers somewhat cheaper products. We are also selling in South and Central America. Not bad for an SME, is it?