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MERLOG FOODS

Join us at the Merlog Foods DTI Seminar to learn about the background of Merlog, the size of the South African chicken market, import process, HDI solution for new importers, and more. Presented by Georg Southey.

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MERLOG FOODS

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  1. MERLOG FOODS

  2. DTI, US EMBASSY & USAPEEC SEMINAR Importers Guide Poultry Meat Importers 1-3 March 2016, Pretoria Presented by Georg Southey

  3. DTI seminar • Background to Merlog • Size of South African Chicken Market • Capital requirements • Import process • HDI (new importer) solution • Questions

  4. Background to Merlog • Started from a home office in 1994 (son and father) • Offered logistics services • Grown over 22 years to become one of the largest WHOLESALE, DISTRIBUTION, and IMPORT Businesses in SA • Distributes 7 – 10,000 metric tons per month • Equivalent to 280 -380 fcl (full container loads) per month • Product make up: 60% frozen chicken

  5. Background to Merlog • www.merlogfoods.co.za

  6. Automated Cold Store (www.merlogfoods.co.za)

  7. DTI Workshop • Merlog operates from 2 warehouses • Head office and warehouse in Cato Ridge; Kwa Zulu Natal • 12,000 pallet positions • Warehouse Heriotdale; Johannesburg • 2,800 pallet positions • Fleet of nearly 50 delivery vehicles and trailers

  8. SIZE of South African CHICKEN MARKET • Annual Consumption 2,200,000,000 kg’s • Imports (all cuts) 250,000,000 kg’s • Local (all cuts) 1,950,000,000 kg’s • Bone in Chicken imports 160,000,000 kg’s • USA Quota 65,000,000 kg’s • USA Quota as % of current imports +-40 % • Number of containers 650/qtr 2,600 pa

  9. Importing is not a get rich “scheme” • Successful businesses are built over time: - Through: • Market knowledge, trust, relationships, and reliability

  10. Capital required • Estimate cost for 1 container of chicken portions:

  11. Process to Access Quota • Quota application to DAFF • DAFF assess applications and allocates Quota • DAFF issues Quota • Importer Applies for Rebate Permit from ITAC • Importer Negotiate to purchase product from Supplier • Importer Applies for Import permit from DAFF • Product is shipped • Import Clearing and customs

  12. Veterinary Inspection and release • Sale of Product • Delivery to customer • Collect Payment from Customer • Repeat, repeat, repeat……

  13. Administration • Negotiate price • Agree shipping period • Currency Hedging • Insurance • Clearing Instructions • Payment terms Supplier (Cash Payment before receipt of Goods (CAD)) • Payment terms Clearing Agent • Customer credit worthiness • Customer payment receipt (14 – 30 days)

  14. New Participants need a Coach or Mentor • MERLOG FOODS JV with MFS 51% HDI : 49% MF • MEGA FOOD SUPPLIES • HDI HDIHDIHDIHDIHDI (Quota Holders) Assistance with Sourcing, Logistics, Clearing, Marketing, Working Capital

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  16. QUESTIONS? • Thank You for the opportunity to present today

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