Member Interview: Maxim McDonald explains the secrets of the juice and spices trade

Thu 28 Mar 2024
Posted by: Phil Adnett

Gerald McDonald Group is a family business, first set up in the City of London by Maxim’s great grandfather as a herbs and spices trader, back in 1917 when such a thing was an “exotic concept”.

After the Second World War, there was a push to get the population more vitamins and minerals. Maxim’s grandfather took advantage and pushed the business into the juice industry as well.

Current director, and fourth generation family member, Maxim McDonald spoke to Member Monthly to explain his company’s success selling overseas.

Over a century of trade

Now based in Basildon, Essex, the company is in its 107th year of operation, selling juice and spice products, primarily to other businesses.

As McDonald says, explaining the move out of London:

“We decided we could add more value by having our own blending facility and warehousing, for both product categories.”

The move away from the City gave the company the space to grow into warehousing, which “adds a lot of value, as it allows customers to vary the quantities”.

In terms of international trade, Gerald McDonald & Co has connections across the world that allow them to sell their products into lots of different markets.

Asia Pacific

Maxim says it is countries within the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) that have seen the most growth recently, including markets such as Japan and Thailand, as well as geographically adjacent countries not in CPTPP, such as China.

This is facilitated by the decision, taken back in 2016, for the company to open an office in Japan and use it to establish a foothold in Asia.

“We were exporting quite a lot to Asia already, but I think that helped us increase the exports to that market,” says Maxim.

“We were also selling a lot more to China, via Japan, which we probably never would have done if we had not had the office in Japan.”

The Japan office opened doors to other Asian markets, such Thailand and Singapore, as well as encouraging interest from Australia.

But exporting to Australia has come with challenges linked to distance, says Maxim.

A matter of imports and exports

The import and export relationship is symbiotic for Gerald McDonald and Co, as the company trades as both an importer and an exporter. The more they sell in certain markets, the more they buy.

“We've also been able to import a lot more interesting juices from Asia, and from Japan in particular. For example, yuzu juice, which has become very popular in the UK and Europe and North America as well.”

Maxim says that trade shows, supported by the UK Tradeshow Programme run by the then-Department for International Trade (now the Department for Business and Trade), played a vital role in accessing new markets, establishing a presence there and building up in-market relations.

The programme, which provided paid sponsorship for businesses to attend trade shows as exhibitors and visitors, has been shut since June 2023.

IOE&IT support

When asked about some of the benefits of membership of the Institute of Export & International Trade (IOE&IT), Maxim referred to the daily email – the Daily Update – as a major benefit.

“They're comprehensive and I get news from them that I don't see in other places regarding trade, or that I don't find so easily on the BBC or anything.”

He also said an IOE&IT consultant gave the company a “comprehensive” visit and advice session on bonded warehousing:

“That's been quite helpful for connecting us and building our network with people we probably otherwise wouldn't know who to approach. We've now got a checklist of what exactly is required if we decide to go for a new market.”

Increasing flexibility

Maxim credits a large part of his company’s success to its relative flexibility in the quantities of ingredients in the orders they fulfil.

“We have very low MO cues generally, and we can pack out into all sorts of types of containers, anything from 10kg to one tonne”

This does make it difficult, however, as shipments can sometimes drop off.

Handling adversity

The last few years have not been easy for anyone trading internationally. Even for a well-established company such as Gerald McDonald & Co, disruptive events such as Brexit or the Covid-19 pandemic, have proved difficult.

“It was particularly tough for us because not a lot of the juices we sell are of UK origin. If we wanted to export them to the EU, we had to pay up to 18% duty rate for it. There’s no way around it.”

Future spice and juice growth

In terms of future markets, Maxim says the business, which is still family owned and operated, is eyeing up Africa.

“There’s a huge potential in terms of juice,” he says, noting the benefits of selling drinks to hot countries such as Nigeria, South Africa or Kenya.

“It makes sense that they’re going to demand quite a lot of juice there,” he adds, “But then again we’ve been waiting for years for those markets to take off.”

Problems including Nigera’s ongoing inflation crisis or instability in South Africa have dented those markets, but for a trader like Maxim “it’s just a question of time.”

Nigeria’s population is expected to grow significantly over the next 20 years, to the point where, as Maxim says “Just by sheer numbers, it’s going to be a huge market for us”.

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