Kim Bigg – Perks
Welcome to the Show Me The Perks podcast. Thank you everyone for listening in again. Today I have with me Ben Nispel from Nippy’s Fruit Juices. Ben is a director of the iconic Nippy’s Group based here in South Australia. For over 50 years, Nippy’s fruit juices and flavoured milk drinks have been a staple in Australian homes, especially here in South Australia. Ben has been a valued client of Perks for nearly 10 years and we’ve had the privilege of seeing how Nippy’s has grown under Ben and his dad, Jeff’s leadership over the last few years.
In today’s episode, Ben will share insights into how Nippy’s, a South Australian icon, has navigated challenges like rising electricity costs whilst continuing to innovate with renewable energy and prepared for the upcoming shifts in sustainability reporting that will impact businesses across Australia.
Ben, first of all, can you tell us a little bit more about the origins of the Nippy’s company and business and how it’s evolved over the years?
Ben Knispel
Yeah, sure, Kim. So the origins of Nippy’s date back to the 1930s when my grandfather, Alec Knispel, rode a push bike to the Riverland in search of, you know, a job basically, or, you know, a life for himself. He arrived at Marook and I think with the help of a loan from an Aunty, eventually managed to purchase his first small mixed fruit property, dried apricots, sultanas, some citrus. And that basically, what we have here today started.
Kim Bigg – Perks
Is that still in the family now? The same block that he started up?
Ben Knispel
Yeah, yeah, I’m sitting in the front office of our Marook site, which when I was a child was my grandparents house. So yeah, where he arrived in 1930 is still a significant…
Kim Bigg – Perks
is where you are today. you haven’t, he hasn’t moved too far or the family orchards have not moved too far. That’s coming up a hundred years. So is there a hundredth anniversary coming up for a celebration for the business or when is considered the start of the business? If you had to consider it.
Ben Knispel
We talk about the start of the business being in the 1930s and in terms of celebrating the milestone, yes, we probably should.
We celebrated 50 years of making orange juice a few years ago. We’re sort of, I guess it’s in our nature, we’re humble, low-key sorts of people. So yes, we should pause and acknowledge it, but we probably don’t do things like that maybe as well as we should, or it’s not really in our nature to make too much of a big deal about ourselves.
Kim Bigg – Perks
Fantastic. I mean, I noticed on your website and on all the trucks that drive past, I think it says, family owned, farm owned, or something along those lines. So yeah, there’s obviously a strong focus on family origins with the thing.
Kim Bigg – Perks
And just to take on from that history, obviously your grandfather Alec started the business and then it went to your father Jeff and then just perhaps explain your role when you arrived onto the scene.
Ben Knispel
Yeah, so grandpa started back in the 1930s. My grandfather had four sons and they were all involved in the business.
One of them was killed unfortunately in a truck accident in 1969 and another one killed in a car accident in 1986. So even though all four of them worked in the business, two left unfortunately earlier than they should have. And that left my uncle John, and my dad spent most of their working careers working in the family business..
Kim Bigg – Perks
…building the business. And your role currently is managing director.
Ben Knispel
my role is joint managing director. Dad and I are the two managing directors of the company.
I did an accounting degree at university, had a full start in Ag science. I did that for six weeks and didn’t like it. Went on and did a business commerce degree and then did an accounting cadetship at a large freight company for three years after university before coming back to Nippy’s in 2008. My dad actually bought out his dad and his brother John at the same time in 2008. yeah, that was when I came back to the business in 2008 and started off sort of just in an accounting role and over the last 15 years or so, yeah, sort of progressed up to pretty much helping dad run the whole show. Yeah.
Kim Bigg – Perks
Fantastic, and obviously the two of you, certainly in my dealings with yourselves through Perks and otherwise, you obviously make a good team with differing skill sets and otherwise and differing views on how to run the company. But I can tell that it obviously works pretty well with those different perspectives on how to run the business. In terms of how that’s progressed over the last, I mean since 2008 when you had a more active role in the business, how do you view how Nippy’s has evolved since then in terms of its brand, its size and its location, staff members and things like that.
Ben Knispel
Since 2008, our group’s turnover was about 30 million and today it’s close to 100. Dad, probably going from say the two active owners being my dad and my uncle, just to being my dad owning it has sort of helped with that growth phase. Cause you know, my uncle’s more conservative than my dad. So I suppose once my dad had brought my uncle out, left my dad to, you know, do be a little bit more aggressive, I suppose, for want of a better word.
Kim Bigg – Perks
Yeah, aggressive in terms of new products or new lines or how do you view that?
Ben Knispel
Both of those and also just, you know, more customers. We started dealing with Woolworths outside of SA and probably invested more in sales staff and bits and pieces like that. Just new skill sets coming into the business.
Kim Bigg – Perks
Yep, so obviously the turnover’s gone up about threefold in terms of staff and operations. Has that changed significantly or is the rising turnover linked to equipment and machinery and things to some extent as well?
Ben Knispel
Yes to both, but we have had, we’ve currently now got 200 direct staff plus, you know, a number of subcontractors that are sort of solely relying on what we do. But yeah, 200 direct staff. We produce our two litre orange juice gets made out of Regency Park where we in the last financial year churned out 16 million litres of juice at that site. Here at Marook where we do our flavoured milk and a little bit of juice. We did 20 million litres of product last financial year.
And now our fruit packing shed at Waikeree last year had a throughput of about 40,000 tons of citrus fruit. So that’s the three sites and the stats of what we run through them.
Kim Bigg – Perks
How does that compare in, let’s say, the South Australian or national Australian market in terms of size and quantities put through? You obviously mentioned before, you’re quite humble in terms of your operations, but I’m just trying to generate a bit of context in terms of what that looks like in the wider market.
Ben Knispel
Yeah our market share you could buy retail data to know those numbers accurately. We don’t spend any money buying scan data like others might to have a closer handle on our market share. But we would imagine that in South Australia in flavoured juice that our market share might be 30 or 40%. We would have to be the leading brand or close to it in South Australia. And in interstate, our market share would be, it might be 1 % where we’re really only just getting started interstate.
Kim Bigg – Perks
And just before I jump onto some, you know, the topic of today’s podcast being rising costs and electricity costs, you’ve obviously thrived over the last 15 years plus that you’ve had an involvement in the business. If you had to put your finger on what, you know, what allows Nippy’s to continue to evolve? it, you know, how do you reflect on that? What’s the, what’s the thing that makes Nippy’s tick in terms of continuing to thrive over the years.
Ben Knispel
Look it might not be a very sexy answer, but I’d just say hard work. yeah,
Kim Bigg – Perks
strong focus on all the fundamentals.
Ben Knispel
you know, grandpa and his, and his sons were all hard workers. I’d like to think that I’m a hard worker. And that gets you a long way into it. You’ve also got to take risks. You’ve also got to attract good managers now coming into the business.
My sister does a bit of part-time work for us, but I haven’t got five brothers to help me run what we’ve got now. So, we’ve now got to attract good managers into the business and keep them here. But yeah, I’d say the foundation of it all is basically hard work.
Kim Bigg – Perks
Yeah, fantastic, like most family businesses in Australia. It’s a good segway. Obviously, there’s a lot of family-owned and privately-owned businesses in Australia who are working hard just like yourselves, they’re facing pressing challenges in the market, in the economy at the moment, a lot of the time relating to electricity costs. And part of the reason for touching base with you today was there’s been a few articles in the paper regarding yourselves in terms of your higher electricity costs and there’s been articles on the ABC as early as this week regarding Golden North, another business in South Australia facing higher electricity costs.
And some of this may be repeating those, but can you give us an indication of how significant the more recent electricity rises were for Nippy’s and what that means on the ground for you when you’re thinking about expanding or trying to invest more in South Australia?
Ben Knispel
Yeah, so electricity has gone up a lot. The recent media articles you’re talking about was probably an extreme example of that where at one of our three sites, we chose to go for the first time ever with a spot contract price, not a fixed. Most people are on a fixed contract. We elected here at the Marook site to go with basically the wholesale market price. So, you ride, know, a lot of the time the actual wholesale electricity price here in South Australia, if the sun’s shining or the wind is blowing, a lot of the time the actual wholesale price of electricity is negative, which a lot of people will be scratching their head saying, how could that be? I’m paying a monster for it.
What you see when you look at a power bill like a place like here is you get the breakdown of all the different things that make up your bill. You’ve got the cost of the electricity itself, but then you’ve got the cost of the poles and wires, and then you’ve got a emo charges and small scale certificates and large scale certificates. There’s lots of things that make up your power bill.
Yeah, so what we did here at Marook was we went on a spot contract and in the months during winter a few months ago when the sun wasn’t shining much and the wind wasn’t blowing, that hurt a lot and our power bill essentially doubled compared to the same month last year when we were still on a fixed contract. So certainly, learning a lot, frustratingly learning a lot about how electricity works. I’d rather be talking about or understanding orange trees more or, know, bottling equipment more. Yeah.
Kim Bigg – Perks
trying to run your business. Yeah. And was there an option to go to a fixed contract or was there a move away from that?
Ben Knispel
No, their fixed contracts are overwhelmingly what people use. Dad and myself, I suppose, are both fairly risk adverse and we thought, well, let’s give it a go at one of our sites. And as scary as it is in the middle of winter when the sun wasn’t shining as much and the wind wasn’t blowing, it was scary in those months. But when I look now, we’re nearly, you know, we’re 10 months into, at least nine months into this year. what we will end up paying by the looks of it on the spot contract is gonna turn out to be no worse than what we would have got if we went fixed. It’s just that, you know, when it was low in January, February, March, we didn’t talk about it much, we made, you know, it hurt or we made a bit of a story about it in July and August when it was very scary, yeah.
Kim Bigg – Perks
Yeah, so when you look back on that, do you see it as being something that you would consider the fixed price contracts, or do you look at this and think the more you can do to mitigate your electricity prices? You’re obviously, your factory operates all during the day and night as well for the most part.
Ben Knispel
I think that we will probably, I’ll wait till the end of the year so I can look across the whole year. We operate 24 hours a day here at Moorook. So I would say if we’re going to go stick with fixed somewhere, I probably won’t do it here. I’ll do it at one of the other sites that are doing less at night basically, because your peak prices are generally always in the early evening or overnight.
Kim Bigg – Perks
Yep. Yep. Excellent. And as a bit of a side, they’re obviously looking at your electricity prices is one way, but you also, I know firsthand you’ve invested significant amounts in renewable energy over the years in terms of solar to try to mitigate some of your electricity costs. Can you give us an insight into the thought process that goes into those sorts of investment decisions from Nippy’s perspective? For example, you might look at it and say, it might cost us X amount of dollars, how much will it save us? People would love everyone to use more, do more solar, but inevitably it comes at a cost.
Ben Knispel
Yeah, look, on my experience, solar is a good idea and a good financial choice to make. Some lessons that I’ve unfortunately had to learn are, if you’re going to put solar panels on a roof, if the roof is 35 years old, consider renovating the roof before you put the solar panels on, is one lesson I’ve learned.
Another lesson is be very careful who you engage. Unfortunately, there’s probably some cowboys in that industry. Be very careful who you engage is another lesson. They’re probably the main two, yeah.
Kim Bigg – Perks
Are you considering solar or any other renewable energy or sustainability type investments at the moment?
Ben Knispel
Yeah, we’ve already got more than 700 kilowatts of solar panels on our roofs. And we only commissioned another one last, another 80 kilowatts only last week. And we’re looking at redoing now that we’ve completely replaced the roof on our 35-year-old building at Regency Park, we’re looking at installing another 200 kilowatts on that new roof between now and Christmas.
Kim Bigg – Perks
Yeah, fantastic. So you’re continuing to look at ways to minimise your energy costs in things like that. So generally speaking, solar is cost effective for you to install, but it does come with a cost. Obviously the implementation cost. And just to segway into accounting circles, obviously Perks’ role in supporting businesses like Nippy’s extends into the accounting industry. And one of the waves that’s coming through the industry at the moment is a shift towards ESG and sustainability reporting in years to come.
Large proprietary companies, I think, come in from 1st of July, 2027, I believe is the time. Although I’m sure someone out there can double check that and tell me if I’m incorrect in the start time. But inevitably accountants are going to have to upskill themselves. But to a certain extent, business owners are also going to have to upskill themselves because this is the new world and even if you’re not a large proprietary company yourself, if you’re the trucking company out there who’s delivering fruit for Nippy’s or if they’re delivering fruit for Woolworths or whoever it might be, they’re gonna have to provide a report to that large proprietary company to help them with their ESG reporting. So, these things are coming. In light of those things, how do you look at that from the perspective of trying to run a business and trying not to get distracted by all these other things that perhaps get in the way of running a business.
Ben Knispel
You’re absolutely right that it’s coming and you’re also absolutely right that you’re gonna get roped into it as a supplier to large companies before you’re directly involved in it yourself is what our finance manager who is like you suggested, starting to educate themselves on this stuff is learning that we’re already seeing questionnaires coming in from our larger customers about this sort of stuff.
So yes, it’s coming, you know, it’s more compliant and whatever.
Kim Bigg – Perks
Are you seeing any pushback from some of these providers where, is there almost a sense that if you don’t comply or continue to improve your own ESG reporting, you fear that some of these larger companies may apply more pressure to you to increase your ESG footprints and solar panels and those things?
Ben Knispel
I think in time, yes, I don’t think we’re quite there yet, but I think in time, yes, it will be a matrix. When you’re submitting a tender for whatever it is, we already see on tenders now and have done for more than 12 months, issues on these things. And at this stage, our experience has been, if you’re a little bit light on in information in those areas, at this stage, it’s still okay. But I think that as time goes on it will become more and more of a requirement. I had my first questionnaire for with two banks. had my first, in the last few months, I’ve had my first round of questions on these topics from the banks. So I think it’s…
Kim Bigg – Perks
Is that in light of the banks wanting to focus their, is there an implied sense that the bank wants to be dealing with customers who have an ESG focus?
Ben Knispel
Yes. Yes. Yeah, absolutely.
Kim Bigg – Perks
Did they mention any additional factors that go with that? For example, some things I’ve heard that haven’t necessarily come in yet, but might be people who seek finance from banks without, they’ll charge a higher level of interest if your ESG footprint is worse than another or vice versa.
Ben Knispel
I haven’t seen or got into that level of detail yet. Charging someone a higher rate because they’re, seems a bit unfair or almost hypocritical to me. But no, I’ve been asked questions in the last six months for the first time from banks on this, not into that level of detail yet.
Kim Bigg – Perks
Yeah, any insights into what they’re trying to gain from this or it’s just a fact-finding mission from some people?
Ben Knispel
I think it was a fact-finding mission or they were satisfying their internal obligations by having asked me some questions. That’s what brought a sense to it.
Kim Bigg – Perks
Yeah. Look, it’s certainly coming, isn’t it? In the industry. And that’s just the, this is the start of, of something more. How do you, Nippy’s and obviously producing, like you’d have a pretty, you do a lot of things that would be looked upon favourably within the, within the ESG industry already with, with regards to your solar and your, way you irrigate your farms and things like that is all the way down to all the recycling programs that happen with regards to your bottles. How do you view internally, if you like, or strategically inside the business things like sustainability and…
Ben Knispel
We’ve been a voluntary signatory to the APCO, the Australian Packaging Covenant for more than 10 years now. Part of that for a number of years now, we’ve been measuring the different waste streams and what do we recycle, what’s going to landfill, what can we divert out of landfill. So, we’ve sort of in a way,
Kim Bigg – Perks
You’ve been part of it.
Ben Knispel
We didn’t realise it at the time, but we sort of started training ourselves a little bit on thinking this way before it’s become law by being in that voluntary code. And, you know, yes, we’re taking weight out of bottles. We launched a bottle line here at Moorook in 2017 and used a white bottle for a long time for our flavoured milk.
The feedback was from the recycling streams that it was a very hard thing to recycle. A lot of it was ending up in landfill. After doing rigorous testing, we’re moving away from white bottles to clear so that they can be recycled more easily.
Yeah, there’s a lot of work goes into those things on multiple fronts. We’ve got plant-based packaging now in our liquid waste board.
Kim Bigg – Perks
Yep, you some plastic straws that are on the out as well.
Ben Knispel
Yeah, that one, that’s law. mean, a lot of businesses, a lot of businesses will probably wait until things become law like, you know, we did with plastic straws. We had an exemption to keep running plastic straws on what was called attached packaging until only a few months ago, we’ve started using paper straws and everything now.
Kim Bigg – Perks
Do you have any complaints from the children unable to use the cardboard straw?
Ben Knispel
We have. Yeah, we have. We have. We have. We have. But I guess, you know, it’s law. It’s good for the environment. You know, we’ve got to sort of just do the best we can and keep moving forward.
Kim Bigg – Perks
Yeah, absolutely. Now look, just to round things out, it’s been really good to talk about a few of those things and hear what Nippy’s is doing in that space. Just a final sort of sum up question and feel free to elaborate on it as long as you like. So as a third generation family business, you’ve obviously continued to adapt in the past. How do you, when you’re looking at continuing to innovate and adapt in future, and you mentioned a little bit of it there, how do you go about that as a group, in terms of the management and how you work through those strategic changes that you wanna make?
Ben Knispel
I mean, looking forward, I’m not in recent months or years, I’m not so much focused on, don’t feel that motivated me personally, this is, by revenue growth so much anymore. I’m probably more interested in being sustainable and by that I mean, yes, the environmental stuff, but I also just mean, you know, what does it look like? Dad still goes to work every day. We’ve got some key managers at sites that like all humans will retire or leave at some stage. So when I say sustainable, I mean, yes, environmental, but I also mean, you know, I’d be happy if you look forward 10 years, if we were still at a hundred million dollar turnover making a profit but the place was still running.
Kim Bigg – Perks
Yeah, employing lots of South Australians and…
Ben Knispel
bigger is not always better. One thing I’ve learned in 15 years going from 30 million turnover to 100 is that bigger is definitely not always better. There are some benefits of getting bigger like economies of scale and purchasing power and ability to service larger customers and whatnot. yeah, I don’t know, just…
Kim Bigg – Perks
Sometimes there reaches a point where you slow down and focus on the things you do really well and refine it and get better at it is perhaps sometimes better than continual growth.
Ben Knispel
Yeah, yeah, everything in heaven’s free. So, at some point enough has got to be enough.
Kim Bigg – Perks
It’s a very good saying. Final question for today, please tell us what your favourite Nippy’s product is.
Ben Knispel
My current – this changes, but my current favourite is vanilla mault flavoured milk poured over a gals of ice.
Kim Bigg – Perks
Beautiful thank you Ben.
All right. With that, I think I’ll wrap things up. Yeah, just like to thank Ben Nispel for coming on. Ben, as I mentioned before, is the managing director of the Nippy’s Group and really pleased to have the Nippy’s Group as a client of Perks for many years and hopefully many years to come. And really, really great to have you on and share your insights with everyone. And we look forward to catching up with you again soon on maybe on the podcast or maybe face to face.
Ben Knispel
Thanks, Kim.
Kim Bigg – Perks
Thanks, Ben. See you.
