SA Mushrooms is the second-largest privately owned mushroom farm in South Australia, and following a massive recent expansion, it’s on track to produce 2.75 million kilos of fresh mushrooms each year.
The business is run by Sam Femia, and sons, Nick and Nat, who grew up in a family run retail fruit and veg operation. Nick and Nat have been growing mushrooms for 21 years.
“Through our experience in retail fruit and vegetables we identified an opportunity for hand-picked mushrooms,” Nick says. It was five years from the day they recognised this opportunity to the day they picked their first mushrooms in 1998.
SA Mushrooms started as a family-run farm. Today it supplies White and Swiss Brown mushrooms to over 300 retail outlets in South Australia, Victoria, Western Australia, Queensland and the Northern Territory. Their customers include major supermarkets, independent greengrocers and produce markets.
The vertically integrated operation is based in a climate-controlled facility just outside metropolitan Adelaide. It currently produces a million tonnes of mushrooms per year, but this will more than double when the expansion is fully commissioned.
Nick says the expansion was a measured risk designed to ensure the sustainability of SA Mushrooms.
“In November 2015 we sat around the kitchen table with a business consultant, our accountant and an industry expert and asked ‘where are we going’."
“We don’t get to choose the market price of our product, so we realised we need to increase our size and output to keep ahead of rising costs – labour, utilities, superannuation, tax, insurance,” he says.
“We initially planned to double in size but we ended up increasing by 150%.”
Innovation by design
Expanding the business is just one way SA Mushrooms could see to secure its future. Identifying opportunities to develop value added products is another.
The company already offers pre-packed and sliced mushrooms as well as being only one of two growers producing Vitamin D mushrooms (where mushrooms are exposed to extra sunlight to boost their Vitamin D) in addition to its loose product range, and they also create mushroom compost.
But they’ve been looking at other ways to add to their product range, and in fact their first new product has just hit the shelves, just 12 months after they started workshopping ideas at a CommBank Design Jam in the Barossa Valley.
Design Jams offer businesses an intensive, immersive opportunity to learn about design thinking and apply it to a real life business challenge. Nick and Nat both attended, along with their general manager and their value add manager.
“We had been discussing the need to value add and we were thinking a mushroom sauce was the way to go,” Nick says. “After the Design Jam we had a really clear direction and we decided to create a creamy mushroom sauce which we were excited to take to market recently.”
Nick says the Design Jam offered the opportunity for him and his team to leave the farm and put their heads together – recognising the usual challenge of too much time working in the business and not enough time working on the business. The Design Jam, with its structured program and clear approach gave SA Mushrooms the momentum they needed to push through with their ideas.
More to come for SA Mushrooms
With the big expansion completed and the new sauce on the shelves, the Femias could sit back for a while, but Nick says they’re already looking at what comes next.
“We’re always thinking about new opportunities. Right now our sauce is being sold in the local market but we’re looking at getting our value added products overseas. Australian food producers are really unlimited in what we can do overseas. Australia is known worldwide for its produce, and South Australia is known across Australia for its quality produce.”
In addition to chasing overseas opportunities, Nick and the SA Mushrooms team are also working on new value add products to extend their range.
Innovation and stability go hand in hand
Nick says SA Mushrooms is always ready to try something new, but he’s not interested in change for the sake of change – the business has been a CommBank customer since its inception and his parents banked with CommBank in their business too, in a relationship going back nearly 50 years.
“We value long term relationships. We still have all of our original customers from 21 years ago and they stay with us because we don’t give them any reason to change. It’s the same with the bank. We’ve never had any issues, they understand us, and they have supported us well as the business has grown, so we stay with them.”