Clear the decks, take on the world: Wesche

A DEFIANT Leanne Wesche remains optimistic about her future despite struggling under the burden of debts accrued by her independent fruit and vegetable packing operation, Pacco Group.

The former Australian Business Woman of the Year has been forced to sell the company to Competitive Foods for what she says was substantially less than what it was worth after major client Coles, which accounted for almost 90 per cent of Pacco’s business, stopped wrapping its fresh produce.

Ms Wesche has completed a three-month handover with Competitive Foods, owner of Hungry Jack’s, but has retained her second business, Safeguard Innovations, which provides fruit and vegetable cleaning products.

She has spent the past 18 months developing the natural Safeguard Fruit & Veggie Wash with scientists, exporting the product to 14 countries.

But during that time, efforts by Ms Wesche to seek other major retailers for Pacco, build export markets, and grow different areas of the business have stalled, and the entrepreneur was forced to sell, owing creditors hundreds of thousands of dollars.

Pacco had a long-standing relationship with Coles after the retailer approached the company to develop a fruit and vegetable packaging facility.

In July 2004, Pacco opened the purpose-built 4,000 square metre facility, which can handle more than 150 tonnes of produce each week.

In five years, Pacco had grown to a $6 million operation with 55 staff.

But 18 months ago Coles pulled out of the arrangement, which WA Business News understands was not contractual.

The Coles move came just months after Perth-based conglomerate Wesfarmers bought the retail giant for $22 billion in the country’s largest-ever corporate takeover.

“So I was comfortable that Pacco Group had gone through great growth, I had consolidated and was sitting there in a nice position,” Ms Wesche told WA Business News.

“But at the end of the day [Coles] did need to make a change, and that change was not wrapping fruit and vegies anymore.”

Ms Wesche said while it had been a “really hard journey” she remained optimistic that creditors would be paid back and she could turn things around.

“Perhaps the biggest lesson I’ve learned is to look more closely at my threats as well as my market opportunities and not be complacent about relationships and customers,” she said.

“But there’s a lot I couldn’t avoid; I couldn’t avoid the global financial crisis, which devalued property values which were the security on my loans.

“Despite all this there are many, many opportunities ahead of me.

“The first is to pay the creditors back, so that means selling my assets and my stock and building the current business [Safeguard Innovations].

“Then there are many other exciting opportunities to come my way that I’m really excited about and I’m ready to take on the world.”

Despite her battle, Ms Wesche did have advice for small business owners.

“Always look to stay ahead of market trends, watch the market closely and watch your competitors, and don’t always rely on relationships to get you through,” she said.

Coles was contacted for comment, but did not return calls before WA Business News went to press.