Trader with his finger on the pulses

Published November 24, 2014
— Reuters/File
— Reuters/File

Not many people can tell you how many sesame seeds are on a McDonald’s Big Mac. But it is a number that Marcus Coles has on the tip of his tongue. The co-founder of Maviga, a UK sesame and pulse trading company, and his team bought a lot of Big Macs, and worked out that the average burger bun has 325 seeds.

“We asked McDonald’s but it wouldn’t tell us,” says Mr Coles, whose sesame seeds end up on Big Mac buns as well as in tempura oil in Tokyo and tahini in the Middle East. While Maviga does not supply the burger chain directly, he felt he needed to find out.

Trading ‘specialist’ yet widely consumed commodities from an office in the middle of a field nearly an hour’s journey from London, Mr Coles and his colleagues are a far cry from the usual image of sharp elbowed City traders.

Being involved in the buying and selling of physical commodities — in his case, most types of bean, from black-eyed to borlotti to blanco sinaloa and baby lima — is what gives him a buzz. “We’re not sitting behind screens and pressing buttons. Every single delivery that we take is every trade we make. We’re rolled-up sleeves, not cufflinks,” says Mr Coles.

The 20-year-old privately owned business has become a leading international speciality crop trader with a turn­over of just under $250m and pre-tax profits of $4.9m.


Marcus Coles runs an international speciality crop trading company from a field in Kent, writes Emiko Terazono


In an open-necked shirt in his offices in a converted granary in bucolic Kent, the 58-year-old chief executive talks excitedly about the pulses and crops he trades. He loves their ‘political correctness’, he says, as he counts off the health benefits. Pulses are credited with lowering blood pressure and blood sugar, are low in fats and high in protein, and are a complex carbohydrate with high levels of fibre: ‘There’s an enormous amount of good health stories.’

The bigger story that excites Mr Coles is the growing demand for protein as incomes rise in emerging markets. The focus has been on meat, but pulses are a more efficient way to source protein. Then there is the environmental benefit, since pulses return nitrogen to the soil, a crop nutrient that is essential for plant growth.

Some of Maviga’s products are used in petfood. The skins of split peas, once discarded, are a healthier alternative to the traditional grains, and are being used by leading petfood makers such as Nestlé: ‘People don’t want their pets getting fat from corn.’

Maviga — comprising the first two letters of the names of Mr Coles, his wife Viviane and their daughter Gabrielle — started life in an attic. Mr Coles’s then employer ConAgra, now a food processor, wanted to exit speciality crops trading. Sensing an opportunity, he bought ConAgra’s UK pulse trading operation for £1, putting up most of the $450,000 share capital from savings, while NatWest provided a $1.5m credit line. He was joined by ConAgra colleagues Mike Quann and Christian Lude. Mr Coles owns 52 per cent of Maviga, with the rest held by Mr Quann, Mr Lude, an external investor and key members of staff.

ConAgra treated speciality crops like other bulk grains, which have relatively low trading margins of about 3 to 4 per cent, says Mr Coles. “I knew that was too low,” he says, because of their relatively low trading volumes and higher risk for traders. “I very much believed in what the business could yield if it was managed properly as a speciality business.”

Maviga now has averagetrading margins of about 6 to 7 per cent. It employs 70 full-time staff around the world with 250 seasonal employees and trades 100 pulse varieties from growers in 30 countries to supply more than 80 markets.

Mr Coles visits all the offices once a year; if he needed to go more than twice a year, something would be structurally wrong, he says.Most communication is by telephone because a one-to-one call is the best way to judge a person’s mood, he says.

Mr Coles is the first to admit to blunders along the way — but adds that he got a ‘business education’ from them.

But bigger challenges came after the financial crisis in 2008. In an episode Mr Coles calls ‘Vicky Pollard banking’ — after the UK television character with the catchphrase ‘Yeah, but no, but yeah, but . . .’, its bank was endlessly indecisive on increasing its credit facilities. Eventually, Maviga found another bank. ‘We had grown too big with one bank.’

During 2011’s euro crisis, its main sesame seed importer in Greece had its banking facilities withdrawn suddenly. Maviga came up with a warehousing and financing package that enabled it to help the Greek tahini maker keep going. “We were pretty sharply affected by the crisis, but there are always ways to work with a good customer,” says Mr Coles.

To counter violent currency swings caused by global economic instability, the company now uses “live” exchange software, which means it can cover its exposure at the point of transaction completion on a daily basis.

However, it faces a new challenge: trading in commodities in­creasingly requires investment in logistics and storage, and purchasing and running such assets needs capital. “We struggle to execute [capital expenditure] projects because we would be diminishing our working capital,” says Mr Coles. A significant investment by an outsider might be the answer, although the foun­ders do not wish to sell up and leave.

Indeed, counting off the challenges the team have overcome, Mr Coles says it is the satisfaction from those that keeps him going. “Success in doing well is quite addictive,” he says: “When something goes wrong, what separates success from failure is how you solve the problems.”

Published in Dawn, Economic & Business, November 24th, 2014

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