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What is the value proposition of food integrity programs to individual organisations? Des Bowler Management for Technology www.initmedia.com.au 11 th May.

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Presentation on theme: "What is the value proposition of food integrity programs to individual organisations? Des Bowler Management for Technology www.initmedia.com.au 11 th May."— Presentation transcript:

1 What is the value proposition of food integrity programs to individual organisations? Des Bowler Management for Technology 11 th May 2011

2 What are the drivers for food integrity programs?  Regulatory compliance – “I must do it and everyone else must do it, so we have a level playing field”. Eg NLIS for cattle  Market demand - “If I want to be in that market I must do as the customer demands”. Eg EU cattle compliance  Product differentiation – “How much more market share or how much more will I get for my product if I have additional systems in place?” eg BRC Global Standards  Product differentiation – “How much more market share or how much more will I get for my product if I have additional systems in place?” eg BRC Global Standards

3 Consumer behaviour  Majority of consumers are price and convenience driven.  A small percentage are influenced by marketing.  A very small, but growing, percentage are emotively driven by such factors as sustainability, traceability, organic, humanely produced, nutritional value. These emotive buyers will pay more for products.

4 What are the cost benefits for food integrity programs?  How much more market share or increased sale price can I get with the additional food integrity programs? Is there a integrity mark I can use?  Am I in a market that is ruled by price, so I can’t get more market share or price increase?  For every dollar I spend on additional food integrity programs, how much will I get back? $1= $1 (neural cost), $1= $1 (neural cost), $1 = $.05 (increased cost), $1 = $.05 (increased cost), $1= $1.5 (increased profit) $1= $1.5 (increased profit)

5 Cost benefit balance?  For each product and market what is the cost benefit balance?  If a food safety incident occurs that balance can rapidly shift, but will return to the original position over time.

6 What are the risks for additional food integrity programs?  Who can use the product integrity program information? Can the consumer, the distributor, the importer, the regulator or just me?  Could this information be used against me if something goes wrong? Eg a distributor does a substitution with my product and then a regulator does a check and finds a problem with the product? What happens then? Who will get the blame?

7 What is the take home message?  Each organisation must determine the cost benefit of additional product integrity programs on a product and market basis. Also consider the cost benefit may change very quickly if there is a product integrity scare in the market.  You must have suitable safe guards to ensure that product integrity information is accurate and can not inappropriately used against you.


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