As Canada’s pork industry prepares to increase emphasis on domestic sales, a study on value chain management suggests the industry has to change its outlook to make the most of the domestic market.
The industry has relied too much on trying to compete on low prices and high volumes rather than selling the other value points of pork, says the study by researchers at the George Morris Centre’s Value Chain Management Centre.
And various levels of the pork industry, including producers, processors and retailers, do a poor job of sharing information about what can be done to improve products and returns from the market. Instead, they are afraid that too much information sharing will lead to “predatory business approaches” by the others that will put them at a disadvantage.
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Martin Gooch, director of the centre, led the study and said in a statement that the industry is missing a chance to improve returns from the Canadian market.
“Opportunities to capture value from the market are missed when participants in a chain focus too much on efficiency and too little on effectiveness.”
Consumer satisfaction studies cited in the report suggest price is relatively low in how consumers judge the value of a product. Convenience, the availability of recipes, healthiness and whether the entire family could eat the product scored much higher in the research.
New higher-value pork products could be created and marketed with each player telling others what they need from them to make it happen. Gooch said it could include some blunt report cards telling other players how they should improve their product.
But that is not how the industry has operated, said the report.
“Each member follows a tendency to sell, rather than market, products,” said the report. “Each member (of the food chain) possesses an ardent belief that focusing on productivity (maximum volume at minimum cost) is the most effective method to address business risks.”
The advice for changes in how the pork industry approaches domestic marketing comes at a time when the Canadian Pork Council is predicting a sharp decline in export dependence and an increased emphasis on sales within Canada.
