Food industry Flashcards
statistics Quebec food industry
- The food processing sector in Quebec encompasses 1500 businesses that employ nearly 70,000 workers
- Most employement is concentrated in the Montreal metropolitan area (65%)
- Most food processing companies are small and medium-sized businesses: 80% have fewer than 50 employees; 4.5% have more than 250
However, the larger companies provide 43.5% of all jobs in the food processing sector
key products of quebec food industry
- Fresh milk
- Other dairy products (butter, yogurt, cheese)
- Meat
- Baked goods and confectionery (pastries, chocolate, candies)
- F & V
- Fruit juices
- Soft drinks
- Animal food
Beer, spirits and wine
cooperatives + agropur
Cooperatives are common in quebec - particularly active in the dairy product, meat, animal food, and maple product segments
Ex: Agropur: - Largest dairy cooperative in canada - More than 3300 dairy farms - 27 dairy processing plants - More than 3 billion liters of milk processed/year More than $3 billion in sales/year
Canadian food expenditures
- In canada and the US, spending on food and non-alcoholic beverages consumed at home accounts for 10% of personal household expenditures
- FOOD FREEDOM DAY is in the 1st week of february: by this date, the average canadian has earned enough money to pay for his or her food for the entire year
- By comparison, in some areas of the world, food costs can consume 50-100% of income
** reasons for this difference:
1. Difference in income
Difference in food consts
3 major contributing factors for difference in food costs
- Advanced agricultural practices
- Advanced food preservation and processing technologies
- Very efficient distribution networks
advanced agricutltural practices
Extensive mechanization, continually increasing production efficiencies (improved equipment, fertilizers, pesticides, biotechnology..)
Results:
- 1940- 1 farmer fed 12 persons
- 1960- 1 farmer fed 28 persons
- 1985: 1 farmer fed 80 persons
- 2006 - 1 farmer fed 200 persons
** percentage of personal household expenditures spent on food dropped from 20% in 1960 to 10% in 2006
small vs larger farms
SMALL FARMS (farms with revenues less than 100 000$) represent 62% of all farms in Canada but account less than 7% of the total value of agricultural production.
THE LARGEST FARMS (farms with revenue greater than 1 million) represent only 5% of all farms in canada but account for 49% of the total value of agricultural production
** the majority of these large farms are family-owned corporations; only a few are owned by large corporations
downside of agricultural production efficiency
- Monocultural practices = pests = extensive use of pesticides
- Extensive use of fertilizers
- Environmental issues
advanced food preservation and food processing technologies
In the developing world, post-production losses of agricultural products are often more than 50% due to:
1. Pests (insects, birds, rodents..)
2. No refrigeration
Little, if any, preservation technology
very efficient distribution networks
- Another very important aspect of our food system is the extensive transport infrastructure (roads) and sophisticated distribution networks
- Result: the production reaches the consumer
In the developping world, food distribution can be sporadic - much food never gets to consumers
- Result: the production reaches the consumer
4 sectors of the food industry
- Production (raw materials)
- PROCESSING (conversion/manufacture)- FOCUS OF FOOD SCIENCE
- Distribution (getting products to consumer)
- Marketing (convincing consumers to buy)
- large companies may address multiple sectors - i.e. be partly or fully (vertically) integrated
production sector
- Primarly farming and fishing (including aquaculture)
- Involves variety selection, cultivation, harvest and some bulk pre-processing and storage:
1. Slaughter of animals
2. Post-harvest storage (e.g. controlled atmosphere)
Refrigeration/freezing
- Involves variety selection, cultivation, harvest and some bulk pre-processing and storage:
processing sector
- The processing sector converts raw materials (usually a basic commodity) into consumable or preserved food products (e.g. canning vegetables, milk to cheese)
- Relatively few basic commodities are transformed into a very wide range of products
All processing requires quality control and must satisfy legal regulatory requirements
- Relatively few basic commodities are transformed into a very wide range of products
classic example
- Milk (skim, 1%, 2%, whole, lactose reduced)
- Cheeses (various)
- Creams (coffee, 15%,35%)
- Ice cream (various)
- Yogurts (various)
- Condensed milk (sweetened, skim, 2%, 7%)
- Powdered milk (skim/whole)
- Butter (salted/non-salted)
- Whey proteins
- Whey beverages
- Caseins (various)
lactose
distribution sector
- Distribution sector consists of WHOLESALE, RETAIL and FOOD SERVICE OPERATIONS (institutions, restaurants, fast-food outlets, etc..)
- Retail outlets in Canada: 24,000 (hypermarkets, supermarkets, grocery store)
- Chains/franchises have buying power advantage over small independent grocery stores
- Retail outlets basically control the food supply as they are the main constarint (bottleneck) to getting product to the consumer: shelf space in stores is limited = intense competition amon products for shelf space
- In contrast to other retail sectors, distribution of food products by direct sales to onsumers over the INTERNET is very limited
- in 2010, the online food market in both the US and Europe was less than 0.3% of total food sales
- Food retail is a low-profit/item business so rapid stock turnover is the key to success for the retailer
- Computerized inventories and scanners make organization/reorders very efficient: items that dont move (turn over rapidly) are quickly dropped from inventory
- This makes the food industry extremely competitive, and that competition is international