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
marketing sector
Marketing of food is a multi-level process: products are marketed to retailers, institutions (hospitals, military, schools,..) and restaurants & fast-food chains a well as directly to consumers through advertising
allied industries
The food industry is associated with a variety of allied support industries:
1. PACKAGING: packaging materials include steel, aluminum, glass, plastic, paperboard among others- very sphisticated sector 2. SPECIALTY CHEMICALS/FUNCTIONAL INGREDIENTS: additives, flavors, enzymes, starches, proteins, acids, sweeteners 3. EQUIPMENT MANUFACTURERS: processing equipment, packaging equipment * * these allied industries are all very large industrial sectors in their own right
companies in the food industry has ot be highly …
- Responsive to competition
- Responsive to demographic changes
Responsive to industry/market TRENDS AND FORCES
- Responsive to demographic changes
7 key demographic changes affecting food industry
- Aging population
- More women in work force
- More ethnic diversity
- Changes in disposable income
- Higher levels of education
- More nutritional/medical awareness
Smaller household size
companies in the food industry must also be responsible to..
- Advances in nutritional/medical knowledge (or perceptions thereof)
- Politics - conflicts in supply area
- Energy costs and more efficient technologies
- Government regulations
- Technological innovations
- Health/environmental issues (pesticides/biotechnology)
- all these factors are constantly changing so complacency is generally fatal for a company in the food industry
product development
- The food industry launches thousands of new products every year
- PRODUCT DEVELOPMENT is essential to remaining competitve and maintaining or expanding market share
- Product development is an EXPENSIVE PROCESS: relatively few new products can become or remain standard items
In fact, NEW PRODUCTS FAIL 95% OF THE TIME
7 steps scientific method
scientific method: system of steps use to solve a problem
1. Ask questions (why, what, how of a problem) 2. Define the problem (clarify the question, set specific goals) 3. Conduct researc (list possible causes of the problem, gather as much information as possible) 4. State the HYPOTHESIS, or possible solution 5. Design the experiment 6. Conduct the experiment 7. Evaluate the results 8. Report the results
laws vs theory
- A hypothesis repeatedly tested over a variety of conditions becomes a THEORY
LAWS are theories widely accepted as explaining and predicting phenomena
characteristics of the step: design the experiment
- Make it answer questions such as how to test the hypothesis, what equipment will be used, how to collect and record the data, and what safety precautions need to be taken
- A well-designed environment will have a VARIABLE and a CONTROL
Each change in an experiment is a VARIATION
- A well-designed environment will have a VARIABLE and a CONTROL
characteristics of the step: conduct the experiment
- Follow procedures exactly and measure accurately
- Records of observations will be numerical or descriptive
Record data appropriately and neatly
- Records of observations will be numerical or descriptive
characteristics of the step: report the result
- A CONCLUSION analyzes and applies data rather than just repeat it
- Experiments may lead to more than one conclusion and reveal the need for further research
Scientists report results in a variety of ways and describe how the results may be applied
- Experiments may lead to more than one conclusion and reveal the need for further research
evaluating scientific studies
- Scientific research is a process of discovery and debate
- Medical experts may be involved to evaluate scientific evidence:
This took place during the 2010 update of the Dietary Guidelines for Americans, which recommend consuming more nutrient-dense foods - Conflicting reports may exist
- Researchers often examine hundreds of studies before making recommendations to the public
A META-ANALYSIS gives overall conclusions to multiple studies of the same issue
- Medical experts may be involved to evaluate scientific evidence:
