In last week's newsletter article about the organic push, "The War on Big Food",  Steve Hughes from Boulder Brands said, “I’ve been doing this for 37 years,” he says, “and this is the most dynamic, disruptive, and transformational time that I’ve seen in my career.”

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The Disruptive and Transformational Parallels.

Eleven years ago I was interviewed by Philadelphia Business Journal to talk about the evolution of our Company, Integrated Management Solutions, in that article I discussed the next big wave in computing,

Looking ahead, Hernandez-Cuebas would like to spend the next three years developing Internet-based software strategies, scaling down the kinds of solutions being offered today to large corporations.

"It's a buzzword, but there is real cost-effectiveness there. The Internet just takes cost out of things. It is just tremendous," he said.

Today we’ll look at the parallels between what your going through and what my industry has gone through.

                   Natural and Organic Sales                Cloud Computing and Internet Sales

 

Growth of Organic

US organic food market to grow 14% from 2013-18 By Stephen DANIELLS, 03-Jan-2014 ”Solid growth for the US organic food market is expected to continue until 2018, according to a new report that puts a compound annual growth rate (CAGR) of 14% on the sector."

Growth of Cloud Computing

A Goldman Sachs study published this month projects that spending on cloud computing infrastructure and platforms will grow at a 30% CAGR from 2013 through 2018 compared with 5% growth for the overall enterprise IT.

If we look at a Company like Amazon. They didn’t exist in 1998 and now they project to be a $100B Company in 2015. They have totally changed the market for shoppers today.

Giant released its Nature Promise label in 2004 and now accounts for 10% of their total sales.

The Applegate Farms label had a 12% CAGR when acquired by Hormel.

Lessons to be learned:

  1. Transformation means change.
  2. Food industry is becoming “local”.
  3. Build relationships that leverage the realty of local and organic.
  4. Distributor salespeople should be working with their food service clients to present natural and organic meal offerings.
  5. Processors should add Natural and Organic lines where appropriate.
  6. Work to become an Amazon not a Sears.

 

 



Issue 598 - Setting the Standards

 

We'll keep following last week's thread about Inventory Management and Profitability.   Food is a very unique industry, so making sure we measure ourselves against our industry cousins is important to understand the standard we are measured against. Got to know the other guy's score to see if you are a winner. Again focusing on inventory value and getting it right is one of the two key elements of our T&E analysis.

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