Food and Beverage Export Strategy Development to 2021

Transcription

1 Food and Beverage Export Strategy Development 2018 to 2021

2 Overview The food and beverage sector in Atlantic Canada (excluding seafood) accounts for approximately $900 million in annual exports responsible for 11,000 jobs in Atlantic Canada. Over 50% of these exports are frozen potatoes and blueberries, with the vast majority of the remaining processors currently not export ready. This sub-group of processors is a key focus. As well this strategy will follow the key objectives of ATIGS which by 2025 will: Double the number of exporters; Increase the value of Atlantic exports by 30%; Increase the percentage of Atlantic firms exporting to more than one market to 40% of exporters; and Increase foreign investment in Atlantic Canada.

3 Context CONDITIONS HOW DO THESE CONDITIONS IMPACT OUR STRATEGY? 1. Fostering Innovation - Delivering the right product to the right market in the most efficient way 2. Coordinating multilevel government supports and reducing policy barriers - Product innovation, product renovation, automation of product processes - A Pan-Atlantic approach to pathfinding to improve ease and access for industry - Coordinating programs and funding 3. Ensuring that key infrastructure is in place 4. Improving management and workforce skills - Inventory: processors, capacity, infrastructure, knowledge, export readiness - Training and support programs - Industry Export Association - Building a culture of export - Increase export readiness

4 Methodology PHASE 1 Research/Industry Analysis based on information, reports, statistics, etc. provided by the team members and or other resources (online, etc.) PHASE 2 Stakeholder Engagement Interviews processors (13), funders (5), importers (2), matchmakers (3), trade commissioners (6) and government partners PHASE 3 Gap Analysis/Best Practices key areas of best practices identified synopsis style i.e. Australia PHASE 4 Strategy Development initial findings presented to the team on Nov. 28 PHASE 5 Review December 11 December 22 PHASE 6 Final Draft Strategy January 5, 2018

5 The Total Sector

6 Without Seafood

7 Current Exports

8 Sub Sectors Of the $242M in sector exports, the following are the sub sectors that represent the industry in Atlantic Canada: Animal Food Grain and Oilseed Sugar and Confectionary Fruit and Vegetable (minus frozen potatoes and wild blueberries) Dairy Meat Bakeries and Tortillas Soft Drinks Breweries Wineries and Distilleries

9 Where Atlantic Canada Fits: PEI NB NS NL Per capita food manufacturing sales 1ST 4TH 9TH 8TH Growth in food manufacturing 1ST 3RD 9TH 7TH Food manufacturing exports 1ST 5TH 7TH 3RD Food manufacturing R&D expenditures 2ND 3RD 6TH 9TH

10 SWOT o Value of the Canadian dollar STRENGTHS o Well-qualified workforce supplied by local universities and colleges o Access to local, essential raw materials o Strength of Canada brand o Plant efficiencies and increased automation o Supportive government agencies/funders o Atlantic Growth Strategy OPPORTUNITIES o Growth through mergers and acquisitions o Value-add food products o Artificial Intelligence to maximize efficiencies o Asia-Pacific and Euro zones (CETA) o Segmented global food market o Organic/health food markets o Emergence and growth of global food value chains o Growing protectionism in the USA (Mexico, Latin America opportunities) o Regional branding WEAKNESSES o Lack of market readiness/knowledge o Lack of export savvy and entrenched attitudes limit perspective and outward vision o Value of the Canadian dollar o Misalignment between small scale production and demands of large European and Asian markets o Lack of coordinated marketing efforts to foreign markets o Under-utilized processing capacity o Labour: low wages, aging workforce and high cost of labour o Lack of consolidated innovation and product development efforts o Access to capital o Competitiveness has stalled o High energy costs THREATS o Price and affordability dominate consumer demand o Focus on healthier eating has led to decline of processed food consumption o Growing protectionism in the USA o Existing and future trade regulations o Rising input costs o Lack of cooperation between provinces o Founder syndrome

11 Key Challenges (1-5) 1. The state of export readiness is overwhelmingly highlighted as the key issue for the food and beverage processors in Atlantic Canada. Many companies have had failed attempts at export because they were not prepared, or did not have the ability/knowledge to follow through - but only discovered it while already in the process. 2. A lack of innovation in product development is hindering export opportunities. 3. A perceived unwillingness of processors to adapt their product offering, i.e. flavor profiles, product positioning and/or branding. 4. Processors view their products as premium sector products and therefore aren t realistic when it comes to cost and expectations related to exporting. 5. Many companies are afraid of the idea of export and what it might do to their business.

12 Key Challenges (6-10) 6. Many companies aren t interested in exporting at all and only participate for the network potential. 7. Capacity to deliver product and price competitiveness tend to be recurring and dominating issues in many markets. 8. A lack of market knowledge has left many Atlantic Canadian companies heading down the wrong path (wrong product for the wrong market at the wrong time) 9. Export growth for Atlantic food and beverage companies. 10. Confusion over tools and services available.

13 Critical Barriers to Export Development 1. Unique Selling Proposition of many Atlantic Products not as strong as some processors think 2. Ability to compete on price 3. Capacity to deliver product volumes 4. Lack of market knowledge creates false expectations 5. Lack of willingness to modify products for certain markets 6. CETA Increased domestic competition 7. Marketing/Branding (No one knows Atlantic Canada)

14 Slides for Reference Only for Q&A

15 NAICS TOTAL Category Animal Food Grain and Oilseed Sugar and confectio nary Dairy Animal Bakeries and Tortillas Other Beverage America United States 41,778,780 26,854,543 10,949,737 10,060,166 3,017,906 36,284,881 77,020,194 15,351, ,317,498 Mexico 1,302,159 1, , ,398 2, ,001-3,226,904 Asia China , ,844-77, ,248 1,290,967 Asia (other) - Philippines 427, ,662 8, , ,081 Taiwan 12, ,955-39,708 8, , , ,568 Hong Kong 122,270 11, ,944 34, ,072 Japan 51,772 14, , ,568-51,839 26,131 1,366,707 Vietnam 43,362 3, ,105-52,296 Korea, South 384,467-33, , , ,967 Europe - United Kingdom - 9,117 44,111 48, , , ,226 European Union (Western) - France 64, ,739 2,946, , ,589 69,505 3,978, ,382 8,068,486 Iceland - 111,837 18, ,390 13,136 8, ,483 Germany - 96,626 61, , , ,456 Netherlands - 13, , ,178,196 3,319,964 5,395,456 Spain , ,306 Sweden ,975-31,017 Portugal ,732-4,732 Switzerland ,729 56,831 Denmark Ireland ,393 89,393 Norway TOTAL 43,585,904 27,731,234 15,609,088 11,700,140 4,651,803 36,514,839 83,734,267 20,707, ,234,496

16 Atlantic Food and Beverage Processors - Online Survey Monday, January 08, 2018 Powered by

17 Total Responses 37 Date Created: Monday, October 30, 2017 Complete Responses: 32

18 Q1: Is your business in food or beverage? Answered: 35 Skipped: 2

19 Q1: Is your business in food or beverage? Answered: 35 Skipped: 2

20 Q2: What is your position/title? Answered: 36 Skipped: 1

21 Q2: What is your position/title? Answered: 36 Skipped: 1

22 Q3: How long has your business been operating? Answered: 36 Skipped: 1

23 Q3: How long has your business been operating? Answered: 36 Skipped: 1

24 Q4: How many employees do you employ? Answered: 36 Skipped: 1

25 4: How many employees do you employ? Answered: 36 Skipped: 1

26 Q5: What are your yearly revenues? Answered: 36 Skipped: 1

27 Q5: What are your yearly revenues? Answered: 36 Skipped: 1

28 Q6: Do you export? Answered: 37 Skipped: 0

29 Q6: Do you export? Answered: 37 Skipped: 0

30 Q7: Have you ever considered exporting? Answered: 11 Skipped: 26

31 Q7: Have you ever considered exporting? Answered: 11 Skipped: 26

32 Q8: Why don t you export? Check all answers that apply. Answered: 11 Skipped: 26

33 Q8: Why don t you export? Check all answers that apply. Answered: 11 Skipped: 26

34 Q9: What do you think the biggest barriers to export are for Atlantic processors? Check all answers that apply. Answered: 11 Skipped: 26

35 Q9: What do you think the biggest barriers to export are for Atlantic processors? Check all answers that apply. Answered: 11 Skipped: 26

36 Q10: What would it take for you to consider exporting your products to other markets? Check all answers that apply. Answered: 10 Skipped: 27

37 Q10: What would it take for you to consider exporting your products to other markets? Check all answers that apply. Answered: 10 Skipped: 27

38 Q11: Where do you think would be a likely export market for your existing products? Check all answers that apply. Answered: 11 Skipped: 26

39 Q11: Where do you think would be a likely export market for your existing products? Check all answers that apply. Answered: 11 Skipped: 26

40 Q12: Could you see your business developing new products to export? Answered: 11 Skipped: 26

41 Q12: Could you see your business developing new products to export? Answered: 11 Skipped: 26

42 Q13: How long have you been exporting? Answered: 21 Skipped: 16

43 Q13: How long have you been exporting? Answered: 21 Skipped: 16

44 Q14: Where are you currently exporting? Check all answers that apply. Answered: 21 Skipped: 16

45 Q14: Where are you currently exporting? Check all answers that apply. Answered: 21 Skipped: 16

46 Q15: What other markets do you think have potential for you? Check all answers that apply. Answered: 21 Skipped: 16

47 Q15: What other markets do you think have potential for you? Check all answers that apply. Answered: 21 Skipped: 16

48 Q16: What did you do to prepare your business going into new markets? Check all that apply. Answered: 21 Skipped: 16

49 Q16: What did you do to prepare your business going into new markets? Check all that apply. Answered: 21 Skipped: 16

50 Answered: 21 Skipped: 16 Q17: What are your biggest challenges in exporting today? Check all answers that apply.

51 Q17: What are your biggest challenges in exporting today? Check all answers that apply. Answered: 21 Skipped: 16

52 Q18: What percentage of your total sales volume is from exports? Answered: 21 Skipped: 16

53 Q18: What percentage of your total sales volume is from exports? Answered: 21 Skipped: 16

54 Q19: Do you have an export plan? Answered: 21 Skipped: 16

55 Q19: Do you have an export plan? Answered: 21 Skipped: 16

56 Q20: Has exporting changed your business? Answered: 21 Skipped: 16

57 Q20: Has exporting changed your business? Answered: 21 Skipped: 16

58 Q21: What are you doing to prepare to go to market? Check all that apply. Answered: 20 Skipped: 17

59 Q21: What are you doing to prepare to go to market? Check all that apply. Answered: 20 Skipped: 17

60 Q23: Do you invest in new product development and R&D? Answered: 32 Skipped: 5

61 Q23: Do you invest in new product development and R&D? Answered: 32 Skipped: 5

62 Q24: If yes, please provide estimated levels of investment. Answered: 26 Skipped: 11

63 Q24: If yes, please provide estimated levels of investment. Answered: 26 Skipped: 11

64 Q25: Using a scale of not important to very important, how important is product innovation in your business? Answered: 32 Skipped: 5

65 Q25: Using a scale of not important to very important, how important is product innovation in your business? Answered: 32 Skipped: 5