Excellent Pathway For Food Industry In Asian Century

Rebecca Dee-Bradbury is President Developed Markets, Asia Pacific, Mondelez International (formerly Kraft Foods). She was a member of the Prime Minister’s Taskforce on Manufacturing. Rebecca spoke at the Global Food Forum in Melbourne earlier this year and she makes some very worthwhile observations.

An Australian Problem

Rebecca is concerned about our Australian approach:

“Somewhere deep in the Australian collective psyche is the wonderfully optimistic ‘lucky country synapse’. Regardless of what happens globally, we revert to a ‘we’ll be right’ Australian default position.”

Rebecca says we must start creating our own luck through significant and deliberate intervention. For example Australian food companies do little in the way value-added processed food exports and there is not much investment in the sector.

“Price deflation is a real risk in Australia; if you can’t survive in the domestic market, and establish a solid base for your entry into the Asian market, you cannot thrive..

Throughout my career I have learnt to face the brutal facts. It is only from this point that you can construct a pathway of hope. For the food sector, let’s replace the notion of luck with hope.

We used a formula for hope based on social research to turn around the Kraft Foods/Cadbury business (now called Mondelez International) into Australia’s fastest growing and most innovative food company. To have hope, you need vision, goals, a pathway and a belief you can do it.”

The Pathway

The pathway to Asia requires us to be successful and aligned across four key areas

• insights
• innovation
• national assets
• capital in the food and agriculture sector

“The most consistently proven pathway to achieve value-added development and manufacturing is through deep consumer insight coupled with the development of strong brands that consistently exceed consumer expectations.

We have a vibrant multicultural community in Australia. We have access to all many vibrant and culturally diverse Asian cultures and we need to look no further than our own backyard for insights.

High value-added products will clearly be a significant part of market growth in Asia – convenient, natural, healthy, safe, tasty food from trusted and high equity brands; Australia is potentially well-positioned to capitalise on this.

We cannot simply focus on exporting raw materials such as wheat, sugar and milk – exporting food commodities and importing the resultant finished goods takes our nation back 150 years and will significantly diminish our wealth.

We must focus on adding value and creating strong brands for Asian consumers, in Asian markets.”

We Must Remove Our Constraints

“The cost of compliance is significant – we need to reduce red tape, create a culture of responsibility and stop laying blame for complex societal issues on corporations and brands. Responding to compliance issues takes precious resources away from product innovation and ultimately consumer choice.

As a nation, we cannot afford to prop up ailing industries..

We need to prioritise sectors that develop sustained competitive advantage in Asia including in food, healthcare, education, mining and the finance and service sectors.”

We Need CSIRO And Austrade Commercially Embedded

We need expertise commercially embedded in Asian food sector outcomes.

Over 80 assistance programs for food and agriculture exist at state and federal levels..unnecessary duplication and a clear lack of focus and collaboration.

Rebecca’s work across large Asian countries has shown that:

“these countries effect change in food manufacturing with two-three major policy interventions that have a clear national focus and a robust national benefit.”

Can We Motivate Capital Investment?

“Many other nations believe in this sector, but Australians appear hesitant. But to be fair, we haven’t developed many winners.

HOW Can We Do This?

We can motivate capital through tax-effective bond structures, particularly when linked to Australian-based manufacturers.

A Longer-Term View

Agricultural investment requires a longer-term view to balance the bumper years from the bad.

More consideration should be given to motivating superannuation investment in agricultural assets as there is a complimentary long-term approach.

Commercially-Led Food Hubs

“Imagine if we created commercially-led food and agricultural hubs to leverage investment, support regional development, enhance workforce skills and attract more people to regional areas?

The food industry has a competitive national business case but as a nation, we need to get decisive and act quickly. Governments must continue to motivate food manufacturing and we must urgently correct the course and catch-up as we’ve just started our journey on our pathway to Asia.”

Well said Rebecca