Monthly Archives: December 2012

Defining “Costs” in the Food Industry: Implications of Higher Food Prices

It shouldn’t come as much of a surprise, domestically, that the drought alerted the industry and consumers to potential coming food supply fallout. According to several sources, this fallout and the challenges it has posed, may be a dominant theme in the coming year. Not only North American consumers will feel the effects. Global concerns about the food industry include: the previously mentioned drought, slow global economic growth, economic crisis in the EU, droughts elsewhere, etc. It all adds up to a potentially challenging year. Issues have arisen with grain especially, along with beef and vegetables.

The World Bank, for instance is concerned that: “Even as the world seems to have averted a global food price crisis, a growing sense of a ‘new norm’ of high and volatile prices seems to be consolidating.” The ramifications of the volatile nature of the market have numerous effects. To begin, the coming year could see even greater difficulty in assuring a food supply for all. Currently, “U.N. agencies have estimated that some 870 million people are chronically malnourished.” Aside from hunger concerns domestically, food prices are likely to affect consumers choices and their pocketbooks. Of course, this comes at a time when many are still struggling with a shaky but perhaps on the mend economy. This shortage, especially for these consumers, will mean, according to Food Business News, that: “it will be essential for manufacturers to market good value.”

Met with a host of ethical, moral, economic, and political issues, the food industry has a busy 2013 ahead. Much can be said and predicted for the year, and ultimately time will tell what is in the cards for the food industry in this new year. Nelson-Jameson will continue to use the Wide Line Blog to feature information on the food industry that we hope will be relevant to you in 2013, among these many concerns. We also welcome your suggestions for ideas and topics for pieces that you would like to see.

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The Furious Fight Over Fruitcake

A light snow falls on a cold December afternoon. Up pulls the delivery person with a parcel for you.  As you eagerly await them to make their way up to the entryway, you can’t help but wonder what kind of treasure may rest inside.  After feigning indifference to the whole excitement at the door, you quickly make your way to the kitchen table and open it up. Inside, your favorite aunt has dutifully and carefully wrapped…a fruitcake. You do which of the following:

A.     Excitedly reach for a plate and a nearby knife.
B.      Sob uncontrollably in disappointment and throw it.
C.      Rewrap it and go visit your sister and her kids.
D.      Hide it away only for your consumption (along with those boxes of chocolate covered cherries).

Perhaps the answer is obvious to you…perhaps not. No holiday dessert has drawn in such debate like the fruitcake. As The Society for the Protection and Preservation of Fruitcake (yes, indeed) stated, fruitcake has been “the butt of many jokes and practical jokes-and yet” fruitcake is “esteemed by many, and an important part of many folks’ holiday.” This is certainly true, perhaps even within families: with the pro-fruitcake consortium on one side and the fruitcake defamation league on the other side.

Johnny Carson once famously launched a thousand fruitcakes out of the front door when he quipped, “The worst gift is fruitcake. There is only one fruitcake in the entire world, and people keep sending it to each other.” The amount of energy that has been put into picking on the fruitcake has been met on the other side with a passion for promoting this cake, often filled with nuts and fruit, and sometimes soaked in liquor or wine.  For instance, “Isabelle” is the author of the blog, “Mondo Fruitcake.” The blog is meant to be a means of sorting through her frustration with “the state of this nation’s attitude toward fruitcake.”  It features a year-round look into the world of fruitcakes.

Made in monasteries, bakeries, home ovens, and in many other places, the fruitcake pulls in some heavy support from a diverse crowd of consumers, just as it draws its detractors. Wherever your passions may rest, we can all appreciate that the fruitcake is a standard for the holidays in the United States.  Its long history (dating back to ancient Rome!) and its ability to draw in such passion and detachment is a pretty impressive mark on American culture during the holidays. So, grab a knife and a cup of coffee, or package it back up and send it off…no matter, the fruitcake will persevere.

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Featured Column: Bringin’ it all Back Home

This is the conclusion of Dan Strongin’s series of columns, click here for his author archives.

This is the final post of my series, and I intend to tie together some of the earlier pieces, and hopefully leave you all with a clearer picture of just what makes Nelson-Jameson such a special company.

Dan: What are the advantages of buying from a family business?

Jerry: Over the years I’ve asked or have been asked “Who is most responsible for bad cheese being made?” The answers generally range from “cultures” to this, that, and the other. But a wise person once gave me an answer that I think is most accurate: “the accountants.” This person had lots of experience in cheesemaking and consulting; it is a good point to consider further.

One of the things that happens, when the numbers come out, you hear explanations right away. But these are just stories. They look at only 1/32nd of the elephant; you really need to be looking at the whole picture to understand what’s going on. Better than cutting a half a cent here or there by buying from a corporate gorilla, they could choose Nelson-Jameson and save a lot more money, overall, without sacrificing the quality they want, or cutting on things that destroy the quality of their product.

John: Accountants are great when there’s a “godfather” sitting in the lead chair, and the Godfather says “yes, it could save half a cent, but it’s going to ruin the quality” and it goes away.

Author’s Note: Very true, accountants are but one part of the team, and are not supposed to run the company. Cost accounting is set up in such a way as to lead people to very bad decisions if they aren’t careful. In fact, it wasn’t created to help people run businesses: it was set up after 1929 so investors could figure out the value of their investments. An investor is a wonderful thing, but, as we have seen, they are in it for the short run. Even good companies take a nosedive when they begin to obsess about paying the lowest price. Read the article here.

It’s horrible to say, but many people in business are not savvy about how money is really made, so they leap on slick sounding solutions, allowing their accountant or the reports in QuickBooks to dictate how to run their business. Making money in business is not just about counting and controlling, but about increasing knowledge and the rate of flow. (Watch a 12 minute YouTube video focusing on how to use flow to better measure how money is made here and then how excess inventory can block the flow here, a challenge Nelson-Jameson can help you with.)

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Antibiotics in Milk and Meat

Decreasing the incidence of antibiotic residues in dairy and meat products is a topic that has garnered a good deal of attention for decades now. It is an issue that has also seen some promising resolution. Levels in sampling nationally have decreased. For instance, according to the National Milk Drug Residue Data Base, “0.044% of all samples were positive for a drug residue, down from 0.101% in 1995”. So, as Pamela Ruegg of the University of Wisconsin asks, “So, why the worry about residues?”

Ruegg points out that further attention needs to be paid to the topic because of potential serious health effects that can be associated with residues. Allergies and concerns about drug-resistant bacteria are primary concerns that have entered into the arena of the debate along with other health effects. Ruegg also discusses that due to the overwhelmingly common usage of antibiotics in farm operations due to conditions like mastitis that effect cows on dairy and beef farms.

For producers, a grave concern comes in the form of possible profits being poured away down the drain. Producers are most commonly the ones that take the hit when tainted milk and meat is found. Such a multitude of effects brings together various populations such as farmers, government agencies, processors, medical professionals, and customers. Much of the blame for the issues comes down to recording mistakes, identification mistakes, communication issues, and a lack/absence of proper training.

Nelson-Jameson itself offers a tool to assist in securing some piece of mind in the process of properly assuring your product is safe and ready for the market. Our Delvo and PremiTests detect a wide array the drugs that can compromise your product.

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