Selling Technology to the Agri-Food Market

Some of you reading this will be looking for that silver bullet or magic potion that will turn growers and processors into instant buyers of new and innovative technologies. Sorry. Those sure-shot-easy-solutions just don’t exist.

However, the following are some suggestions and insights that might help entrepreneurs, sales and marketing people in their quest to optimize that somewhat broken value chain through the adoption of their new wares – hard and soft.

Prove Your Worth

You might be asking yourself why there isn’t a beaten and well-worn path to your door after you have articulated the value of your offerings. Or, in some cases, the ROI hasn’t actually been proven but you are wondering why your prospective customers just don’t “get it” intuitively? It is not their fault.

The best answer is that we, collectively, need more independent third party analytics as to the cost of doing business the same old way. The places to go for that kind of objective research are our institutions of higher learning. More attention to the issues of cost versus value and less to the “how” of the technology means that those folks conducting the studies should be cost accountants and economists. Academics with those skills just don’t seem to be available.

We need to find researchers who can get into the weeds and show growers and processors just how much your products and services can contribute to their bottom lines. And why continuing with antiquated practices is costing them a lot of money.

Compliance Hammer

Look to the government to help out with your sales. It is not your fault that there is increasing oversight on the part of regulators. You’re just the people with solutions to problems. This is referred to as regulatory compliance.

Pesticide reporting has driven the success of many ag tech companies over the years. Now due to high levels of Nitrogen in the groundwater in some areas of the country those same companies are positioned to help growers with new fertilizer reporting requirements.

In the case of water usage the accuracy of measuring both surface and groundwater has been severely lacking. We simply do not know how much water is being applied to a crop if it is coming out of a ditch or sent through a sprinkler system. While the measurements are better with modern irrigation methods such as micro and drip it is still a simple and inaccurate calculation of time and volume.

Let's not forget that commercial compliance is also a force that has driven buying decisions. WalMart Sustainability has had an impact on their suppliers and suppliers suppliers that requires much better documentation about the how, what, where, when, how much and more concerning our food. Who is going to tell WalMart "no"?

Technology solves most, if not all, of the problems of collecting and documenting the required data for government agencies. The IRS, EPA, State and Federal agencies, they are all demanding more and more information about the business practices employed throughout the agri-food chain. It does more than simply provide a means to comply, however, it can be used run the business of growing and processing food more efficiently.

 

Should Do and Gotta Do

All of us have a list of things that we should do. Our actions are primarily driven by a need to survive in business and if there is time and energy available after that we strive for continuous improvement. Compliance will always win out over value as a primary sales driver.

Food Safety and Modernization Act – Impact on Agri-Food

Fizzma Compliance Mandate

The FSMA (fizzma?) regulations that were enacted over 5 years ago may only now be considered to be very “real” in terms of enforcement and compliance. These things take time and in all fairness many of the relatively new business requirements have been metered into the fabric of the industry over the course of several years.

Here is what is stated on the U.S. Food and Drug Administration (FDA) website concerning the new mandates for the agri-food chain.

“The FDA Food Safety Modernization Act (FSMA), the most sweeping reform of our food safety laws in more than 70 years, was signed into law by President Obama on January 4, 2011. It aims to ensure the U.S. food supply is safe by shifting the focus from responding to contamination to preventing it.”

That last line is interesting in that prior to 2011 it was only necessary to “respond” to a contamination incident and not “prevent” it. Reactive vs proactive. The latter seems to be a much better approach to managing our food supply system.

Document, Document, Document

The gist of the new FSMA mandates are in the recording of information about food and ingredients. First stage processors, those manufacturers who receive product directly from growers, not only need to document all processes and procedures inside the plant but also what took place outside their four walls.

Pre harvest records, for example, the application of pesticides (there are others) as well as harvest information that details the “chain of custody” from field to plant are going to be a requirement and not optional. Harvest crews, harvesters, haulers, receiving stations, plant gate entry and a lot more data are all necessary in telling the story about where, what, who, how and when of a food item before it gets turned into a can of peas, bottle of wine or package of frozen French fries.

Traceability is Trace AND Track

Recalls have traditionally focused on tracking and not tracing a product through the ag supply chain. These are two different exercises. “Track” is, essentially, looking at a specific “production lot” that may have been contaminated and determining where it went in the chain forward from problem origination to consumer. “Trace” is going backwards to the source of the problem in the first place and looking at the complete history of that product. The latter may provide a clearer picture of the problem origination.

Without both of these capabilities one really does not have a good handle on the causes of any food safety issues.

Compliance Forces Supply to Value Chain

What may occur here is that processors will require more information from growers so that they can do a better job of being proactive in their food safety initiatives. They will require more and more of the pre-harvest and post-harvest information as detailed in the FSMA guidelines.

The result may be that this data can be used in a positive way to improve processing yields for food manufacturers while at the same time enhance crop yields and quality for their suppliers. You can't optimize what you don't measure. Or, something like that.