The Cost of Safety, Innovation and Sustainability
In the mature market of animal feed and pet food manufacturing, the safety and quality of products is viewed by consumers as an absolute and fundamental expectation. Going beyond that, claims of innovation and sustainability are key to differentiating products, providing better positioning for meeting consumer demands and generating product sales and market leadership. Retailers are increasingly feeling the effect of sustainability-driven industry disruptions. Already feeling their margins pinched, retailers are among the first to gain or lose a competitive advantage from changing consumer demands for sustainable products, and retailers are aligning with these changing consumer demands.
Eighty-two per cent of grocery retail CEOs now cite sustainability as a key priority, 90 per cent of the top 50 global grocery retailers market their own private-label organic products and 68 per cent publish a sustainability report.1 Retailers are deploying multiple approaches simultaneously and requesting additional data, time commitments and other resources from suppliers in pursuit of sustainability goals.1
Organisations looking to validate their sustainability claims often turn to an independent third-party organisation. For example, NSF International evaluates three main pillars to determine if a supply chain is sustainable: the environment, the economy and animal/social welfare. Certain third-party organisations may look into the environment, the economy and animal/social welfare to determine if a supply change is sustainable. Consumers will look for and select products and brands that stand for the “right” things as they see them. This can include (or exclude) social ethics, animal welfare and environment claims.
Understanding the direct and collateral impacts that accompany these perspectives and trends is where the real challenge lies.
General Supply Chain and Risk Management
The entire food supply chain must not just be aware of, but also accept, the appropriate responsibility for risk management and control at all points along the supply chain in order to ensure that the supply of animal feed, pet food and human food is fundamentally safe and meets sustainability pillars.
The industry of feed ingredients and feed and food manufacturing continues to have an ever-increasing degree of complexity. There are contributing factors including increased global trade in feed ingredients, feed novel ingredients, natural evolution of biological hazards, new technologies, etc. Around the globe, there are differences in the priority of and/or emphasis on some or all pillars of sustainability. Every business is unique and global challenges impact supply chains in different ways.
Amplified attention to sustainable supply chains in retail has been driven by factors including brand reputation, risk mitigation, compliance and cost savings.1