Julien, Jean-Paul

English

Research Papers in Economics

MILK MARKETING - U,H,T,
by
Jean-Paul Julien
Chairman, Department of Food Science
Laval University
Stanislaw Berger, in a paper on
“Food and Nutritional Patterns Today and
Tomorrow” (Food Science and Technology,
Vol. 10 [1977] No. 4) (Switzerland)
stated:
“For several reasons the fulfill-
ment of mankind’s nutritional needs,
is at present and no doubt must in
the future be one of the area of
major concern in the global stra-
tegy if our civilization is going
to survive,
Throughout history man has faced
numerous famines, but neverbe-
fore as today hunger and mal-
nutrition received such wideworld
attention.
We have approached in a dramatic
way towards a new era in which
technology, economy, or social
aspects of our life are taking
over from ecology, which for
ages has influenced our nutri-
tional patterns. Food is by
now and no doubt will be in the
future the most important issue
for our survival and well being.
Improved technology has become one
of the many requirements for our
survival.”
It is in this context, in line with
history, that, in my mind, “improving the
application of food technology in the
food industry” has become a must, but
also a most difficult assignment for
everybody working in the food chain or
food system. As stated, technology,
economy and social become partners.
The specific subject associated with
my name on your program is the marketing
of UHT milk. With your permission, I
will use this specific example or case to
illustrate the difficulties or intric-
acies facing the application of new
technology in a complex system, in a
society like the one we actually live in.
For those who are not familiar with
this UHT milk, let us explain very briefly
what it is. Milk, as you know can be
pasteurized, which means a heat treatment
destroying pathogenic germs but leaving
others, which may spoil the product
rapidly, mainly if kept warm. Pas-
teurized milk has a shelf life of approx-
imately 2 weeks at cold temperature.
By increasing the heat treatment we
can improve the shelf life and with
ultra high temperature (UHT) (140°C) it
becomes possible to get a product
practically sterile, and have a few
month shelf life at room temperature. No
refrigeration, therefore, is needed, in
the distribution system which is an ob-
vious great advantage. Unfortunately,
such a heat treatment does more than
killing “bugs” or microorganisms. For
the consumers, the main effect is the
production of a cook or off flavor, with
the result that a special market has to
be found or developed for such a product.
Therefore, before going ahead in such a
Journal of Food Distribution Research February 78/page 85venture (over $1.5 million investment
in this case) studies have to be made
and these were:
- Choice of a technology
- Market study.
Let us consider, first, and briefly,
the choice of the technology. A tour in
Europe, including discussions with sup-
pliers, equipment manufacturers and dairy
plant operators, lead to the choice of
an indirect heating system with the
aseptic filling operation in the con-
tainer you have seen (tetropak).
Importing technology appears a
simple process, but it is not always the
case, and it is even seldom the case
when you deal with biological material.
Milk, as many other foods, is the result
of a biological activity. It means,
therefore, that you deal no more with
uniform chemically identical species;
you deal with populations, the products
differ from one area to an other, from
one season to the other, etc. This means
that you import equipment, not a process;
the technology has to be adapted, dev-
eloped in many instances and this may be
a very costly experience which may take
months as well as days. In the case of
UHT milk, in Quebec City, such problems
were encountered. The process had to be
modified and it took weeks and even
months before getting satisfactory
results. Even in those conditions, the
shelf life was not what was expected
because of physico-chemical changes in
the product with time.
As you can see, in the food indus-
try, even importing technology is a
complex problem and improving it is not
simpler and cannot be achieved by any-
body because of the expertise, capitals
required and risks at the end of the
line. Most of the small or middle size
firms cannot afford such a venture by
themselves.
Before making a decision the
Laiterie Citd, had a market study per-
formed by a specialized firm. Chron-
ogically this came, obviously, before the
technology problems discussed previously.
For obvious reasons the firm did not give
me a copy of this study, and you surely
understand why. After discussion with
people concerned and observations, I
believe fair to make the following re-
marks, which I hope, will be of some
interest to your group!
First, the market study was useful.
It has been a necessary tool in the
process of making decisions, right at the
beginning. Later on, however, it has been
important to forget a bit about it, in
that sense that many answers were not
there, many situations were not foreseen.
In Europe, it took five years to establish
a market. Strategy has to be developed
with time and events, with reactions and
pressures from competitors and consumers.
A key to a great many trends or
shifts in American eating and drinking
preferences for the last 25 years has
been convenience (K, O. Carson, Food
Prod. Dev. Sept. 1977). Convenience
implies:
- Ease of preparation or use.
- Speed of preparation.
- Higher cost.
UHT milk met those requirements and
should constitute a promising new pro-
duct . But it takes more in some instances.
Those familiar with milk marketing
know that, first, consumer’s loyalty does
not exist, and, secondly, on our continent,
milk flavor must be excellent, even uni-
formly excellent.
People buy milk more for biogenic
reasons (as an excellent source of
nutrients) not for sociogenic or
February 78/page 86 Journal of Food Distribution Researchpsychogenic reasons, as it is the case
for a car or a detergent or a suit.
Those are facts which a market
study does not always reveal, in specific
cases. There are groups of consumers
who have not responded as expected, As
an example, couples where both, husband
and wife were working, did not respond as
expected while older people are responding
much better than shown by the market
Study . Baby feeding is becoming a
promising market. Those customers will
prefer this flavor and are becoming
“permanent” ones and a long range, that
is excellent. The response has not been
uniform from one area to the other. In
some regions, sales are excellent while
in others they are below expectation and
I do not have an explanation except for
special cases.
This is probably related to what we
might call “special difficulties” which
a market study, even the best ones,
cannot foresee. I refer, here, to three
areas or regions, Montreal, Ontario and
Us. I do not intend to go into details
to explain the situation in those cases
for many reasons among which an excellent
one: those stories are never told in
details to an outsider.
In Montreal, with the same strategy
as in Quebec City, the response has not
been as good. Among the reasons given
were tactics or fuss by competitors.
Was this behavior unfair or fair? I
don’t know, but apparently, it has been
rather “rough.”
In Ontario, it has been short and
sweet, it has not been accepted as a
protective measure for their milk pro-
ducers. It has not been simpler in U.S.
as it has been almost impossible to ship
samples, except via the embassy according
to what has been told.
It can be concluded that, only an
improved technology is not enough. When
politics, particular behaviors come into
the picture, it becomes a tough struggle.
An other factor in food distribution
which is important and too often for-
gotten is the influence of some profes-
sional in the health and nutrition fields.
It is not easy to get their support but
they can easily throw you out of business
by any statement. How to reach these
people? How to convey to them the right
information? That has been, is and will
be an acute problem for the whole food
system. With statistics, I can prove to
you anytime that there is a correlation
between pickles and cancer, between
margarine disappearance and heart incidents,
etc. It is easy to play with figures but
not so easy to establish a cause to effect
relationship.
To conclude, and always using the UHT
milk as an example, improving the applica-
tion technology in the food industry, is
an open question, a problem with many
facets. Success has been obtained with
this type of milk, a premier on this
continent, but lessons have been taught
and problems have yet to be solved.
Among them lets mention:
- A greater uniformity in the product.
Uniformity, I am not teaching you some-
thing new, it is a must in the food or
other businesses.
- The actual container, besides being very
expensive, presents some drawbacks when
handled by children and even by adults.
Milk has a tendency to pop out.
- The flavor, for many consumers consti-
tutes a handicap. Improved technology
has resulted in better results and there
is hope for the best.
Journal of Food Distribution Research February 78/page 87- Its high water content (87 percent) may This case teaches also that for
constitute a handicap, economy wise, in improved technology, to become a success
transport and handling. in business, it requires teamwork, team
efforts from one end to the other of the
chain.
****************
METRIC CONVERSION AND THE FOOD RETAILER
by
Frank Moran
Director of Metric Conversion
Steinberg’s Limited
Metric conversion in Canada and the
United States is progressing on a
voluntary basis, with each sector of our
economies conducting its conversion pro-
gram in general coordinationwith its
manufacturers and its customers, accord-
ing to guideline dates agreed and pub-
lished from time to time.
The two significantparts of that
statement are the “voluntary basis,”
which means that each company must plan
and implement its own conversion program
in its own way, at its own expense; and
the “general coordination”which requires
that each company know what metrication
changes are taking place in outside areas
that affect its own operation.
Let’s deal first with the “voluntary”
aspect.
For the retailer to convert econ-
omically he must do it in the shortest
possible time; he must avoid significant
capital expenditures;and he must keep
his training and awareness effort to the
minimum required to do the job properly.
Except for private brands, the re-
tailer has little or no control over the
pace of product conversion,which is
determined by the manufacturer or the
supplier. So the “voluntary” aspect
applies to his “voluntary” reaction to
product changes, and his “voluntary”
absorption of his own conversion costs.
One example of such costs is the
movement and control of dual inventories
through his warehouses, his ordering and
distribution systems, and his stores.
Another is the proper preparation of his
people and his customers for the introduc-
tion of metric products at the store.
With adequate notice, consultationand
planning, through his metrication coordin-
ator, he can minimize these costs. He
cannot, however, make them disappear.
Conversion costs for the retailer are
not offset by any real or early return on
investment. He cannot therefore,be
expected to lead the nation into the
promised land of metric conversion,ex-
tolling its undoubted virtues and ultimate
advantages to our peoples.
February 78/page 88 Journal of Food Distribution Research

MILK MARKETING - U.H.T.

Abstract

Similar works

Full text

Available Versions

Research Papers in Economics