Collaboration - it's a way of life

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When you attend a conference organised by English Farming and Food Partnerships, you expect to hear a lot about collaboration.

And yesterday's "Routes out of Recession" conference, held in the aesthetically pleasing Plaisterer's Hall in the City of London, was no exception.

collaboration.jpgDEFRA minister Lord Davies was first out of the blocks, stating that "strong working relations and collaborative relations in the food chain are vital". (It was about all he did say.)

EFFP chief executive Sion Roberts was more erudite, claiming that "the unifying principle that the visionaries all share is the drive to strengthen food chain relationships". (Good point, well made, Sion.)

Other speakers were quick to latch on to the theme. Jonathan Warburton described how his bread empire was built on trust and mutual reward along the chain, while NFU president Peter Kendall quoted the examples of the Red Tractor logo and designated supply chains in the dairy sector as examples of the industry working together to extract more value.

And Morrisons chief executive Marc Bolland spoke at length of his strong determination to work with all stakeholders, but especially farmers, to deliver "shared benefit for all"....

The message that was permeating my senses by the end of the day was that "collaboration in the food chain is good, isolationism is bad".

It's something I've heard before, and I certainly wouldn't question it. But what was more interesting was the attempt by Tim Slater, UK managing director of logistics company DHL, to quantify this benefit.

His analysis went along the lines that, in other sectors of the economy, the "best in class" performers achieve a 50% saving in their logistics costs compared with the sector average.

These supply chain leaders are those businesses that "seek to collaborate and develop more integrated and value driven solutions" and their reward was an extra £5m profit for every £100m of turnover ie a 5% gain.

But the agri-food business was somewhat lacking in such ventures. Mr Slater therefore suggested that, if the sector improved its record on collaboration, then it could achieve up to £1bn extra profit, that being 5% of the sector's £20bn turnover.

It all sounded a bit "back of the envelope" to me. But even if the figure is wrong, the sentiment is clearly correct. There is little doubt that farmers have a huge amount to gain by collaborating with each other, as well as with other stakeholders up and down the supply chain.

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About this Entry

This page contains a single entry by Philip Clarke published on November 4, 2009 3:21 PM.

UKIP policy - beauty is skin deep was the previous entry in this blog.

Grain trade torpor - calm before the storm? is the next entry in this blog.

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