"Growing a Sustainable Business"
The 2011 ARA Conference and expo’s theme was Growing a Sustainable Business: What your customers, consumers and the government want from ag retailers. This year’s conference featured five speakers and two panels over the two days of the conference. The speakers offered their perspective on how the issue of sustainability will impact ag retailers and some offered ways to better handle that shift. Here are some highlights of each speaker’s presentation.
The 2011 conference opened with a presentation from Ian Hope-Johnstone, director, agriculture sustainability, PepsiCo. He offered a view of sustainability from PepsiCo’s perspective. He explained PepsiCo’s sustainability lens by saying the company took a two-pronged approach to sustainability. PepsiCo considers sustainability to be about ensuring continued access to key ag raw materials necessary to supply growing consumers’ needs. Secondly, PepsiCo sees sustainability as respecting the environment. Hope-Johnstone said the company recognizes that it’s going to be a challenge making farmers more productive in the future while preserving natural resources. As a result, PepsiCo sets up contracts with growers who apply proven practices.
Hope Johnstone explained that the reason PepsiCo set this approach was due to several factors. An increasing global population will demand more food and impact North American production. As the diets of developing countries change toward more protein, more food will need to be imported into those countries. Hope-Johnstone said he believes North America will help produce that food.
Another factor will be global commodity prices. Although commodity prices have increased, Hope-Johnstone said the volatility in the markets is concerning. He also tied consumers into this point because of the impact of rising food prices. In a market survey of consumers, he said 54 percent considered sustainability to be one of their decision-making factors. Although consumers’ perception of sustainability has increased, Hope-Johnstone said it was not part of PepsiCo’s marketing strategy to adopt sustainable practices only for marketing purposes. Rather, the company is looking to continue adopting sustainable practices to ensure the viability of its global operations and the access to the raw materials it needs to stay in business.
The farmgate is a factor because if PepsiCo is going to meet the increase in food demand, the issues that affect the farmgate are important as well. So, understanding issues such as water availability, soil, agri-chemicals, energy management, farm economics, land management and social and community dynamics are key.