Teys Australia - Creating and sharing unrealised value through the supply chain

Summary

This project was established to deliver transformational change throughout the Teys supply chain and to the greater industry via development and implementation of a comprehensive Value-Based Marketing (VBM) system.

he VBM system was foreseen to deliver a superior value-based producer payment system with enhanced producer returns, improved revenue from increased carcase value, and superior product delivered to the consumer via strong, meaningful brands underpinned by eating quality.

The project ran over three years and had three main focus points;

1. Value-Based Marketing,
2. R & D to support an innovative branding strategy, and
3. R & D to support an innovative value-adding strategy. People capability and change management factors were incorporated through all aspects of the project.

The project has been highly successful with significant achievements across the wide scope of interlinked Value-Based Marketing components. That the Australian beef industry now has an awareness of VBM as a principle and the contributing factors involved is considered to be the most significant achievement.

Within Teys this is supported by detailed knowledge based on extensive analysis of actual company data and modelling to evaluate alternative strategies. This modelling is integrated into branding and marketing planning and has been extensively workshopped at the individual plant level. While a VBM system is yet to be formally launched the enabling factors required are in place.

Teys suppliers now receive feedback that includes an interim ranking of yield and eating quality for all MSA cattle and work is being pursued to field test both advanced objective yield and MSA grading technologies. Success in either or both areas will add accuracy to VBM calculations which in turn are expected to drive improvement in cattle supplied for mutual benefit.

A consistent research structure is now in place to evaluate both fresh and value-added product utilising MSA protocols and leveraging extensive external research capacity, notably through international and Australian collaborative arrangements. Clear opportunities have been identified to derive greater carcase value from the existing supply chain and to generate ongoing industry competitiveness through a VBM system that stimulates change by directly linking returns at all points to ultimate consumer value. This system is expected to improve communication and coordination across the Teys supply chain and to encourage open fact-driven collaboration for mutual benefit.

Due to the all-encompassing nature of the project remit it coordinated the development of and supported the implementation of a number of other PIP and MSA projects, including P.PIP.0488, P.PIP.0503, L.EQT.1813, L.EQT.1814 and P.PIP.0550. While the detailed reports of these projects are intended to be read in conjunction with this report, it is clear that the research studies within and allied to this project have resulted in significant industry-wide changes, including the removal of MSA meat colour requirements and identification of retail packaging influences on consumer satisfaction (P.PIP.0488 and L.EQT.1813). The mechanisms and resulting eating quality changes through a range of value-adding processes are also far better understood and supported by flavour chemistry.