2008 KPMG Executive Roundtable

Rainey: I think change is inevitable. Ten years ago there was a certain amount of change going on in business, but as Henry says, the difference is the speed with which things are changing; products are given a much shorter opportunity to prove themselves. And I think consumers are seeing so much more out there now as well, in the media and in restaurants.

Willy Kruh: Are your businesses set up to be proactive to this rapid change?

Rainey: If you’re going to be successful you can’t be reactive. We have a global innovation group that we meet three times a year to make sure that there is cross-pollination of ideas. In the past everybody had their own little piece of turf and you were doing what you were doing and you weren’t telling anybody. Now this information moves around the globe, from Europe and from Asia, but you have to be prepared to capitalize on it. If you’re in a reactive mode you’re probably pretty much dead in your tracks.

Smith: There are some segments of the industry that are seeing success in addressing niche markets with products like gluten-free foods, low GI index products, kosher or halal. How profitable are these niche markets and are there unique challenges that they pose for manufacturers?

Mizrahi: We look for niche markets where we can provide added value to our customers. The challenge is to understand not just the profitability, but the opportunities of those niche markets. To assess whether we are best-structured to provide those products to consumers, or whether we should defer to other companies. We can’t be all things to all people, and so we have to decide with great care the markets that we will enter, because when we enter we have to do it properly.

Kruh: How is Canada’s changing demographic makeup in terms of age and ethnicity affecting the way food and beverage manufacturers process, package and market their products?

Charles Pillitteri: It’s actually quite interesting for us, in terms of our icewine business. What we’ve really seen is that the Asian culture loves icewine. So we actually took a global perspective with our icewine product and researched packaging and presentation that would appeal best to this market. The result was gold and red, something dynamic with a gifting appeal. And it’s been very lucrative for us.

Thompson: This issue is very important to us as well, because certainly our product has always appealed to the Asian population in Toronto. But the change in our population has also opened up a whole new world to the rest of the country. And when you talk about first generation, second generation now heading into third generation ethnic communities, you now also see the traditional shopping experience combined with newer spices or ingredients. Again, I think this is expanding opportunities for the food business. As far as the aging community, as the hobby of cooking becomes popular with this group, duck is something that people are choosing when they’ve got the disposable income to say, “Yes, I want something special.”

Kruh: Environmental issues and policy practice have become a focus for many Canadian consumers. At the same time, consumers now really have more information available to them, empowering them to demand a lot more transparency and accountability from food companies. How has this changed manufacturing, in terms of your operations, public relations and marketing? Is it a positive change or a negative change?