CATTLE and sheep industry body Meat and Livestock Australia has taken an axe to its domestic marketing and trade support team in its bid to both deliver greater value to levy payers and chase growth opportunities in overseas markets.
The move has raised fears the domestic red meat market is being left behind in the rush to cash in on the Asian potential and that will come at the expense of smaller, independent retailers.
However, producers agitating for more transparency within MLA, along with peak representative group Cattle Council of Australia, are supportive of rationalisation to ensure levy money has the most impact.
They say that includes making tough decisions.
MLA has retrenched eight key personnel in domestic marketing, some with decades of experience and expertise.
State program managers are departing, along with food service marketing manager and nutrition executive Stephen Pocock and regional manager Australia Lachlan Bowtell.
MLA marketing general manager Michael Edmonds said the move reflected MLA’s direction.
“While Australia remains the number one market for both beef and lamb, the strongest forecast growth is in our international markets,” he said.
“As a result MLA has decided to streamline its investment in the domestic market.
“Given this direction, and following an assessment of the domestic marketing function under the full efficiency and effectiveness review, these positions will no longer be required.”
New MLA managing director Richard Norton’s restructure and cost-cutting, announced last month, comes in response to a forecast $6m reduction in levy revenue over the next year.
In announcing the restructure, he flagged the shift of focus towards “emerging markets” and “a more sophisticated, evidence-based ap-proach to provide the basis for marketing strategies”.
Cattle Council Australia president Andrew Ogilvie said his organisation backed the changes within MLA, which he believed “focus on reinvigoration of research, development and extension to better meet the on-farm needs of beef producers”.
“Any moves to provide more consultation on levy expenditure is beneficial to producers,” he said.
“Richard Norton has been given a task to make MLA more transparent and accessible, taking on feedback from levy payers and industry.
“The cattle industry expects value
for its investment and this means a well-equipped research and development and marketing body to service beef producers into the future.”
Butchers have questioned how the MLA can have any effect in domestic marketing and promotion given the drastic culling of staff.
With the March quarter non-supermarket share of sales for beef at 20.4 per cent and lamb at 20.1pc – both down several per cent year-on-year – they say any neglect of domestic marketing will significantly affect their ability to stay in the game.
Australian Meat Industry Council’s (AMIC) Ray Kelso, Queensland, said the cuts weren’t expected to be so severe and the retrenchment of people with so much experience in the meat industry would be a big loss.
However, until it was clear what was to replace the current structure and how MLA would manage its domestic marketing now, the full impact could not be assessed, he said.
Mr Kelso, chairman of AMIC’s national retail council, said a designated manager for independent butchers could be an improvement.
“The domestic market is the largest and most profitable market for Australian beef and sheep meat, and we would expect a strong focus on it,” he said.
“As any small butcher shop owner will tell you, looking after the customers you have comes first.”
At the pork industry’s peak marketing body, Australia Pork Limited, it’s business as usual, with no downsizing in investment in domestic marketing earmarked.
APL’s five-year strategic plan, released last week, continues to build on the substantial work undertaken in the domestic market, where 90pc of pork is sold, as well as expanding export opportunities, a spokesman said.
Unkind cut for butchers dulls competitive edge
FROM the dancing butchers of 10 years ago to today’s “nothing beats beef” promotion, the domestic consumer-focussed marketing campaigns run by Meat and Livestock Australia (MLA) have bolstered the businesses of small independent butchers.
They have built demand where it was unfeasible for individual enterprises to have an effect, so MLA’s move to pull money from its domestic market operations has country and city butchers worried.
For Jason Wall, who with his brother-in-law Jason Roach runs the two-shop Farmer’s Choice Butchery business in Dubbo, the marketing activities undertaken by MLA have been key to a shift in business strategy in recent years.
The butchers breed Angus cattle to produce the majority of supply through their shops and have focussed on the consumer market while downsizing the wholesale side of their operation.
Mr Wall said selling the paddock-to-plate message and meeting his customer’s need for information on everything from cuts to nutritional value and cooking methods was vitally important to his business.
“Consumers are much more aware today than they ever have been,” he said.
“Consumer education and point-of-sale promotions are critical to our ability to survive in a very competitive market.”
He said his shop went through “boxes and boxes” of MLA’s flagship consumer magazine Entice and had DVDs of television commercials running in store.
Victorian butcher Gordon Stabb, Stabb’s Butchery in Anglesea, said MLA-run cooking workshops for butchers had allowed him to put together value-added products that had been the cornerstone of his competitive edge.