Agriculture Reference
In-Depth Information
U.S. agricultural products (including foods, feeds, and beverages) were roughly $108 billion
in fi scal 2010. Operations managers must factor the effects of globalization into their deci-
sion-making. Decisions such as determining where to place a new production plant are more
complex as countries with promising markets and/or low cost inputs should be considered.
As well, decisions on the size or capacity of a plant must factor in the potential rapid growth
of exports. Exported products may require modifi cation to fi t the needs of a different con-
sumer; therefore, plant layouts and equipment must be fl exible. Also, domestic markets no
longer imply domestic competitors. For example, seven of the top 30 food retailers in the
U.S. are affi liates of foreign-owned retailers. Operations managers in retail food operations
must determine how to positively respond to these new competitors from abroad.
Quality
High-quality products and services at reasonable prices have been the source of success for
many food and agribusiness fi rms, but the importance of
quality
has escalated with increased
competition. The results of poor quality are often increased costs of production and lost
market share. Furthermore with food products, quality is also associated with expectations
of food safety. Concerns over an e-coli breakout can affect sales for entire industries as the
UDSA and FDA try to identify the source.
For today's operations managers, a key challenge is to provide top-quality products or
services effi ciently. But “quality” without reference is a nebulous term. Like “comfort” and
Plate 14.1
Fresh produce
Timeliness in the delivery of seasonal products requires effi cient production, foreman processing,
and delivery. Photo courtesy of USDA Natural Resources. Conservation Service.
