April 5, 2012, by Fraser

Is big the new small?

Dr John Strak, Honorary Professor in Food Economics at The University of Nottingham, investigates whether size really does matter…

Small is beautiful and big is ugly – or so goes the rhetoric. And this sentiment typically triggers an avalanche of criticism for any big corporate (or public sector organisation) that suggests it may have some answers to food security questions. But it may be that the world is changing and that some of the biggest food firms are now in the forefront of best environmental and sustainable food production practices.

McDonald’s is big – 33,000 sites, 68 million customers each day in 119 countries and it has recently announced the winners in its Best of Sustainable Supply Chain competition.

Best Sustainable Supplier

Amongst the winners were Smithfield Foods for its efforts to protect the health and safety of its employees;  GenOSI Inc. for its contribution to improved animal welfare through training animal welfare officers and meat inspectors in the Philippines; Grupo Melo, a Central American supplier, which built and optimized hydro power turbines that produce excess power for the surrounding community during the rainy season;  and Fresh Start Bakeries in Europe worked with suppliers to reduce the carbon footprint resulting from the agricultural practices used to produce its main raw material, wheat.

Truly, this was a global competition for a global supply chain. In total, McDonald’s received more than 400 submissions to be recognized as “Best Sustainable Supplier” from 172 different suppliers across the world.

Big is the new small

The key point in this story is that these suppliers wanted to please their customer and their customer is big enough for this process to have a global impact. Long before the relevant government official has visited the factory site in the Philippines or South America for example, McDonald’s has induced the factory owner to institute higher standards which improve food security.

It’s difficult to see how a small supplier – or hamburger seller – could have this sort of impact. Hence my thought that big is the new small – and a belief that we cannot accept criticism of large firms just because they are large.

‘Forum for solutions’

Later this year this aspect of modern supply chains – what works best, small or large in the search for global food security – is one of the themes that the University intends to explore in a new initiative. In Shanghai in September we intend to have over 100 senior executives from the global food chain in a closed meeting with experts and academics.

This will be the first of a series of three meetings at or close to the University’s campuses in China, Malaysia and the UK and these will be a “forum for solutions” – a way to identify how the food industry’s supply chain can work with the best of the academic community to identify and deliver answers to the key questions in global food security. I hope that McDonald’s, and many of its key suppliers will be there.

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