Background
The meat and dairy industries are fundamental to all
countries and the cost and quality of food products
are reflected directly in the standard of living. It
is therefore important to improve the productivity and
reduce the costs in these industries so that both the
product costs and prices to the consumer can be
lowered. Increased profitability likewise can lead to
increased wages for the workers.
CEI has organized economic development missions for
both meat & dairy and fruit & vegetable.
How can the CEI program help?
CEI programs to the U.S. can expose dairy and meat
processor management to modern management techniques,
products, organization, and methods. Product costs
can be lowered, infrastructure strengthened, and more
efficient use is made of existing facilities and
manpower. Only by visiting working plants in the U.S.
and talking to experienced industry managers and
seeing for themselves what works, can the managers
fully appreciate the benefits of streamlined and
updated procedures and practices.
What will they see?
The CEI programs are designed to acquaint the
participants with the detailed operation of plants,
procedures, forms, and practices used in the U.S.
They will visit dairies, meat processors, industry
suppliers, government agencies, trade associations,
and others. They will see the equipment used,
marketing practices, product packaging, quality
control practices, and new products.
Topics covered
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Organization structures
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Marketing practices and advertising programs
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Use and application of new technologies
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Sanitation requirements and standards
Companies studied on earlier missions
Where will the group travel?
The program will be centered on the Cincinnati Ohio
area with trips to at least 5 other states in the
Midwest. At least two weeks will be spent outside the
Cincinnati area.
Expected Benefits
Example benefits from Ukraine
CEI has conducted a Meat & Dairy program and a program
for Fruit, Vegetable, and Sugar. The following
examples come from that experience.
Cooling Systems
When the first fruit & vegetable and dairy tours in
1998 visited Kroger and other U.S. plants, Kharkiv
engineers noticed that that the cooling systems in the
U.S. were located in the ceiling. In Ukraine they are
located on the floor. It is well known that hot air
rises – or actually cold air sinks. Therefore, the
American system is much more efficient in cooling the
entire storage area.
Due to the high cost of energy in Ukraine, when the
engineers returned to Kharkiv they immediately
re-located their cooling systems to the ceilings.
After making the change, one dairy forgot to readjust
their cooling controls. Their milk froze. As a
result of the improved efficiency, the dairies now
reduce their cooling costs by 30%.
Increasing the Milk Supply – Soy
In
1998, the Kupiansk Milk Plant was short of whole milk
for making condensed milk, its primary product line.
The reasons were many and Alexander Radchenko,
Executive Director was looking for a solution. His
CEI program paid a visit to Archer Daniels Midland
(ADM) the large U.S. soy processor. The tour group
was fascinated at the uses of this very flexible food,
one of which was as a whole milk substitute.
At
that time there was little or no soy grown in Kharkiv, Ukraine.
There had been some experiments with it earlier, but
the Ukrainians had little interest in using it as a
substitute for sunflower seed oil. ADM showed the
tour group how soy could be used as a milk
substitute.
Upon his return to Ukraine, Radchenko put together a
plan to start using soy. He encouraged every farm in
the area to start growing soy. This included Olga
Zhygaylo of Verbovskoe who participated on the 2000
Meat & Dairy tour. In the meantime, Radchenko
obtained a soy processing machine from a Ukrainian
equipment manufacturer. Despite Kharkiv’s northern
location, seeds suitable for that latitude were
found. Other farmers were encouraged to grow soy.
Most started with experimental plots. These have
increased each year since there was a steady market
for soy. By 2002, Kupiansk Milk was using a 50% soy
and 50% whole milk combination in their white
condensed milk operation. Chocolate condensed milk
was 100% soy.
Saving Whole Milk from the Calves
When an American calf is born, it nurses from its
mother for just a few days. After a Ukrainian calf is
born it nurses for 6 to 12 weeks. The result is that
almost 6 weeks of whole milk production is consumed by
the calf. After seeing that the Americans were
feeding their calves on a soy milk formula, the
Ukrainians were able to save this whole milk for the
market and improve their finances.
Expanding the Milk Export Market through the Internet
Like any progressive firm, Kupiansk Milk wanted to
expand into new markets. When CEI first met this
dairy there was little hope of expansion – least of
all outside Ukraine.
The supply was just not large enough. As this
gradually became resolved, exporting became a
possibility.
One of CEI’s other activities in addition to running
programs, is the operation of the www.ukrainebiz .com
website. Due to the excellent site name, many visit
it daily. CEI has set up individual pages for most of
the firms who have participated on its programs. By
early 2003 over 23 sales inquiries were being received
each week.
As
one result of the sales leads received through the CEI
web site, Kupiansk Milk is now exporting condensed
milk to India and the United States.
Advertising on Trucks
In
many countries, a truck, in addition to carrying
goods, is viewed as a moving billboard. Although
large and attractive billboards are located on the
side of most Ukrainian main roads, vehicles are almost
never used to promote products and services. This
applies to all companies from the very largest to the
single owner entrepreneur. In Kharkiv, international
companies advertise on street cars and busses where
large signs promote McDonalds, Panasonic, Konica,
Marlborough, Lucky Strike, and others. Ukrainian
firms seldom advertise here.
Milk and bread trucks are seen frequently seen on the
streets. However, they are painted olive green and
brown. They appear to be army surplus with the word
“Bread” or “Milk” crudely painted on the side. None
promote their products with benefits such as for
stronger and healthier babies and children. CEI was
told that some companies wanted to remain anonymous in
order to avoid detection by the tax man. Others
explained that a change in color would require a
re-registration and they did not want to incur that
expense. After the program, companies such Kupiansk
Milk and Roma Bakery use their trucks effectively to
promote their products.
© Copyright CEI World 2006
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