The Rural Voice, 2003-06, Page 65i
PERTH 'Mk
County Pork Producers NEWSLETTER
Pat Louwagie, President
519-393-6424
The Rural Voice is provided to Perth
• County Pork Producers by the PCPPA.
Intangible costs are hardest to manage
Any opinions expressed herein may
not necessarily reflect the views of
the Perth County Pork Producers'
Association.
I believe farmers manage tangible
costs very well: feed, interest, labour,
vet, utilities and even depreciation.
However, as the pig business gets
more sophisticated, there needs to be
another line on the expense side of
the financial statement — intangible
costs. The intangible costs include
the paperwork, applications, permits,
community meetings, surveys,
political interactions, paper trails,
certifications, codes, deciphering
laws and even filing this stuff. Too
often, these do nothing productive
and can even limit good management
innovation.
What are the cost -recovery
methods for some of these intangible
costs such as extra space as requested
in loose housing, compulsory
weaning age, acceptable
euthanization techniques or unit size
restrictions? It might look good and
even feel good, but how do you
sustain the operation's profit (first) to
change (later)? There is not only the
cost to the paper trail but also the cost
of training, updating and verifying,
especially at crucial time periods.
Many organizations are claiming
that "society" is demanding certain
standards in livestock farms, and in
particular, swine operations. This
same society does not hesitate to eat
pork from Mexico, lettuce from the
Dominican Republic, sauerkraut from
Poland and import pet turtles from
Guatemala without these restrictions.
Are these consumers asking for the
same standards for imported products
and do we have production legislated
and verified in one country but not
for the other? Who defends cost
deferrals down the chain, especially
in a global trade environment or is it
a subtle trade barrier?
"Consumers are demanding it" —
you say. That sounds like a nice niche
market opportunity, but we know
"niche" is usually a myth and only a
marketer's dream. If it is an
intangible cost that is requested for
marketing purposes, then it needs to
be allocated appropriately to
marketing. I doubt it!
It was said we are managed each
day by over 35,000 laws and more
are imposed each day. We are
imposed with more paper trails,
certifications, and courses requested
such as by-law verification, manure
disposal audits, medicine
disappearance audits, carcass
disposals, gun bylaw, chain saw
courses, medicine courses, pesticide
certification, weed controls, weight
restrictions, signage, road permits,
etc. Many of these rules and courses
have good intent but are
unsympathetic to the situation at hand
and the total time required mastering
them.
Often these requests are said to
require "only 10 minutes per day" but
that is equivalent to 3650 minutes per
year, otherwise stated as one week's
work per year. We can only hope
there aren't 52 requests a year. The
net result is an extra office expense
that has no way to get an extra return.
As Canadians, we want to be careful
that one of our biggest export
opportunities — pork — is not made to
be uncompetitive by over -regulation.
Check your zipper and my bet is
that YKK appears on it. I dare you to
check it. That's the name of a zipper
company in Japan — one of two
majors. Surprisingly not long ago,
there used to be a zipper company in
Ontario (Canadian Fasteners) that had
the major share of the global market
and now it does not even exist. As a
Pork Industry, I believe we need to
stay involved, subscribe to supporting
organizations and speak your mind.
Let the YKK on your zipper be a
reminder that an industry, regardless
of its market share or benevolence,
can disappear.0
— Submitted by Richard Smelski
PERTH COUIITY PORN PRODUCERS'
PORN PRODUCTS
• Smoked Pork Chops • Fresh Pork Chops
• Stuffed Loin Chops • Smoked Sausage
• Smoked Cheddar Sausage
• Bacon Burgers • Teriyaki Pork Steaks
• Vittorio's BBQ Sauce
AVAILABLE FROM:
Steve Hulshof (Kinkora) 348-8167
Walter Bosch (Monkton) 356-9000
Ted Keller (Mitchell) 348-9836
JUNE 2003 61