Sudhir Ahluwalia's Blog, page 17

Is there a shift to organic farming occurring?

There are only some parts of the world where farmers want to switch to organic farming. It is not correct to claim that farmers are switching to organic farming. Of the total global land (1.5 billion hectares), about 11% is under cultivation. 2015 figures published by FiBL put the international organic agriculture area under cultivation at 50.9 million (FiBL, 2015).

The largest area under organic food production in the world is in Australia. It has 22.49 million hectares under organic agriculture. Argentina is the distant second with 3.07 million hectares, followed by the USA (2.03 million hectares). Two of the most populous countries in the world, China and India, have 1.61 and 1.18 million hectares under organic agriculture. (FiBL Survey, 2017)

Most of the organic producers are in developing countries. FiBL 2017 Survey puts the total number of producers worldwide at 2.4 million. India has the largest number (585,200), followed by Ethiopia (203,302) and Mexico (200,039). More number of producers does not mean that they produce the highest amounts of organic food.

The US is the largest market for organic food and food products. Its demand has been put at 24.3 billion Euros. Approximately 43% of the world’s revenues from organic food come from the US alone. Other major contributors are Germany 13%, France 8%, China, Canada, the UK, and Italy, constituting 4%. The European organic food market was estimated in 2013 at US $31 million (FiBL-IFOAM 2015).

From the above overview, it is clear that most organic food producers lie outside the major demand regions of the world. Further, organic food production is currently less than the available supply. Given that, the prices for organic food tend to be higher when compared to conventional food. Although, this is not universally true. The difference between traditional and organic products is near absent for some organic food products like citrus fruits.

Farmers will opt for organic agriculture only when that is financially more attractive. Organic farming is a purely economic decision in developing countries of Asia and Africa or developed Australia and New Zealand. Overall though, farmers do not find agriculture a lucrative activity. And this includes organic cultivation.

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What are the strategies used for growth in an organization?

Growth takes place when your customers like the product or service that you are offering. I like to closely examine the marketing mix 4 P formula (Product, Price, Place, and Promotion) elements.
Once you have the marketing mix right, I look at the customer. What does your customer like or dislike? I would segment the customers and explore options to target and position products or services. I like to spend a lot of time understanding the customer. It is here I look at competitors too.
It is time to look inward if the marketing mix is right and the customers are fully aligned with your product or service. Understand how well the internal organization is aligned to meet the customer’s needs. Are the processes efficient? What are the skill and customer requirements compatible? Is the leadership supportive of a customer-centric organization?
I have come across instances when everything I have touched upon above is right, but still, the company is not growing at the desired pace.
Here we look at the business model, value chains, activity charts, and strategy plans.
Growth in any organization occurs when everything is geared to serve the customer. Whenever you have mismatches, growth stagnates.

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What is the best marketing strategy to attract today’s generation?

Young people are not a monolith with a uniform set of preferences, likes, and dislikes. The only thing similar to this market segment is that they are more comfortable with digital tools.
Marketing is not just about the use of tools. A customer’s comfort with the mobile device will not mean you can market anything to that individual via that tool. Marketing fundamentals are as relevant when targeting the youth as any other demographic segment.
If you have to target this market segment successfully, look at the product or service you are planning to market. How different is this product in comparison to its competitors? How is the product priced? What are its features and benefits that will accrue to the customer? Is the product climate-friendly? Look at the social and governance practices of the company producing that product.
Once the product has been comprehensively understood, the target market’s geographic location comes into play. Product profile messaging should be geography and culturally specific.
I would like you to look at the targeted customer’s attitudes, likes, and preferences and create the marketing message appropriate to that segment.
Often marketing experts forget the importance of the ability to pay and the willingness to pay of the market segment. Like any other market segment, the youth is also subject to these fundamentals.
Marketing is not just about campaigns and social media posts. Do not assume that a great Instagram reel and a catchy message will persuade the youth to buy your product. Never underestimate your customer. It is important to show respect and do your homework before designing your marketing campaign.
Successful marketing is a close and integrated play between strategy, business model, and messaging.

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Why is food production lower in organic farms?

Let me share with you some of the reasons that make organic farming more expensive than conventional farms.

Current crop productivity levels of organic farms average 20% lower than conventional farms. It is a major concern for policymakers charged with feeding the burgeoning global population. Lower productivity of organic crops has been attributed to higher crop loss due to insect and pest damage and poor nutrients available in the plant’s high growth phase when nutrient demand peaks.

Probably there is a genetic aspect that too is required to be factored in. Most of the seeds in agriculture result from sustained breeding to produce crops that can grow more when intensively cultivated, are resistant to major pests, etc. Breeding has been done to produce crops that can be easily machine harvested in a low labor availability environment.

When a farm switches from conventional to organic farming, the only source of seed available is varieties that have been bred for traditional cropping; the crop requires fertilizer and pesticides for optimal yields. In organic farming, cultivation practices do not permit using chemical fertilizers and pesticides. As a consequence, a rapid drop in yields takes place. The low yields are seen for at least the first two years.

As demand for organic food rises across the globe, seed requirements for cultivation in organic conditions are being developed in organic seed farms. In northern Europe, where larger chunks of agricultural land are being put into organic cultivation, specialized farms for producing seeds suitable for organic cultivation are taking place.

The major challenge in breeding varieties suitable for organic cultivation is that the varieties available to most farmers have been more suited for conventional agriculture than organic cultivation over the years.

Organic cultivation varieties need efficient nutrient uptake and the ability to thrive even in weed competition. It calls for producing seeds appropriate to organic cultivation. There appears to progress in breeding organic cultivation-specific cereal crops in Europe (Wolfe et al., 2008, Murphy et al., 2007).

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Organic food certification – some fundamental features

Certified organic foods do not necessarily need to be free of all pesticides; they permit some pesticides’ use. Organic food production prohibits the use of sewage sludge, genetically engineered or genetically modified organisms, ionizing radiation, most synthetic pesticides, and fertilizers. Organic meat, poultry, eggs, dairy, and dairy products must be free of antibiotics and growth hormones. Animals are fed on organic feed only. Organic regulation prescribes specific requirements for feeding, housing, and breeding. Animals need to be raised in natural, humane conditions.
The focus is on the sustainable use of resources and the adoption of environmentally sustainable practices. Organic agriculture and farming practices require integrated pest management practices, protection, promotion of biodiversity, and maintaining native ecosystems. Organic crops must be free from any contamination from genetically modified organism crops.
Sustainable ecological practices help conserve and, over time, improve the soil. Soils that are bio-diverse have better soil structure are less prone to soil erosion, and have an enhanced ability to fix carbon dioxide from the air through the photosynthetic process. It leads to enhanced carbon sequestration and contributes to the fight against climate change.
Most regulators like the USFDA require agricultural farms to adhere to organic farming practices for three years before the farm output can be certified. It ensures that crops are not contaminated with substances prohibited for use in organically produced food. National Organic Programs put standards that must be adhered to be certified organic.
The certification covers not just cultivation but also storage, processing, packaging, and shipping. Standards for certification can vary from country to country.
The food industry’s labels — natural, all-natural, free-range, or hormone-free — should not be confused with organic; the two are not synonymous. The use of natural, free-range, hormone-free is simply a statement describing a property of the food item. The natural label will mean minimally processed and could include non-use of artificial flavors and colors, preservatives, and other artificial ingredients.
In the case of meat, animals may continue to be given growth-enhancing chemicals or hormones. Labels describe the meat as naturally raised, free-ranging, grass-fed, pasture-raised, hormone-free, and the likes. Labels describe the property of dairy, meat, or other food product. It helps distinguish products from those certified as organic.

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What are the common foods and lifestyles that cause diabetes?

Diabetes manifests itself when insulin produced in the body cannot adequately metabolize the sugar in the blood, causing blood sugar levels to spike. Insulin plays a blood sugar regulatory role. It prevents blood sugar levels from either rising too high.

The inability of available insulin to fully break available blood sugar into energy leads to a rise in blood sugar levels. Another reason is that the conversion process itself has become retarded. The cells of the body have become resistant to the available insulin. As a consequence, blood sugar levels rise. The medical name for such a condition is insulin resistance.

There are multiple causes of insulin resistance. Hepatitis C virus infection in the liver is one reported cause. (Petit et al., 2001) The pancreas themselves have become calcified and is unable to produce enough insulin is another reason. (Malka et al., 2000). There are other causes of insulin resistance. Gene dysfunction could also lead to the inability of the body to produce insulin or become insulin resistant.

Risk factors like overweight or obesity, unhealthy diet, physical inactivity, high blood pressure, enhanced cholesterol levels, smoking, and gene dysfunction can cause diabetes.

There are three main types of diabetes.

Children are mainly affected by Type 1 diabetes. The ability of the body to produce insulin is impaired. It is due to damage or destruction of the insulin-producing organ pancreas. Such patients require insulin regularly to prevent hyperglycemia (high blood sugar). Type 1 diabetes is often inherited.

Then we have gestational diabetes, which is seen during pregnancy. Gestational diabetes affects the mother and the child.

Type 2 diabetes mellitus is the third type and accounts for approximately 90 percent of all diabetes. Type 2 diabetes is a lifestyle disease. A healthy lifestyle, physical activity, and dietary goals that reduce calorie intake can help improve diabetes risk.

Some vital recommendations for older adults with diabetes are moderate leisure-time activity and walking, higher intake of dietary fiber, and consumption of low- a fat diet, especially trans fats, easily digestible carbohydrates, cutting down on smoking, and reducing central obesity. (Mozaffarian et al., 2009). Often with a few lifestyle changes, prediabetic condition progression to full-blown diabetes can be prevented.

According to the American Diabetes Association, nutrient-dense foods are the best for individuals who have diabetes. These foods are rich in fiber, vitamins, and minerals but low in added sugars, sodium, and unhealthy fats.

These nutrients are available in non-starchy vegetables like broccoli, tomatoes, beans, lettuce, cucumbers, and the like. These should be consumed as far as a possible whole and minimally processed.

Apple, cantaloupe, strawberries, blueberries, brown rice, whole wheat bread, whole grain pasta, and oatmeal are other food recommendations.

A diabetic diet can include starchy vegetables like corn, green peas, sweet potatoes, pumpkin, plantain, black beans, kidney beans, chickpeas, and green lentils.

Avoid refined, highly processed carbohydrate foods, foods with added sugar, sugary drinks like soda, sweet tea or coffee, juice, white bread, white rice, sugary cereal, sweets, and snack foods like cake, cookies, candy, and chips. Nuts like peanuts, walnuts, and almonds have a lot of fiber and healthy fat. Keep the portion size small as these contain a lot of calories.

Similar recommendations are made by the Diabetes body in the UK too. While both these bodies do not prohibit the consumption of fish, meat, chicken, and dairy, they do not also expressly support their use.

Dr. Neal Barnard, associate professor of medicine at George Washington School of Medicine, recommends a vegan diet for people with diabetes. According to him, a vegan diet can even reverse diabetes. (Dr. Neal Barnard’s Program for Reversing Diabetes, published his book in 2007)

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What are the business expansion strategies in marketing?

Typically the following are the market expansion strategies that a business could deploy:
Market penetration – Expand in the existing market where you are operating
Market expansion – Enter new markets to increase business
Product expansion – Bring new products to your current market or a new market
Diversification and expansion – Diversify product or service lines by using acquisition as a tool
The choice of a market expansion strategy is influenced by the nature of the product or service, it’s business feasibility, the organization, the business process, prevailing business climate, competition, and financial condition of the enterprise.
Blinding following theory and hoping that it will bring you the desired business results will be a folly. There is a lot of art in growing a business. It is not just empirical information alone that will help you drive your business to perform better.

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Will companies that fail at sustainability soon start to fail at business fundamentals?

Sustainable practices have three facets – environmental, social, and governance.
There is a lot of research-based evidence that companies that are socially not responsible and follow poor governance practices are unable to compete with those with a cleaner image and a record of good governance standards and procedures.
Companies spend a lot of advertisement dollars and marketing efforts to present to their customers a brand image that is clean, trustworthy, and socially responsible. The concept of corporate social responsibility has emerged from such practices.
Scandals, cases of cheating, and misdemeanors are dealt with a heavy hand by most global regulators. Customers shun companies that are shaken by such scandals. Social and governance components of ESG are as old as humanity, and businesses understand their value.
Environmentally responsive governance is an old practice. It was, though, restricted to planting trees, taking care that new construction is not causing damage to the existing vegetation, etc.
With the realization that the use of fossil fuels and emission of greenhouse gases are leading to global warming, rising sea levels, melting of glaciers, and increased frequency of adverse weather events, the world has awoken to the danger posed by climate change.
Climate change is impacting the lives of people directly. It is no wonder that customers expect companies to be environmentally responsible and take steps to switch to cleaner fuels and adopt practices that will help slow down the rise in global temperatures.
Companies are dependent on their customer for growth and survival. A company that does not adopt sustainable practices will lose customer trust and disappear.

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How do I grow my restaurant’s business organically?

Hi Mark, Let me share some tips for promoting your restaurant’s business.
Customer centricity is critical to making any business successful. Keeping this principle in mind, begin by segmenting your customer.
As you think about your customers, you will note that they may not all be the same. They will be coming from different demographic profiles. Their preferences, demeanor, and attitudes are other. Their needs and wants will vary.
Once the customer segmentation is complete, you will move on to solutions or treatments that you need to set in place to address your customer requirements. These could be internal to your restaurant, like looking at your front staff, your chef, your payment process, etc.
The next step is market positioning. How do you want to position your restaurant in the market? It is as a takeaway, fine dining, and fast food. Your restaurant has to be aligned to the market positioning.
Once you have gone through the abovementioned steps, you will move on to branding and promotion. The choice of tools will depend on what you have learned from the steps enunciated above.
Let me stop here. But remember, whatever you do, keep the customer at the center. If you do that, you will see growth in your restaurant business.
All the best!

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How is sustainability catching on in your country?

Let me benchmark progress against the UNDP 17 sustainable development goals. These are:

(1) No Poverty,

(2) Zero Hunger,

(3) Good Health and Well-being,

(4) Quality Education

(5) Gender Equality

(6) Clean Water and Sanitation

(7) Affordable and Clean Energy

(8) Decent Work and Economic Growth

(9) Industry, Innovation, and Infrastructure

(10) Reduced Inequality

(11) Sustainable Cities and Communities

(12) Responsible Consumption and Production

(13) Climate Action

(14) Life Below Water

(15) Life On Land

(16) Peace, Justice, and Strong Institutions

(17) Partnerships for the Goals.

The goals represent the desire of humanity. India is a developing country. The country’s constitution also reflects many of the goals listed above. The progress towards achieving these goals is a work in progress in India as it is anywhere in the world. It includes the Nordic region countries that have made the most progress in achieving these goals.

With a population of nearly 1.4 billion people, India represents almost 25 percent of the world’s population. The country has set for itself 2070 to achieve net-zero GHG (Greenhouse Gas) emissions targets. Net Zero emissions are just an intermediate stage in achieving the 17 UNSDG goals. Still, it will be a giant step for humanity when India achieves net-zero emissions.

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