Scale is the key to producing premium food at a non-premium price, says Matt Howe, senior vice president, chief support office, McDonald's UK One of the most challenging issues facing the food industry is ethical sourcing. From farm to fork, the industry and consumers are facing up to the environmental cost of food. Society has changed from consuming to survive to consuming for enjoyment and there is more choice now than ever before. A recent survey commissioned by McDonald's showed more than half of consumers tried to purchase free range, organic or fair trade as much as possible, but found the produce wasn't always available. In 2005, the organic market alone was estimated at £1.6bn - up 15% on the previous year. So, while value is important to our customers - a third of them shop on price first - the origin and ethics of our food also matter to them. However, higher standards of animal welfare, traceability, social responsibility, environmental practices and working conditions all come at a cost. The question is, how much of this cost can, or even should, be passed on to the consumer? Do retail and foodservice sectors have a responsibility to absorb these costs? Last month I debated this topic at the South West Excellence Conference in Exeter, alongside representatives from the NFU, Defra, Tesco and others. I told them McDonald's has managed to provide premium-quality products without charging a premium price. The key with ethical foods is to create scale and add value. As a company that spends £400m annually on sourcing food in the British Isles and feeds two million people daily, traceability is important to us. We know which farms our beef comes from, the farmers' names and how the animals were reared. Our beef comes from 16,000 farms in Britain and Ireland and our suppliers are independently audited. Our animal welfare standards have been recognised by the RSPCA and Compassion in World Farming. We are also a core sponsor of the Food Animal Initiative in Oxford - set up to develop robust farming methods that raise animal welfare standards. Adding value has changed in the past decade and the trend is towards taking food from a field and doing nothing more to it. In today's climate, added value needs to come from responding to consumer trends for improved knowledge, sustainable food, local sourcing and reduced environmental impact. For McDonald's this means focusing on what our customers want - not cheap food, but value for money that doesn't cost the earth.

Topics