Domestic and International Market Features: Idaho Experience

Potatoes are one of the most important crops in Idaho's economy. Idaho farmers produce this vegetable for several different markets (fresh, organic, and developed) and utilized various methods to make the potato very competitive. The Idaho Potato Commission provides an engaging website that illustrated it's meeting concept and offers some others are useful links. The Commission provides a list of shippers, processors, organic suppliers, exporters, brands and a list of various types of potatoes that are sold by the different companies. The Commission illustrates 30 different brands of potatoes that it sells internationally. The commission, also, provides representation to the industry, assists with licensing, has food bloggers, provides a regular cost and size for each potato as well as another useful and necessary assistance in marketing the product internationally. The commission provides representation to the industry, assists with licensing, has food bloggers, provides a regular cost and size for each potato as well as another useful and necessary assistance in marketing the product. However, despite all of the assistance, the bottom line is that that this market is highly dependent on the availability of the potatoes.

Potato Market

The potatoes are harvested in the early summer, which means that they spend the winter and fall developing in the soil. Once the harvest is complete farmers will plant another crop of a different variety of potatoes. The perfect soil for planting is around 50 degrees, which means that growing this vegetable is a year-round job, although each season has its equipment. Farmers use sensors to keep track of the soil temperature. The planting season is mainly in the fall, growing season is in the winter, and the harvesting occurs in the summer. The following potatoes are harvested during different parts of the summer: "Early summer Yukon Gold, Irish Cobbler and Nolan; summer: red Pontiac and Viking and Late summer season are Kathadin and Kennebec.

The Idaho Potato Commission provides a daily report to how the prices of the potatoes. The potato retail sales vary from year to year because it is dependent on the yearly harvest. The Idaho potato has its strongest completion on the International market since there are so many other countries that produce their potato. AS a result, these countries heavily promote their vegetable.

Domestic Market

The beginning of the organized commission began in the late 1930s as the result of depression. It is the one (of many) vegetables that do not require a great deal of technology and equipment. "The average price paid to growers was $7.70 per hundredweight and the total value of production were $978.4 million. (Farmers Bureau 2016)." All though as the years' progress, technology has become part of the growth, harvesting, sales and development of the product. The potatoes are a year-round market for the farmers; the potatoes are planted in the fall, spends the winter and summer growing in the soil and is harvests beginning in June. The USDA potato stock report shows that there is 13 major state that sells a variety of potatoes. The growers in the United States usually mirror the type of operation the kind of Arrowhead Potato's Farms. The have a business section of the company which received its potato from their farm or farms. The company a necessity as it provides a (hopefully) consistent precut to the retail side of the business.

The Idaho Potato business has the more recognizable brand as it not only promotes its organic product, but they have a strong base for the sale of potato's to companies that in turn dehydrate the product for mashed potatoes, French fries and tater tots. The potatoes are sold in three channels open market, dried for various types of food or sold in the organic marketplace. The potatoes that dehydrated are sold to companies that make a frozen product from the vegetable such as French fried tater tots and hash browns.

Technology and the Potato

The process of the growing potatoes has changed over the decades. Farmers' views on precision agriculture can be fit into three lines of thought. Some views as the complete solution, other are not sure because of the cost but will eventually use it because of the completive marketplace and then those who wouldn't use it for all of the evidence in the world to prove that it is the best method. Initially, the potatoes were grown by hand and horse and plow. Technology in the potatoes market is in the whole area. The seed is injected with various hormones to make it grow, change color or keep the vegetable ripe a little longer. In addition, there are some companies that make the plan do other things. The idea is that the farmer will spend more time working on the actual potato. The better the potatoes, the more sales that farmer will make during the market season. The farmer, in general, knows that using technology is cost effective event though they do not like the initial cost of the devices and equipment

Technology is not just in the area of the developing a better potato but also developing better equipment for the farmer to use in the harvesting the potatoes. Sometimes the potatoes will be damaged during the arresting process. It used to be that most potatoes were picked by hand, but because of the competitive marketing place, the farmer uses high-quality equipment, but sometimes the product is damaged and cannot be sold or sold at a discount. The quality of the potato is till judged by it's appearance. This aspect is also included when it is sold to companies that will be cutting put the product away. If they have to cut a portion of it away, then they will not be able to use it in their processing. Although the company may have it's share of damage and waste, it doesn't want to include the loss and waste as it purchases it from the farmer.

The equipment that the farmer uses also has its type of technology. The tractors come equipped with Global Positioning System (GPS) technology. The GPS helps prevent redoing the same field or parts of the same area over again because the signal tells the farmer what has been completed. Also, the farmers use cell phones to keep in touch and use the computer. The cell phones come complete with a computer, GPS, and images so that the farmer can keep all of the information in one place.

Technology is not just evident in the area of farming, but also in the production of potatoes in factories. The companies use the sensor to control where the product is in production. The enterprises that manufacture potato products use various forms technology to keep track of their inventory and improve the quality of their food. Sensors are used to control inventory, and their Laborites are always testing new samples to make the food taste better, last longer and cook better.

Competitor Analysis

The companies that will be used in the section as comparison models include Arrowhead Potato Company as a business that has the potential to operate in an international market. The other two companies do work in the international potato company, J.R. Simplot, Inc. and Benchmark Potato Company, Inc.

Arrowhead Potato Company is an own family business that includes a factory where they process their own food and also have their farms that supply their potatoes. These two things put them in the unique position of being able to increase their growth should they decide to do so on their own. The other two companies, Benchmark Potato Company, and J.R. Simplot Company, Inc., already operate in the international marketplace and has the same characteristic as Arrowhead Potato Company but on a much larger scale. Each company differentiates from each other in their position in the marketplace and type of product.

The companies are not necessarily rivals at this point because J.R. Simplot Company, Inc. and Arrowhead Potatoes are in the emerging stages of what their businesses can achieve. Benchmark Potato Company, on the other hand already markets themselves as an international business. Each company, at the current time, have their website, active in the marketplace and provide a unique approach to the current position. J.R. Simplot Company, Inc. is a biotech company that is entering the market by skipping over the farmer and making their potatoes. They are in the process of developing an engineered potato. Arrowhead Potato Company is a family owned business and does not have the capital to continue with the development of the company to an international level. Arrowhead would need "structure, conduct, and performance of agricultural and food industries in Idaho and the Pacific Northwest (PNW). This is required to identify production and marketing strategies of the food chain participants that can improve their economic performance and increase the competitiveness of their respective industries at the state, national, and international levels. They, Arrowhead Potato Company may have to borrow or go public to raise the capital necessary to complete this process.

Benchmark Potato Company, as stated early, has already established themselves as an internationally market but they are on still on a small scale. They do have the home country advantage in that they keep track of the competitors here in the United States and other countries. However, they also send their representative over to other countries to make their product and keep competitive with their companies. In addition, they also maintain ties with the international market by participating in the international organizations.

The Arrowhead Potato Company is two companies in one and is referred to as the Moses Farms company because it is society and farming business, although the two have separate tax identities. As a result, this company has a consisted supply of potatoes for its company. This company has four distinct target markets, which are the food service and distributors, retail, processors (frozen and dehydration) and specialty product process grade of the potatoes. This company has two various types of vegetables that they market, Russet Norkotah and Russet Burbank, that they market. The Russet Norkotah is used for the fresh market and sells to the grocery stores and other retail outlets. The Russet Burbank is a multi-purpose potato at in that it is sold fresh, frozen or dehydrated and can be used in a variety of methods. This company works in close collaboration with the Idaho Grower Shippers Association and the Idaho Potato Commission.

If all of three companies had the same strengths and were on equal footing, their weakness may make them vulnerable to international competitors. Arrowhead is first and foremost a family owned business. However, if they were to go global, they might have to fight to keep control of their company. The money aspect is huge, and the fact that they have their farms which produce their product may open them up to being divided by outside forces such as economics, hostile takeovers or just a bad season. The other part of the company would have to go outside for purchase and if they market their farms as a selling point that may drive away investors into their business and customers may go elsewhere for product. The main cost increase for all three companies that would be the structure of energy prices combines both international markets and international policies and supply structures.

J.R Simpleton Company, Inc.is first and foremost a biotech company. They need FDA approval to begin their product development. Once this is developed, they would need to convince the customer that their product is good as the vegetable produced on the farms. Then they would need to persuade the factories that it can be used to develop French fries, tater tots, and other potatoes products. This could take a while, and the company would also need capital to conduct clinical trials and promote their biotech potatoes. The fact that they need money would make them vulnerable to international companies that may be looking for another company or a novel approach. Finally, Benchmark Potato Company has positioned themselves in the international market, based on their website they have kept their approach simple and seem to keep their focus on just selling potatoes to everyone in the world. In other words, they are doing what they would be doing if they were a local farm. While this approach seems to work for them, they would need to keep a tight grip on their company. Their day to day operations needs to incorporate the big picture for them to stay competitive.

 
 

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