Pig International - November 2017 - 2

2 ❙ PigInternational

PIGS and Money

WATTAgNet.com

CORPORATE HEADQUARTERS

BY IOANNIS MAVROMICHALIS, Ph.D.
imavromichalis@wattglobal.com

Following versus
leading in agribusiness
An old Chinese proverb says that copying is a form of the highest flattery. I will
not disagree. After all, we all copy patterns, behaviors and trends in our everyday life, and this is the way children take their first lessons. I will not get into
the legal or ethical side of copying products to make a profit as such notions differ among countries; I would rather focus on the practical aspect of it.
I have seen two patterns in the agribusiness industry, both successful: those
who copy, and those who invent. The first enjoy high volumes at relatively low
margins, making a living but never a fortune. The second enjoy high margins,
but they fall victims to copy practices that minimize their volume aspirations.
They attempt to prolong their margin privileges by offering claims on quality, innovation, etc., but eventually their products become commodities. We all
know of many such examples!
The way I have perceived this "game" is that it takes an enormous amount of
time, effort and resources to develop a new technology. Then, there is a window
of about 2 to 3 years that the investment can be recovered by applying necessarily high margins, whereas any profit is reaped during the following 2 to 3 years,
and always against competition, as
it takes them so long to copy and
launch a similar product. After that,
even competitive copies become as
good as the original (at least those
sold by smart copiers) and all sell
based on volume deals, other services attached or just because of their
name. But the real money goes to
the lowest priced product-commodity after the first 5 years. Perhaps a
patent, or any other legal measure might delay the process, but in our business,
it brings about the same result in terms of long-term profitability.
So, what do we do? If we take for granted that "those who can, invent;
those who cannot, copy," then it is very simple. Keep inventing but make
sure your customers know that if they want to continue enjoying such inventions, they have to support the leaders. And give those supporting customers
a margin break! ■

I HAVE SEEN
TWO patterns in
the agribusiness
industry, both
successful: those
who copy, and
those who invent.

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EDITORIAL TEAM
Editor-in-Chief: Ioannis Mavromichalis, Ph.D.;
imavromichalis@wattglobal.com
Director of Content:
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Table of Contents for the Digital Edition of Pig International - November 2017

Pig International - November 2017
Contents
Pigs and Money
Industry Happenings
What you should know about gastric ulcers in pigs
Business, science behind phytogenics in pig feeds
Mastitis in sows: A perennial problem
Understanding chemistry of organic acids in antibiotic-free diets
How piglet gastric pH development affects gut health
Debunking trace mineral myths in animal nutrition
Animal feed formulation: Fiber matrix secrets revealed
World’s top 40 pork processors
World’s top 40 pork producers
5 programs pig producers don’t want to miss at IPPE 2018
Products
Marketplace
Advertisers’ Index
Pig International - November 2017 - BB1
Pig International - November 2017 - BB2
Pig International - November 2017 - Pig International - November 2017
Pig International - November 2017 - Cover2
Pig International - November 2017 - Contents
Pig International - November 2017 - Pigs and Money
Pig International - November 2017 - Industry Happenings
Pig International - November 2017 - What you should know about gastric ulcers in pigs
Pig International - November 2017 - 5
Pig International - November 2017 - 6
Pig International - November 2017 - 7
Pig International - November 2017 - Business, science behind phytogenics in pig feeds
Pig International - November 2017 - 9
Pig International - November 2017 - 10
Pig International - November 2017 - 11
Pig International - November 2017 - 12
Pig International - November 2017 - 13
Pig International - November 2017 - Mastitis in sows: A perennial problem
Pig International - November 2017 - 15
Pig International - November 2017 - 16
Pig International - November 2017 - 17
Pig International - November 2017 - 18
Pig International - November 2017 - 19
Pig International - November 2017 - Understanding chemistry of organic acids in antibiotic-free diets
Pig International - November 2017 - 21
Pig International - November 2017 - 22
Pig International - November 2017 - 23
Pig International - November 2017 - How piglet gastric pH development affects gut health
Pig International - November 2017 - 25
Pig International - November 2017 - 26
Pig International - November 2017 - 27
Pig International - November 2017 - Debunking trace mineral myths in animal nutrition
Pig International - November 2017 - 29
Pig International - November 2017 - 30
Pig International - November 2017 - 31
Pig International - November 2017 - Animal feed formulation: Fiber matrix secrets revealed
Pig International - November 2017 - 33
Pig International - November 2017 - 34
Pig International - November 2017 - 35
Pig International - November 2017 - World’s top 40 pork processors
Pig International - November 2017 - World’s top 40 pork producers
Pig International - November 2017 - 5 programs pig producers don’t want to miss at IPPE 2018
Pig International - November 2017 - Products
Pig International - November 2017 - Advertisers’ Index
Pig International - November 2017 - Cover3
Pig International - November 2017 - Cover4
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