Ontario Food Terminal - Three Year Business Plan 2014- 2017

Table of Contents

  1. Mandate
  2. Executive Summary of the Plan
  3. Strategic Direction
  4. OFT Organization Structure
  5. Environmental Scan: Assessment of Issues Facing the Board
  6. Corporate Plan
  7. Overview of Current Activities and Forthcoming Activities
  8. Resources Needed to Meet Goals and Objectives
  9. Performance Measures and Targets
  10. Proposed Capital Expenditures
  11. Risk Assessment and Management
  12. Summary
  13. Ontario Food Terminal Board Members 2014

Mandate

Reference to the Ontario Food Terminal Act R.S.O. 1990, Chapter 0.15 4.(1)

The Objects of the Board are:

  1. To acquire, construct, equip and operate a wholesale fruit and produce market in the City of Toronto or The Regional Municipality of York known in English as the Ontario Food Terminal and in French as Marche des produits alimentaires de l'Ontario and to acquire and operate such facilities for the transportation and handling of fruit and produce as may be necessary for the purposes of the Terminal; and
  2. To do such other acts as may be necessary or expedient for the carrying out of its operations and undertakings.
  3. To try and ensure that the market operates efficiently in order that high quality produce can be provided to the Ontario consumer at competitive prices.
  4. To provide a central marketplace for Ontario growers and produce wholesalers to sell their produce directly to the wholesale and retail trade.
  5. To foster, through controlled buying hours and regulated shipping policies, a competitive market place where buyers and sellers can freely negotiate prices and terms of sale.
  6. Maintain a good working relationship with the wholesale tenants, growers and buyers.
  7. Ensure that the market is properly maintained so that Ontario retailers and institutions will continue to use the market as a major source of supply for the fresh produce.
  8. Ensure that the cash flow from operations is sufficient to cover expenses including all capital and maintenance expenditures.

Executive Summary of the Plan

The OFT Board has continued to work towards providing a market place that stimulates competitive trade of agriculture products within Ontario. Through effective management OFT is in a good position to move ahead with larger expansion projects that were investigated and supported during the last year. Building on these investigations the OFT Board will target key areas of physical resource development and systematically develop plans for increased communications and market awareness.

Review of Revenue and Expenditures

The annual review of the financial operations of OFT reveals that toll fees increased 1.5%, cold storage fees increased 9% and rents increased by 2.0%. This increase was due to greater gate entry traffic, increased usage of the cold storage, farmers' market tenant occupancy rates and the increase in rents were a result of higher volume in waste removal and cost of electricity.

OFT experienced a 3.1% decrease in salary expenses during this fiscal year while still maintaining the continued level of service by our staff to the tenants and buyers of OFT. The Office expenses reflect the Board's continued efforts to maintain its promotional efforts for Ontario products and the terminal as a whole. Legal costs for this fiscal period were lower than the previous year; as the Board continues to resolve breaches of leases within the farmers' market and the A & B warehouse unit tenants rather than commencing litigation actions. Electric power expenses were considerably higher than last year due to the hot summer weather and increases in power rates. OFT's waste removal costs have increased due to a higher volume generated by the OFT tenants, in particular higher waste created by the warehouse tenants. Management will continue its efforts on working on creative and efficient recycling programs to reduce costs in this area to help mitigate any future increased costs. These results demonstrate management's ability to control the growth in expenses through prudent fiscal management while protecting the services provided by the Board.

With rising costs of maintenance of the facility and infrastructure, OFT has to consider how to increase revenue in future years in order to keep operational expenses covered. To maintain future growth in revenue, OFT has and will continue in its investigations as to facility renovation and expansion. In consideration of this, the OFT Board is examining the construction of 23 warehouse selling units in order to increase Ontario produce distribution volumes through the terminal. Preliminary results of investigations and observations have already been presented to the OFT Board. Management will continue undertake further evaluation of the entire facility and continue to create a progressive plan for OFT in order to keep the facility current and fiscally sound.

Reference Attachment One - Annual Financial Statement and Projected Budget

Highlight of Strategies for next three years

Responding to the Ontario consumer, OFT tenants and the policies of OFT's Board of Directors, the next three years will bring increased awareness of OFT's role within the food distribution system for Ontario; a proposal of more modern facilities that will address current storage shortages; a commitment to effective use of all resources and an enhanced method of evaluation and planning for future activities at the OFT. Details of these activities will be outlined within the implementation and communication plans submitted with this report.

It is expected that in the next three years efforts will be made to build on OFT's past successes of highlighting products that have originated in Ontario. It is proposed that the overall look and feel of the wholesale farmer's market area of OFT will be reviewed with increased marketing of this sector occurring. Currently, the Board has designed new warehouse selling units in order to facilitate the increased promotion and distribution of Ontario produce and has had meetings with stakeholders to evaluate the design and demand. Challenges will exist due to the seasonal fluctuations of product availability sold within these units, but it is hoped that by creating maximum exposure to Ontario produce can be featured to the wholesale food industry.

In addition, the Board is well underway in its plans to renovate the existing Food Terminal building in order to bring it up to today's standards.

Strategic Direction

Vision Statement of the Board:

To have the Ontario Food Terminal (OFT) operate as a central competitive market place for Ontario growers and shippers of produce and horticultural products for a direct unregulated market for the wholesale/retail trade in Ontario along with other provinces and regions within the United States in order to facilitate that the best quality produce can be provided to the Ontario consumer at competitive prices through all four seasons of the year.

Operating policies of the Ontario Food Terminal's Board of Directors:

  • To operate in accordance with all administrative policies established and specified in MBC Directives and Guidelines, both those in effect at the time or as amended and to fully comply with the Public Service of Ontario Act;
  • To follow the Ontario Food Terminal Act; its regulations and the Memorandum of Understanding (MOU) with the Ontario Government in its relationship with all who use the Ontario Food Terminal;
  • To promote best management practices for all operations of OFT having goals of positive cash flow from operations, efficient costs of operation, maximizing all tenant occupancy rates while still providing well maintained, reasonably priced and relevant facilities and to monitor operational logistics to maximize efficiency of operations and delivery of product;
  • To maintain good working relationships with all tenants, subsidiary businesses, community, government and working partners through maintaining a responsive 'open dialogue' philosophy;
  • To actively respond to tenants needs, the economic environment and changing markets;
  • To operate the OFT in a manner that will facilitate superior facility security, cleanliness and a safe work environment;
  • To actively seek new technology for methods of operation and competitive delivery to keep OFT a leader within its industry;
  • To promote the facility through effective communications as an essential distribution centre for fresh produce and horticultural products;
  • To treat all tenants, partners, and employees in accordance with all the laws of the Province of Ontario and Canada.

OFT Organization Structure

The Board's current organizational structure consists of a seven-member Board of Directors, appointed by the Ministry of Agriculture and Food; a General Manager, Secretary -Treasurer and two Operational Managers. The Operational Managers head five service departments; (police, maintenance and sanitation, administration and cold storage). This structure has proved to provide a more responsive service to our customers in a very efficient manner.

The staff of the Ontario Food Terminal Board totals forty four non-union individuals which includes eight part-time staff. Staff resources are used across all core businesses and time is allocated to nine cost centres allocated by management within the OFT. Costing for staff requirements is closely controlled by the annual OFT operating budget and maximum efficiencies are achieved through the existing hierarchy structure.

Reference to OFT Staff Hierarchy - Appendix 1

Environmental Scan: Assessment of Issues Facing the Board

External:

Leasing competition
  • In 2014 OFT experienced a slight decrease in produce tonnage volume distributed from the Terminal as a direct result of December's ice storm and power outage. Otherwise, the overall demand for fruit and produce in Ontario continues to increase.
  • In the past few years, a number of tenants' businesses have outgrown their operation at the Terminal. Some of them have accommodated their business growth by building offsite warehouses for the purpose of storage and distribution; however all their sales and contacts are continued to be made at the Ontario Food Terminal. This will have an effect on the Board's revenues particularly in our cold storage and road & gate cost centres;
  • This provided an opportunity for the smaller tenants to use extra cold storage space and expand their product lines, thus having lessened the effect of lost cold storage business;
  • Future warehouse expansion at the Terminal will be required to accommodate these tenants and any new tenants;
  • The trend in 2014 is that produce tonnage and paid entries would continue to increase due to the overall increased demand for produce in Ontario;
  • The number of buyer entries has decreased slightly over the previous year resulting in a slight decreased volume of annual produce tonnage that is handled at the Terminal, once again due to the ice storm.

Table 1. Ontario Food Terminal Statistics as of March 31, 2014

  2003 2004 2005 2006 2007 2008 2009
# of paid entries 28,920 35,044 37,701 30,963 25,032 24,712 25,730
#of buyer entries 287,698 286,640 285,898 277,603 279,029 279,029 277,025
Annual produce tonnage 868,000 965,000 989,000 947,000 949,555 949,555 960,958

 

  2010 2011 2012 2013 2014
# of paid entries 26,922

27,323 28,512 30,839 29,358
#of buyer entries 280,823 278,058 281,123 283,773 280,432
Annual produce tonnage 974,895 975,998 983,776 1,001,200 998,358

Farmer's market: 1,000 daily paid entries and 30,000 leaseholders for stalls in the wholesale farmer's market area

Cold Storage Volume: 8,779,546 number of pieces received

Graph 1. Ontario Food Terminal Statistics

Ontario Food Terminal Statistics

Economic Forecasts for Ontario

The current conditions in Ontario have shown that moderate growth is taking shape. Sustained growth is expected to become more balanced, but Global demand remains challenging. Ontario's economy has been supported by household spending; significant government actions to support jobs and the fundamentally sound domestic economy, and policies to promote long term competitiveness and moderate growth in 2014 and 2015. Exports to the US from Ontario have declined over the last ten years however exports to the European Union and emerging markets has seen tremendous increases with new trade agreements and a growing world economy. Expected outcomes will include rising employment and growth in both income and consumer spending including fresh food items and therefore OFT's tenants will see higher demands for their products.

The Canadian dollar has recently depreciated against the U.S. dollar since 2013 and is now below par. This is attributed to lower commodity prices, low interest rates as compared to the U.S., Canada's respectable economy and sound financial system. Ontario exporters will benefit, but our warehouse tenants that import produce from around the world face a competitive challenge as a direct result. Private-sector forecasters expect the dollar to average below parity to the US dollar over the next two to three years. The global economic recovery is continuing but at a moderate pace and has created higher demand for oil. As oil and other commodity prices are expected to remain at high levels in 2014 due to robust emerging market demand, this will once again begin to place upward pressure on the dollar.

With these projections, management will continue to proceed with due diligence with the renovation and/or expansion decisions that are made in light of the current economic conditions in Ontario.

Monetary Policies

Interest rates continue to remain very low and the prime rate is still sitting at historic low levels in order to support economic recovery. Although central government interest rates are expected to eventually rise gradually as the pace of the economic recovery strengthens. While this is beneficial to the operation of the Terminal, as business growth rebounds more buyers may utilize the Terminal more frequently due to improved availability of credit. OFT's borrowing costs will remain reasonably low during the next fiscal period. Strategies for long term debt will be to lock in at lower rates since it will be expected that as global financial conditions improve and economic growth resumes, interest rates will gradually rise to more normal levels.

Location and access

The facility location was at its inception well situated on the outskirts of the downtown Toronto area with easy access through well maintained roads by local producers, large international distributors and the buyers for large retail food distributors.

Several factors have developed that have highlighted to management and the Board that constant evaluation of the efficiency of OFT's location and the ease of access be done. To strengthen that the location is still relevant to international distributors, tenants have centred their warehouse locations near the OFT when they required additional storage space. Due to off hour travel time of most transport, easy access is still available to vendors but some late arriving buyers may be more challenged to reach the location during the mid-morning commute especially with the Gardiner Expressway construction this year.

Evaluations by many external organizations such as the Toronto Food Policy Council have been reviewed and considered. OFT is a vital component of the delivery of fresh food product to all of Ontario and specifically to the Greater Toronto region. 'OFT is the keystone of Toronto's food distribution network' Points of consideration outlined in reports and profiles detail the importance of optimal size, location, transportation connections, sustainable infrastructure and other key points of operation of the OFT in relevance to other sources of food within the GTA.

It will be investigated to look into access and traffic issues at more depth within the next three years to determine the future needs of OFT's operations. The Board has established communication lines with the City of Toronto's transportation department.

Transportation

It has been identified and therefore further investigations will be continuous as to the external transportation issues that will effect the OFT in the future. With volume issues becoming critical for transports and small producers to reach the facility, research through all available sources will be completed to gather the current and projected traffic rates and future planning projects with local municipal and provincial governments.

It will also be investigated as to the growing consumer and advocate concerns about the environmental costs of importing food product. Becoming more aware of social and economic concerns over Ontario's dependence on food imports, management will increase communications in order to fully reveal the role and purpose of the OFT within the overall food supply system in Ontario and how OFT responds to demands and offers the ability to provide buyers with a free market environment.

Consumer trends, ethnic diversity
  • A demographic change in terms of new Canadians has historically meant that many of these new immigrants will become buyers to service their ethnic community. This is positive for the Terminal.
  • The baby boomers are showing a trend toward a more healthy diet and as such they are going to purchase more fresh fruits and vegetables. This is apparent even at the fast food restaurants that are now offering salads and lighter meals the contents of which are supplied from the Terminal, thus the food service sector is becoming more significant and their reliance on the Terminal vital.
  • Canadians are continuing to increase the per capita consumption of fresh fruits and vegetables.
  • Ontario's population continues to increase, particularly in the GTA and with municipal governments' efforts in increasing population densities in cities.
  • On the other side as the population ages, we are finding that more of our older farmers' market tenants are now giving up their leased stall space. In the past, the family farm operation was passed on to the offspring. This is no longer the norm.
Buy-local campaigns and farm markets, regional distribution

Increases in the number of retail farmers markets in Ontario will result in more buyers from those markets coming to OFT to purchase supplementary produce. Large and small retail farmers markets and even farm gate markets operators sometimes must supplement what they grow with what their customers are asking for. It is possible that increased regular use of farmers markets will expand sales at the OFT wholesale farmers' market site due to limited availability of primary producers at all local markets, consistent supply and consumer demand for efficiency in food purchasing.

It would be beneficial if Ontario product can be easily identified as such since the consumer and industry have classified that all product purchased and sold by 'resellers' is threatening Ontario's primary producers. Lack of identification of product origins has led to some misunderstanding that within farmer's markets in Ontario all produce that is sourced through OFT and 'resold' has not originated in Ontario. It would be beneficial to highlight that Ontario produce sourced through OFT is still supporting an Ontario primary producer but is being distributed in a different manner. Overall OFT's role in secondary distribution is supporting and enhancing the retail farmers' market efforts and providing a distribution option to Ontario primary producers and continue to support the buy local movement.

Growing trends in the interest of food origins and environmental impact of product delivery will influence marketing efforts by OFT of the wholesale farmers' market sector of OFT.

Fuel supply, environmental hazards, biochemical terrorism

The OFT Board in the past has responded to needs and trends in waste management and energy conservation. Actions have been taken to investigate the feasibility of source or management procedure that will maximize the efficiencies within these areas. Constant review of new procedures and available resources will continue.

The changing world has brought new potential external threats to consider and plan for and OFT will continue to strive to keep up and respond to these challenges. Investigations to alternative fuel supplies, emergency procedures responding to energy outages; bioterrorism threats and identification of any environmental hazards will be monitored throughout normal management procedures and the OFT will develop accordingly any strategies that are required in response.

Internal:

HR Management

With budget constraints and with effective trained managers the HR responsibilities are shared between senior management at OFT.

Succession Planning

The organizational structure of OFT supports strong 'hands on' central management with long time dedicated employees currently holding those positions therefore minimalizing instability during any transitions of staff. As reflected in the OFT Organizational Structure there are two operational managers that are potential replacements for the General Manager in case of his leaving the position for any reason. The OFT Board has reviewed and supports this structure with the knowledge that management's assessment of all human resource issues will keep effective use of employee's skills.

Employee Retention and Development

The roster of OFT employees reflects a diverse selection of nationalities and skill levels. Since some of our employees are new immigrants, understanding of English and/or French can be limited. Senior staff has devised visual signage throughout the facility to overcome this limitation.

Expanding on the success of this signage, management will investigate further employee training and skill development to assist in employee retention and as social/economic enhancement.

Constant assessment by middle managers of employee skills has led to a proactive system of cross training between facility departments that promote understanding and support between the departments and allow efficient use of manpower.

Labour Issues

Senior management is constantly aware and actively progressive on any labour issues that affects their employees and/or any external third party relationship within the facility.

As a result of the Board's organizational structure of staff, positions of responsibility are helping OFT work together to achieve stated goals.

Reference to the OFT HR Hierarchy Chart

Age of Facility

The OFT Board is aware that the facility is aging and this means maintenance costs are planned regular items on the OFT budget each year. Constant evaluation of need vs. available money is balanced by management and the Board each year and it is a strategy to self-finance any planned maintenance.

It is obvious that there are limitations to building maintenance and with investigations and evaluations of such it has become apparent that additional considerations of the facility's structure be assessed.

Future Expansion of the OFT facility

BDO was hired to do a preliminary study of a possible expansion of the facility. The OFT Board has evaluated BDO's report, has acted on its findings and will continue to move forward within 2014 on this by looking at the design and construction of new warehouse selling units adjacent to the Farmers' Market area thereby improving the marketing conditions for locally grown produce. As well as, at other areas of the facility to improve working conditions such as enclosing the buyers' court docks, building a canopy cover in the centre of the buyers' court, replacing the main water lines for the Terminal, building a pedestrian bridge to connect the second floor office wings which includes an elevator and accessible washrooms and the replacement of the original cold storage refrigeration equipment. In addition to create improved parking areas for farmers and buyers amongst other projects.

Summary

There are many positive indicators that the OFT is moving forward. Any negative indicators centre on the increased operational costs the Board will be faced with. With proper management and strategic planning the cost of maintaining the facility can be absorbed into normal business operations if costs are spread over a specified period of time. At this time, the environment assessment does not lead the Board to believe there are any factors that will cause the Board and its staff not to deliver its stated mandate for the next fiscal period. Continued assessments of any environmental issues will give the Board relevant information for future operational decisions.

Corporate Plan

Outline of Board objectives:

It is a strategy of the Board that Management is to work within the Operating and Capital Budgets for each fiscal year. That Management continues to examine the operation of the Market and to report to the Board for approval and subsequent implementation of all strategic plans that are developed for the good of the market.

Allowable risk and risk management:

  • Financial tolerances;
  • Leasing rate tolerances (demand included);
  • Tenant approval rating;
  • Staffing;
  • Facility location and accessibility;
  • Communications (emergency and negative response);
  • Energy and biosecurity tolerance levels.

Description of Implementation Plan activities:

Improved Allocation of Leased Space:
  • In the Farmers' Market, the Stall Point System works well. Our tenants' requests for stall changes, from their current location to a better location in the market are moving forward. This program recognized our tenants who use the Terminal regularly and thereby encourage them to continue to market their produce at the Terminal;
  • The Board has allocated additional stalls to tenants that require more space to sell their products in order to accommodate their growing businesses;
  • The Board has provided larger stalls in the 800 row to accommodate tenants' requirement of more space in the open section of the Farmers' Market;
  • The allocation of additional stalls to tenants in the 100 row to meet the demands of their businesses;
  • The Board will continue to work with Ontario Growers and promote local produce and assist them in being successful.
Improved Worker Safety Policies:
  • The Board is active in the creation of a safer work environment in conjunction with the Terminal wide Safety Committee. We will implement any recommendation brought forth by the committee and continue to enforce all existing safety rules at the Terminal through our police department. We must provide a safe workplace by also advising our tenants and buyers of both our and their responsibilities as employers to comply with all the laws to ensure worker safety;
  • The buyers' court dock has been widened in order to separate pedestrian and vehicle traffic on the dock system and improve it by using physical barriers, signs and ground markings that clearly show the proper route pedestrians and vehicles are to use. This separation has reduced and/or eliminated the risk of pedestrian and vehicle collisions. It has eliminated the risk of dock plates collapsing or slippage issues by having standard hydraulic lip levellors, adjusting the ground grade, the elimination of stepping up and down the dock by the use of strategically placed stairs and the extension of a new roof that covers the back portion of trucks.
Food Safety Policies:
  • The Board has a Food Safety Policy at the Terminal. The Policy will allow the buyers at the Terminal to know that a Food Safety Policy is in place where they purchase their fresh fruit and vegetables;
  • The Board is currently enclosing the building's dock system in order to maintain the cool chain.
  • The construction of a canopy cover over the centre of the buyers' court will protect buyers and their purchased produce from the weather while loading their vehicles in that area.
  • OFT Management and the OFT Board work with both federally and provincial Food Safety Inspectors as required.
Maintain a Profitable Cold Storage Facility:

The Board has a number of strategies in maintaining the profitability of the Cold Storage:

  • Responding quickly, and thoroughly when investigating any claim for product damage or loss;
  • Improving inventory controls;
  • Providing labour when and where needed;
  • Encouraging all OFT tenants to use the Cold Storage;
  • Increasing the storage rates when required.
Increased Communications:
  • Creation of a planned external/internal communications plan;
  • Increased collaboration with Foodland Ontario;
  • Increased exchange of information between Ontario agriculture associations;
  • Expansion of messaging and imaging for OFT via a redesigned website and the use of a twitter account and other social media.

Overview of Current Activities and Forthcoming Activities

Leased Space:

It is essential that management and the OFT Board continue to evaluate the needs of our tenants in light of the type of facility we currently offer so that we do not lose our tenants to alternative facilities.

  • In the Farmers Market, our goal is to ensure the allocation of leased space is compliant with Board directives and policies. The Board recognizes that tenants who consistently use the Farmers' Market should be considered when additional space becomes available.
  • In the Warehouse and Office areas, our goal is to ensure that all space is leased and that the facilities meet the needs of our tenants.
  • To ensure, for the purposes of orderly marketing, that all tenants abide by the terms of their leases.

Cold Storage Facility:

To provide a central Cold Storage facility for the Farmers' Market and Warehouse tenants in order to ensure the best quality produce is available for our customers.

Market place for Ontario Growers and Shippers:

  • The maintenance of a viable Farmers' Market and Warehouse section of the Terminal can continue to make certain there is viable outlet for Ontario Growers and Shippers of produce and horticultural products to market their products in Ontario;
  • Board initiatives like the subsidized Grower / Shipper rate for deliveries encourages use of the facility.

Competitive Market Place for the Independent Retailers:

  • Maintaining an active, safe market place (Farmers' Market and Warehouse Market) by providing facilities at a reasonable cost along with a strong buyer base fosters the competitive market. This market provides the major source of supply for the independent retailers of Ontario and beyond;
  • New technology, has fostered quick and easy access via gate systems;
  • Clearly marked roadways and leased areas allow buyers and sellers to conduct business with little disruption and congestion.

Terminal remains at the forefront of the produce industry in Ontario:

  • Efforts are being made to attract new buyers to the Terminal by print media and trade show exhibits and tours; as well as the use of social media.
  • Creation of store decals that promote the Ontario Food Terminal as the place to buy the freshest produce and horticultural products.

Reference Implementation Summary Plan 2014
Reference Communications Summary Plan 2014

The Board will succeed in keeping the Terminal in the forefront only if our tenants succeed. We have to keep this concept focused in our minds and try to do our utmost to meet their needs. This in turn will provide a better facility for our buyer customers and the continuation of the Terminal as being the leading distribution center for fresh produce and horticultural products in Ontario.

Resources Needed to Meet Goals and Objectives

  • The Board has approved the enclosed Operating and Capital Budgets for the fiscal year 2014/2015 and that Management is to operate the facility within the confines of the resources provided within the approved budgets. Constant monitoring of expenses to budget as well as monitoring the capital budget during the year assists the Board in meeting financial obligations. By having such a system, where we monitor actual results to budget, allows us to more accurately forecast our financial position and ensures the financial resources are available to meet the annual needs. The Board's strong relationship with their Bank has allowed the Board to finance major capital projects;
  • Support and involvement of Foodland Ontario to promote the wholesale activities of the OFT Farmers' Market to the Ontario Consumer, food retailers and the primary producer;
  • Quick access to any policy change of food safety or biosecurity issues from both federal and provincial sources;
  • Collaboration on energy conservation proposals with the Ontario government.

Reference Proposed Operating and Capital Expenditures

Performance Measures and Targets

The OFT Board is provided with a monthly report on the financial position as compared to budget for the period and this report is monitored for results. Directors are also provided with statistics as to usage of the Terminal throughout the fiscal year.

It is proposed that within 2014 the OFT Board will investigate further into the development of future performance goals and targets.

Reference Operating Statement 2014/2015 Capital Budget
Reference Performance and Target Plan

Proposed operating expenditures, projected revenues, finding requirements

Reference Operating Statement 2014/2015

Initiatives Involving Third Parties

  • Working with staff and architects OFT has completed a design plan for possible expansion at the Terminal within our property. The expansion would include the possibility of new warehouse selling units adjacent the farmers' market for the marketing of Ontario produce, the and possible reconfiguration and expansion of the Terminal's common cold storage facility, and the addition of more loading docks;
  • The Board in co-operation with the University of Toronto and the Toronto Regional Conservation Authority has planted 200 trees along the Queensway to improve the environment and city streetscape in the past and will continue to work with them in the future;
  • Tenants and OFT Management encourage interaction and support of various social support food distribution groups within the Greater Toronto area, such as the Daily Bread Food Bank, Foodshare, Second Harvest and the Ontario Christian Gleaners;
  • Increased communications with the City of Toronto concerning transportation planning will be encouraged;
  • Any loans required for capital improvements are with OFT's bank and currently no government involvement is required with guarantees on these loans.

Proposed Capital Expenditures

The Ontario Food Terminal Board has approved the following projects in the previous year and are continuing this year; the enclosing of the loading dock, the construction of a pedestrian bridge, a canopy cover for the centre of the buyers' court, the replacement of the main water line, lower warehouse roof areas and the replacement of the original cold storage refrigeration equipment.

Risk Assessment and Management

The Board operates within the economic climate of Ontario. The Budget is prepared based on forecasts for that environment. We have taken into account interest rates, which have a major impact on our costs, we have taken into account inflation, we have used existing volume of activity and we have reviewed the overall health of the economy when we prepared our budget. Based on these costs, we know what the rental rates would have to be to cover the Terminal costs. We carefully examined the current rental rates paid and compared them to rates at outside facilities, and we looked at the tenants' ability to pay the higher rates. According to this analysis we feel confident that our budget is reasonable and as such does not expose the operation to undue risk that we will not meet our targets.

The risk of employees striking and closing down the facility is a great concern to the Board. In the past the Board has been successful in mitigating the complete shut down of the Terminal by negotiating a strike protocol with the union involved to allow access to the Terminal. However, there are never any guarantees that a complete shutdown of the facility is eliminated. Therefore, a strike can effectively halt the local distribution of fresh fruit and produce in Ontario.

Reference Risk Assessment Table 2014

Implementation Plan

Reference Implementation Plan 2014

Communications Plan

Reference Communications Plan 2014

Summary

Summary of Management activities:

  • Maintain a reception center at the General Office, Main Gate building and at the Police Office within the Farmers' Market where staff is available to answer questions from our customers and the general public;
  • During market hours, there is no less than three management staff available to answer enquiries and resolve disputes resulting from the operation of the Terminal. This is our most practical and efficient means of communicating with our customers;
  • Liaisons with the Farmers' Market Tenants Committee and the Warehouse Tenants Committee to ensure the flow of information and the response to issues is addressed;
  • A web site (www.oftb.com) provides detailed information about the operation of the Terminal;
  • A phone system provides as much detailed information about the Terminal as possible in order to assist people seeking information about the Terminal.
  • A Twitter account to quickly inform buyers of various activities at the Terminal.

Summary of Board activities

  • Board communicates to the tenants of the Terminal on matters relating to the operation of the Terminal via individual letter, mass mailing letters and memos, newsletter, or by Bulletin. The budget information and rate information are provided to the tenants;
  • The Board continually seeks input from the various segments of the Terminal;
  • The Board maintains stats and data within the National Association of Produce Market Managers Directory to provide information to other markets around the world;
  • The Board is a member of the Ontario Produce Marketing Association;
  • The Board is a member of the World Union of Wholesale Markets to further our exposure to the industry we serve.

Graph 2. Ontario Food Terminal Organizational Structure

Ontario Food Terminal Organizational Structure

Ontario Food Terminal Board Members 2014

James Reaume - Chair

James Reaume is currently Executive Director of the Holland Marsh Growers' Association. He is a former Communication Director and Managing Editor of the Ontario Fruit and Vegetable Growers' Association (OFVGA) and continues to serve on various committees of OFVGA. He is also a former Marketing and Communication Coordinator with Waterloo Management Education Centre. Mr. Reaume is Director of the Bradford Board of Trade, the Greater Toronto and Area Agricultural Action Committee and the Town of Innisfil Economic Development Advisory Committee. He holds a Bachelor of Arts degree from Wilfrid Laurier University.

Victor Debono - Vice-Chair

Victor Debono of Waterford has been a member of the Ontario Food Terminal Board since 2003. He is part-owner and Executive Officer of Debono Greenhouses Ltd. Mr. Debono is currently Chair of the Farmers' Market Tenants Committee at the Ontario Food Terminal. He is also a member of the Canadian Federation of Independent Business; the Christian Farmers Federation and Flowers Canada.

Mark Pearlman

Mark Pearlman of Toronto has extensive experience in merger and post integration activities. He coordinated project activities for the merger of Hewlett Packard Canada and Compaq Inc. and managed HP Canada's organization realignments activities in 2004. Mr. Pearlman is currently Director of Sales Delivery Solutions Group Operations at Hewlett Packard. Prior to this, he worked with several global companies to implement business transformation programs among them Wal-Mart Inc.; IBM Canada and O&Y Enterprises. Mr. Pearlman is a member of several community boards including being a federal appointed chair of the Employment Insurance Board of Referees for three years. He holds an Honours Bachelor of Arts degree from York University with a specialist in Organizational Behaviour.

Paul D. Tiveron

Paul Tiveron operates a one hundred acre farm, and also wholesales and markets local produce at the Ontario Food Terminal. He is a member of the Ontario Federation of Agriculture and the Canadian Owners and Pilots Association. Mr. Tiveron attended the Ontario Agricultural College in Guelph.

William Cudmore

Until his retirement William Cudmore was a regular grower, wholesaler and retailer at the OFT Farmer's Market. After high school Mr. Cudmore worked for Gulf Oil for six years while farming part-time. Following that he returned to work full-time on the farm. Over the years he has been involved with both community and agricultural boards and commissions.

Table 2. Annual Financing Statement and Projected Budget

Ontario Food Terminal Board

Income Statement Actual Projected
For the year ended March 2014
Total
March 2014
Budget
Variance to Budget March 2015
Budget
March 2016
Budget
March 2017
Budget
Revenue 11,644,301 11,129,820 514,481 11,562,376 11,735,812 12,087,886
Expenses
Board Expenses 59,796 85,000 -25,204 80,000 81,200 82,012
Salaries 2,920,784 3,013,041 -92,257 3,003,510 3,033,545 3,124,551
Interest Expense 157,107 277,501 -120,394 433,832 442,509 455,784
Realty Taxes 850,804 906,522 -55,718 876,109 884,870 898,143
Depreciation 1,205,099 1,345,610 -140,511 1,420,726 1,442,037 1,485,298
Operating Supplies 174,499 162,950 11,549 163,450 165,902 174,197
Repairs & Main. 450,440 403,100 47,340 393,400 399,301 411,280
Waste Removal 1,322,799 1,079,750 243,049 1,113,750 1,136,025 1,170,106
Misc. Contracts 91,860 101,287 -9,427 101,267 102,786 105,870
Electric Power 1,950,366 1,848,306 102,060 2,037,511 2,068,074 2,130,116
Water 59,033 69,863 -10,830 73,156 74,253 76,481
Fuel 118,863 158,956 -40,093 140,226 142,329 146,599
Insurance 308,628 311,841 -3,213 314,801 319,523 332,304
Office 76,098 88,500 -12,402 88,500 89,828 92,522
Legal 56,315 80,000 -23,685 60,000 60,900 62,727
Miscellaneous 33,168 15,000 18,168 15,000 15,225 15,682
Rent - Hydro Land 51,929 54,053 -2,124 53,874 54,682 90,000
Total Expenses 9,887,588 10,001,280 -113,692 10,369,112 10,512,988 10,853,672
Net Income (Loss) 1,756,713 1,128,540 628,173 1,193,264 1,222,823 1,234,214

Table 3. Ontario Food Terminal Board

Operating Statement 2014 / 15 Capital Budget

Method of Financing
(A)
Item
Capital Budget:
Amount Date
Cash
1
South Wing Lower Rear Warehouses Roof Area
600,000
June
Cash
2
Roadway Paving - Various Areas
100,000
October
Cash
3
Skyjack Lift
20,000
November
Cash
4
Access Control System Replacement
150,000
September
Cash
5
Compactor Equipment
175,000
May
Total
1,045,000
 

Table 4. OFTB - Risk Assessment 2014

Category Risk Prioritazion
Strategic/Policy The OFTB has increased promotion of Ontario produce. This could be perceived to favour one tenant group over another. Medium
Strategic/Policy Regulation 65/09 limits the number of warehouse units a tenant can lease. This regulation could be challenged by the tenants since it limits the growth of their business. Low
Strategic/Policy The farmers' market lease prevents the sale of non-Canadian produce in the farmers' market area. This could result in a potential NAFTA challenge. Medium
Accountability / Compliance Financial impact on operation to ensure compliance with accountability directives. Low
Accountability / Compliance Since the OFTB is a non-profit agency, lawsuits, fines, settlements and legal fees could result in increased cost to the tenants and buyers. Medium
Accountability / Compliance Fundamental changes in the OFT Act and Regulations could change the overall mandate and operation of the OFT. Low
Accountability / Compliance Potential board conflict of interest could cause the Board to be ineffective and make bias decisions. High
Operational The potential impact of changes in government legislation, directives, policies and guidelines. (i.e. the power to collect and keep fees). Medium
Operational Change in demand for terminal services could cause loss of revenue for the OFTB and the tenants. Medium
Operational Unforeseen events (i.e. road closures, border closure, power failure) could result in business disruption at the OFT and loss in revenue to tenants. Medium
Operational Labour disruptions (i.e. tenant employees striking or city workers striking) could interfere with the day to day operations of the OFT. High
Workforce Change in structure of OFTB staff, (i.e. employees become unionized) would result in the ability to strike and thus potentially affect the operation of the OFT. High
Workforce OFTB has a very small specialized work force. If a staff member leaves, this could result in gaps in the staffing structure and could temporarily interfere with operations at the OFT. Low
Information, Technology, Infrastructure Infrastructure failure (i.e. cold storage cooling system failure, electrical failure, water system, sanitary system failure and heating system) could result in significant loss to OFT tenants and shut down the operation of the OFT. Low
Information, Technology, Infrastructure Existing or new tenants may not be interested in occupying the new units in a potential terminal expansion due to increased cost of leasing space. Low
Other Workplace health and safety is an ongoing issue for all market participants. Medium
Other The OFT covers a large geographic area and as a result is difficult to secure. High
Other Food security (i.e. safety and tampering) is an issue since public access is allowed on the dock system, in the farmers' market area and the cold storage. High
Other Changes to the food safety policies of the buyers may affect the conduct of business at the facility. High
Other Due to the nature of the facility, food safety in the farmers' market area is always a concern. (i.e. the farmers' market is an open air market with no refrigeration). High
Other OFTB is currently short two board members. Low

Table 5. OFT Implementation Plan 2014-2017

Date: April 1, 2014

Strategy Action Who is Responsible Target Comple-tion Date Actual Comple-tion Date Anticipated Results Actual Results
Identify Challenges enhanced data retrieval (external and internal) B. Nicholas/G. Da Silva/G. Leo Dec 31/15   better evaluations  
evaluation of location (access and traffic) B. Nicholas/G. Da Silva/G. Leo Dec. 31/14   updated data  
general increased external research B. Nicholas/G. Da Silva/G. Leo ongoing      
consumer trends in buying patterns (what and where) B. Nicholas/G. Da Silva/G. Leo ongoing   food trend awareness  
environmental assessment B. Nicholas/G. Da Silva/G. Leo ongoing   assessment of need  
bioterrorism assessment B. Nicholas/G. Da Silva/G. Leo ongoing   assessment of risk  
evaluation of offsite tenant locations B. Nicholas/G. Da Silva/G. Leo Dec 31/15   assessment of competition  
Develop Vision for Change strategic planning session with OFT Board B. Nicholas yearly   proactive planning  
Communicate Vision general increased communications B. Nicholas/G. Da Silva/G. Leo ongoing   increased awareness  
tenant surveys B. Nicholas / contracted staff yearly      
media and industry interaction B. Nicholas/staff ongoing      
increased promotion of facility B. Nicholas/staff as required      
consultations with Foodland B. Nicholas/staff ongoing   increased exposure  
marketing of Ont. Product campaign B. Nicholas/staff ongoing      
Fiscal Responsibilities revenue growth and expense control B. Nicholas/G. Leo yearly   future positive growth  
improve waste management B. Nicholas/G. Da Silva yearly      
facility management goals B. Nicholas/G. Da Silva/G. Leo yearly      
energy efficiencies evaluations B. Nicholas/G. Da Silva yearly      
Customer and Staff Relations staff training B. Nicholas/G. Da Silva/G. Leo yearly      
labour evaluation B. Nicholas/G. Da Silva/G. Leo yearly   needs assessment  
Reportability Develop Performance Measures for OFT OFT Board Dec. 31/14 set of measurements created for clear goals and results    

Table 6. OFT Performance Measures and Target Plan 2014 - 2017

Date: April 1, 2014

Performance Measure Goals Measurement Target Completion Date

Actual

Completion Date

Outcomes Comments
Core Business Measures
Maintenance of OFT Facility Building facilities pass safety inspections 100% Compliance Mar 31 2015      
To provide a safe workplace for staff Provide a incident free safe working environment Less than 10 incidents Mar 31 2015      
Maintain a positive budget Meet or exceed budget projections Meet Budget Targets Mar 31 2015      
Meet or exceed volume throughput projections Greater 980,000 Tonnes Mar 31 2015      
Provide a market for wholesale fruit and product Maintain or exceed 5,000 Registered Buyers # of Buyers Mar 31 2015      
Arrangements of Lease Agreements Warehouse Space Vacancy Rate 100% Occupancy Mar 31 2015      
Farmers' Market Stall Vacancy Rate 90% Occupancy Mar 31 2015      
Office Space Vacancy Rate 100% Occupancy Mar 31 2015      
Support the exposure of Ontario produce Increase # of tenants in farmer's market Greater than 350 Tenants Mar 31 2015      
Increase awareness of farmer's market # of Tours / Trade Shows Mar 31 2015      
To promote the facility Increase awareness of role of OFT # of Tours / Trade Shows Mar 31 2015      
To respond to all external inquires 100% response rate within 24 hours 95% Success Rate Mar 31 2015      
To respond to tenant's needs Provide feedback and solutions Within 24 Hours Mar 31 2015      
To maintain good working relationships Maintain or lower # of complaints Less than 20/year Mar 31 2015      
Tenant Satisfaction With Rented Space 85% Satisfaction Rate Mar 31 2015      
External environmental assessments Maintain data on external issues Collection of Data Mar 31 2015      

Table 7. OFT Communication Plan 2014 - 2017

Date: April 1, 2014

Strategy Action Who is Responsible Target Comple-tion Date Actual Comple-tion Date Anticipated Results Actual results
Communication through Media Feature Articles G. Leo /G. Da Silva various various Primary producer target Grower front page article
Interviews B. Nicholas various various Consumer target The Packer
Farm market target Produce News
Government communication Prov. And Fed. Food Safety Div. B. Nicholas /G. Leo/ G. Da Silva various   response / maintenance  
Annual Review with OMAFRA B. Nicholas/ G. Leo/ G. Da Silva September 30/13      
Community Communications Social groups (Daily Bread & Foodshare) B. Nicholas/ G. Leo/ G. Da Silva Dec. 31/13   increased communications  
Facility signage, flags and image G. Leo/ G. Da Silva Dec. 31/13   landscaping  
community meetings  
Taste of the Food Terminal B. Nicholas/ G. Leo/G. Da Silva September 30/15   Open House for Public >3,500 attendees
Municipal interactions Toronto Planning Department B. Nicholas/G. Leo on-going   improved relationships and communications  
Biosecurity planning G. Da Silva        
Energy          
Sanitary Systems          
Internal Communications Tenants G. Da Silva/G. Leo various various surveys  
Staff G. Da Silva/G. Leo     meetings  
B. Nicholas     walk-abouts weekly process
Internet/Website Communications update website G. Leo on-going   update content  
messaging system G. Leo (yearly)      
twitter G. Leo/G. Da Silva on-going   update content daily  
You Tube Channel G. Leo/G. Da Silva on-going   update content as required  
Trade Show Communications trade show events B. Nicholas and Staff Dec.31/14 (yearly)   consumer and industry CRFA Trade Show
exposure Landscape Ontario Show
Grocery Innovation Show
OFVC
Communications through Foodland Signage B. Nicholas/G. Leo/G. Da Silva on-going on-going increased visuals of Ont. products Placed Throughout OFT
Labelling          
Flags         Placed Throughout OFT
Banners         Placed Throughout OFT

Table 8. Communication Plan

Date:

Strategy Action Who is Responsible Target Completion Date Actual Completion Date Anticipated Results Actual Results
Communications to Ontario Agriculture Associations CPMA / OPMA B. Nicholas Dec 31/14   meeting  
OFVGA   (yearly)   electronic update  
OGVG          
Facility Tours educational groups B. Nicholas/G. Leo/G. Da Silva continuous   tours on demand  
industry groups       promotion of tours  
Standing/Advisory Committees Review for need B. Nicholas continuous   as mandated  

 


For more information:
Toll Free: 1-877-424-1300
E-mail: ag.info.omafra@ontario.ca
Author: Loree Saunders - Compliance Programs Coordinator / OMAFRA
Creation Date: 1 April 2015
Last Reviewed: 1 April 2015