Your dairy products need to be described correctly for both potential customers and regulators. The international CODEX standards for various milk products may be useful and you will need to specify a dairy category code for your product when exporting.

You need to be able to maintain the quality of the product you make locally to sell to a market on the other side of the world. Can the quality and safety of your product be maintained throughout the supply chain? Guidance on determining an appropriate shelf life is available from the NZ MPI, and decision support tools can be found at the Food Safety Centre. Getting this wrong can put the health of consumers at serious risk and can lead to expensive and damaging food safety compliance action by FSANZ or a foreign Government. A single incident can cause irreparable damage to the reputation of your product, company and possibly the wider Australian dairy industry.

These include quality certifications, quality descriptors and additional characteristics that will define it in the market place? Examples include Halal, Kosher, organic, etc.

Will your product be sold in bulk for wholesale/commercial purposes or packaged for retail/consumers? If you intend to sell to some countries, such as some in the European Union or the United States of America, you may need to apply for a dairy quota licence as there could be a maximum quota limit on certain products.

2. Intended Export Market

The country or countries you intend to export to, will have the specific regulatory requirements you need to know and these are found in the Manual of Importing Country Requirements (MICOR).
As expected, each country is different, so before you start your export process, you should consider how you will comply with their unique regulations as outlined in MICOR as well as providing a product that is attractive to the local consumers. Some countries require your company to be registered in their system before any trade commences. The Department of Agriculture, Fisheries and Forestry’s dairy Export Facilitator Service can provide assistance in interpreting any importing country requirements. Some countries such as China, require your company to be registered in their system before any trade commences. Austrade can assist understanding the trading climate and what you can expect when doing business with other countries and their cultures. The Dairy Australia website is also helpful as a resource.

Your customers may be wholesale or retail. Will your product be competitively priced in that market? Will you sell your product in bulk or individually packaged for retail sale? Who will you sell your product/s to? Will you choose to use an agent or distributor? Most exporters like to visit their markets as a part of their research. Many first-time exporters sell through an agent, broker or a distributor based in the export market. Do you have an export market entry strategy? The Export Council of Australia regularly hold information workshops and courses across Australia, which may assist in preparing you for the export journey ahead.

3. Business Plan

There are a number of business plan templates and resources for setting up a new export business at Austrade. Pay particular attention and seek advice on the likely resources required to develop and implement your food safety plan. The costs of compliance and product testing are frequently underestimated in the overall ‘costs of doing business’.

Your business plan should identify the structure of your enterprise and any intellectual property (IP) that requires protection. Business.gov.au provides a range of information on starting a new business, including on choosing a business structure. IP Australia has some practical advice on Protecting your IP.

Your export supply chain includes suppliers, customers, freight forwarders, distributors, agents, etc. Food Innovation Australia Limited (FIAL), Austrade, and the Export Council of Australia provide access to market data, information and insights and can introduce you to potential supply chain partners. Dairy Australia also keeps a database of Australian suppliers of a range of dairy products and ingredients.

Your strategic and business plans should include a market analysis that identifies incentives and barriers. It should also include your marketing plan and resources for promotion of your products in domestic and overseas marketplaces. Commercial market research services are available or you can do the research yourself on domestic markets using data provided by FIAL, Dairy Australia or through Government sources. Dairy Australia and Austrade are good places to start your research on export markets.

The time between purchasing supplies and receiving payment for sales can be delayed when trading on international markets. Export traders use a range of strategies to cover the risks, including legal contracts, insurance and financing. The Austrade website is a good place to start although it is likely that you will need specialist advice when starting out. State and Commonwealth governments offer a range of assistance packages for new exporters – search grants for establishing new businesses.

New dairy businesses require a great deal of time and a special set of skills to get up and running. Ensure you have a team with the right mix of technical and business skills to support and nurture the business. Regulatory and food safety skills are particularly critical as new regulatory approvals must be sought for domestic businesses expanding into export. Food safety compliance requires a significant on-going commitment from your business. Advice is available through your State Regulatory Authority and the Department of Agriculture, Fisheries and Forestry (DAFF), with private consultants contacted through the Dairy Industry Association of Australia.

4. Regulatory Requirements

Businesses that manufacture or are involved in the storage or distribution of milk and dairy products within Australia must be licensed by the State Regulatory Authority of the State in which they operate. It is a condition of licence that the premise implements a documented HACCP-based food safety plan. Having a licence for domestic manufacture is a prerequisite to being registered for export by Department of Agriculture, Fisheries and Forestry.

Businesses intending to process, store, handle, load and/or dispatch milk and milk products for export must be registered with the the Department of Agriculture, Fisheries and Forestry (DAFF). A step-by-step guide for exporting dairy products is available. Having an ‘approved arrangement‘ is a key requirement for export registration. Requirements of an approved arrangement and a checklist for the approved arrangement are published by the Australian Government. The Dairy Export Welcome Pack and a host of other resources have been created to help dairy manufacturers along their export journey, together with tailored assistance through DAFF’s export facilitator service

Most countries have specific requirements for dairy products they import. The requirements of each country are collated in MICOR. The Department of Agriculture, Fisheries and Forestry’s (DAFF) dairy Export Facilitator Service can provide assistance in interpreting importing country requirements. It is also wise to consult with your shipping agent who may have knowledge and experience in getting products through border controls smoothly.

Each consignment leaving Australia must have a valid export permit issued by the Australian Government, which is generated through the NEXDOC system. The requirements for dairy exporters are explained on the Australian Government’s website. A Government issued export health certificate (where required by an importing country) facilitates the entry of the goods into the destination country. A completed customs declaration must also accompany each export consignment.

Some importing countries reSome importing countries require a health certificate issued by the Australian Government for each consignment of dairy product. The details are included in MICOR and the certificates are issued through the NEXDOC system. Further information is contained in the Australian Government’s Guideline for Dairy Exporting.

If you are setting up a new business in Australia, the Australian Business License Information Service (ABLIS) can help identify the Local, State and Commonwealth regulatory requirements for operating any type of businesses in Australia.

5. Packaging & Labelling

As well as meeting Australian export requirements, there may also be specific labelling requirements set by the importing country. You should check these additional requirements carefully using MICOR. It is also a good idea to seek advice from your agent or distributor in the importing country to ensure your labelling is acceptable. The Codex General Standard on the Use of Dairy Terms (GSUDT) is the international standard on dairy product labelling. You should also consider Country of Origin labelling requirements.

As with labelling, the pack size and type of packaging for your exported products may have both regulatory and commercial constraints. MICOR will provide some guidance, as will the local knowledge from your agent or distributor in the receiving country. Larger manufacturers in Australia may be signatories to the Australian Packaging Covenant, which set guidelines on appropriate packaging to reduce waste streams.

In some highly-populated countries where storage space is limited, their markets are geared towards smaller portions. Although your Australian ‘best seller’ might be the economy size to feed the whole family, some countries will only purchase smaller amounts more frequently, so make sure you understand the cultural preferences.

IP Australia has some practical advice on Protecting your IP in Australia and overseas. In addition to the designs of your labels and packaging, you should consider registering your brand or trade mark before going global. Similarly, an IP search can prevent you from infringing on someone else’s IP.

6. Premises & Systems

Each premises where you intend to manufacture dairy products must be registered with DAFF before you are able to export. Having an approved arrangement in place, to manage food safety and other risks to the export product, as well as meet the importing country requirements is a key requirement of export registration. The Australian Government provides guidance on the steps required to become export registered.

Food safety and quality should be your business’s first priority. Any deficiency in infrastructure or systems can put consumers and your entire enterprise at risk. Compliance with both domestic and export regulatory controls is mandatory and additional commercial sanctions can be severe for sub-standard product. How people ‘think and act’ in their daily job is underpinned by the food safety culture of the business. FSANZ’s food safety hub is a good resource to explore this topic further. Also keep abreast of developments in DFSV’s Dairy RegTech program.

An organisation’s human resources are the backbone of every operation. Ensuring you and your staff are trained in HACCP food safety practices is an essential part of the dairy manufacturing process. Many training organisations and commercial providers offer training in food safety, with several offering specific training for dairy manufacturing staff. Engaging an experienced consultant could also be an option in some circumstances, with many being members of the Dairy Industry Association of Australia. FSANZ’s food safety hub is a good resource to get you started.

There are a number of other organisations that you will need to engage to ensure your products meet regulatory requirements. Examples include product testing laboratories, auditing services and technical advisors. Your State Regulatory Authority or the Dairy Industry Association of Australia can help put you in touch.

7. Sourcing & Suppliers

Although primary production establishments and the transport of raw milk between farm and processor are excluded, establishments that prepare dairy ingredients for inclusion into dairy products destined for export need to be export registered. Each consignment of ingredient supplied needs to be accompanied by a Transfer Certificate, ensuring the integrity of the export supply chain.  Your ingredient suppliers should have reliable quality management systems in place to provide assurance that their ingredients meet your quality expectations. Contracts should include ingredient specifications, as variations in ingredients can greatly change the characteristics of the final product. Dairy Australia has a ‘Who makes what‘ directory which can help identify suppliers of dairy ingredients & products.

Although non-dairy suppliers may not be required to be export registered, the export manufacturer needs to certify that the dairy product they produce meets Australian and importing country regulatory requirements. Consequently purchasing non-dairy ingredients from trustworthy suppliers with robust quality management systems is a must. Austrade’s Australian Suppliers Directory and Food Innovation Australia Ltd’s Australian Food and Beverage Catalogue can help you identify potential suppliers of non-dairy ingredients.

Verification of your supplier’s product integrity through independently verified Quality Assurance systems with appropriate Quality Control procedures (testing) at various points along the export supply chain is an integral part of an Approved Arrangement.

Supply and sales contracts need to adequately mange the risks to your export business. These include product quality, safety, export compliance as well as the usual clauses to do with trading terms, logistics and continuity of supply. Austrade is a good place to start although you are likely to need specialist legal advice when trading internationally.

8. Logistics & Shipping

Transport of dairy products after the point of manufacture is a regulated part of the export supply chain, requiring participants to be export registered, and documentation to accompany each consignment. Different products have different transport requirements and the shelf life of some products may limit their export potential. It is essential that you allow for time in transit, storage and potential delays when exporting dairy products.

Every storage facility that your product goes through will need to be export registered and compliant. It is a good idea to check MICOR for any additional importing country requirements regarding storage. Engaging an international freight forwarding company is one way to ensure your goods are in experienced hands.

Dairy exports are highly regulated and each consignment needs to be accompanied with documentation to satisfy both exporting and importing country authorities, as well as the usual commercial certificates. Mistakes in documentation can result in serious delays or outright rejection, so it may be useful to engage an agency or broker that knows the system and can help you navigate the process. Export documentation must be lodged through NEXDOC and can be submitted as a single transaction, or incrementally as it becomes known.

Since Australia is an island nation, we are only able to export by sea or air. Both transport methods require your products to leave and arrive through customs borders. Completing a thorough pre-loading check of the product and the accompanying documentation is recommended before the shipment leaves your care. Photographic evidence can be useful if disputes arise.

There are some international freight terms (Incoterms) which might be unfamiliar to you, but understanding the differences will avert your product waiting at a foreign port because the freight company only specified delivery to the border, not to your local distributor’s door. Read the fine print and make sure you ask questions if you do not understand the terms. If using a freight forwarding company, they should make these terms clear to you.

9. Finance & Contracts

How do you know that your contract with the buyer is enforceable beyond our borders? Legal contracts should be clear on terms of trade, onus of responsibility and dispute resolution. Engaging a specialist in international commercial contracts can ensure your contract with the buyer is enforceable, fair and there are no hidden clauses that may leave you at a disadvantage. Every contract should be explicit in when payment is required and when transfer of ownership of the goods takes place.

Foreign exchange rates can be volatile, so it is a good idea to make sure the currency your contract specifies is relatively stable. If you are expecting to be paid in $AUD, this should be explicitly stated in your contracts as a net amount (after any bank transfer charges incurred by the buyer so you are not left out of pocket). The Austrade website has some tips to help you negotiate terms of payment.

The cost involved in export, distances, your lack of control over events (often driven by circumstances outside your control), make insurance and risk management a necessity. Insurance should cover the product whilst in your possession until the transfer of ownership is accepted by the customer. The policy should also include product liability. Experienced insurance brokers should be consulted as this is a specialist area.

The Austrade website can help guide you in the particular pricing methods you can use. As part of your price calculations, you should be aware of the costs, fees, charges and duties that are incurred with the relevant authorities. Some are found on the DAWR charging guidelines.

10. Traceability & Continuity

To protect consumers, many countries require importers to have a documented product recall system in place should a food-safety problem be identified with imported dairy products. Your system should be practiced periodically, and appropriate insurances taken out. Product recalls or withdrawals can be extremely expensive, with exporters having little control of activities initiated in destination countries. Food Standards Australia New Zealand (FSANZ) have some practical advice for domestic manufacturers on how to go about a product recall or a voluntary product withdrawal that is not a health and safety issue e.g. underweight products. Dairy Australia has also developed a Dairy Food Recall Tool and online training to help Australian dairy businesses understand the potential costs and plan for a food recall.

If there are issues with your product on arrival or in the market place then in most cases you as the exporter will be involved, either to minimise financial losses, damage to the brand or perhaps to your company’s reputation. These issues need to be thought through, and appropriate risk management steps taken before the first shipment. As a minimum, an agreed method of investigation and appropriate compensation arrangements should be determined and detailed in your contract with the buyer. Bringing the product back to Australia is rarely an option for exported dairy products.

Regular visits to your overseas agents or customers is a good way to keep in touch with the trends in your target market and a chance to address any issues that may arise. It may be difficult to set the time aside from your Australian operation, but the expense in doing so can be a good investment in maintaining your market share and possibly lead to other opportunities along the way.

Feedback from your overseas distributor on improvements to the product itself or the logistics pathways are important. If you are anticipating growth in sales, do you have sufficient marketing resources to promote your product to increase demand? If you are in the process of exporting your product and are experiencing technical difficulties, the Export Council of Australia could provide some assistance.

Your dairy products need to be described correctly for both potential customers and regulators. The international CODEX standards for various milk products may be useful and you will need to specify a dairy category code for your product when exporting.

You need to be able to maintain the quality of the product you make locally to sell to a market on the other side of the world. Can the quality and safety of your product be maintained throughout the supply chain? Guidance on determining an appropriate shelf life is available from the NZ MPI, and decision support tools can be found at the Food Safety Centre. Getting this wrong can put the health of consumers at serious risk and can lead to expensive and damaging food safety compliance action by FSANZ or a foreign Government. A single incident can cause irreparable damage to the reputation of your product, company and possibly the wider Australian dairy industry.

These include quality certifications, quality descriptors and additional characteristics that will define it in the market place? Examples include Halal, Kosher, organic, biodynamic, etc. Note that there are specific export and certification requirements for the export of these dairy products from Australia.

Will your product be sold in bulk for wholesale/commercial purposes or packaged for retail/consumers? If you intend to sell to some countries, such as some in the European Union or the United States of America, you may need to apply for a dairy quota licence as there could be a maximum quota limit on certain products. Consignments of less than 10kg do not need to be registered for export, however you should check the receiving country requirements as they may still insist on export certification from the Australian authorities.

2. Intended Export Market

Search potential markets for your dairy products using Austrade’s market search tool. The country or countries you intend to export to will have the specific regulatory requirements you need to know and these are found in the Manual of Importing Country Requirements (MICOR).  As expected, each country is different, so before you start your export process, you should consider how you will comply with their unique regulations as well as providing a product that is attractive to the local consumers.  The Department of Agriculture, Fisheries and Forestry’s dairy Export Facilitator Service can provide assistance in interpreting any importing country requirements.  Some countries such as China, require your company to be registered in their system before any trade commences. Austrade can assist understanding the trading climate and what you can expect when doing business with other countries and their cultures. The Dairy Australia website is also helpful as a resource.

Your customers may be wholesale or retail. Will your product be competitively priced in that market?  Will you sell your product in bulk or individually packaged for retail sale? Who will you sell your product/s to? Will you choose to use an agent or distributor? Most exporters like to visit their markets as a part of their research. Many first-time exporters sell through an agent, broker or a distributor based in the export market. Do you have an export market entry strategy? Food Innovation Australia Ltd and the Export Council of Australia regularly hold information workshops and courses across Australia, which may assist in preparing you for the export journey ahead.

3. Business Plan

There are a number of templates and resources for setting up a new export business at Austrade. Pay particular attention and seek advice on any importing country requirements and the route to market. The costs of export compliance and product/customer support are frequently underestimated in the overall ‘costs of doing business’.

Your business plan should identify the structure of your enterprise and any intellectual property (IP) that requires protection. Business.gov.au provides a range of information on starting a new business, including on choosing a business structure. IP Australia has some practical advice on Protecting your IP.

Your export supply chain includes suppliers, customers, freight forwarders, distributors, agents, etc. Food Innovation Australia Limited (FIAL), Austrade, and the Export Council of Australia provide access to market data, information and insights and can introduce you to potential supply chain partners. Dairy Australia also keeps a database of Australian suppliers of a range of dairy products and ingredients.

Your strategic and business plans should include a market analysis that identifies incentives and barriers. It should also include your marketing plan and resources for promotion of your products in domestic and overseas marketplaces. Commercial market research services are available or you can do the research yourself on domestic markets using data provided by FIAL, Dairy Australia or through Government sources. Dairy Australia and Austrade are good places to start your research on export markets.

The time between purchasing supplies and receiving payment for sales can be delayed when trading on international markets. Export traders use a range of strategies to cover the risks, including legal contracts, insurance and financing. The Austrade website is a good place to start although it is likely that you will need specialist advice when starting out. State and Commonwealth governments offer a range of assistance packages for new exporters – search grants for establishing new businesses.

New dairy businesses require a great deal of time and a special set of skills to get up and running. Ensure you have a team with the right mix of technical and business skills to support and nurture the business. Regulatory and food safety skills are particularly critical as new regulatory approvals must be sought for domestic businesses expanding into export. Food safety compliance requires a significant on-going commitment from your business. Advice is available through your State Regulatory Authority and the Department of Agriculture, Fisheries and Forestry (DAFF), with private consultants contacted through the Dairy Industry Association of Australia.

4. Regulatory Requirements

Export traders that do not manufacture or distribute dairy products in Australia generally do not need to be licenced by the State Regulatory Authority. However, export traders should check to ensure that any companies that manufacture dairy products they intend to export do possess a current dairy licence.

Export traders that do not manufacture, process, store, handle, or load dairy products for export generally do not need export registration. However, export traders should check to ensure that any participants in their export supply chain that do undertake these activities are export registered. Export registration is administered by the Australian Government.

Most countries have specific requirements for dairy products they import. The requirements of each country are collated in MICOR. The Australian Government’s dairy Export Facilitator Service can provide assistance in interpreting importing country requirements. It is also wise to consult with your shipping agent who may have knowledge and experience in getting products through border controls smoothly.

Each consignment leaving Australia must have a valid export permit issued by the Australian Government, which is generated through the NEXDOC system. The requirements for dairy exporters are explained on the Australian Government’s website. The issue of an export permit facilitates the export of the goods from Australia. The issue of an export health certificate (where required by an importing country) facilitates the entry of the goods into the destination country. A completed customs declaration must also accompany each export consignment. Note that (non-dairy) products that do not require an export permit from the Australian Government may still require an export permit issued by the Australian Border Force.

Some importing countries require a health certificate issued by the Australian Government for each consignment of dairy product. The details are included in MICOR and the certificates are issued through the NEXDOC system. Further information is contained in the Australian Government’s Guideline for dairy exporting.

If you are setting up a new business in Australia, the Australian Business License Information Service (ABLIS) can help identify the Local, State and Commonwealth regulatory requirements for operating any type of businesses in Australia.

There are other organisations and service providers that you may need to engage to ensure your exported products meet regulatory or customer requirements. These include product testing laboratories, auditing services and technical advisors.

5. Packaging & Labelling

As well as meeting Australian export requirements, there may also be specific labelling requirements set by the importing country. You should check these additional requirements carefully using MICOR. It is also a good idea to seek advice from your agent or distributor in the importing country to ensure your labelling is acceptable. The Codex General Standard on the Use of Dairy Terms (GSUDT) is the international standard on dairy product labelling. You should also consider Country of Origin labelling requirements.

As with labelling, the pack size and type of packaging for your exported products may have both regulatory and commercial constraints. MICOR will provide some guidance, as will the local knowledge from your agent or distributor in the receiving country.

In some highly populated countries where storage space is limited, their markets are geared towards smaller portions. Although your Australian ‘best seller’ might be the economy size to feed the whole family, some countries will only purchase smaller amounts more frequently, so make sure you understand the cultural preferences.

In addition to the designs of your labels and packaging, you should consider registering your brand or trade mark before going global. Similarly, an IP search can prevent you from infringing on someone else’s IP.

6. Premises & Systems

If your enterprise does not physically handle export products, your premises do not need to be export registered. However, you still need to be aware of Australian export requirements so you can satisfy yourself that your supply chain is compliant. Further assistance can be found on the Australian Government website.

7. Sourcing & Suppliers

Although primary production establishments and the transport of raw milk between farm and processor are excluded, establishments that prepare dairy ingredients for inclusion into dairy products destined for export need to be export registered. Each consignment of ingredient supplied needs to be accompanied by a Transfer Certificate, ensuring the integrity of the export supply chain.  Your ingredient suppliers should have reliable quality management systems in place to provide assurance that their ingredients meet your quality expectations. Contracts should include ingredient specifications, as variations in ingredients can greatly change the characteristics of the final product.  Dairy
Australia has a ‘Who makes what‘ directory which can help identify suppliers of dairy ingredients & products.

Although non-dairy suppliers may not be required to be export registered, the export manufacturer needs to certify that the dairy product they produce meets Australian and importing country regulatory requirements. Consequently purchasing non-dairy ingredients from trustworthy suppliers with robust quality management systems is a must. Austrade’s Australian Suppliers Directory and Food Innovation Australia Ltd’s Australian Food Catalogue can help you identify potential suppliers of non-dairy ingredients.

Verification of your supplier’s product integrity through independently verified Quality Assurance systems with appropriate Quality Control procedures (testing) at various points along the export supply chain is an integral part of an ‘Approved Arrangement‘.

8. Logistics & Shipping

Transport of dairy products after the point of manufacture is a regulated part of the export supply chain, requiring participants to be export registered, and documentation to accompany each consignment.  Different products have different transport requirements, and the shelf life of some products may limit their export potential. It is essential that you allow for time in transit, storage and potential delays when exporting dairy product.

Every storage facility that your product goes through will need to be export registered and compliant.  You will need to check MICOR for any additional importing country requirements regarding storage.  Engaging an international freight forwarding company is one way to ensure your goods are in experienced hands.

Dairy exports are highly regulated and each consignment needs to be accompanied with documentation to satisfy both exporting and importing country authorities, as well as the usual commercial certificates. Mistakes in documentation can result is serious delays or outright rejection, so it may be useful to engage an agency or broker that knows the system and can help you navigate the process. Export documentation must be lodged through NEXDOC and can be submitted as a single transaction, or incrementally as it becomes known.

Since Australia is an island nation, we are only able to export by sea or air.  Both transport methods require your products to leave and arrive through customs borders. Often it is the length of shelf life that will determine the best transport method to use. Requesting photographic evidence of product as it is loaded for export can be useful if disputes arise.

There are some international freight terms (Incoterms) which might be unfamiliar to you, but understanding the differences will avert your product waiting at a foreign port because the freight company only specified delivery to the border, not to your local distributor’s door. Read the fine print and make sure you ask questions if you do not understand the terms. If using a freight forwarding company, they should make these terms clear to you.

9. Finance & Contracts

How do you know that your contract with the buyer is enforceable beyond our borders? Legal contracts should be clear on terms of trade, onus of responsibility and dispute resolution. Engaging a specialist in international commercial contracts can ensure your contract with the buyer is enforceable, fair and there are no hidden clauses that may leave you at a disadvantage. Every contract should be explicit in when payment is required and when transfer of ownership of the goods takes place.

Foreign exchange rates can be volatile, so it is a good idea to make sure the currency your contract specifies is relatively stable. If you are expecting to be paid in $AUD, this should be explicitly stated in your contracts as a net amount (after any bank transfer charges incurred by the buyer so you are not left out of pocket). The Austrade website has some tips to help you negotiate terms of payment.

The cost involved in export, distances, your lack of control over events (often driven by circumstances outside your control), make insurance and risk management a necessity.  Insurance should cover the product at each stage of your export supply chain until the transfer of ownership is accepted by the customer. Product liability insurance may also be prudent in some markets. Experienced insurance brokers should be consulted as this is a specialist area.

The Austrade website can help guide you in the particular pricing methods you can use. As part of your price calculations, you should be aware of the costs, fees, charges and duties that are incurred with the relevant authorities. Some are found in the Australian Government’s guidelines.

10. Traceability & Continuity

Many countries require importers to have a documented product recall system in place should a food-safety problem be identified with imported dairy products. Your system should be practiced periodically, and appropriate insurances taken out. Product recalls or withdrawals can be extremely expensive, with exporters having little control of activities initiated in destination countries. The Australian Government regulates food recalls from export markets, noting that re-importing exported product is rarely an option. Food Standards Australia New Zealand (FSANZ) have some practical advice on how to go about a product recall or a voluntary product withdrawal in the domestic market. Dairy Australia has also developed a Dairy Food Recall Tool and online training to help Australian dairy businesses understand the potential costs and plan for a food recall.

If there are issues with your product on arrival or in the market place then in most cases you as the exporter will be involved, either to minimise financial losses, damage to the brand or perhaps to your company’s reputation. These issues need to be thought through, and appropriate risk management steps taken before the first shipment. As a minimum, an agreed method of investigation and appropriate compensation arrangements should be determined and detailed in your contract with the buyer. Bringing the product back to Australia is rarely an option for exported dairy products.

Regular visits to your overseas agents or customers are a good way to keep in touch with the trends in your target market and a chance to address any issues that may arise. It may be difficult to set the time aside from your Australian operation, but the expense in doing so can be a good investment in maintaining your market share and possibly lead to other opportunities along the way.

Feedback from your overseas distributor on improvements to the product itself or the logistics pathways are important. If you are anticipating growth in sales, do you have sufficient marketing resources to promote your product to increase demand?  If you are in the process of exporting your product and are experiencing technical difficulties, the Export Council of Australia may be able to provide some assistance.

Your dairy products need to be described correctly for both potential customers and regulators. Definitions of milk and dairy products are set out in Chapter 2 of the Food Standards Code for domestic markets. The international CODEX standards and/or IDF Standard are useful references for the terms used to describe different dairy products. FSANZ regulates Standards for dairy products sold on the domestic market.

The safety and quality of the product needs to be maintained from the point of manufacture through to the point of consumption. Guidance on determining an appropriate shelf life is available from the NZ MPI, and decision support tools can be found at the Food Safety Centre. Getting this wrong can put the health of consumers at serious risk and can lead to expensive and damaging food safety compliance action by FSANZ. Even a bad product quality review from a consumer can damage the reputation of your product and company.

These include quality certifications, quality descriptors and additional characteristics that will define it in the market place? Examples include Halal, Kosher, organic, allergen-free etc. Businesses need to be aware of consumer protections under Australian consumer law.

Continuity of supply is vitally important for your customers. Volumes and maturation times need to be taken into consideration when planning your sales strategy. The volume you manufacture may dictate whether you sell to wholesale or retail markets.

2. Intended Market

Your customers may be wholesale or retail.  Will you package your products in bulk (for further processing) or will they be ready packed for retail sale?

Perhaps you will engage an agent or distributor to distribute and market your products for you. Clearly defining your path to market is an important step in planning your business.

3. Business Plan

There are a number of business plan templates and resources for setting up a new businesses at Business.gov.au. Pay particular attention and seek advice on the likely resources required to develop and implement your food safety plan. The costs of compliance and product testing are frequently underestimated in the overall ‘costs of doing business’.

Your business plan should identify the structure of your enterprise and any intellectual property (IP) that requires protection. Business.gov.au provides a range of information on starting a new business, including on choosing a business structure. IP Australia has some practical advice on Protecting your IP.

Your supply chain includes suppliers, distributors, agents, retailers and customers. State Government business support services and Food Innovation Australia Limited (FIAL) can introduce you to potential supply chain partners. Dairy Australia also keeps a database of the Australian suppliers of a range of dairy products and ingredients.

Your business plan should include a market analysis that identifies incentives and barriers. It should also include your marketing plan and resources for promotion of your products. Commercial market research services are available or you can do the research yourself using data provided by FIAL, Dairy Australia or through Government sources.

You will need to understand the capital and operational resources required for the first and subsequent batches. Know your break-even point and drivers of profit and loss. Research the costs and ensure you have sufficient resources to implement the food safety plan, as well as some contingency for unexpected expenses. Seek financial advice with regards to setting up a business and taxation implications. State and Commonwealth governments offer a range of assistance – search grants for establishing new businesses.

New dairy businesses require a great deal of time and a special set of skills to get up and running. Ensure you have a team with the right mix of technical and business skills to support and nurture the business. Regulatory and food safety skills are particularly critical as regulatory approvals must be sought and new plant, equipment and systems are commissioned in the start-up phase. Food safety compliance requires a significant on-going commitment from your business. Technical expertise and contacts are available through your State Regulatory Authority and the Dairy Industry Association of Australia.

4. Regulatory Requirements

Businesses that manufacture or are involved in the storage or distribution of milk and dairy products within Australia must be licenced by the State Regulatory Authority of the State in which they operate. It is a condition of licence that the premise implements a HAACP-based food safety program based on the Food Standards Code, which includes several relevant Standards in Chapters 1, 2, 3 & 4. Guidance on what needs to be included in a food safety plan for a dairy manufacturing business is provided by most State Regulatory Authorities. An online course ‘Understanding Food Safety Programs’ is available through the Dairy Australia website. Having a dairy licence for domestic manufacture and/or distribution is a prerequisite to being registered for export by the Department of Agriculture, Fisheries and Forestry.

If you are setting up a new business in Australia, the Australian Business License Information Service (ABLIS) can help identify the Local, State and Commonwealth regulatory requirements for operating any type of business in Australia.

There are other organizations and service providers that you may need to engage to ensure your products meet regulatory or customer requirements.  These include product testing laboratories, auditing services and technical advisors.

5. Packaging & Labelling

Regulatory requirements for food labelling and packaging must be met, as set out in Chapter 1 of the Food Standards Code, under Australian consumer law, and by the Australian Competition and Consumer Commission. Country of origin labelling requirements for food sold in Australia also came into effect on July 1, 2016 so you need to ensure that all labelling of dairy products sold in Australia complies with the information standard. The product type and target market will also dictate what type of packaging is appropriate for your product. Companies that specialise in the supply of food packaging for the domestic market are a good resource for a new dairy business.

You should consider registering your brand or trade mark if you want your product to be associated with your company in the market.  This decision will have implications for the labels and packaging used on your products. Similarly, an IP search can prevent you from infringing on someone else’s IP.

6. Premises & Systems

Each premises where you intend to manufacture dairy products must be licenced by the State Regulatory Authority before you are able to commence operations. The requirements for dairy premises are set out in the Food Standards Code which includes several relevant Standards in Chapters 3 and 4. Guidance on the design and operation of dairy manufacturing premises and what needs to be included in the site’s food safety plan for a dairy manufacturing business is also provided by most State Regulatory Authorities. Tools are also available on the Dairy Australia website to explore the costs of building and operating a dairy manufacturing facility.

Food safety and quality should be your business’s first priority. Any deficiency in infrastructure or systems can put consumers and your entire enterprise at risk. Regulatory controls through Food Standards Code are tight and commercial sanctions can be severe for sub-standard product. Guidance for dairy processors is available from your State Regulatory Authority. Traceability is a vital component of your food safety plan and is important to safeguard the reputation of your business. FSANZ’s food safety hub is a good resource to explore this topic further.

An organisation’s human resources are the backbone to any operation.  Ensuring you and your staff are trained in HACCP food safety practices is an essential part of the dairy manufacturing process. Many training organisations and commercial providers offer training in food safety, with several offering specific training for dairy manufacturing staff. Engaging an experienced consultant could also be an option in some circumstances, with many being members of the Dairy Industry Association of Australia. FSANZ’s food safety hub is a good resource to get you started.

7. Sourcing & Suppliers

Domestic dairy supply chains, including primary producers (farmers) and milk transport businesses, are regulated by the State Regulatory Authority of the State or Territory in which they operate. These suppliers must be licenced to legally sell milk intended for human consumption.  Apart from these mandatory food safety requirements, your ingredient suppliers should also have reliable quality management systems in place to provide assurance that their supplies meet food safety and quality expectations. Supply contracts should include ingredient specifications, as variations in ingredients can greatly change the characteristics of the final product. Dairy Australia has a ‘Who makes what‘ directory which can help identify suppliers of dairy ingredients & products. Insights from industry experts are also available on the Dairy Australia website.

Although non-dairy suppliers may not be required to be licenced by the SRA, you are required to effectively manage the food safety risks that they may introduce to your dairy supply chain. Consequently, purchasing non-dairy ingredients from trustworthy suppliers with robust quality management systems is a must. Austrade’s Australian Suppliers Directory and FIAL’s Australian Food and Beverage Catalogue can help you identify potential suppliers of non-dairy ingredients, packaging and the like.

Verification of your supplier’s product integrity through independently verified Quality Assurance systems with appropriate Quality Control procedures (testing) at various points along the supply chain is the best way to obtain this assurance.

8. Logistics & Shipping

Distribution of dairy products after the point of manufacture is a regulated part of the supply chain, requiring participants to be licenced by the State Regulatory Authority. Dairy products for domestic markets are usually perishable, meaning that specialist cold chain logistics providers are often required. Contingencies for disruptions need to be planned and the potential risks to product appropriately managed and documented in your food safety program.

Every storage facility that your product is warehoused in needs to be licenced by the SRA.

9. Finance & Contracts

Advice on starting and/or conducting a business is available through small business advisory services offered by State Governments. In particular, businesses need to be familiar with Australian consumer law.

Contracts for the sale of product should be clear on terms of trade, onus of responsibility and dispute resolution. Your contract should be explicit in when payment is required and when transfer of ownership of the goods takes place.

Insurance should cover the product at each stage of your supply chain until the ownership is transferred to the customer. Product liability insurance may also be prudent. Experienced insurance brokers should be consulted as this is a specialist area.

10. Traceability & Continuity

By law, all food businesses must be able to quickly remove food from the marketplace to protect public health and safety. Your documented product recall plan should be practiced periodically. Product recalls or withdrawals can be extremely expensive so appropriate insurances need to be taken out. Food Standards Australia New Zealand (FSANZ) have some practical advice on how to go about a product recall or a voluntary product withdrawal that is not a health and safety issue e.g. underweight products. Online training in food recall procedures is available through Dairy Australia.

If there are issues with your product identified by customers or consumers then in most cases you as the manufacturer will be involved, either to minimise financial losses, damage to the brand or perhaps to your company’s reputation. These issues need to be thought through, and appropriate risk management steps taken before any incident occurs. As a minimum, an agreed method of investigation and appropriate compensation arrangements should be determined and detailed in your contract with the buyer. Customers and consumers have some legal protections through Australian consumer law.

Seeking feedback from customers and consumers is a good way to keep in touch with the trends in your target market and a chance to address any issues that may arise. It may be difficult to set the time aside from your manufacturing operation, so these tasks are often out-sourced.

Feedback from your distributors or customers is important, but having an agent to represent your product in the market place can provide them with a greater level of service. Do you have sufficient marketing resources to promote your product in the market place?

10.5 Have you developed contingency plans in the event oof a disruption to your ability to manufacture or supply dairy products?

Disruptions to the smooth operation of a dairy business are almost inevitable. Being prepared, with plans in place to protect the continuity of the business, can greatly reduce the severity of the impact. DairySafe have developed a business continuity tool which can help you assess how prepared your dairy business is to withstand disruption, based on the products manufactured and a number of other variables.