In 2018, companies in the food and beverage industry are finding better ways to meet growing expectations by staying on top of changing consumer demands, understanding their preferences, and employing the latest technologies that are crucial in such a competitive industry.
While there’s always room for growth – are companies willing to invest to achieve it? These are the trends are shaping the food and beverage industry this year!
Mergers and Acquisitions
A shift towards more organic and healthy foods is taking place and many companies will add new products with healthier ingredients to their existing portfolio. Instead of developing newer products and ingredients, there is a shift to acquire companies that produce the type of food or ingredient they need. When compared to the time and resources spent on new product R&D, the cost and time to market of a merger or acquisition (M&A) is often more economical.
Food recalls are always making headlines and manufactures are being held accountable. In the United States, confidence of the safety of the foods has been going down since 2016 and that is no surprise. Assurance of food safety in terms of processing, packing, and quality control all come at a cost. This year, the focus will be on food safety and preventative measures to improve consumer confidence and preventing food recalls at all costs.
Big data is on the rise in all industries, but in food and beverage we will see a much larger percentage of manufacturers leveraging digital capabilities this year. The ability to collect vast amounts of data to display, report and analyze allows for better and faster decision making throughout the whole supply chain process. Big data gives companies the ability to do demand planning, forecasting, consumer preferences, logistics and increase operational efficiency – giving them a competitive advantage.
Changing consumer preferences
In 2017, we noticed how large food companies lost sales since they weren’t on track with the healthy foods trend. Millennials in particular focus on healthy eating options and this shift will be essential for growth and profits for food and beverage organizations. With this in mind, in 2018, companies in the food and beverage space will add healthier products and ingredients to their existing portfolio and may also add new product lines to meet consumer needs.
In today’s competitive market, technology cannot be an afterthought. It definitely needs to be in a company’s strategy for it to bring about true business value. Big data was already mentioned – but that is just part of the digital future. Can your sales team access information remotely through a smartphone or tablet? Is the percentage of a certain ingredient in your product monitored and measured 24/7? Do you have access to real time insights without spending a whole day compiling reports? 2018 will see an increase in demand for fully integrated solutions with ERP, IoT, Artificial Intelligence and Machine Learning capabilities that will ensured sustained growth by optimizing their business processes.
Digital transformation is no longer a choice but has become vital to the survival of any food and beverage company. Falling behind due to legacy systems is not an option and digital transformation gives companies incredible potential for profitability and growth.
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