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After three years of stalled revenue growth, forecasts predict higher sales for the food and beverage industry in 2024, providing a major boost to operations still recovering from the COVID-19 pandemic. Even with this good news, challenges are overwhelming manufacturers, impacting efficiency, labor recruitment, and overall profitability.
What major challenges must the food and beverage industry overcome this year? And what solutions can help navigate the difficult manufacturing landscape? Here’s a look at the top issues in the food and beverage industry and the technology that can help resolve them in 2024.
The shipping and transport delays that characterized the early days of the pandemic have largely resolved. In 2024, the primary challenges are high transportation costs, driven by increased gas prices and labor costs, which drive up expenses throughout the entire value chain. As a result, many stakeholders in the food and beverage industry continue the search for more cost-effective and reliable suppliers, requiring more efficient data management capabilities.
Food and beverage manufacturers need software that easily links recipe data with enterprise resource planning (ERP) and other solutions used in supply chain management to help make more informed and expedited sourcing decisions. Even better, software that provides an up-to-date and well-managed supplier guide can help procurement teams easily identify new suppliers according to their specifications and quickly establish relationships.
Food and beverage regulations are constantly evolving according to public health concerns, consumer advocacy, and advancements in science and technology. In 2024, the FDA has changed the definition of “healthy,” impacting when brands are allowed to use the word on packaging and in marketing, while manufacturers must begin finding a way to phase out red dye No. 3 and other additives from products in California. International laws, like Europe’s new requirements for processed food labeling, even point to future regulations in the U.S. that manufacturers should try to stay ahead of.
Food and beverage companies need product data management (PDM) software that stores product information in a central database. It also offers access to regulations and development guidelines in all markets where these products are sold. This not only reduces the risk of compliance errors, but streamlines operations so that interdepartmental communications and compliance-related tasks can get completed more efficiently.
A 2023 survey on the state of the food and beverage industry found that over 80% of respondents reported an increase in costs of materials and ingredients, significantly eating into profit margins for each product. In 2024, inflation remains a fact of life for consumers and producers. Manufacturers must find a way to control the costs of making their products without impacting quality to maintain prices and protect customer loyalty.
Food and beverage manufacturers need a PDM that updates ingredient cost data in real-time, allowing engineers to virtually experiment with new product formulations and easily see the impact on production costs. This will expedite product redevelopment for cost savings and allow companies to protect their profit margins more easily.
In 2024, food and beverage product development will be a more year-round challenge than ever. Every quarter brings expectations of novelty products with seasonal flavors (such as pumpkin spice in the autumn), or limited-edition stunt products like the Grimace Shake. Consumers now even demand multiple varieties of their favorite snacks, prompting the trend of sweet or spicy product variations.
In this environment, profitability depends on developers’ ability to quickly respond to trends and consumer demands, so speeding up the time to market is one of the most important KPIs for manufacturers to focus on. Engineers need a PDM solution that allows them to not only quickly simulate and optimize product formulations but accurately estimate production costs and ensure regulatory compliance for each variation.
Though the food and beverage industry shows signs of recovery in 2024, manufacturers still face challenges in every sector of their operation. Your team needs a unifying solution they can implement in every process to reduce errors, increase efficiency, and improve transparency. That’s where SpecPage comes in.
SpecPage is a world-class PDM and product lifecycle management (PLM) solution purpose-built for the needs of the food and beverage industry. Want to experience end-to-end transformation of your operation in 2024?
