Success depends on quality and digitization

FOOD and drink IT specialist CSB-System has released a new report, The Future of the Food Industry, which alongside key industry trends, highlights the effects of IT and the status of digital transformation.

The survey of 120 respondents from the food and beverage industry reveals collective optimistism about future prospects, expecting the economic situation for their businesses to pick up in the years to come. As part of this, half of them specified quality, freshness and innovations as key drivers in defining product leadership.

Although quality is seen as the biggest driver for success, two-thirds of decision makers highlighted prices as the most significant challenge, with many sectors affected by high raw material prices, which are difficult to pass onto the trade or end-consumer.

Legal requirements in terms of food safety, labelling and traceability were also an area of concern, the most recent example at EU level being the regulation on the provision of food information to consumers and the mandatory nutrition declaration.  Another important consideration is the requirement among retailers for permanent product availability and prompt response times.

In these circumstances, respondents identified three business areas in particular where there was greatest potential for improvement – sales and marketing, production and intralogistics and information technology.  In particular, enhanced IT systems were seen as critical in helping to reduce costs, effectively manage complex operations and improve overall responsiveness.

Looking to the future, the decision makers forecast an increasing focus on both value and sustainability in the food sector.  As well as mass market products, high-price segments would also gain in importance, with the combination of cutting-edge technologies and traditional crafts allowing the introduction of a new generation of quality foods elaborately prepared and manufactured.

Hermann Schalk, head of sales at CSB-System, says this trend, together with the need to focus on costs, will lead to the growing importance of effective IT.

“We still expect the downward pressure on prices to persist, therefore cost reductions are necessary,” he explains.  “This must not adversely affect product quality, which is not necessarily the case.  Our experience is that there is plenty of optimization potential in the processes, mainly through digitization.”

Access the full report: info.csb.com/us-en/downloads.