Food and beverage manufacturers are facing many similar challenges as other industrial companies– slim margins, aging equipment and lower budgets. However, there are also challenges unique to this sector. The biggest issues in the food and beverage sector involve consumers’ satisfaction with the products and brands they choose. First of all, consumers today demand a wider variety of products than ever before – according to Fortune, this increasing demand for variety is one of the main causes of the recent mass exodus of Big Food CEOs. This increasing variable demand means companies need to operate with greater agility to remain competitive.
Second, digitally-connected consumers expect full transparency of information and will react instantly to safety and health issues. From the same Fortune article, consumers have already lost trust in once-staple legacy food brands. Any company impacted by a recall faces a similarly steep potential drop in trust. Implementing end to end traceability and quality assurance is a necessity, not only for regulatory purposes, but also to provide accurate and timely information to consumers and to respond quickly and efficiently to a recall. Digital transformation gives food and beverage companies the tools they need to meet consumers’ demands, manage quality and reduce related risks, respond to recalls quickly and become consumers’ go-to brand in the marketplace.
Improve Time to Market
In this competitive environment, it’s critical that companies increase their speed to market. New demands for new product variations can arise suddenly. Companies must be able to respond quickly to trending diets or rising demand for a particular ingredient, “superfood” or compound. With more companies operating globally and handling shifting regulations there is also an element of regulatory compliance. An ingredient that is permissible in one country may become impermissible in that same context in a different country or region. This means companies need to remain flexible in their operations.
The same trends are apparent in the packaging side of operations. As there is rising demand for seasonal and event-specific products and packaging, companies need to be able to quickly deliver on new packaging variations in order to capitalize on fast-shifting consumer trends, without the need for expensive repacking operations. Digital recipe management gives companies the ability to be increasingly responsive to consumers and reduce time to market for new product introductions. Rapid equipment set-up through electronic recipe parameter download, consistent batch and packaging process execution and enforcement of bill of materials through RFID or barcode readers helps to securely manage more product variations. It also allows manufacturers to achieve faster product changeover times without increased risk of quality losses, increased variation or non-conformance.
Respond to Recalls Quickly
Obviously, avoiding a recall is the preferred course of action, and solutions that provide material traceability, detailed product genealogy and comprehensive 100% label checks are very helpful in ensuring the quality of finished goods that leave the factory. However, while companies aim to manufacture with 100% quality and accuracy that is obviously not always possible. Despite everyone’s best efforts, sometimes mislabeling, non-conformance, or ingredient or product contamination happens.
When a recall hits, companies need to be able to react quickly and effectively. This is critical for the safety of consumers, as contaminated products or mislabeled allergens can be a serious health risk. It also helps protect brand value – social media means unhappy consumers can have an immediate impact on a brand’s reputation.
Digital transformation of inventory, production and quality operations with manufacturing execution systems (MES) and integration with Enterprise Resource Planning (ERP) and Quality systems enables complete end-to-end traceability from receiving materials to shipping logistics and provides a comprehensive product genealogy and history. This allows improved response time during a recall, as well as improved regulatory compliance.
Winning the Consumer’s Trust
With digital transformation, food and beverage manufacturers can improve manufacturing agility and provide the transparency and traceability consumers and regulators expect. This allows companies to provide consumers the products they want, while mitigating the risk of recall. Taking these steps builds consumer trust, which can provide companies an edge in today’s competitive food and beverage market.
Moving beyond quality assurance and food safety, traceability allows manufacturers to build a relationship directly with their consumers. By making end to end traceability information available at the point of sale (via serialized barcode scanning, with the consumer’s mobile device), a manufacturer can provide a consumer genealogy and nutrition information about the scanned product. In addition, the manufacturer can suggest complementary products and recipes. This deepens consumer engagement and gives the manufacturer consumer behavior information that is traditionally obscured by the retail channel.
To learn more about the benefits of digital transformation in food and beverage, visit our website and join our webinar “Provide Food Safety Through Traceability and Quality.”
How is your company working to keep your consumers happy? Let us know in the comments!