Major Challenges to Look Out for in The Food and Beverage Industry

A masked customer moving through a food and beverage aisle in the supermarket

To say that last year has been unprecedented would be an understatement of gigantic proportions. The fact that words and phrases like “the new normal,” “pandemic,” “social distancing,” “lockdown,” “quarantine, “virus,” “zoom,” “remote,” and of course “COVID” were used the most paint a bleak picture of how challenging the past year has been.

To no one’s surprise, no country, economy, or industry has escaped the pandemic unscathed. Manufacturers and retailers across the globe have been sent into a frenzy trying to keep their businesses afloat. Some economies have collapsed, while many are on the brink of a collapse. Countless businesses have gone under, and some industries are barely breathing.

Needless to say, the food and beverage industry was no exception. In fact, it was one of the industries that took the earliest and the hardest hit. But interestingly, experts are coming to the conclusion that after the initial unavoidable hit that took everyone by surprise, things may have taken a turn, and not necessarily for the worse. In fact, it was soon predicted, and rightly so, that the food and beverage sector may be the only one to grow during this pandemic.

And this should not exceptionally be surprising as a pandemic doesn’t diminish hunger. People continue to eat. But what has changed are their eating and purchasing habits. As a result, these changing trends have brought on a set of new opportunities for businesses in the food and beverage industry. Still, the opportunities come with a few costs, i.e., certain unavoidable challenges.

Here are a few challenges facing the food and beverage industry right now.

1. New Regulations and Safety Standards

While a lot of industries have completely moved into the virtual space, food manufacturers can’t work from home. Food cannot be packaged and stored on Zoom meetings. Therefore, naturally, it’s imperative for those in the food and beverage industry to adhere to the latest safety regulations that are in place due to the pandemic to ensure that the food produced and supplied is safe to consume.

However, keeping food safe is not the only challenge. It’s also imperative to keep the workers safe, which may mean fewer physical inspections. This places a huge responsibility on the manufacturers and suppliers to maintain the integrity of the supply chain on their own.

Additionally, since a lot of the products in question are perishable items, they need to be consumed within a set time frame to ensure the highest safety standards. This is a challenge in itself, as supply chains today are extensive and complex.

However, using an order management system software can help in ensuring quicker order processing.

2. Issues with Inventory Management

As previously touched upon, perishability is a major concern when it comes to inventory management. Failing to store products hygienically is directly proportional to failing in upholding safety standards. The food can be exposed to foodborne pathogens and much more.

Given that this is a major and persistent challenge in the industry, there is a constant hustle to overcome it using different approaches. One most popular approach used by foodservice suppliers and retailers alike is incorporating cloud-based inventory management and wholesale food distribution software to manage their stock better.

3.Increased Labor Costs

Another major challenge facing the F&B industry at the moment is the rising labor costs. Given that this is a challenging and unpredictable financial era, it’s imperative to cut down on costs while maximizing productivity.

But since labor costs and rising wages are often out of one’s hand, it means that the business needs to improve sales to balance it all out and remain profitable. There are several ways to do this.

For instance, you can digitize some operations and benefit through automation and reduced chances of human errors. Order management systems like OrderTron, for example, allow a business to save time and resources by offering reduced data entry, increased capability and sales, eliminate errors, and improve order processing time. Such automation also allows you to cut down on labor altogether.

4.Reducing Food Loss and Waste

A small sack of ruined oranges

According to the UN Food and Agriculture Organization, 1.3 billion tonnes of food is wasted globally, and this leaves a carbon footprint estimated to be around 3.3 billion tonnes. These are staggering statistics and are particularly surprising given the fact that an increasing number of consumers and businesses today are environmentally conscious and trying to be sustainable.

For businesses, though, in the food and beverage industry, this is more than just an environmental loss. Wastage equals monetary loss, a phenomenon most small and midsized businesses need nothing to do with it. So, in order to overcome this challenge, these businesses are constantly trying to improve operations using technology.

The idea is to monitor the stock in real-time to ensure minimal to zero wastages caused by human errors or overlooking important expiry dates. At the same time, quicker order processing ensures that perishable items are delivered on time. New inventory management and order processing software allow businesses to accomplish this effortlessly while allowing improved purchase management

5. Lack of Traceability and Transparency

End-to-end traceability is emerging as a huge trend or rather a demand by the consumers. This presents a number of challenges for the business in the F&B industry. Because the supply chains nowadays are so extensive, complex, and multi-layered, it can be very difficult to keep up.

To ensure supply chain visibility, a lot of businesses are opting for modern data-driven approaches and tools. Some of these wholesale food distribution software allows businesses to create digital warehouses and personalized dashboards to access information easily.

This software allows easy tracking of orders while streamlining the delivery and also provides live updates on order status.

A warehouse with sacks of food supplies

6.Making Food More Affordable

We’re living through one of the biggest global financial crises the world has ever witnessed. Many people have lost their jobs in the past year and those that have lost breadwinners to the pandemic, so it’s important to Meta: Food service suppliers are faced with challenges today, the likes of which no industry has ever seen before.

understand that the collective purchasing power for consumers has significantly decreased.

As a result, food businesses are faced with the challenge of supplying products that are still affordable to a majority of consumers across the board. This is not easy as most businesses themselves are barely getting by.

The only way to do this is by reducing costs through enhanced efficiency and greater productivity, which in turn should boost sales to increase revenue. Since the profit margins will be slimmer, the higher sales should help balance that out.

For food businesses, one way to enhance efficiency is by automating what can be automated. For example, data entry, order processing, and managing invoices are not tasks expensive labor should be wasting its time on. These things can be handled by any sophisticated order processing software, improving response time and decreasing labor costs.

Smart measures like these across the supply chain can help make the product much more affordable for the consumer.

7.The Demand for Greater Convenience

If we had to pick one word to describe the past year, it would be “inconvenient.” The extremely unforgiving ways in which this pandemic has been inconvenient are hard to put into words.

The new normal wasn’t all sunshine and rainbows. Not even close. It made us alter every aspect of life, including the way we conducted businesses. Since social distancing is part of the new normal and extra effort is required at almost every front, people want convenience where they can get it easily.

This is basically what the customers are demanding as well across industries. Therefore, suppliers across industries are trying to meet this challenge by innovative means. They are mostly doing this by using technology and automation to provide quicker service without having a lot of physical contact with the consumers.

An android and iPhone displaying the order management app

For instance, OrderTron, which is an Order Management App, allows consumers to place and track orders using their iPhones and Androids. The application is user-friendly, which makes it even more convenient.

8. The Growing Pressure to Digitize Operations

If there is anything positive that has come about due to the pandemic this past year, it’s the newfound appreciation for technology all across the board, including the food and beverage industry.

Digital trends were making their way slowly but surely into the F&B industry; however, the pandemic has accelerated the transition. The need for automation and digitization is far too real for businesses now and pretty much their last hope to stay afloat.

It’s a cut-throat competition out there, and the only way to survive is to upgrade and become more productive to stay on top of the game. Not doing so could result in slower response time and a loss of existing or potential customers.

There are a number of ways businesses are incorporating the latest technological solutions into their day-to-day operation.

Our online order system software is one such solution. OrderTron is the ultimate order processing software that can help food suppliers and their retail customers tackle all of these new challenges in the industry.

It not only simplifies order processing but also helps to track and manage inventory by incorporating a powerful cloud-based system into your business.

Get in touch with us to learn more about how OrderTron can take your business to new heights.

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