- THE MAGAZINE
- FOOD MASTER
Based on statistics released by Frost & Sullivan earlier this year, the food and beverage industry fared very well in spite of the recent economic slump. In fact, the food industry was one of the top performers in the study, losing only about 6% of its value compared to a year earlier. In contrast, the automotive industry lost nearly half of its value while the banking industry lost more than 60% of its value, according to Frost & Sullivan.
So why is the food industry so glum? Preliminary results from Food Engineering’s annual plant construction survey, scheduled to be published next month, are projected to be down 10-15% from the previous year. In addition, food and beverage suppliers are reporting that some processors are not investing in new equipment. Instead processors are focusing on traditional offerings rather than developing new products requiring new lines or updated technologies. This goes hand-in-hand with projections by industry experts who say consumers will continue to watch their wallets by clipping coupons and buying private label or store brands
In my opinion, savvy processors should be somewhat conservative in these turbulent times, but business leaders also know that innovation was never born out of inaction.
I have to wonder if some major processing companies are foregoing or greatly reducing employee raises and management bonuses this year just because they think it is the politically correct thing to do. If profits are good, employees should be rewarded. A raise or bonus and an ounce of enthusiasm might just help get us out of this economic mess.
Now would be a good time to invest in food safety measures, HACCP improvements and track and trace systems that seem to be in great need at some manufacturing plants. Either way, food companies should not hold on to the purse strings too tightly if they want to achieve true innovation.
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