One of the only constants in our industry is change. How will your business adapt to changes in consumer buying habits? How will the radical changes that occurred in 2009 impact the future of your organization?
Tony Perazzo, a partner in the San Francisco office of Grant Thornton, LLP, recently contributed his thoughts on the new ways food and beverage industry organizations will be doing business in 2010 and beyond. Here are his article’s highlights:
- The economy has dramatically changed the way people shop. Consumers are looking to spend less, making price and value key priorities. Private label SKUs are becoming more profitable, forcing many retailers to reduce the number of SKUs across the board. Offering fewer SKUs lowers carrying costs, reduces the likelihood of shortages, and gives retailers more leverage to “squeeze” vendors.
- The recession will likely have a lasting impact on how consumers spend their grocery money. Price and value lessons will stay with shoppers long-term, fueling the demand for private label products.
- Private labelers, contract manufacturers and even retailers will need to pursue aggressive and novel product development to compete for shelf space.
- Smaller brands and emerging food and beverage companies will have unique opportunities to partner with retailers in producing private label products, and create innovative and higher-value product offerings. Those companies that best capitalize on emerging consumer trends will win the battle.
- Emerging and middle-market companies should focus on: regaining access to credit to keep pace with product development; streamlining operations; and enhancing operating efficiency.
- Bottom line, higher-value, less expensive product offerings are here to stay. As a result, innovation, efficiency and strong relationships should be key priorities for food and beverage industry companies.
To view the entire article, follow this link to Food Industry 2010: Priorities for the New Decade.
Kinsa Group can help you quickly and cost-effectively access the talented professionals your organization needs to capitalize on these trends. Please visit our website to find out what we can do for you.