Food & beverage spending

InTech, Jul 2004

Plant-level expenditures in the food and beverage industry, which totaled more than $280 billion worldwide in 2003, will exceed $340 billion by the end of 2008, a just released study predicts.

"Today's food and beverage industry exists in a state of dramatic change," said David clayton and Ravi Murthy, senior analysts at Dedham, Mass.-based are Advisory Group and co-authors of ARC's Food & Beverage Industry Plant-Level Expenditures Worldwide Outlook.

The researchers predicted that market will expand at a compounded annual growth rate approaching 4%. "Whether it's consumer demographics, product globalization, industry consolidation, changing regulations, cost of operations, or brand loyalty, this change is driving the need for innovative solutions that enable companies to become more lean and agile," according to the study.

While manufacturing processes designed to ensure quality product with consistent taste and texture have, to date, been the hallmark of food and beverage manufacturing expenditures, manufacturing flexibility and time to market have also become increasingly important.

Meanwhile, as food and beverage makers respond to increasing consumer demands for a variety of more convenient, high-quality foods, consumer and government concerns over food safety have increased, the analysts said.

Power retailers, such as Wal-Mart and Carrefour, and government regulators are demanding improved supply chain visibility to increase safety and efficiency.