Anyone looking to help their food company succeed in 2023 faces several challenges. The industry is facing problems with sustainability, understaffing, insufficient technology, and more. Lumiform co-founder Lukas Blasberg joined FoodDocs to share his thoughts on prospective improvements within the food industry.
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What are the biggest challenges for a food company today?
The interview revealed a few major types of challenges faced by businesses in the food industry. Broadly speaking, the two categories of challenge are economic and environmental. Addressing these challenges is not just about keeping food businesses afloat, but part of a bigger picture. For example, improving food sustainability is a key component of fighting climate change.
Economic challenges in the food industry
The general economic situation has been as difficult for food companies as for anyone else. Inflation poses a challenge to restaurants and other food suppliers, as the cost of food and other supplies keeps rising.
Higher food prices mean higher menu prices. Food businesses have had to charge customers more to offset increased operating expenses. On average, menu prices have increased by 15%, which is the most their customers are prepared to tolerate. Given that they are close to the price ceiling already, food companies need to find ways of accounting for rising food prices that don’t involve raising prices.
Another challenge is labor shortages. The hospitality industry in the U.S. is heavily understaffed, with nearly 2 million jobs unfilled. Labor shortages are expected to continue throughout 2023, in addition to the food industry’s high turnover rate.
Environmental challenges in the food industry
In the face of climate change and growing consumer preferencefor sustainable products in general, food companies have started paying more attention to improving the sustainability of their operations. Additionally, prospective employees now prefer to work with sustainable businesses.
The food industry also covers manufacturers and suppliers. One of the biggest challenges in food sustainability is large-scale agriculture like industrial pork farming. Industrial and factory farming take a heavy toll on the environment.
At the same time, consumer demand for meat and meat products remains high in 2023. Those two things combined with the high amount of food waste in the sector make up the main sustainability concerns a food company contends with.
What is the solution to these challenges?
Everyone interviewed by FoodDocs identified technology Technology as the solution to both the economic and the environmental challenges the food industry contends with.
When it comes to the environment, food businesses can benefit from a switch torenewable energies and more sustainable supply chains enabled by data collection and production management software. These two things minimize the impacts of routine business activities.
Technology can also revolutionize farming and food production. Current large-scale farming practices aren’t very sustainable, and they could be improved. For one thing, massive farms dedicated to only one type of crop weaken the soil and increase the risk of disease. Manufacturers could grow a bigger variety of crops to avoid this.
Farming techniques like crop rotation and agroforestry also reduce the carbon emissions caused by production. Businesses can repurpose food waste into electricity and heat through anaerobic digestion.
Technology helps with labor shortages and rising costs by allowing businesses to implement automated solutions, like self-service kiosks or digitized QR code menus. Restaurants have also been embracing online food delivery as a way to reduce overhead costs.
Technological improvements are especially important for deskless workers, as Blasberg pointed out. Deskless workers make up a large portion of any food business; when was the last time you saw a chef or a waiter with an office? Yet digitalization has not yet arrived in the world of deskless work.
Blasberg notes that intuitive, mobile-friendly digital solutions can and do prove monumental for productivity in a food company for exactly this reason. Such solutions help streamline workflows, improve communication, and manage inventory, all things which are typically hectic in the fast-paced food industry.