Gain a Competitive Advantage for your organisation with our Agrifood Cost Optimization Solutions
Overview
COVID-19 has of course had a big impact on the Agrifood sector even if the impact is slightly different than other industries.
Disruptions in the supply chains of raw materials and parts, financially unstable suppliers, challenges with production planning due to increased distance between employees, new and possible complicated legislation are of course obstacles that the Agrifood industry meets – just like any other industry.
During crisis however, the Agrifood Industry is less affected in the first period of time, simply due to the fact, that people for obvious reasons prioritize food, despite the crisis they are in.
However, historically the industry is always hit after a period of time because of two factors.
Firstly, some export markets might be affected or even disappear. Covid-19 is no different to any other crisis and companies see major changes in demands. If, as an example, a country has a large number of Covid-19 related restrictions, the professional market (Catering, Hotel/Restaurants, Events) might be radically affected. This is the case in most countries today, and even if retail turnover starts to increase, it doesn’t necessarily cover the losses and will for sure lead to changes in production and distribution setup.
Secondly, and this was very much the case in the years following the financial crisis in 2008, consumers tend to move from up market to discount products as the price parameter plays a larger role in consumer buying behaviour.
We still have to wait to see which long term changes Covid-19 will bring in the Agrifood Industry. However, companies with a sharp supply chain, where contracts have been updated and supplier relations renewed will be best prepared to meet the challenges ahead.
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Introduction to ERA Group Agrifood Solutions
ERA Group offer a wide range of industry solutions to help businesses all over the world. Our dedicated Agrifood Solutions team are focused on working with organisations within the Agriculture and Food Manufacturing space, and we've already helped hundreds of companies to run more efficiently and to protect their margins. Watch this short video which provides an introduction to our Agrifood Solutions. You can also download our full Agrifood Solutions guide for specific details of how we can help you.
"We are now entering, what some have termed, the global agrarian revolution. For businesses, it seems the only way to stay profitable is to understand and adapt to the trends and developments that continue to gain momentum and this means, for many, stepping into unfamiliar territory."
Agrifood Industry Insights
Growing Population
The world’s population will exceed 9 billion by 2050, and trickle up to over 11 billion by 2100 (and that’s a lot of people on one small planet). The countries that will see the greatest increases will be the poorest ones, with places like Africa expected to rapidly double in population size and continue to struggle to feed their populace.
Environmental & Geopolitical
Industrial growth will be dependent on the economic and political landscapes of the countries, and how these change over time. Governmental vision and expertise will be vital in allowing businesses in the market to develop efficient long term plans that are in line with regulations, and business & industry goals, therefore, those operating within visionary countries, with the right infrastructure to produce and exports, are likely to see more advances at more rapid pace.
Supply Chain Issues
Agrifood supply chains have diversified over time, moulding into a multi-layered system of intricate relationships that cross borders. A complicated operation such as this can pose a threat to the profitability and efficiency of a business should one cog in the system fails to meet the requirements.
Sustainable Models & Technology
In the UNEP Discussion Paper (2012), authors Moomaw, Griffin, Kurczak and Lomax highlighted that if our populations and consumption rates continue at their current rates, we will need to be supported by the equivalent of two Earths by as early as 2030.
"The quicker businesses adopt technology and the opportunities it presents, the better placed they will be for the future."
Agrifood Solutions Case Studies
CP Foods Case Study
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"Digitalisation is changing the way consumers purchase products, including food, with new business models embracing direct-to consumer approaches."