BGL Insider Special Report

Food & Beverage: 2021 In Review

2021 was a landmark year as the impact from the COVID-19 pandemic persisted in varying degrees throughout the world. The Food and Beverage (“F&B”) industry experienced significant growth, despite reduced physical interaction with consumers. Like most manufacturing industries, F&B had to deal with unprecedented levels of disruption, such as unreliable and costly supply chain volatility. Continued evolution of consumer tastes and preferences, as well as unique industry demands, have forced companies to adapt.

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DANIEL J. GOMEZ
Managing Director

Over the past year, four priorities stood out for F&B companies: 1) overcoming supply chain disruptions, 2) emphasizing sustainability and traceability, 3) capitalizing on eCommerce, and 4) adapting to increasingly dynamic consumer preferences. As younger consumers enter the market, more and more purchases are being made based on a company’s reputation for sustainability. This includes traceability, visibility, and the ability for companies to accurately measure their carbon footprints. Today’s market is embracing a more conscious consumer. The need for more transparency, safety, and long-term sustainability is leading to major innovations within the F&B industry.

Supply Chain Disruptions

The increased cost and availability of freight, inputs, and labor have significantly disrupted supply chains. Empty grocery store shelves and long lead times continue to be the norm in a challenging environment. Companies across the supply chain are finding ways to combat price fluctuations and shortages of key inputs.

Sustainability and Traceability Driving Demand

Sustainability and traceability continued to be driving factors for consumers in 2021. Consumption of eco-friendly F&B products is expected to increase, which is building a bridge between the economy, ecology, and social issues. Consumers expect more traceability from both brands and manufacturers as they want to know the source and safety.

Direct-to-Consumer (“DTC”)

Digitalized platforms further shaped consumption patterns, as consumers are making purchases without physically walking into a store or restaurant. Pursuing and building a digital strategy will be imperative for brand marketers to survive and capture market share.

Increasingly Dynamic Consumer Preferences

Global flavor profiles and intense flavors are driving consumption. Functional and fortified foods are becoming more popular as snacking occasions become more frequent and substitute traditional breakfast, lunch, and dinner trends.

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