Food industry feels the pinch
3 Aug 2015
A recent survey of UK food manufacturers reveals that optimism has slightly cooled since last year, as market and regulatory pressures take their toll.
The research, which was conducted by Food Manufacture in May this year, quizzed 511 UK food and drink manufacturing professionals on the key issues impacting their performance.
“Perennial complaints from suppliers about supermarkets putting the squeeze on them financially; burdensome regulations; and inability to pass on raw materials cost increases remain,” said the report.
Perennial complaints from suppliers about supermarkets putting the squeeze on them financially; burdensome regulations; and inability to pass on raw materials cost increases remain
Food Manufacture
While 75% of the respondents still remained reasonably optimistic about the future of their companies, the figure was slightly down from 78% in last year’s survey.
There was a similar trend when quizzed about confidence in the long-term future of the food manufacturing industry, with positive responses from 86% of manufacturers, compared with 88% last year.
Many of the concerns raised in last year’s study were repeated this year, said the researchers.
Pricing pressure from retailers is holding back new production development and innovation in the sector, according to 69% of respondents.
Most respondents (70%) also agreed that raw material prices would add to the market pressure in the coming year, along with tighter industry regulation.
However, 75% of participants still expected their company’s profit margins to improve over the next year, while 69% of respondents said they planned to invest more in new product development than last year, up slighty from 66% last year.
Although most of those surveyed (79%) claimed their company’s products were now compliant with current consumer information regulations, even tougher regulations for foods high in fat, salt and sugar are anticipated by 74% of those surveyed.
Recruitment within the sector also proved challenging, with 64% of respondents admitting they continued to find it difficult to hire people with the appropriate skills.
But only 44% of respondents said their company had plans to take on more apprentices over the coming year.
Environmental concerns are increasingly shaping the corporate agenda, with 62% indicating their companies were embracing “a holistic approach to product lifestyle management” and establishing plans to assess the environmental impact of their products across the whole supply chain. However the report findings indicated that more work needed to be done in this area.
Although 60% of those surveyed said they planned to reduce their packaging weight or make recycling a priority this year, only 36% indicated they had hit the 2015 target set by the Food and Drink Federation of sending zero waste to landfill.
