New FSMA Rules A Major Concern For Food Companies, Says New Study From The Food Institute and Weisers Mazar
Rising commodity cost is the main concern among food and beverage companies surveyed in a new study from The Food Institute and accounting firm Weiser Mazars. Some 69% of participants agreed and two-thirds are looking for ways to improve their strategies related to the cost of goods. Rising health insurance costs, followed with 61% as they look to navigate changes in the Affordable Care Act.
The Food & Beverage Industry Study conducted late last year is a way for food & beverage companies to benchmark their results with the overall industry. Overall, the industry expected to see year-end sales increase 13.7% in 2012 versus a year earlier and profit to rise an average 5.8%, although one-half of those surveyed foresaw either flat or declining profits.
However, these gains were offset by rising costs contributing to modest net profit. Companies also indicated that they had raised prices in 2012 by an average of just over 5% to maintain profits. In 2013, they expect that the most important industry factors influencing sales growth will be new customers (59%), new products (51%), and increased selling prices (40%).
Three of the top five common operations strategies planned were the direct result of the implementation of FDA’s Food Safety Modernization Act, with participating companies noting that traceability/tracking, food safety, and knowledge/information sharing will receive much more attention in 2013 as a result.
Healthy/nutritious foods were noted as the industry trend most likely to impact company sales in 2013 (47 percent of study participants), with other trends each affecting approximately one quarter of organizations. This, again, indicates the need for F&B companies to focus on trends impacting their particular sector or region, and, when possible, to develop offerings that can take advantage of multiple trends concurrently.
Other interesting findings from the study include that food and beverage companies increased their capital expenditures by an average 9.3% last year, increased research and development spending by 1.7%, and employed 2.1% more people on average.
The results of the study can be downloaded at no charge at www.weisermazars.com