< Previous10 Food & Drink International www.fdiforum.net IMPORT AND EXPORT © stock.adobe.com/Photo Gallery opportunity Reaching for Import and export is the lifeblood and future of the food and drink industry, but with many new markets emerging – it’s important to get the initial push right, otherwise one might lose out to competitors who know better. Food & Drink International 11 www.fdiforum.net IMPORT AND EXPORT W hen it comes to exporting food and drink products, identification of an attractive market and quickly getting a foothold are important factors. The early bird gets the worm, as the old saying goes, and attempting to unseat a well-known product in a country can be a daunting task. As such companies are often keeping a close eye on countries that are not the biggest, or the highest spending on products. But what countries are booming or are showing sudden increases in demand. The US still stands at the top of the table when it comes to their demand for foreign food. This is according to a number of factors involving, imports and exports, and is ranked on the Food and Beverages Attractiveness Index (FBA). The problem is that the US is also one of the most well-established markets in the world, with thousands of brand names competing for shares of the customer base. As such, introducing a food and drink product from the UK for instance, can be difficult. The marketing budget alone necessary to break into the market can be staggering, particularly in competitive markets such as confectionaries or soft drinks. More attractive markets to prospective exporters might be those who are just starting to become bigger players in the world economy. They are far less likely to have a wide range of products in the market, and it gives a company a chance to build their own brand and marketing strategy, without being pressured by existing brands with multi-million marketing budgets. What makes a market attractive to exporters often is determined by what specific exports are booming. A clear sign of increased food and drink imports in a country might mean little if a company’s particular product is not experiencing the same demand. For instance, when it comes to eggs and dairy products, Germany sits at the top of the table, based on sheer volume. On the other hand, Japan leads in terms of meat imports, with China also showing a high amount of specific meats. Many countries right now are also grappling with the concept of food scarcity and what they will do if trade routes are cut off, either as a result of belligerent trade 12 Á12 Food & Drink International www.fdiforum.net IMPORT AND EXPORT attitudes, rising xenophobia or the risk of escalating global conflicts. Since many larger powers rely on trade to sustain their populations, it has made for difficult conversations. Ever since World War 2, the UK Government or agencies related to it have, at times, run what is called a U-Boat Analysis. This references the dreaded submarines of the German Reich that would sink convoys bringing much-needed supplies to the UK, and the hypothetical scenario asks how well the country would do at feeding its own population should all international trade somehow be cut off. The answer, surprisingly, is that the country could survive – but it would mean a lot of changes. Right now, the UK produces about 50% of the food that it eats. It actually produces more – closer to 70%, but much of that is exported to other countries. Exactly why the UK imports the other 50% is to enable variety among consumers. Certain seasonal fruits and vegetables impossible to grow in the UK in certain months can be brought in from elsewhere, allowing options of foods that would not be seasonable in the UK. Similarly, spices and tastes that we have gotten used to from other countries make for staple diets for much of the population. If the UK were to be cut off for whatever reason then one of the first things to go would be the range of goods on shelves. Suddenly, the UK would be forced to adapt to very seasonal and limited ranges, especially in the colder months. Similarly, there might need to be a significant reduction in meats. While British and Irish meats are popular across the world and make up a bulk of our exports, the production of livestock is land-intensive, and they also feed off crops that humans could eat. As a result, meat would be cut down and available only to the wealthier consumers, with much of the land dedicated to its production re-allocated to productive crops instead. Food manufacturers in the UK would initially face struggles sourcing specific materials commonly used in their recipes, and © stock.adobe.com/Travel maniaFood & Drink International 13 www.fdiforum.net IMPORT AND EXPORT they would also be faced with shortages at key times of the year. Those that do not go bust might adapt and be able to change recipes or move to plant-based goods entirely, and carve a niche for themselves, but given that cost of living would rise even further, it’s unlikely they could raise costs much on their produced goods without consumers being unable to afford them. The result would be a United Kingdom that could “technically” feed its population, albeit on a reduced diet of crops and barley and other plant-based meat alternatives. It should go without saying that this is not an ideal any country should aim for, but the results do raise questions for the UK’s food security and D Davies Turner could shape policy in the coming years. Given that other countries are also likely running similar simulations, the importance of imports and exports is growing as populations do. Trade is integral not only for business, but for survival, hence why it is so worrying when global leaders throw terms like “trade war” around so easily. 14 Food & Drink International www.fdiforum.net END OF YEAR REVIEW It’s not been a great year for many people – and some might argue it’s been a bad one in general. Even those who have done well will be shocked and perhaps a little shaken by the speed at which the industry is changing. A s we look back on 2024, it’s difficult to pinpoint the exact moment where the year turned rough. Some might argue that the year was sabotaged from the start, coming in off a rough few years prior reaching all the way back to the pandemic. It’s a year that could go down in the history books for all the things that have happened, but the sheer quantity of incidents has also made it so that problems in other areas and industries are overshadowing the challenges faced by the food and drink industry. It’s perhaps no small exaggeration to say that the biggest success of 2024 is making it through 2024 in a strong position, because sometimes survival is the greatest challenge of all. Economically, the year got off to a rough start because of global political strife and danger in several key areas. The war between Food & Drink International 15 www.fdiforum.net END OF YEAR REVIEW © stock.adobe.com/Anna Russia and Ukraine raged on throughout the year displacing a lot of people and putting pressure on the surrounding regions, and attacks in the Red Sea by Houthi rebels similarly struck at shipping supply lines, forcing some importers and exporters to change entire routes or risk cargo falling to attack. The conflict in Gaza between Israel and Palestine has similarly turned the Middle East into a powder keg that could go off at any moment, but it has also exposed the challenges of providing food – especially when one side of the conflict is unwilling to let the food flow. This has led to food scarcity being a talking point across much of the world, especially in more developed countries where the much of the food eaten by the populace is imported. While most governments are keen to shy away from talk of all-out war, some have taken that as a sign they can get what they want by threatening it, and so even the most conflict-averse countries are having to ask difficult questions on how they will feed their populations in the event that importing food in becomes difficult or even impossible. As if that wasn’t bad enough, spiralling inflation led to cost of living crises that completely 16 Á16 Food & Drink International www.fdiforum.net END OF YEAR REVIEW changed the way people bought foodstuffs, forcing many to move down a bracket in terms of food quality, and invest in cheaper foods over luxury brands. In the midst of all this (as if it wasn’t hard enough) Donald Trump ascends to presidency in the US and immediately threatens tariffs, causing further pain to the food and drink industry as they face down the prospect of the US market putting even more of a squeeze on them. It’s unlikely that other countries will respond timidly to the threats, so even US food and drink manufacturers will have to suffer the consequences of it. The only ones set to benefit are those manufacturers in the US who can’t compete against international competition and so may gain an advantage if said competition is priced out. However, this is unlikely to be a long-lived advantage at all, as tariffs will not last forever and those international brands will come back. Also, scarcity often just drives up the demand of goods. Another revelation that cropped up this year and turned the industry on its head is the continued development and commercial use of artificial intelligence. While AI has been maligned and disliked by many who see it as lazy and uninspired, that certainly hasn’t stopped brands engaging with it, especially those who see the drop in reputation as a worthwhile price to pay if it means being able to cut staffing numbers. In certain parts of the industry (particularly those the consumer doesn’t engage with, like testing and warehousing) the usage of AI has been found to be useful without the risk of alienating customers, but in more customer-facing aspects like marketing and engagement, it’s been a lot riskier. Some brands (not just in food but elsewhere) have taken huge hits to their reputations by trying to engage with AI too soon and looking foolish because of it. The technology itself is controversial, and that’s worth keeping in mind when letting it engage with customers. If the year could be summed up by one word then perhaps that word would be “change”. Change is good, and it’s usually seen as advancement – but too much change coming too quickly can be challenging, because change is rarely affordable when it has to be spread out over a company that might span 50 countries, 100 facilities and over 1,000 individual members of staff. If it were just AI on its own, or just the rapidly changing geopolitical scene on its own, then companies might be better able to adapt to thrive, but it’s multiple changes coming at once and each and every one of them being so grand that it’s not just difficult to ignore them, but an outright bad idea. Brands that refuse to invest in AI will be left behind by those who do, and those that bury their heads in the sand with regards to the rising tensions across the world will be caught flat- © stock.adobe.com/akobchuk OlenaFood & Drink International 17 www.fdiforum.net END OF YEAR REVIEW footed when they bubble over into conflict. Similarly, it’s not wise to ignore fluctuating interest rates, spiralling inflation and the cost of living – for while it appears to be ending in most developed regions, 2024 has shown the instability of markets. Another cost of living crisis like what was seen in the UK, US and Eurozone could further squeeze food and drink manufacturers, especially those who produce luxury products with higher prices. In the quest to reduce costs and also reduce wage overheads, automation is emerging as an ever more profitable solution – and it’s an area where AI can be used to great efficiency. As more companies move to fully automated manufacturing lines, it creates a buffer against fluctuating wage costs and demands for higher earnings. While that may sound cynical (because it is), there’s no denying that recruitment has become more difficult in recent years, and that’s unlikely to change anytime soon. Those who are not yet fully automated will want to take a good long look at becoming so. It’s obviously difficult to guess at what 2025 has in store, but it’s unlikely to be static or calm. This all sounds like bad news, and it will be for many, but it’s worth remembering that an unsettled market creates opportunities for both smaller and larger businesses. Large, monolithic brands struggle to adapt to change quickly because of the logistical challenges, while smaller brands can shoot ahead by embracing new technology. In a time of upheaval and change, it’s anyone’s game – with an almost “Game of Thrones” mentality to be had. It’s been a chaotic year, but chaos is a ladder and there are those who have managed to scale it. ʴˈˇ˂ˀʴˇʸ ˀ˂ʼˆˇˈ˅ʸ ʶ˂ˁˇ˅˂ʿ %RI\GIWWSJQSMWXYVIGERLEZIPEVKIMQTEGXWSRJMREPTVSHYGX UYEPMX]TVSHYGXMSR IUYMTQIRXJYRGXMSR1SMWX8IGLƅWRIEV MRJVEVIHQSMWXYVIWIRWSVEPPS[WQERYJEGXYVIVWXLIEFMPMX]XSEHNYWX QSMWXYVIPIZIPWFEWIHSRVIEPXMQIMRJSVQEXMSRPS[IVMRKVE[ QEXIVMEPGSWXWERHSZIRYWEKITVSPSRKMRKIUYMTQIRXPMJIG]GPIERH MRGVIEWMRKTVSHYGXUYEPMX] TVSHYGXMSRIJJMGMIRG] ˪˪˪ʡˠˢ˜˦˧˧˘˖˛ʡ˖ˢˠ ʞʧʧʤʤʦʫʠʩʫʣʧʤʦ © stock.adobe.com/Ikram18 Food & Drink International www.fdiforum.net END OF LINE PACKAGING In the ever-shifting landscape of consumables manufacturing, end-of-line packaging stands as a crucial phase in the production process. M anufacturers can be forgiven for feeling confused or overwhelmed when it comes to end of line packaging – there’s a dizzying array of options available, and a dozen different machines for each process, be that collating, packing, or dispatching. Case formers, case packers, partition inserters, case sealers, pick & place units, carton erecters, load & close units, palletisers & de-palletisers… the list goes on and on. First and foremost, manufacturers need to identify whether they require a stand-alone or integrated solution. As the name suggests, integrated solutions can be incorporated into an existing production line, ensuring a smooth, seamless journey for products as they pass through the production line and are packed ready to leave the factory for the customer. The downside, BAG SEALING MACHINES RM Sealers remain a leading British manufacturer and supplier of high quality Bag Sealing Machines, also known as Rotary Band Sealers and Impulse Sealers. Call 01442 843387 to speak to a member of our team SEALERS © www.rmsealers.co.uk Beginning at the end Food & Drink International 19 www.fdiforum.net END OF LINE PACKAGING © stock.adobe.com/Irina Sharnina however, is that there is a significant investment required, and the downtime needed for installation. Stand-alone solutions, however, are by their very nature modular and smaller, often requiring a human worker to manually place the products for wrapping on the stretch wrapper. Of course, there is the initial investment to consider in either case, but also the size of an operation and its throughput to take into account. An integrated solution is suited for larger operations, particularly those working around the clock. On the precipice of potential expansion, a stand-alone option may provide proof of concept when it comes to automation, as well as offering an affordable solution for smaller manufacturers. Even a semi-automated end of line solution can have a powerful impact on throughput and speed, whilst freeing human workers up to be utilised elsewhere in the production. As well as the inherent gains in production speed, precision, and efficiency, adopting automated solutions often comes with an environmental benefit – not something to be sniffed at amid the continuing climate crisis. To be human is to be fallible, yet mistakes BENCHTOP BAG SEALING MACHINE IMPULSE BAG SEALING MACHINE HORIZONTAL BAG SEALING MACHINE VERTICAL BAG SEALING MACHINE 21 ÁNext >