Food industry revenue grew in 2020. But will this scenario stay positive over the coming years?
Even with the pandemic caused by the coronavirus, the sector performed very well last year — mainly because of the new consumption habits that were created.
However, were the changes deep enough for the sector to keep growing? And will the new consumption habits last, or will new ones soon appear?
To answer these questions, this article gathers the numbers behind the food industry's growth in 2020, the outlook for the future, the changes in consumption, and the trends for the years ahead.
Happy reading!
Changes in the way people consume
Before the Covid-19 pandemic hit Brazil and quarantine was imposed, there were already signs that Brazilians were changing the way they eat.
A 2019 Nielsen survey showed that, at the time, 42% of consumers were changing their consumption habits to reduce their impact on the environment. To give you an idea, 30% of respondents were paying closer attention to the ingredients in the products they buy.
In addition, the population was also showing greater concern with adopting a healthier diet:
- 57% were cutting back on fat;
- 56% on salt;
- 54% on sugar;
- 38% on processed foods;
- 34% on caffeine;
- 27% on lactose;
- 27% on gluten.
At the supermarket, there was greater demand for products with added fiber, vitamins and minerals (45%) and for organic foods (35%).
With the arrival of quarantine as a consequence of the pandemic, these habits changed even further — mainly because many consumers started doing their grocery shopping online.
And this shift in consumer habits forced industries to adapt quickly. Read on to see the financial impact these changes had on companies.
Food industry growth in 2020
Faced with an almost sudden change in consumer habits, one would expect organizations to have some difficulty adapting so easily.
However, even in this unexpected scenario, the food industry grew in 2020. According to figures compiled by Neotrust/Compre&Confie, the food and beverage sector grew 241% in the second quarter of 2020.
And the surge continued throughout the year. According to a survey conducted by ABIA (the Brazilian Food Industry Association), the sector recorded 12.8% revenue growth over 2019, reaching R$ 789.2 billion.
Part of that volume came precisely from online purchases. According to the study "E-commerce Trends: Lessons from a More Digital Year" by Mercado Livre, 2020 saw greater demand for digital grocery shopping, resulting in a 161% increase in the number of orders.
But how long will this food industry growth continue? Are organizations prepared for the new trends that will emerge or gain strength in the coming years?
Trends for the future of the food industry
According to a forecast by Brasil Supermercados Online (BSO), the food and beverage industry should move around R$ 48.65 billion in Brazilian e-commerce by 2023.
However, for that to happen, business owners need to prepare and invest in technology. Check out some trends that should be followed for the food industry's projected growth to become reality.
Online shopping
Because of the pandemic, consumers found a new convenience: doing their grocery shopping online.
There is no sign that this new consumption behavior will disappear anytime soon. In fact, more and more people are expected to adopt this shopping model.
However, the sector's current reality cannot handle a significant increase in online purchases. Today, of the 50 largest supermarket chains in Brazil, only 18 have their own e-commerce operations.
And that is among huge chains serving the whole country. So it is fair to conclude that small and mid-sized companies are not ready to meet this new demand either.
Sales channels and marketplaces
Although physical points of sale are still essential, digital channels also play an important role in the food industry's growth.
That is because the modern consumer evaluates both the physical and the online experience before making a purchase decision. On top of that, you also need to be present in marketplaces.
A study by EBANX shows that the top 10 most visited and most engaging websites in Brazil are all marketplaces, making it clear how important it is to invest in this model.
Plant-based proteins
Driven by the search for healthier eating, plant-based proteins emerge as a nutritious, sustainable option that can be a good substitute for animal-based foods.
Snacks
During the day, the home office desk became the place where a good share of consumers eat their meals. This turns out to be a great opportunity for creating snacks, especially healthy ones.
Hygiene and food safety
During the pandemic, food hygiene and safety were among consumers' biggest concerns. And special attention to this factor is here to stay.
In this sense, food companies must care not only about product handling, but also about packaging. Beyond cleanliness, packaging must convey safety.
As we have seen, the main changes in consumer behavior that contributed to the food industry's growth are expected to persist and gain strength.
However, companies have not made major changes to their processes, adapting only temporarily.
And to stay up to date and keep pace with the trends, it is necessary to invest in technology. With the right tool you can keep tight control of the organization's finances and inventory, and reduce costs so the budget stays healthy.
Furthermore, when entering a marketplace and expanding sales channels, information needs to be centralized. That way, managers' time is optimized and it becomes easier to control and analyze information, supporting faster, more accurate decision-making.
With an ERP system you get access to all these benefits and also make communication between employees faster and more reliable.
Want more tips on how to optimize your business management? Keep reading the blog!
Originally published in Portuguese at useall.com.br.