Recent times have witnessed a steep rise in the food processing equipment market, as highlighted in a Transparency Market Research report that the industry is projected to value approximately 80 billion USD by 2027, growing at a CAGR of 5% from 2019 to 2027. Thus, the food processing equipment industry is decidedly on a continuous high growth trajectory and is expected to continue on it in the foreseeable future as well.
For a business to cope efficiently with the fast-changing market trends as prevalent in a booming industry, it has to anticipate them timely and formulate a plan to accommodate the same. The ability to identify and exploit favorable market opportunities before competitors can help companies gain an advantage over others in the market and thereby enhance their profit substantially. Additionally, recognizing possible threats beforehand can minimize losses and add to the profit margin. Thus, a business must stay abreast of all the latest and expected changes and trends that dictate its industry.
Some opportunities and challenges as expected to appear in the future landscape of packaged food industry are discussed briefly below:
Increased inclinations towards hygiene
The demand patterns of consumers have shifted significantly because of the global pandemic. The Indian people who initially favored loose and unpackaged food items progressively opted for packaged food. This preference change can be attributed to the growing importance of hygiene in today's world. Covid has made people skeptical of unpackaged products, and thus the demand is now majorly present for neatly packed food products that have been minimally touched.
This inclination of the masses towards packaged products has increased the scope of the food processing and packaging industry. Businesses are now shifting to selling sanitized, and packaged food products and are investing significantly in food packaging equipment.
The firms functioning in the packaged food machinery industry can exploit this opportunity by making available viable and economical options in food processing equipment to the firms functioning in the food and beverage industry.
Robust technological advancements and automation
At present, technology is fast infesting in all big and small processes of businesses worldwide. In this circumstance, the food processing industry is anticipating a technological shift.
The use of equipment in food packaging processes aims to make the packaging processes efficient and smooth. Introducing technology and automation in these processes will naturally only fuel the operations' speed and precision. Thus, the industry is expected to undergo a surge in the use of technology in the approaching times, and the companies operating in the industry should prepare to cope with the same.
As technology becomes a familiar part of the industry and its products, the productivity and revenues of the businesses in the industry will soar as the ease and benefits of using the food processing equipment increase and works to bolster the demand.
Growing need for going green
The world has been growing increasingly concerned for the environment and its health, and rightfully so. The environment is deteriorating at an alarming pace and the Covid pandemic has acted as a wake-up call for the masses to act responsibly in this matter. Thus, consumer demand is now shifting towards 'greener' options.
The trend as translated in the food processing industry is for the products that come in eco-friendly packaging. Thus, the firms offering packaged food should be mindful of making their packaging and the packaging processes biodegradable and non-polluting to avoid any backlash in this regard.
The opportunities for rising technological use and hygiene are indeed welcome news, but they do not come without their share of concerns. Technology, in present times, is fast developing and therefore requires constant upgrades. However, being at par with all the latest technological updates is an expensive affair and can thus serve as a problem for firms.
Additionally, ensuring hygienic and eco-friendly processes and products too can translate into additional expenses for the packaged food firms. Thus, this potential threat of possibly increased expenditure is something that firms operating in the industry should watch out for.
The packaged food market has been fast growing in recent times. Therefore, there is a need for firms working in the industry to identify the upcoming potential opportunities and threats and accommodate them timely in their future plans to not lose out on any possible profits and avoid getting caught in possible losses. Some opportunities arising in the field include the increased demand for sanitized food products and technology use. At the same time, the threats stretch to include growing concerns of the public for non-eco-friendly practices and the possible rise in expenses of the firms to accommodate the same.
Author - Raghav Gupta, director, Kanchan Metals