A glimpse into the future
What does the future of the manufacturing industry truly look like?
While no one has a crystal ball, there are several issues the sector must face up to and deal with. No sector of manufacturing is able to ignore these challenges and I expect many, if not all of those I have highlighted below, to be the topics of conversation under the microscope at next week’s Foodex event in Birmingham.
It is one of the major events of the year for the food and drink industry, and looking through the programme at the exhibitors, speakers and demonstrations it has to be the must-attend event for those senior executives with some pretty tough decisions to make in the next six to 12 months.
For those that are driving their businesses, are ready to tackle the issues head-on or even just want to get a broader picture of the landscape then this could provide a few answers.
From my perspective these are the issues affecting not just the food and drink sector but manufacturing across the board:
Research and development. The UK has been at the forefront of investing in R&D and has been in a position to attract external investment. The government has signalled its intentions to maintain R&D spend with the Industrial Strategy but with a changing political landscape due to Brexit, sourcing overseas finance will be just one challenge. If the UK continues to take on the world, then continued innovation is a must if it is to stay ahead in a competitive market.
Changing tastes. This links to the need for R&D and innovation. Consumer tastes change and so manufacturers have to deal with that. Take the food sector as an example, today’s products must cater for a variety of customers as well the likes of allergens, to have broader appeal. Looking at recent developments, there is a continual rise in veganism, a growing move away from ready meals, demands for less salt and sugar in products and a growth in dairy and gluten intolerances to name but a few changes. If you’re one a product company or a multi-national, the question will be how do you meet these new demands and how are you going to financially to soften the blow?
Eco-friendly. This is not a new phenomenon at all with ‘green’ issues being on the agenda for the past 20-30 years or so. We’ve seen it with CO2 emissions, plastic, ‘green’ energy etc. Again, the food sector has a number to tackle including packaging, labelling and food shelf life to cut down on waste and make products better for the environment.
Legislation. Where do you begin? As new laws and taxes come into place, sectors have to adapt. There are a number of EU laws that have a profound effect on businesses and what will happen to them in less 12 months or when the UK is finally ‘out’ of Europe. Then there are our own UK laws. In the food sector, there has been the introduction of the sugar tax to tackle obesity. There are the current ‘coffee cup’ and the plastic straw debates – which also fall under the ‘eco-friendly’ issue. These are high-profile campaigns but ones’ indicative of the challenges the sector will tackle. Food hygiene and food safety always rank high on the list too.
Staffing issues. There is already a shortfall in the number and quality of employees across the manufacturing sector – and it is about to get worse. Currently, there is a lack of talent being drawn to the industry due to its image; there is an ageing workforce while an over-dependence on migrant workers has been severely hit by Brexit. Something major needs to be done to arrest this.
Brexit. With less than a year to go, there remains uncertainty on what impact Brexit will have – but it is being felt. The weak pound, though it is getting stronger, has boosted exports, but its negative effects have seen price rises, a depletion of the migrant workforce, while businesses are still unable to adequately prepare for the long-term future because of the lack of clarity.
I’ll be interested to see how Foodex deals with these and how other manufacturing sectors react.