Business-Model-Transformation-in-the-Food-industry

Shifting Trends set Business Model Transformation in the Food Industry

The COVID-19 pandemic took operations across various sectors by storm, including the highly essential food industry. With the emergence of the second wave in several nations, major food manufacturers have dramatically altered their response plans in order to preserve cash flow, therefore thriving during these unprecedented times.

In the present-day scenario, food companies’ success is attributed to the clear understanding of consumer behavioral responses. For instance, the food consumption patterns have extensively shifted to immunity-boosting functional foods, including supplements and functional beverages.

The geographical outlook estimates that Asia-Pacific records substantial growth in the demand for frozen packaged food, especially in Hong Kong. In this regard, as per statistics, approximately 58% of the consumers prefer ready-to-eat products in the country.

Strategical Actions amidst Disruptions

While the virus outbreak led to the shutdown of several food flagships, many thrived by modifying their business models, adapting to the changing market trends, which is likely to stay post-pandemic.

Below list is the prominent companies and restaurants that persevered in the current market situation:

  1. 7-Eleven: By collaborating with third-party delivery services, this global convenience store chain remained afloat despite the irregular lockdowns. Besides, adopting a new business model helped the establishment procure a speedway chain of gas stations through a $21 billion deal.
  2. Dig: This American fast-food chain launched the Dig Acres Farm Boxes and Crates, owing to the shutdown of in-house dining services. These crates primarily include fresh farm products grown by the company, which can be either picked up by consumers or delivered to their homes.
  3. Eat Offbeat: The New-York-based catering services pivoted towards providing curated holiday boxes and ready-to-heat meal boxes to consumers. This change in its business model not only helped the company survive during the early lockdowns but expand its gourmet food gift box sales across the country.
  4. Chipotle: This widely popular food chain introduced digital kitchens to handle online orders during the initial days of the virus outbreak, proliferating its digital orders. This resulted in the company hiring over 8000 new employees as its stock reached an all-time high.

Technological Transformation

It is noteworthy that every crisis has sparked some form of innovation. Given the current industry operations, technology has offered major assistance to foodservice providers with respect to contactless delivery and payments. For instance, fast food giants, such as McDonald’s, Subway, and KFC, introduced mobile app-order-and-pay.

Several F&B companies incorporated relevant technologies in order to upsurge their sales. For example, the Coca-Cola companies introduced contactless fountain services to ensure smartphone-enabled pouring.

With the advent of AI-based technologies and robotics, food manufacturers can effectively manage risks associated with workplaces. As a rapidly developing avenue, robotics and automation are likely to positively impact the correspondence within the global food industry.

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