Investments and Trends in the Food and Beverage Industry

The transformation to an environmentally friendly yet productive economy can only succeed with enormous investments. The companies surveyed in the food and beverage industry make investments within a scope that is justifiable and necessary for them. 28 % plan to invest between 1 million and 4.99 million euros in the next three years, 13 % plan to invest more than 5 million. For most, the continued existence of the company appears to be more important than expansion; they are focusing primarily on replacement investments or increasing efficiency; 36 % of those surveyed are planning to expand capacity.

Increasingly scarce resources, the challenges on the energy markets and

strict environmental regulations are making efficient production processes a

decisive competitive factor in the food and beverage industry. For the companies surveyed, investments in sustainable production, digitalization and automation are currently the most relevant. This goes hand in hand with investments in data, production and food safety, which are seen as very important in connection with the digital transformation over the next three years. The latter is progressing steadily in the companies surveyed. In addition to cybersecurity, which is becoming increasingly important, developments in data acquisition and management are opening up new opportunities for companies today - especially in connection with artificial intelligence (AI). Respondents consider this to be by far the most important technology of the future. AI-based systems are also a key driver of innovation in data analysis: Today, large amounts of data from different sources can be obtained in a very short time and processed automatically in order to monitor and control machine performance and process quality in real time and to organize both cleaning and predictive maintenance processes. This is precisely where automation and digitalization come in; they play a key role in investment considerations. The best way to achieve efficiency and sustainability is through automated processes that are monitored digitally and in real time, allowing them to be adjusted quickly if necessary. The basis for this is data transparency. It enables companies, for example, to break down and optimize their energy consumption for rinsing, cleaning, washing or heating into individual processes. Consequently, "energy management" and "new technologies for reducing water, cooling/heating or electricity consumption" and "waste avoidance" are at the top of the list of sustainability investments made by the companies surveyed.

In general, the companies surveyed have seen an increase in the use of alternative proteins, especially peas, wheat and soy. However, sunflower and rapeseed are also being used more frequently, while the use of lupins remains unchanged. Insects continue to play a subordinate role in the companies surveyed. It is clear that, in addition to start-ups, conventional food manufacturers are also becoming increasingly involved in this growth market. This is because alternative proteins will play a central role in the food market of the future, particularly in meat substitutes.

The willingness of the companies surveyed to invest in innovations continues to decline compared to the DLG Trend Monitor 2021.

The results of the current Trend Monitor highlight the existing need for companies in the food and beverage industry to continue investing in transformation in order to remain competitive in a sustainable global economic environment.

Planning security and the removal of existing barriers to investment through optimal framework conditions, including on the part of politicians, are the key to further strengthening corporate investment in the transformation and promoting the necessary innovations for progress in a persistently volatile global environment.

1. Investments

The companies surveyed are primarily planning replacement investments and investments for increasing efficiency. However, investments in sustainability, digitalization and automation are also being considered, reflecting the increased importance of these topics for companies. The largest investments will continue to be made in the production area. Investments in security issues (data, production and food safety) are regarded as particularly important over the next three years.

2. Sustainability

Sustainability is of tremendous importance to the companies surveyed. Until mid-2023, investments were made primarily in the areas of "energy management", "waste avoidance through more efficient processes", "recycling of raw materials" and "new technologies for reducing water, cooling, heating and electricity loads". In the next three years, investments will also be made in the areas mentioned above. What is striking is the decrease in the willingness to invest in the areas of "recycling of raw materials" and "re-work", which was already apparent in the previous DLG Trend Monitors. In addition, there was a decline in investments in the area of "reduction of cleaning agents", which could indicate that the optimisation possibilities in this area have been exhausted.

3. Current and planned use of processes and technologies

The importance of processes and technologies with which "clean label" products can be manufactured appears to be decreasing. Predictive maintenance has also moved somewhat out of focus or has already been implemented. The use of the "smart factory" has increased slightly, but not as much as expected. "Artificial intelligence" is already being used by 10 % of the companies surveyed. Interest in the use of artificial intelligence is expected to increase significantly over the next three years.

4. Industry 4.0 and digital transformation

The trend towards digital transformation continues to be recognisable. Implementation is most advanced in the areas of "traceability and transparency", "data management" and "data and production security". Further implementation is also planned in these three areas over the next three years. However, the digital transformation will also be increasingly implemented in the area of "strategy and change management" over the next three years, as it is particularly important to motivate employees in this regard.

5. Data security

Data security is a very important issue for companies. However, knowledge about hacker attacks is not very widespread. Hacker attacks on company data occur more frequently than on production facilities. There has been an overall increase in hacker attacks.

6. Online food retailing (eFood)

The existing online food trade has not changed significantly in the last three years. Around 60 % of the companies surveyed sell food online. Almost half of the companies surveyed are planning to expand their own online sales.

7. Products for special life situations

Alternative foods for people with allergies or intolerances (e.g. gluten-free or lactose-free) continue to play an important role. The production of vegan products has become even more important.

8. Alternative protein sources

In general, there has been an increase in the use of alternative protein sources. "Pea", "wheat" and "soya" are most frequently used as alternative protein sources. However, the use of "sunflower" and "rapeseed" is also increasing, while the use of "lupins" remains unchanged. "Insects" continue to play only a minor role.

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