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Nearly half of food and beverage brands now rely on contract manufacturing to operate more efficiently, with a renewed focus on new product development (NPD), according to a new TraceGains study.
“The results also shed new light on the roles that technology and outsourcing play in containing costs and securing market advantage,” according to TraceGains. “In addition to engaging with more co-manufacturers and doubling down on NPD, other strategies include the increased adoption of automation tools to reduce manual processes and plans for breaking into new markets with half the respondents planning international growth in the coming year.”
From PR Newswire:
- Brands are increasingly relying on contract manufacturing as a viable alternative to traditional in-house production, with more than half (55%) outsourcing more today than three years ago and 47% working with up to 10 different partners.
- The use of co-manufacturers has a direct correlation to the bottom line, ranging from accelerating time to market (35%) to saving costs on facilities and equipment (27%) to filling in labor gaps (13%).
- More than one-third (36%) use co-manufacturers for materials manufacturing, and 20% seek help with materials sourcing and management.
- More than half (52%) of respondents plan to expand their global footprint this year to capitalize on growth opportunities abroad, with North America (21%), EMEA (18%), and APAC (15%) topping the list of expansion regions.
- Industry veterans remain in recovery mode with 86% of respondents feeling somewhat to completely overworked in their jobs.
- When asked what keeps them up at night, brands explained that the Top 3 stressors were: dealing with tedious paperwork (50%), meeting compliance regulations (49%), and mitigating the impact of sourcing complications (42%) such as ingredient shortages and rising costs.
- 39% of survey respondents cited work automation tools, such as real-time risk flagging and information sharing, as the top improvement that could help them do their jobs better. Other desired improvements included transforming the digital infrastructure (24%) and increasing headcount (22%).
