Ride the Organic and Functional Food Growth Wave

The pandemic produced a tale of two consumers. Those who turned to alcohol and junk food and the 75% of consumers who sought healthier options. The wellness-minded majority drove sales of natural, organic, and functional foods and beverages up 13% in 2020. These number blew past analyst expectations of more moderate growth to produce $186 billion in revenue.

New Hope Network Content Lead Carlotta Mast attributed the record year to “dramatic shifts to eating more meals at home, through the quarantine, and surging consumer interest in healthier foods and beverages, and health and wellness products.” 

Mast added that the future for natural and organic food and beverages remains bright.

“Nearly every organic food and beverage category did well in the United States last year, including dairy, which saw some headwinds over the last few years, but last year this category benefited from consumers stocking up on organic milk during the pandemic,” Mast added. 

This niche outpaced the rest of the food and beverage market, with robust sales growth of 8.6% in 2020.

“We anticipate we’ll see conventional food and beverage sales growth continue to lag significantly behind natural, organic, and functional once we are out of the pandemic and retailers large and small continue to make more space for our industry’s products,” Mast said.

(And it’s worth noting that while growth slowed in the space somewhat in 2021, it still managed to climb at more than a 7% clip.)

Functional food development demands functional teams

With rapid industry growth and no sign of slowing demand, how are companies expected to do more with less?

The answer lies in focusing on efforts that encourage greater supply chain collaboration. Strategic supplier relationships remain crucial for organic food and beverage manufacturers to deliver the high-quality, safe products consumers demand. But far too many brands fail to effectively leverage suppliers as collaborators, especially when drafting and updating specifications. This disconnect leads to drawn-out negotiations over attributes, tolerances, and other downstream problems.

Maintaining updated raw material and finished goods specifications is cumbersome when manufacturers need version control, authorization, and clear audit trails. And partners trade data over email and voicemail, making it increasingly difficult to track status, agreements, or supporting documentation.

Poor collaboration hampers specification management efforts. Especially when teams can’t see what others are doing, status is unclear, and progress grinds to a halt. How can stakeholders have confidence they’re working on the correct version? Or that an employee didn’t overwrite an essential attribute along the way?

With Networked Specification Management, teams can draft, publish, and update raw material and finished goods specs with suppliers and co-manufacturers over a networked platform that streamlines and automates document and information exchange.

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