IT HAS been an uncertain year for the Food, Beverage & Tobacco industry with a strong economy and high consumer confidence running against the backdrop of a number of business pressures and changes in retail ownership.
Dick Wells, CEO, Australian Food and Grocery Council (AFGC), says a significant burden for companies has been increased input prices due to fuel price rises, higher labour and utility costs, the impact of the drought and biofuels.
“This comes in the face of increased competition from the introduction of private label offerings by retailers and the growing strength of the discount chains.
“The food regulatory system is increasingly problematic, with excessive regulations and failure in process resulting in a lack of consistency across the states and territories.
“This is reducing domestic industry competitiveness through increasing costs and hampering innovation at a time when manufacturers need to be responsive to changing consumer demands.
“Manufacturers continue to improve their environmental performance – via sustainable commodity sourcing, water efficiency and emission reductions. Business understands there is a need to be more sustainable and have committed to finding ways to achieve this.”
Wells said while there are still some significant challenges for industry, there havebeen a number of positive developments over the past year, including Daily Intake Labelling.
“The development of industry standards for the introduction of shelf ready packaging is an example of cooperation between industry and retailers.”
Wells said changes in the retail industry, particularly with the Westfarmers take over of Coles, will continue to be a focus for suppliers over the next period.