Predictions about the impact of the novel coronavirus on the U.S. economy range from a sustained slowdown to more dire scenarios, but no one is certain.
Because the timetable for an end to the outbreak remains unclear, manufacturers, distributors, and retailers in the food and beverage business are preparing to pursue long-term strategies that consider the economic environment, supply chain management strategies, and consumer buying patterns.
Every two weeks, Salesforce Research surveys the general population to discover how COVID-19 impacts consumers and the workforce. In May, 44% of U.S. respondents said they’re shopping more online, and 68% expect to buy essential goods online after COVID-19 has subsided.
A recent Nielsen article, “COVID-19: Tracking The Impact On FMCG, Retail and Media,” identifies long-term consumer behavioral shifts resulting from COVID-19 and outlines how food businesses can adapt.
Emphasize Quality and Efficacy: Manufacturers, retailers, and other related industry players need to communicate why consumers should trust their products and supply chains.
Deliver Supply Chain Transparency: Shoppers want complete transparency and details on safety measures taken along the way. Promoting a product’s local origins could help manufacturers and retailers reduce some consumer concerns.
Leverage Technology: Companies that can leverage technology — by enabling seamless interactions through direct-to-consumer offerings — have the opportunity to earn consumer loyalty well after consumer concerns subside.
In the wake of the pandemic, the likelihood of discord between consumer goods companies and retailers is rising. While government officials have reported no food supply shortage in the United States, much of how the supply chain has traditionally operated has changed.
Many face-to-face negotiations have shifted to video and voice calls, making them more transactional. And the traditional retail supply chain, which typically consists of wholesalers, distribution centers, and retail stores, is offset by more online shopping, curbside drop-offs, and home deliveries.
The outlook for domestic production of agricultural commodities, including cereals, meat, and dairy, remains robust. USDA’s World Agricultural Supply and Demand (WASDE) report shows most commodities on the rise. Even red meat and poultry continue to recover from the impacts of COVID-19 with expectations for increases in 2021.
How Can Private Label Brand Owners Take Control?
The demand for food products isn’t slowing down during the pandemic. And many private label brands are reacting quickly to meet rapidly changing consumer preferences.
When it comes to developing new products or making updates to existing products, we hear from many store-brand owners that creating and managing specifications is labor-intensive and slow. Companies struggle with effective collaboration across departments, and when it comes to suppliers, the slow-motion collaboration gets worse.
With TraceGains, companies find that, on average, 80% of their suppliers are already on TraceGains Network when they log on for the first time. With our Specification Management solution, companies can connect to their suppliers, items, and ingredients on TraceGains Network and gain instant access to all that data to speed up the specifications process. They no longer have to track down suppliers and ask for information and documents, because they already have what they need. And if a supplier is unable to meet requirements, it’s easy to find a suitable alternative.
Check out our recorded webinar “Grocery and Private Label Retail Supply Chain Survival Tips” here to learn more.