The food & beverages segment was expected to generate US $76,082m in revenue in 2020. It also shows a 17.21% annual growth rate, resulting in a market value of US$653.60bn by 2027.
With increasing user penetration, the fastest-growing food industry is now facing greater challenges in terms of food quality, safety, and cost reduction. Food and beverage manufacturing organizations are under immense pressure to meet changing customer requirements, innovate, and adhere to regulations. It's disastrous.
Food & Beverage has always been driven to invent its products to make customers' lives easier and to provide more value for its employees with new technology. The sector has been severely affected by COVID-19, and businesses are still trying to find the best way forward. The pandemic has had a negative impact on major consumer-focused areas of the industry, such as fine dining. However, it has also opened up new avenues like digital distribution networks.

What are the challenges facing the food & beverage manufacturing industry?

Great things come from hard work!
Although food & beverage manufacturing today is one of the most popular industries, they also have to face many challenges, including shifting consumer demand, globalization, constant innovation, seasonal demands, and fierce competition.
From bulk producers to short-cycle and midsize manufacturers, it's becoming more important to develop superior products that meet today's market needs while adhering to strict food safety regulations.
In today's scenario, It is almost impossible to do this without cloud based ERP solution. With time, more businesses realize the potential of an ERP system for the food and beverage industry.

Why is cloud-based ERP software necessary in the food & beverage industry?

The food & beverage industry changes constantly based on trends, resources available, and compliance requirements.
Many food and beverage companies have systems for raw ingredient sourcing and fulfillment, warehouse management, and production planning. They also manage customer service and accounting. This complexity and inefficiencies can limit brand growth potential and require extensive IT support. The disconnected systems also limit visibility into business processes as well as the ability to track the quality. A company will be unable to control product quality or ensure compliance with industry standards if they limit the amount of tracking. Old legacy ERP systems are not flexible enough for consumers' changing tastes and market preferences. The 21st-century success of Food & Beverage businesses will depend on the use of cloud ERP software.
Cloud ERP is the most effective solution to meet the technical requirements of food manufacturers. It also opens up new opportunities for growth. Food & beverage focused ERP solution fills the gaps left by traditional software solutions. Cloud ERP is an integrated, automated solution that can automate these tasks. This software connects information at key points in supply chain management, including packaging, labeling, and shipping.

A cloud ERP solution that is highly effective for food and beverage manufacturers:

All the above obstacles can be removed by an agile cloud ERP system like Dynamics 365 Business Central. Experts agree that cloud-based ERP systems offer growth and scalability that legacy ERP systems do not. D365 Business Central can address complex supplier networks, production complexities, and tracing regulations.
Microsoft Business Central is a cloud-based ERP system that's ideal for small to medium food and beverage enterprises. Business Central allows manufacturers to streamline their application maintenance and upgrade processes so they can all be done seamlessly through the cloud rather than disruptive on-premise updates.
Let's look at the many benefits cloud ERP implementations offer to food and beverage businesses.

Food & beverage ERP software for food manufacturing

Every business has its unique requirements, thus, each ERP for food manufacturers is unique. They may offer different functionality depending on the manufacturer's size, production process details, and the digital environment. The following ERP features are popular in the food manufacturing industry:
  • Food production and distribution management. Get analytics-based recommendations about the best time to purchase raw materials, plan for product shipping, and manage bulk order groups.
  • Creation and management of a Bill of Materials (BOM). To centralize the information about the cost and amount of raw materials needed to make a specific SKU, you can create and edit product packaging and manufacturing instructions.
  • Real-time inventory management. To monitor the number of finished goods and raw materials to reallocate inventory timely among multiple manufacturing, storage, and distribution sites. To identify slow sellers and popular items and to predict high and low sale periods in order, not to overstock or stock outs. To monitor the expiry dates of ingredients and products, and to identify inventory control and optimization possibilities according to the First Expired, First Out (FEFO) principle.
  • Management of the supply chain. Monitoring the movement of raw materials and finished products between manufacturing plants, storage locations, and distribution centers.
  • Recipe management. Record information about ingredients and substitutions to facilitate the creation and storage of food and beverage recipes.
  • Quality management. Quality management is the establishment of quality control procedures and checklists. This allows you to monitor the quality and safety of food products and ensure compliance with applicable governmental regulations.
  • Cost management. Track the expenditure on raw materials and consumables to accurately value inventory.

Improve operational productivity.

Food manufacturing has very low margins. It is important to be as efficient and productive as possible. Profitability and sustainability require minimizing food, water, energy, and time waste. This transformation can be possible by implementing modern enterprise resource planning software for food. It drives decisions to reduce waste and minimize food safety risks by using IoT sensor data. Avoid downtime and food safety risks with predictive maintenance and embedded quality process, and automate and increase productivity with embedded AI.

Warning signs: When to look for cloud-based F&B ERP

It can be hard to determine when your ERP should be upgraded. However, even if the ERP upgrade or implementation is not on the company's radar, employees and leadership must be alert for any signs that indicate their current system may fail or be aware of them.
Following are some of the signs that indicate your existing ERP system needs migration:

Overloading and bogging down your systems

High activity can often slow down systems and lead to crashes. The wrong system can have a negative impact on a company's ability to function in these cases. Slow processes can lead to unhappy customers, ultimately resulting in a business's demise.

More competition

A business can grow and expand into new markets by partnering with larger-scale competitors with established processes to improve efficiency. A cloud-based solution will be necessary to maximize profits and optimize operations to gain market entry. This is crucial to remain competitive.
It is a good rule of thumb not to upgrade or implement an ERP system unless absolutely necessary. A good ERP system can help a business grow, but only if the company has the knowledge and resources to make the project successful. A carefully chosen ERP can help increase profits and reduce errors.
If you want a cloud ERP implementation partner, connect with our experts. Advaiya is a Microsoft Solutions Partner with extensive experience implementing business management solutions based on highly versatile Microsoft Dynamics 365 and Power Platforms.

Kirti Sethiya

Kirti is an Associate Principal at Advaiya and is a technology enthusiast specialized in business applications and analytics. She has been an integral part of Advaiya for over seven years, contributing to myriad deliverables involving business intelligence, technology marketing, and business consulting.

Posted by Advaiya

    Let's connect to make technology work for you.

    Please tick the options most relevant to your business challenges
    Decision makingBusiness productivityCustomer experienceTechnology-led innovationDigital transformation

    [By using this form you agree with the storage and handling of your data by this website.]