Food and Beverage

Foundations for Successfully Scaling of Food and Beverage Companies

April 18, 2022

Growth equals success, and sustainable scaling plays an important role in reaching new business milestones. As a food and beverage company, there are certain aspects to consider so that strategy aligns with planning and execution.

While some markets fluctuate, the food and beverage industry shows no sign of slowing down. The global food and beverage market size is expected to grow to $6,384 billion in 2022, at a compound annual growth rate of 9.7%.

Understand Your Distribution Channel

Whether you work in processed food, e-commerce, or fresh food, it’s important to streamline your distribution channel. Pay attention to supply chain trends in the food and beverage industry and apply them to your network.

You need to understand where your target customers are based, how far your operational base is located, and the distance to possible new locations. While doing so, keep the following details in mind.

Positioning Your Product

Positioning your product is the first step in a healthy distribution strategy, ensuring that the product is attainable. The supply chain can be smooth, and packing can be efficient, but if the product is badly positioned, it won’t reach the hands of the consumer.

There are a few key factors to consider when positioning your product:

  • Understand why your customers use the product and the primary benefit they receive
  • Identify your target audience and how they fit in the market
  • Consider the market’s maturity when drafting your message
  • Determine the consumer’s state of mind - either push, pull, anxiety or habit
  • Produce a market frame with all of the above in mind

For example, a survey revealed that 68% of shoppers in the UAE are willing to pay more for quality food and beverages that they can trust. As a result, New Zealand has identified growth in F&B exports to the UAE to meet the shift in demand for safe and trusted products.

Choosing the Right Distribution Channels

The distribution channel plays a much larger role than simply moving products from the start to the final consumer. There are many other benefits to leverage, but strategy needs to be applied.

For example, prioritizing the right distribution channel for your products will enhance your exposure to the targeted product market. The correct distribution channel will also provide the flexibility to respond to consumer preferences as needed and manage supply and demand to support sales growth.

When these channels are correctly selected, then expansion is possible. Consider how food and beverage trade in the UAE exceeded $20bn in the first nine months of 2021. This growth was made possible through smooth export channels to the likes of India and other countries.

Developing Channels

As technology develops, there are different tools that can further streamline these channels and communication methods. For example, enterprise resource planning (ERP) systems have digitally transformed the distribution journey.

Data is another important factor that contributes to the efficient scaling of food and beverage businesses. With the rise of food delivery, whose global market worth has tripled since 2017, this data is becoming more readily available.

Both customer feedback and data, as well as technological tools, can be used to develop distribution channels and assist in scaling the business.

Action a Go-To-Market Strategy to Increase Your Sales

A go-to-market strategy is an action plan that gives businesses the opportunity to reach target audiences and achieve a competitive advantage over other businesses that are also trying to expand. The blueprint for delivery should factor in various aspects such as pricing and distribution.

The clearly defined plan not only includes tactics that pertain to pricing, sales, and channels but also the buying journey, new product or service launches, rebranding, and product introduction.

All bases are covered after considering market definition, customers, distribution model, product messaging and positioning, and price. Sales are enabled by prioritizing each part of the go-to-market strategy.

Add Something Fresh to New Locations

Expanding to new locations is an important part of growth. Brand identity and quality control are essential when establishing a new franchise or operation in a new location, but sometimes a fresh twist is needed. It’s worth considering the different food and beverage trends on the market and how they can be incorporated into the new location.

It’s important to consider how the expansion will fit into the community of the new location. Research is critical when it comes to giving your customers what they want and adapting your services to meet these desires, while upholding the brand’s standards.

Consider how UAE fast food brands were looking for franchise partners overseas in 2015, in an effort to manage the rapid growth of the sector. This expansion required a slight cultural shift in how business is conducted in order to connect with other local businesses and customers.

Make Customer Satisfaction the Top Priority

At the end of the day, keeping the customer happy is key to managing a successful operation and turning a profit. Each franchise door that you open or new factory floor that you sweep should have the customer’s satisfaction in mind.

Customer service is fundamental to the success of the business, and there are various ways to prioritize their satisfaction. From optimal quality control and customer reward programs to being strategic in franchise location - it helps to be “customer-obsessed” when expanding.

Food & Beverage Consulting Services

Strategy and effective implementation are key to scaling a food and beverage company. Listening to the consumer, adapting to their needs, and adapting technological tools need to work together in order to scale effectively.

As a leading food and beverage consulting firm, Ollen Group food & beverage industry consultants and team of experts are highly versed with day-to-day F&B business problems and are up to date with consumer shifts in the Middle East, and the necessary steps needed to find success in the future. We offer turnkey solutions from strategy to execution, as well as design, development, and deployment.

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Ollen Group is a global consulting firm established by passionate professionals with extensive institutional and entrepreneurial experience regionally and globally, to help business leaders achieve practical results with real impact. Ollen Group provides consulting services from idea-to-execution and covers capabilities such as research, analytics, strategy, innovation, planning, improvement, design, supervision, activation, and support.

For more information on industries and relevant consulting services, email us at info@ollengroup.com