(3 min read)
In our previous cost-of-living article, we learned about the ongoing effects of the crisis on customers, retailers, and brands. Most certainly, inflation together with customers’ reduced disposable incomes is causing changes to their shopping habits, and this is having significant impacts on businesses within and outside of the plant-based sphere.
Fewer treats, shopping around, smaller budgets, and the return of pandemic behaviours are just some of the ways that food inflation is affecting consumers.How the cost of living crisis is changing food and drink habits, (2022). The Grocer. Available at: … Continue reading Remarkably, 80% of Brits have reported budgeting for groceries or monitoring their spending more carefully, while almost half said that they were now buying and eating less food.How is the cost of living crisis affecting grocery shopping habits, (2022). The Grocer. Available at: … Continue reading The case is similar Europe-wide.
We also learned that some of these changes might actually benefit the plant-based market, providing opportunities to gain new consumers and innovate the industry. Recent data shows that, as a result of higher prices, consumers are purchasing less meat, eggs, and dairy. Plant-based products have, thus far, not been affected by inflation as badly, so we might start to see a greater number of people swapping to more affordable plant-based alternatives.
On the other hand, many mainstream customers already find some plant-based foods ‘expensive’. In a yet-unpublished ProVeg International survey, 70% of European consumers agreed that plant-based food products generally cost more than animal products. Therefore we must try to keep down the costs of plant-based products, compared to meat and dairy.
So, how should producers and manufacturers react? And more importantly, what can be done to leverage any opportunities offered by the cost-of-living crisis? Let’s find out.
It’s likely that at some point you will have to put up your prices. This will inevitably be difficult news for your clients to hear, especially if they have to push costs onto the consumer, which might affect sales.
As a business in a cost-of-living crisis, it’s vital that you watch for potential problems or solutions that might be around the corner; keep an eye on the economy, and follow consumer trends, competitor moves, and innovations that could improve your manufacturing methods and save money.
Are your suppliers expensive or raising their prices beyond your budgets? It might be time to look for more affordable suppliers that can provide you with the same quality ingredients.
It’s important to try to see the opportunity in any bad situation. When times are tough, we can use the experiences and learnings we’ve gained to make changes and improvements. With this in mind, the cost-of-living crisis can be viewed as a chance to restructure, innovate, and improve all areas of your business and its processes.
To mitigate the effects of the cost-of-living crisis and leverage opportunities, ProVeg recommends the following best-practice strategies for manufacturers:
For more expert advice on how to boost plant-based sales, get in touch with ProVeg at [email protected].
Make sure to head back over to the New Food Hub, to read our cost-of-living crisis article aimed at retailers and brands!
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