Manufacturers are under increasing pressure to address the issue of food waste. Mike Hughes, Head of Research and Insight at FMCG Gurus, discusses how this trend is driving the upcycling of ingredients and the shortening of supply chains, and how this is creating new product opportunities.
November 2, 2021
Environmental concerns have ramped up significantly in recent years, with tangible evidence of climate change – freak floods, intense heatwaves, and unseasonable weather – amassing. Consumers increasingly link the state of the planet to their own wellbeing, underlining the belief that a healthy planet equals a healthy person.
“This has only increased since the COVID-19 epidemic,” explains Hughes. “Citizens look at the state of the planet and ask whether environmental degradation contributed to the spread of the virus.”
This is influencing consumer consumption habits, though often in modest ways. Consumers for example are looking to take home a little less plastic packaging, purchase more products from local stores and markets, and make more meals that are based around freshly bought produce.
“I think we can get caught up a little in current trends,” says Hughes. “Yes, people are buying more plant-based products, but when addressing the environment, they are more likely to try to be resourceful, rather than making fundamental changes to their diets. They are more likely to avoid unnecessary food waste and seek out alternatives, over eliminating meat or dairy from their diets completely.”
Linked to this is the issue of food waste. Buying specific ingredients from a local market often means less food is thrown away. Many people have had to tighten their belts during the pandemic, which means that reducing food waste is a financial issue as well.
Critically, such growing environmental consciousness has put more pressure on businesses to take the lead. Citizens no longer think that acting responsibly should be left up to individuals alone.
“Brands have to demonstrate their green credentials,” notes Hughes. “This will soon be more important than heritage.”
The issue of brands and food outlets throwing away perfectly good food has been brought sharply into focus in recent years.
“At a time when people are struggling with living costs and falling below the poverty line, food waste is something that actually disgusts many consumers,” says Hughes. “This isn’t a case of forgetting an out-of-date packet of something in the cupboard – it is food waste on an industrial scale.”
The COVID-19 pandemic has also highlighted the importance of community, and how we support each other.
“Consumers tend to take a more negative view of corporations during challenging times,” says Hughes. “They don’t want to see big businesses trampling over the little guys. This ties into the point about food waste – at a time when people are more vulnerable than ever, consumers want businesses to act responsibly.”
Hughes sees two key industry trends emerging – an increase in the upcycling of ingredients, and a shortening of supply chains.
“More and more businesses will look to turn perfectly edible food into ingredients for something else,” says Hughes. “A great example of this is Toast Ale in the UK, a craft beer made from bread that would otherwise be thrown away.” Another example is The Ugly Company in the US, which takes misshapen fruit that would normally be thrown out, in order to make dried snacks.
We are also likely to see a shortening of supply chains. Benefits include a reduced carbon footprint due to lower transport overheads, a reduced risk of food becoming perishable, and a closer relationship with local suppliers. All these issues appeal to the modern consumer.
“We will see some manufacturers moving towards “Just In Time” production, rather than just stockpiling ingredients,” says Hughes.
Early adopters of these trends have the chance to build sustainable brands that are not only sustainable and environmentally friendly, but also ‘cool’.
“If you think about the last 20 years, consumers have been moving away from liking brands simply because they are big,” says Hughes. “They want brands they can identify with, and which match their attitudes and outlook. If you can achieve that, then you have the chance of making a cool product that consumers won’t mind paying a premium for.”
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