Friday, March 29, 2024

Adapt quickly

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Traceable, trusted and safe food will be more important than ever before in post-lockdown society but consumer behaviour has changed and New Zealand food producers must adapt quickly, KPMG agribusiness global head Ian Proudfoot says. An understanding of food’s importance in peoples’ lives is greater today than it has been in decades, probably since the 1940s, he told an AgriTech webinar.
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“We’ve always assumed food will be there but now there is an awareness we could face food insecurity.

“Now we recognise food supply is not certain. Food availability will no longer be taken for granted.”

There have been empty shelves around the world and people will remember that.

With restaurants and takeaways closed people have had to learn to cook for themselves.

That will lead them to reconnect with their customary foods because when people feel a threat to their lifestyle they generally move back to traditional eating patterns.

Governments will recognise that and will focus on creating more local production.

Food security is now the priority of every government around the globe.

For food exporting countries like NZ a big part of that will involve how to get food to people.

Global freight paths are changing and will need to be reinvented, which will initially be more expensive, pushing more towards grow-local models.

Proudfoot expects a shift to countries putting themselves first, which will lead to them protecting their own food producers though they won’t want to be seen to disrupt international trade.

What that means for NZ is a need for more government investment in helping to tell the NZ food story in overseas markets.

Face-to-face contact with customers overseas will be out for a while so the Government has to work out how to use its footprint in those markets to help sell NZ food in different ways.

Social isolation is already accelerating the use of digital solutions in day-to-day life and that is encouraging more direct-to-consumer supply channels.

There has already been a dramatic jump in the popularity of click and collect delivery services worldwide.

In recent weeks the number of businesses operating in that area in the NZ food space has jumped from about 65 to more than 600.

Businesses have used face-to-face marketing in supermarkets to help create loyalty but that won’t be possible in the foreseeable future so cyberspace is going to become even more important.

But just sticking an ad on Facebook won’t work.

Businesses will need to work out how to create loyalty, such as providing an initial discount to try a product.

The big challenge for non-essential food-supply businesses will be re-opening.

Much will depend on established relationships and experiences because once people have learned new behaviours they generally don’t go back to what they did before.

Those businesses will have to change their marketing focus to attract customers and much of that will come back to digital platforms.

There will need to be innovative use of digital solutions to keep customers connected, especially when they can come back so they will want to. For restaurants that might involve providing cooking classes or tips.

Consumers will increasingly seek food products that build immunity and minimise the risk of contagions so Proudfoot expects an emphasis on helping people discover the unique health benefits of different food products.

That will mean nutritional components will be highlighted, moving from the back to the front of packaging.

“It’s not necessarily what people want to read but they will want to see it there.”

He also expects human-free handling systems to increase rapidly, with the mantra “this product has not been touched by human hands” a big driver.

That will reverse the trend to minimal packaging, with more packaging to provide increased confidence around food safety but that can’t be at the expense of the environment so the challenge will be how to provide it in a circular way so it can be reused, recycled or composted.

Staying the course on environmental issues like greenhouse gas mitigation and improving freshwater quality must remain a key focus because those issues have not gone away and they cannot be forgotten.

That commitment to the environment is a chance to lead global markets and attract premium prices.

But the pace of progress must match the ability to pay and that won’t be the same as it was three months ago. Businesses will need to be viable if changes are going to be made.

That means there could be room for more sector-based approaches, such as He Waka Eke Noa, the primary sector climate change commitment, in other areas such as freshwater quality.

Unfortunately for food producers, Proudfoot says history will record the global pandemic as a food safety failing, which will raise questions among some people about the place of animals in the food system, meaning the animal/plant products debate will intensify.

Consumers will want to better understand the safety and traceability of the products they buy.

Controlled growing systems such as controlled environment, vertical farms will become more attractive.

Now and in the near future is a time of disruption for many in the agrifoods sector but with that comes opportunity.

Businesses can benefit from knowing that food will always be central to peoples’ lives, he said.

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