How the Food & Beverage Industry Can Creatively Keep Costs Down

Food inflation is up, on average, 3.2% over the past year in the United States and 2.8% in the European Union (EU). Despite an increase in total food spending, the average consumer is buying less, reducing restaurant visits (only 1.3% sales growth forecast in the United States), and reconsidering purchases like snacks, desserts, and other products no longer deemed essential. The term “shrinkflation” specifically references negative consumer attitudes regarding developments in food marketing. In response to all of this, many food & beverage manufacturers are looking for cheaper, more available ingredients to preserve profit margins. This answer, while simple, is incomplete and ultimately ineffective, serving best as only a portion of a more comprehensive strategy.

By changing ingredients, manufacturers do not need to consider their operations, their equipment health, or their workflow solutions. Get a cheaper ingredient, lower cost: done. This, however, can backfire as candy manufacturer Hershey recently found out. The company was forced to back-peddle on key ingredients in its Reese’s food line when Brad Reese, the grandson of Reese’s inventor H.B. Reese, issued a public letter exposing and condemning the attempt to make a milk chocolate and peanut butter candy without milk chocolate or peanut butter.

Rather than risking public relations and company image, manufacturers are better suited toward making other internal improvements to control cost. Data from ABI Research’s Industrial and Manufacturing Survey 2H 2024/1Q2025: State of Play for Digital Transformation (PT-3657) found that “improving our quality levels” ranked as the most urgent priority for manufacturers across a range of industries. Improving quality has no one answer but presents myriad opportunities for food & beverage manufacturers looking to optimize quality without sacrificing the quality of the products they make.

Manufacturers do not like to hear that they should replace their equipment, especially before said equipment has completely broken down. Nevertheless, when it comes to lowering cost, having the right mixing machines matters. Mixing typically happens early on in the production process, enabling not just optimization at stage but down production as well. Utilizing a mixer, such as the high shear mixer line from Silverson, that produces consistently fine particle sizes will benefit high-pressure homogenizing, as the mix will pass through the homogenizer quickly—reducing the risk of blockages and greatly reducing downtime. Mixing properly and efficiently also lowers (or removes) aeration, enabling manufacturers to fill their packages consistently and without entrapped air slowing down order fulfillment. This is especially important when it comes to food that is packaged by volume.

Energy reduction is another area where food & beverage manufacturers can cut cost and, luckily, especially when it comes to frozen food. In May, Actemium deployed its Real-Time Coefficient of Performance (RtCOP) solution through the Rockwell Automation PlantPAx Distributed Control System (DCS) platform. RtCOP uses Artificial Intelligence (AI) in the form of an always-on virtual operator to analyze system capacities, efficiencies, and environmental conditions in real time. It then can adjust combinations of compressors, condensers, and evaporators accordingly to use less energy, while still maintaining data access, transparency, and processing speed. Rockwell Automation estimates that this solution alone can save frozen food manufacturers an average of US$130,000 per year per site.

Finally, another area to explore centers on packaging, specifically an emerging replacement for glass. Fiber-based packaging has long existed for certain products, such as egg cartons, produce trays, and takeout containers. Beverage manufacturer Diageo is expanding this range, recently showcasing Johnnie Walker Black Label whiskey bottles made from 90% paper. This fiber bottle alternative is far lighter than its glass counterpart, allowing for less expensive shipping. Creating it also only generated roughly half of the traditional Carbon Dioxide (CO2) emissions.