Covid 19 has been a situation like none other for businesses all around the world and specially India which has experienced a lockdown of over 8 months curbing the actual capacity of operations to a bare minimum. One such Industry adversely affected by this shift in the paradigm is the food processing industry.
Food processing industry basically deals with the conversion of raw material into either the finished goods or an intermediary product to act as a consumable for other food products. According to the Indian Brand Equity Foundation (IBEF) Report, the indian retal food industry amounts to $894.98 Billion of which 32 percent is the processing Industry. However now with the pandemic and its subsequent restrictions in place, there has been an unprecedented change in the market. Due to the lockdown, the long due increase in the storage capacity of processing plants has finally seen the light of the day with all major companies increasing intermediate storage capacities to combat the uncertain nature of supply and demand. This change was long overdue but the circumstances brought forth by the pandemic seemed to act as a motivational factor in pushing this agenda to fruition. Moreover, looking at the situation and the future of the retail market in a digital sense, it's likely that the increase in storage and on the production line will be permanent.
Also to be considered that even though the industry is greatly machine driven, the human resource aspect is still substantial and ever since the pandemic has had its effects, the limitations placed on the number of workers on the floor at the same time with additional safety measures has reduced overall production capacity too. However now as the manufacturing plants with limited Human resource on duty have begun to realise the possibility that with concentrated efforts, volume of work that was initially being done could be reached, the future may see a reduction in employment opportunities as manufacturing concerns may push to increase automation and operations with minimal staff resulting in increasing chances of unemployment. This may not at first glance seem much but with an already increasing trend in unemployment with Indian Unemployment percentage rising to 5.4% this year, it may see further acceleration with automation in the mix. Hence to combat this issue, the government may have to step in at some point and set benchmarks for limits on automation to ensure the employability thrives.
With the consumer demand shift from the restaurant and dine in food to retail food availed in the safety of one's home, the food processing might display an increasing demand in current times due to the purchasing trend set by the times of lockdown in the country. In order to meet these increasing demands later on down the line, the processing industry may look to permanently increase their storage and production capacities in anticipation of the surplus demands. With the time duration that has seen the plants follow a less worker dependent process of manufacturing, the companies may also in near future look towards the avenue of Automation. Automation will assist in achieving the much needed reduction in labour costs incurred by the plant and it will also pave the way for increasingly advanced processing and storage technologies such as the Automated Storage and Retrieval System (ASRS) greatly reducing the time taken and increasing the efficiency of the work done. Further , with the help of leading developments in the field of Artificial Technology, the automation may extend further to even take on responsibilities such as placing material orders, scheduling and work division and allocation of materials as well. As the order for retail food increases, the production and processing plants and the warehouses may move in closer proximity to the major markets.
With the consumer demand shift from the restaurant and dine in food to retail food availed in the safety of one's home, the food processing might display an increasing demand in current times due to the purchasing trend set by the times of lockdown in the country. In order to meet these increasing demands later on down the line, the processing industry may look to permanently increase their storage and production capacities in anticipation of the surplus demands. With the time duration that has seen the plants follow a less worker dependent process of manufacturing, the companies may also in near future look towards the avenue of Automation. Automation will assist in achieving the much needed reduction in labour costs incurred by the plant and it will also pave the way for increasingly advanced processing and storage technologies such as the Automated Storage and Retrieval System (ASRS) greatly reducing the time taken and increasing the efficiency of the work done. Further , with the help of leading developments in the field of Artificial Technology, the automation may extend further to even take on responsibilities such as placing material orders, scheduling and work division and allocation of materials as well. As the order for retail food increases, the production and processing plants and the warehouses may move in closer proximity to the major markets.
In conclusion , although Covid 19 has pushed the processing industry into a tight spot, the ensuing changes will soon see the spotlight and transform this into not only a larger but also a more effective sector catering to needs of more people than it can now.
Thank you.
Regards,
Snehal Wagh,
Kautilya,
IBS Mumbai.
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