WHEN Malaysia first took notice of the COVID-19 pandemic, not many businesses in the country were prepared to strap themselves for unprecedented times.
The first nationwide lockdown declared in March 2020 subsequently became the first step to a challenging journey for food and beverage (F&B) businesses.
Since then, many businesses have stayed resilient and adapted by finding new methods to stay afloat during this period, realising that digitalisation is one of the only options to sustain their business.
This is also evident in the local F&B industry, with a report by Flanders Investment and Trade indicating that the pandemic has triggered Malaysian F&B retailers, such as food suppliers, supermarkets and restaurants being seen to shift their operations and embrace digital marketplaces.
Challenges faced by the F&B industry
When the lockdown was first declared, the F&B industry faced its own unique set of challenges.
In an ecosystem where business deals were traditionally carried out physically, the food supply chain was severely disrupted due to restricted operation hours, logistical difficulties, and communication hurdles with suppliers, buyers, and end-consumers.
This is also in addition to the challenge suppliers face in reaching out to retailers, and vice versa.
For example, on one end of the food supply chain, several farmers in Cameron Highlands were forced to give away their farm produce due to the perishable nature of the produce, whereas, on the other hand, buyers were flocking onto online marketplaces, only to find limited options available for their choosing.
This is a clear reflection that the pandemic has affected the mode of communication, even between buyers and suppliers thus impacting the source of revenue for all parties within the industry.
The emergence of digital solutions for the F&B industry
The shift in communication habits have also forced F&B businesses to pivot and adopt to digital solutions to sustain and identify new revenue streams for their business operations.
Adopting to digital space has given businesses an increased interest into digital marketplace, which allows them to connect with businesses within the F&B industry.
With many more digital solutions and guides to digitising made available, F&B businesses can use it to their advantage to adapt this new normal, while looking at other possibilities for growth.
Previous challenges such as communication hurdles, low sales volume and mismanagement of inventory and expenditure can be resolved, thus enabling these businesses to remain resilient and scalable even during these tough times.
Paving a new future for the F&B industry
As digitalisation becomes a key fixture during this new normal, the digital transformation journey for businesses is expected to continue even in a post-COVID world.
A report by Bain & Company indicates that COVID-19 has rewritten the rules of survival for businesses.
Online purchasing, digital consumption and average online basket size have risen substantially and will continue to grow at record-setting rates, providing an opportunity for traditional businesses, large marketplaces, and disruptive business models to thrive.
The report also indicated that around 83% of online buyers share that they are likely to continue their increased spending online even after lockdown restrictions are lifted.
Echoing the importance of digital transformation, the Malaysia Digital Economy Corporation (MDEC) recently launched a SME Digital Guidebook and Quick Guide, for the food & beverages (F&B) and retail industry.
Intending to help businesses in the F&B industry reassess their digital opportunities and readiness, MDEC introduced a step-by-step guide on how to enhance their current digital capabilities and begin their digital transformation journey.
All these potentially indicate a rebound for the Malaysian F&B industry should they pursue and consistently work towards transforming their business digitally.
By identifying these new opportunities, there is a possibility for F&B businesses to regain normalcy, while opening doors to future growth. – Sept 21, 2021
Saladplate is the premier international wholesale marketplace for sourcing food, beverages and hospitality products globally, while Food Market Hub is a big data cloud-based purchasing and inventory solution specifically designed for the F&B industry.
The views expressed are solely of the author and do not necessarily reflect those of Focus Malaysia.
