Food Industry 101
Ask a chef, a fisherman, a farmer and the night manager at your local supermarket exactly what the ‘food industry’ is and you’ll get four different answers. The truth is that the ‘food industry’ is a complex web of separate businesses connected to each other in various ways. Sure, the general manager of your favorite restaurant in town is a part of the food industry but increasingly he is more a part of the entertainment business and the hospitality business as much as he is the food industry.
The reality is that the food industry covers such a broad group of businesses that it probably makes more sense to think of its totality as a ‘system’ as opposed to an industry. Like any system it helps to break the larger parts into smaller categories. Check out some of the broad business categories, as well as related industries, that lots of food industry information falls into.
This is more commonly known as agriculture. We use the term growing/raising/catching to encompass crop production, animal farming and seafood/aquaculture. Agriculture can include non-food products such as fibers, fuels and raw materials. Farming and agriculture are the oldest and the most important part of the system. Modern ag operations and farmers are reliant on agri-chemicals, sophisticated equipment, biotechnology (and more) while facing increased pressures from policy-makers and land/environmental changes.
Food production refers to all activity that is required to prepare fresh foods for market as well as to manufacture prepared and processed foods from raw items and ingredients. The difference between good processing and food manufacturing has become blurred and apply the food production to the variety of tasks that it takes get crops and animals from the farm to the marketplace and for the processes required to create highly processed and prepared food products that has minimal relation to a farm (think ‘imitation pasteurized process cheese food’). Food production also includes the science of coming up with new foods and the many steps a manufacturer has to take to get their food ready for sale such as
Food Safety & Compliance
All issues that affect the safety and protection of the food supply from a variety of health hazards and security/risk factors. This site primarily focuses on the US food supply – its food politics and policy. Food safety subjects includes food handling, labeling, food technology, traceability, recalls/alerts and all topics that contribute to the safe development, marketing and consumption of food products. Review and compliance with State and federal regulations is also an important part of this category.
Covers retail and food service distribution businesses as well as wholesaling of food products. Getting food from its source to market involves a web of middlemen (brokers, distributors, warehouses, retailers and transport/logistics/packaging companies) who are affected by rapidly changing technologies and business practices. This category includes all activities that involve moving food products through the system so that ends up in the hands and on the plate of the consumer.
This category focuses on food that is sold through the “food-at-home” end of the business which includes supermarkets, grocery stores, discount merchandisers, club stores, fresh formats, e-commerce sites, app-enabled technology and more. It’s a business that is squeezed by low profit margins, rising prices and the blurring of sales channels. Food retailing is changing dramatically as consumer preferences and trends change.
Covers restaurants and other “food-away-from-home” establishments such as cafeterias, caterers, hospitals, nursing homes and meal delivery services. Food sold at food service outlets accounts for about half of all food sales with much of that sold at restaurants. While the restaurant business is an integral part of the food industry it is also an industry unto itself. As retailers of the “meal experience” restaurants struggle with the same issues other retailers face including new technology, a changing labor force, high real estate and operating costs and competitive pressure from large, public companies. This category deals with food topics of interest to chefs (and others located in the ‘back of the house’) at US restaurants and foodservice outlets. Examples include culinary arts, recipes, food procurement and meal preparation.
Consumer: Marketing, Trends, Health
This category examines how manufacturers, retailers and other in the food chain market and promote their brands to the end consumer. When it comes to the US food system ultimately it is the consumer that is at the heart of the “food system”. All players in the food system must deal with consumer trends that change rapidly as well as with the increasing emphasis (from both private and public entities) on diet and health issues. Manufacturers fight for limited shelf space with the growth of private label food manufacturing which produces higher profitable store brands for the retailer. Restaurants fight for a greater slice of the consumer’s entertainment dollar and grocery stores are doing all they can to make sure their customers do not abandon them in favor of discount chains, convenience marketers or even to e-commerce start ups such as Amazon.com.
As previously indicated, the term ‘food industry’ may be a bit of a misnomer. Increasingly the path of food from farm or factory to the plate relies on and involves many other business and industries including:
Retail & Shopping
Internet and IT sectors
Convenience Store Industry
Trucking & Logistics