New Study Reveals 48% of Food and Beverage Suppliers Still Relying on Manual Spreadsheets; 65% Cite Regulatory Change as Driver for Modernization

Other Drivers for Change Include Fear of Supply Chain Disruptions and Urgency to Adopt AI

WESTMINSTER, Colo., Sept. 10, 2024 /PRNewswire/ -- TraceGains, the leading provider of networked  compliance, quality, and innovation solutions in the food and beverage (F&B) industry, today released a new report, Old Habits, New Challenges: The Critical Need for Modernization in Food and Beverage Supply Chains, measuring the readiness and sophistication among suppliers to manage regulatory change and market influences. Based on responses from more than 450 global F&B industry suppliers, the new research shows legacy approaches plague the industry, leaving suppliers inadequately prepared for the next major disruption, regulatory changes, and demand for more sustainable products.

The new research comes on the heels of unprecedented regulatory change, creating razor-thin margins for error in product formulation, labeling, and market entry. As consumer demand for supply chain traceability grows, independent experts such as Bain & Company have discovered companies with advanced digital tools for visibility are beginning to outpace less sophisticated competitors.

Old Habits Die Hard… and Hamper Efficiency
TraceGains found that almost half of all suppliers commonly rely on legacy approaches to manage communications with buyers in the food and beverage industry. Beyond daily tasks, this continued reliance on outdated tools hinders their ability to achieve greater efficiency, maintain compliance, and meet evolving environmental, social, and governance (ESG) standards.

• Nearly half (48%) still use manual spreadsheets to manage day-to-day tasks, processes, and document exchanges.
• Over two thirds (71%) admit that outdated processes sometimes or often create issues in their day-to-day work.
• The biggest issue is time consuming tasks (60%), followed by data entry errors (39%) and miscommunication (32%).

Digital Divide: Suppliers Unprepared for Regulatory Change and Sustainability
This lack of modernization among suppliers is partially due to awareness: one in four are simply unfamiliar with available technology to better manage customer relationships with F&B brands. Recent food safety incidents have heightened scrutiny on regulators, while state governments push for faster federal action. The upcoming FSMA Rule for Traceability (204), effective January 2026, will enforce lot-level traceability for specific food materials in the U.S., while strengthening European ESG regulations are reshaping industry practices across Europe.

• Of those familiar with technology, two-thirds (65%) cite "keeping up with regulatory changes" as the top motivator for modernizing internal software.
• Other contributing factors include faster responsiveness to consumer preferences (58%), better agility to manage supply chain disruptions (42%), and ability to adopt tech advancements like AI (33%).
• Further, almost half (44%) of suppliers cite evolving consumer behavior including a preference for sustainable products and increased demand for online delivery has had a significant or moderate impact on business operations.
• When it comes to decision-making, nearly 89% of suppliers believe alignment with corporate sustainability goals is a crucial consideration, with over half (53%) rating this alignment as very important.

"This new research underscores the urgent need for suppliers to update their operations," said Paul Bradley, Senior Director, Product Marketing, TraceGains. "With increasing regulatory pressures and shifting consumer demands, widely used, outdated methods are putting companies at risk. Embracing digital solutions should no longer solely be seen as a competitive advantage - it's required for staying ahead and meeting compliance, sustainability, and market demands."

To learn more about how F&B suppliers can leverage digital tools to achieve compliance, sustainability, and efficiency goals, please visit: https://www.tracegains.com/.

Survey Methodology
From June 24, 2024 through July 15, 2024, TraceGains conducted an online survey of 483 food and beverage industry suppliers.

About TraceGains
TraceGains provides a purpose-built marketplace connecting food and beverage (F&B) brands with ingredient and packaging suppliers, powered by a suite of software solutions to manage all business and product-related challenges such as regulatory compliance, nutritional analysis, labeling, new product development and more. Trusted by over 1,200 global clients including half of the top 100 F&B manufacturers, TraceGains is the industry's de facto business hub serving the needs of Product Development (formula/specification management, regulatory global, nutritional calculation), Compliance (supplier, quality and audit management) and ESG. TraceGains represents the largest network of 85,000 supplier locations and a robust database of 550,000 ingredients where brands collaborate on behalf of consumers to develop new products faster while ensuring quality, safety and compliance.

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