Snack on This: A Look at How Consumer Eating Habits are Changing the Dairy Industry

Amar Kulkarni
By: Amar Kulkarni
Date: October 05, 2017

More than 90 percent of Americans snack multiple times throughout the day, accounting for half of all eating occasions. As the average consumer gets busier, they move further from the traditional three-meals-a-day lifestyle. This drives the need for snacks to be able to replace the nutrition missed from a meal.

Dairy manufacturers are seeing this shift greater than anyone. Changing eating habits are impacting the way foods are being portioned and packaged, moving to on-the-go packaging. At the same time, traditional milk consumption in the U.S. is continuing to drop, with milk sales projected to fall 11 percent by 2020. This drop is driving dairy manufacturers to find new ways to satisfy customers.

The Value of a Snack

The move towards naturals and organics continues to spike as well. Nearly 60 percent of consumers define a health food as being high in health components or nutrients. Consumers are more inclined to seek out these options as they give the sense of getting more for the money. So, snack products that are considered high value have a better chance to outperform their less nutrient-rich competitors.

Protein is a large category in the value-added food world and potential new lines of business for dairy manufacturers. Proteins have experienced substantial growth recently due to an increase in consumers’ fast-paced lifestyles and perceived deficiency of proteins in their diets. The consumer search for high protein snack bars and shakes as well as desire for portable products beckons the need for modern technology for dairy manufacturers.

For example, a product lifecycle management (PLM) system can help manufacturers easily determine and manage the level of protein and other nutrients in a given product. Infor PLM Optiva gives dairies the ability to optimize their formulas while reducing material costs. It also lessens risk associated with product recalls.

Moving to Market

With rapidly changing food expectations and eating habits, it is important that products are able to move from formulation to the shelf quicker. Manufacturers with top-of-the-line consumer insight capabilities and best-in-class product development capacities can make this move with ease and gain advantage in the market. A dairy industry-specific ERP integrated with PLM gives manufacturers the ability for faster innovation with simpler development processes and improved supply chain function.

Say What?

Before a product gets on the shelf, a generous amount of care goes into packaging and labeling. Errors still happen, however, and they can be costly. A product recall costs an average of $10 million in direct costs.

It’s critical that products are accurately formulated and that information makes it directly to the team making the labels. A PLM solution gives team members across the product development cycle access to accurate and up-to-date ingredient and nutrient information, reducing risk of product recalls resulting from labeling errors.

As snacking becomes more prevalent in consumers’ everyday lives and as diets continue to evolve, dairy manufacturers need to adapt. In addition to high value foods and clean label products, dairy manufacturers must invest in technological solutions that will allow them to innovate, explore new lines of business and remain relevant while increasing efficiencies, modernizing processes and lowering costs.

Amar Kulkarni is vice president of Manufacturing at Avaap. He works with leading manufacturers to implement Infor Food and Beverage, PLM and other Infor software solutions to make their technology strategies succeed.

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