Every company worth its salt wants to grow. That idiom applies regardless of the sector you operate in. But for food sector companies, there are considerable headwinds driven by the depth and complexity of the sector – its supply chains, its consumers, the extraordinary levels of competition, the influence of international trade and currency. Add to that challenges with cash flow, inventory management of perishable products, exposure to capital costs and labour constraints. It’s little wonder that food industry players struggle to settle on the most effective way to finance operations and growth.
Food industry operators – right along the supply chain – face a combination of retailer price pressure, fickle consumer trends, intense regulatory pressure and, particularly in Australia, considerable supply chain pressure driven by costs of labour and transport. Every one of those elements is also heavily influenced by international trade pressure, whether in the form of fuel costs, exchange rates, import pressure or export barriers. And margins are slim to start with, so any adverse impact can rapidly put pressure on profitability and growth aspirations.