Infor: Adopting applied AI is the key to smart and efficient operations in the food and beverage industry

2023-06-08 14:35:38 Author: Song Junyi

Faced with high inflation and rising prices, innovative food and beverage companies have turned to artificial intelligence (AI), and more specifically, machine learning (ML) to reduce costs and increase efficiency. Increased investment in applied AI and ML solutions can help food and beverage companies reduce waste, improve business processes, and meet growing market demand in an environment where supply chains are becoming increasingly complex and unstable. The most important thing is that food and beverage companies in the cloud can obtain data, analysis technology and machine learning technology in the form of instant services, start machine learning faster, and seize market opportunities. As food and beverage companies continue to deepen their research into applied AI, the ability to host and visualize data in the cloud will be critical to identifying opportunities to optimize operations, cut costs and reduce waste.

Food and beverage companies can apply AI to product recommendations and sales pricing strategies to improve accuracy and efficiency. Food and beverage companies must adjust their product supply and pricing strategies dynamically in order to maintain sales in the current volatile environment of fluctuating raw material and energy prices.. Zeelandia Group, a global baking ingredients company, deployed an ML model to recommend products and quotes to bakeries based on similar customers' purchasing situations, successfully solving the problems of high costs and lack of baking ingredients. Through the deployment of applied AI, Zeelandia Group has shortened the preparation time for product promotion from 30 minutes to 5 minutes, increasing efficiency by 83%. Reduced product introduction time has increased revenue per transaction and revenue from individual customers, while also freeing up Zeelandia employees to spend more time improving the customer experience.

Deployment of applied artificial intelligence and machine learning can also promote the sustainable development of food and beverage companies. Many food and beverage companies are already using machine learning technology to reduce waste and identify inefficiencies in their supply chains. For example, Amalthea, the world's leading supplier of sheep cheese and organic cow cheese, has begun to use applied AI to improve the predictability of cheese quality, significantly increase production, build customer loyalty, and promote sustainable development. Previously, because Amalthea could only analyze milk production manually on a weekly basis, it was difficult for the company to make adjustments based on process parameters to optimize production. Through ML technology, Amalthea can now view the causes of changes in production in real time and understand the situation of production. Amalthea successfully reduced overall waste in the manufacturing process because they were able to quickly identify pain points and improve the process on the fly. These changes have had a direct impact on the company's profitability and net profit, as every 1% increase in production means Amalthea can save approximately €500,000 in costs.

In addition, the global labor shortage continues, affecting the output of the food and beverage industry. Part of the reason for the labor shortage is that a new generation of workers is more likely to seek lifelong employment opportunities and value-driven jobs than to work in factories or customer service departments. Due to increased market demand and increasing pressure to maintain supply, food and beverage companies are increasing investment in automated production and Industry 4.0 technologies to solve the problem of employee shortages. For example, companies have begun to use AI and robots to complete some labor-intensive tasks, such as sorting, grading, cutting and slicing, which previously required manual monitoring and decision-making. In addition, companies’ introduction and deployment of the latest Industry 4.0 technologies can also attract more young talents who are eager to learn and eager to use the latest technologies to solve problems in the global food and beverage industry, such as sustainable fisheries. Nutreco, the global leader in animal nutrition, is using the latest Industry 4.0 technology to achieve precise shrimp farming. It shortens the breeding cycle of healthy shrimp and reduces feed consumption by 30%. More specifically, Taigao Group uses audio sensors to listen to the sounds of shrimp to determine the best feeding time and improve aquaculture efficiency. Using AI to independently determine the feeding time and amount can not only reduce feed waste, but also promote the optimal growth of shrimp.

As unprecedented challenges become the new normal in the food and beverage industry, the deployment of applied AI is imperative for enterprises. It can allow enterprises to operate more intelligently and efficiently, rather than blindly act haphazardly. It is obvious that companies can save costs and improve sustainability by introducing ML solutions, and employees can get rid of repetitive tasks and focus more on improving customer experience. In times of economic uncertainty, food and beverage companies have no choice but to adapt. The current economic downturn is accompanied by increasing inflation. In order to ensure the profitability of enterprises, it has become urgent to introduce applied artificial intelligence.

(Author: Lu Chong, Senior Director of Business Consulting, Infor Greater China)

About the author

Mr. Lu Chong is currently the senior director of business consulting in Infor Greater China. He has more than 15 years of practical experience in the field of enterprise application software. Mr. Lu Chong has joined Infor since January 2003. Before joining Infor, he worked as a system engineer at KPWOOD Company, a business consultant at SSA Shanghai Company, and a project leader at Schindler Elevator. Mr. Lu Chong graduated from Tsinghua University majoring in management information systems.

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