Entering the Food System Transformation

Entering the Food System Transformation

Knowing how, where and when to plant the seeds for your own disruption

These two mega-trends are moving in opposite directions, meaning 1.7 planet Earths will be needed to sustain our growing human footprint. This issue is compounded further when we consider the impact of environmental degradation:

  • 26% of all greenhouse gas emissions stem from our food system – a number that governments across the globe aim to decrease
  • 33% of the food produced in the world is lost as waste

Along with the planet, our current food system also continues to impact our health and well-being in negative ways:

Though the pressing need for action from a planetary, societal and human health perspective is clear, there are also a number of implications for businesses. When we talk to executives across the food value chain, consensus is nearly unanimous as to the need to address the issue by finding avenues for creating and sustaining new business models that effectively respond to the changes at hand. In this context, there are some core questions that remain top of mind for these CEOs:

  1. Is now the right time for us to go into this food system transformation business?
  2. If it is the right time, how big do we go in relation to our investments in traditional food systems?
  3. Where do we start among all of this and how do we maintain our traditional portfolio with a new disruptive one?

Ultimately these executives want to gauge the potential outcome for their business from a financial, brand and investment perspective, among others. Fortunately, there are undisputable business benefits to be gained when starting on this food transformation journey, as we address in this article. Important to note is that these benefits are not merely financial – they also offer advantages in terms of boosting brand as well as customer engagement.

When should we move?

Define the right moment to act, depending on your specific segment dynamics to ensure a strategic approach

How big should the move be?

Identify the level of disruption & investment opportunity to strike a balance with the existing business

Where do we start?

Construct a winning strategy to capture opportunities offered by the food system transformation

What results can we expect?

Understand the benefits as well as the potential for mitigating risks that your business can unlock


Looking back at the history of some players in disruptive industries – from Kodak and Blockbuster to Barnes & Noble and Xerox – shows us that, when faced with a burning platform, hesitating for too long can have grave consequences for a business. In our experience, as well, we’ve seen many companies lose out on opportunities and value by failing to take moments of pending disruption seriously.
While the general answer to the question of “When should we move?” is “Now!”, there are a number of influencing factors that businesses should likewise be aware of when planning to address the food system transformation. Overall, the most common indicators we’ve identified for measuring the temperature in this context can be divided into the three broad categories of consumers, investments and regulations.


With consumers around the globe becoming more conscious of their impact at an individual level, we’re seeing clear shifts in dietary behavior.

  • Global plant-based food & beverage sales set to grow from 1.3 billion to 24.6 billion EUR between 2017 and 2025 – 2 billion in the UK by 2025(4)
  • For 80% of consumers, environmental considerations matter more in relation to food & beverage than any other product(3)
  • Alternative food is moving from a fringe offering to the mainstream, with a 3.5x increase in interest recorded between 2016 and 2022(1)
  • 10% of consumers site clean eating as the reason for converting and plant-based food, with interest expected to grow substantially(2)
  • Acceptance of milk substitutes is seeing steady growth, expected to double to 1.6 kg per capita by 2030(5)
  • Tesco is targeting a four-fold vegan sales increase by 2025(6)

These figures point to significant growth based on consumer demand, indicating that consumers are clearly moving in this new direction – a trend that is undoubtedly here to stay. At the same time, however, businesses would also be advised to dig a little bit deeper and reflect on how these trends are really starting to impact the bottom line:

  • Are consumers already seeking these products or are they still viewed as “Frankenfoods”?
  • Have habits really changed or are people just dipping their toes in the water for a taste of novelty but without very much sustaining motivation?
  • How do you address perceptions that alternative products are unnatural and unhealthy or that they undermine the livelihood of traditional farmers?


Faced with a steady shift in consumer behavior and a need to develop new technologies, we’re seeing an abundance of capital helping to accelerate change. Experts predict that, at current prices, revenues of beef and dairy (currently exceeding 400 billion USD) will decline by at least 50% by 2030 and 90% by 20357.

Investors have been closely attuned to predictions pointing to such seismic shifts. Last year alone, the market saw over 3,000 food-tech deals take place8, which can be divided into two categories:

Up-stream investments:

  • involving targets such as food safety and traceability as well as innovative food segments such as biotech, marketplaces, farm software, robotics and biomaterials
  • 19 billion USD were invested in 2021, representing a 68% year-on-year increase, with just under 2,000 deals(9)

Down-stream investments:

  • Experienced a 124 year-on-year increase to reach 32 billion USD in 2021
  • This involved areas such as e-grocery (with 5.1 billion USD invested in China alone), retail, in-store, restaurants, cloud solutions etc.
  • These large-scale investments are being driven by an increasing number of accelerators, venture capital companies and private equity firms. Investors clearly have their sights set on a very different future of the food system.


As action on the part of regulators generally tends to lag behind other market drivers, determining whether regulations are turning into a burning element can be a bit trickier. There is, however, already strong evidence that this is the case:

  • In Denmark, the finance minister is setting out plans to ban meat in all public canteens and restaurants twice per week.
  • In the UK, the Health Alliance on Climate Change is starting to call for a climate tax based on food, with support from 10 of the royal colleges of medicine and nursing, the British Medical Association and the influential Lancet publication.
  • New taxes have already been applied to high-fat and high-sugar foods across Europe, which is having a dramatic impact on retail and FMCG companies.

Markets are being subject to more and more regulations at the global, regional and local levels year after year – be they in response to environmental initiatives or new technologies. Considered together with consumer trends and investments, this supports the view that the platform is indeed smoldering.

A final element that, while not a driving factor in itself, will have a significant impact on the shifts within the food system is economics. We’re seeing the cost for alternative products steadily nearing the level of conventional products. According to expert projections, the critical tipping point will take place sometime between 2025 and 2030. Once these products do become cheaper than their conventional counterparts, we can expect this market to really take off.

In terms of making a move, our advice for companies is to

  • go in with their eyes wide open,
  • assess the reality of the market and
  • make the needed adjustments.

Given the direction of consumers, investors and regulators, now is certainly the time to make strategic moves that will be decisive for building a viable business prepared for the future.


While the time for your business to move may be now, knowing the appropriate size of this transformation will vary greatly from company to company and from context to context. There is no set formula for dimensioning this move, meaning that the answer will depend on conducting a thorough assessment of the existing business strategy, the respective market landscape, your position along the food value chain as well as additional factors specific to your context and business – even including your company culture.
Having helped numerous businesses along the food value chain navigate the food system transformation, Integration has the experience and expertise to support clients on this journey and guide them as to the size of reaction required given their context. In the following, we provide illustrative examples of some businesses we supported in addressing this question as part of their own transformation.

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A food-tech startup was seeking to conquer the emerging market of cultured meat – one that was already filled with competitors racing to develop viable products. The challenge involved tackling a nascent market characterized by high levels of uncertainty, working on assumptions in the absence of concrete data while needing to develop and update models as new information emerged. Considering the difficulties of driving a business still largely in the R&D stage paired with uncertainty on the consumer side in terms of acceptance, sizing the actual market potential would be a serious obstacle.


We supported the client in carrying out a global market scale and value-chain assessment of the cultured meat industry. This involved determining the expected market size for their product in major markets as well as value-chain maps and the regulatory and taxation landscape. As new technology would be needed, it was important to answer questions such as:

  • which industries to potentially partner with
  • who had access to related technology
  • whether to process the product in-house or provide basic material to other players on that part of the value chain


The detailed market scan offered the client a clear picture of the challenge at hand, supported by information on profit-pool sizing per target market, which would serve as a basis for pitches to investors. A new simulation tool, framework and long-term roadmap for each business area empowered the client to make up-to-date strategic decisions as new market information emerged.


In light of ever-changing market demands and supply chain realities across food & beverage categories, a leading global player in flavoring and ingredients recognized an urgent need to update its operations according to the 5-year business strategy. Part of this involved focusing more on innovation and new platforms considering the broader food system transformation – including ingredients for alternative protein products, more natural products and solutions to reduce sugar. The client called on Integration to assist them with building a strategic roadmap to turn plans into concrete actionsfor their global operations area – one of the pillars of the ambitious new strategy. The team was tasked with holistically analyzing the operations of this area to 1) determine the current as-is, 2) the to-be and 3) the wayto get there that would place the business on a sustainable growth path in a changing food system landscape.


A holistic framework was applied and 4 steps defined to address operations in their entirety – from strategic differentiators and values drivers to operational enablers – across all regions and the entire value chain, including planning, procurement manufacturing, logistics and customer service:

  1. Analyzing both pain points and existing excellence within operations
  2. Defining a to-be plan for the operations area along with differentiators and focus areas along the value chain
  3. Designing initiatives to cover gaps between the as-in and to-be at the global, regional and local levels
  4. Translating plans and initiatives into a transformation roadmap that would prepare the business to achieve its objectives and overall strategy


The new strategic roadmap established operations that would enable 6% CAGR over the next 5 years. The client also gained the acquired capabilities to deliver on demands related to innovation platforms and shifting customer needs (B2B and B2C). These capabilities allowed the client to more effectively address the needs of food & beverage startups, which had proven to be distinct from incumbents in terms of speed, volume, adjustments and innovation.

By streamlining operations processes to boost flexibility and agility across the value chain, the company was effectively able to increase speed to market – which was critical for new business frontiers across food system transformation categories. Finally, the newly designed end-to-end performance cell enabled the client team to effectively deal with E2E collaboration and steering across the value chain, especially for new ventures and innovations that would be a break from “business as usual”.


Once your business has identified that now is the right time to go and has a sense for the size of the move, the next key question to address is:

Where do we start the transformation or where do we go next?

There are two entry points for businesses to consider here:

1. We want to go now but don’t know where to start

Businesses beginning to consider their response to the food system transformation are advised to first set a course by developing an end-to-end strategy. This will provide absolute clarity as to where to start, exactly how big you need to go compared to your other investments and the potential benefits your business can expect.

2.We’ve already started but face specific challenges

While some businesses may already have gained clarity as to when, how big and where to start the transformation, the sheer novelty and complexity of the food system transformation means that constant adjustment to new challenges will remain a reality. Some of these may cover areas issues such as:

  • the go-to-market model
  • your supply chain
  • approaches to marketing
  • closed-loop systems and more

When defining a plan of action, context is king. Depending on where your business is currently situated, you will face a different transition path, for which there are seven product offerings that can help propel you in the right direction – be it a complete E2E solution or specific challenges involving closed-loop solutions.


How do we create a future-proof strategy and organizational model in line with emerging trends?

Being successful in a changing food system requires a redefinition of business strategies. This includes all the different elements for turning strategy into a reality – from the organizational model to the supply chain and go-to-market strategy. Overwhelmed by a lack of clarity on where to start, businesses are often left with a patchwork of initiatives that are inconclusive and fail to provide an end-to-end strategy for making effective decisions and acting in a fast-moving marketplace. A 2030 E2E Strategy allows companies to establish the right direction, pace and quality of execution as well as authenticity in their brand and portfolio management


How do we develop, supply and sell a new mix in a diversified protein supply landscape?

The protein supply landscape has been evolving rapidly, leading to high degrees of diversity and a movement beyond momentary interest. The challenge for incumbent and disruptive businesses alike isto set up a very clear and novel go-to-market strategy (GTM) and implementation plan in response to customer target segments, channels, pricing and all the other related elements. This must effectively incorporate the development, supply and sale of their chosen mix of proteins, using the appropriate blend of traditional and modern channels available to ensure successful execution.


How do we grow and produce food to overcome environmental challenges and lower supply chain risk?

The food systems transformation will impact sourcing in two major ways:

  • The need to acquire different raw materials with different dynamics and requirements, e.g. natural plant-based raw materials with an impact on sourcing, region, pricing etc.
  • An imperative to make sourcing more sustainable and resilient, and requiring companies to drive their upstream supply chain more by leveraging partnerships.

The overall aim and challenge lies in growing food more sustainably, adapting to changing habits such as in relation to raw materials and tackling environmental risks such as water availability.


How do we adapt our product portfolio to match the healthy and sustainable lifestyles demanded by consumers?

Many incumbent companies feel content with the success of existing product portfolios that have driven growth for years. However, with consumer demand shifting and regulations increasingly calling for actions to address environmental, societal and health considerations, companies need to rethink their product and service portfolio to match. The challenge here lies in effectively transiting the business into this new landscape while tending to shorter-term financial commitments, shareholder interests and existing consumer demands.


How do we develop brands with mission, purpose and connection to the consumer?

Regardless of the industry, brands need to convey a cohesive vision and purpose to their consumers. What may have proven successful in the past is not necessarily what will resonate with consumers in a transforming food system. As such, brands need to position themselves to represent the values and beliefs that the company wants to convey in a transparent and authentic way, while considering scrutiny from regulators and investors. In this emerging and diverse landscape, brands that are able to express a convincing mission and purpose as well as truly connect with their consumers can achieve a distinct advantage over the competition.


How do we adapt supply chains for new materials in a cost-effective manner?

In response to a fundamentally new strategy, GTM, portfolio and approach to sourcing, companies will need to radically adapt their supply chains. Taking the example of alternative proteins, supply chains can range from animal-based, agricultural and integrated supplies to more decentralized and industrialized chains. This transition arguably represents the most fundamental physical change to the business that demands sizeable assets and investment. It also touches on all elements of the supply chain, from strategy and organization to KPIs and warehousing. The biggest challenge is driving this change successfully and delivering a business case while maintaining business operations and profitability.


How do we create circular value chain models that reduce and re-use waste?

It has become imperative for the business world to take the environmental impact of the food system into account – and especially the high percentage of waste that remains a reality. To address this, the food system must become more resourceful and efficient in the way food along with side-stream products are used. For companies, this means creating closed loops for reusing and recycling resources to reduce or eliminate waste as well as new resources needed to maintain them.


Transitioning to a future-oriented sustainable food system will unlock business opportunities of up to 4.5 trillion USD by 2030(1).

Once your business decides to start down this path, the benefits inherent to this rapidly expanding market that is being actively encouraged by consumer groups will become clear:

  • Access to investments from one of the fastest-growing sectors
  • Role as an innovator in the marketplace
  • Reputation as an organization seeking to benefit the planet and consumers
  • Improved brand image and brand equity
  • Better ability to attract, retain and develop the right employees and skillsets for promoting the business

On the other hand, companies that hesitate for too long and lag behind can expect to face numerous risks related to:

  • Being prepared for new and upcoming legislation
  • Fines stemming from non-compliance
  • Resilience and the ability to fend off competition from companies that do go down this disruptive path

As illustrated in the graphic below, the market is giving us more and more concrete signs that the time is ripe to start considering a move within the food system transformation.

Final Thoughts

When should we move?
The food system transformation is no longer something at the early stages of bleeding-edge development – with all the frailties and uncertainty that this entails. Consumer interest, investments and regulations are clearly all moving in a single direction. While economic headwinds and diverse challenges persist, the fundamentals driving this transformation forwards have been laid. Our advice to companies wondering when to move is: Be leading edge, not bleeding edge, but move fast to start occupying your space within the food system transformation.

How big should the move be?
There is no one-size-fits-all answer here as each business’ respective context, power to invest, appetite for risk and point of departure will be different. What we have learned from experience, however, is that the three factors of

  • having clarity as to your place along the food system value chain
  • adapting a mindset of collaboration and connection within the ecosystem
  • taking a focused approach to commercialization can deliver a return for your company and your investors in the short, medium and long terms

These three parameters should guide you in finding the smart investment needed to win.

How do we start?
It’s essential to start by obtaining a clear view of where your business can realistically be within a defined period of time. Doing so will help identify where your biggest gaps, constraints and opportunities lie. As we’ve seen, the biggest obstacles for mature plant-based companies involve supply chain issues, challenges with scaling up, being able to reduce costs to achieve cost parity, gaining clarity regarding which markets to play in and knowing how to enter their targeted markets.
What we know from the history of disruptive ventures is that, over time, the quality of disruptive products improves (in this case, taste) while the cost goes down – ultimately placing them in a position to beat incumbents. Combining these two factors with the environmental and health qualities that products born out of the food system transformation can offer, we are left with an enticing journey for leading food and drink companies to be a part of.


Daniel Lentfer

Daniel Lentfer is an engagement manager at Integration and has been working since April 2016 in the Germany office. His area of focus is Marketing & Sales, where he has deep experience in Go-to-Market strategies, market and customer segmentation, key account management and planning, and organizational redesign. Prior to Integration, he worked as a political [...]

Freya Tomley

Freya Tomley is an senior manager at Integration and has been working at the London Office since 2015. Freya has a wide range of experience in implementation and project and program management across new business/product launches, M&As (post-merger integration), and efficiency-driving initiatives (e.g. internal restructuring, systems implementation, commercial planning). In the last few years, she [...]

Jamie Gale

Jamie Gale is a partner at our  London Office. He has spent more than 25 years in the consulting industry and private sector. Jamie is recognized for his extensive experience in digital, developing and executing strategies that enable business transformation. He has supported clients across manufacturing, retail, telecommunications, financial services, food & beverage and transportation [...]

Julian Lempp

Julian Lempp is a senior director at Integration's Munich Office. He has experience both within consulting and industry, having previously worked for a leading German consultancy and as a business development manager within an industrial goods manufacturer. While he has experience across many project types, his specialization lies in supply chain, having undertaken numerous consulting [...]

Rodrigo Seabra

Rodrigo Seabra is the partner at our Office in Munich. He joined Integration in 2006 in Brazil and led the Mexico Office, before taking on responsibility of the Munich Office. Rodrigo is part of our Implementation Practice, has amassed international experience in industries such as consumer goods, retail, food & beverage, pharmaceutical and healthcare and [...]

Sven Hoffmann

Sven Hoffmann is a senior manager at Integration's Munich Office. His experience covers projects in the areas of strategic planning and roadmaps, organizational and process redesigns, go-to-markets and innovation systems. Sven has worked in projects across Asia, Europe, North and South America. He holds a master's degree in technology management from the Technical University of [...]

  • On 9 March 2023