Future Scenarios for the UK Food & Drink Industry

This report provides a set of possible scenarios for the future of the food and drink industry in the UK in 2025. These are based on a series of interviews and two workshops with food manufacturers, policymakers, civil society representatives, farmers and retailers.

This report, commissioned by the Food and Drink Federation (FDF) and written based on work carried out by the Institute for Manufacturing, University of Cambridge.

The aim is to provide senior decision makers in industry and government with a common basis for discussion on the issues surrounding food production and what can be done to achieve positive outcomes for the industry and the country.

The scenarios bring together self consistent pictures of possible futures based around two axes –

  • Whether the impetus for change is coming from government (top-down) or from a mixture of the market and individual action (bottom up)
  • Whether we have sufficient or insufficient resources to maintain and improve our standard of living

This leads to four scenarios depending on whether each axis is at one extreme or the other (see figure 1).

Figure 1 – Four scenario quadrants based on impetus for change and resource availability

Fig 1 - four scenario based quadrants

In Vision Failure we see a future characterised by a severe supply-demand gap, resulting in shortages and increasing energy and food poverty, as a polarised society struggles with social unrest and tension. Progress towards this future is driven by both a lack of social engagement and by government's inability to propose a clear vision combined with its reactive short-term response to crisis.

As confidence collapses and the economy falls deeper into recession, politicians' ability and scope of action wane. Eventually, forced by the crises they are facing, individuals lobby for greater efficiency and sustainability in the sourcing and use of resources, but with minimal impact.

Executive Summary

Sustainable Champagne describes a future where there is a sustainable balance between supply and demand for raw materials, food and energy. This has been made possible by changes in people's attitudes and behaviour, which has reduced consumption and has led to pressure on industry for more efficient and sustainable products and services. This change is based on greater awareness and understanding of environmental issues and limits, and a reduction in the role of central government as there has been an increase in localism and community initiatives.

Demand continues to exceed supply in Good Intentions, as society, the economy and the environment are affected by the unintended consequences and failures in the strategies chosen by the government. Here government action is the main driver for change, however the difficulties in forming a working and stable coalition, the inability to act rapidly and the limited involvement of industry in the development of strategies contribute to their inability to offer successful and long term responses to the emerging crises. The issues are well understood but government is not making good choices.

The future described in the Command & Control scenario is one where government-led interventions and well aimed regulation successfully achieve a balance between supply and demand. On the back of a strong mandate from the voters, the government is able to carry through long term strategies and obtain acceptance for controversial solutions to pressing issues such as energy and food security, including the increased use of nuclear power and the adoption of GMOs. There is increasing regulation, due to the inability or unwillingness of industry to deliver the required changes and targets through self-regulation, and greater control and presence of the state in everyday life.

The most desirable future for contributors to the workshops was Sustainable Champagne, although an almost equal emphasis was placed on the Command & Control by the stakeholders represented, especially the food manufacturers and retailers. In order to achieve either of these outcomes there is a need for a shared vision for the future of the food industry in the UK based on strong evidence, consistent regulation and consumer engagement. Without such a vision, in a business as usual approach, there is a concern that both Good Intentions and Vision Failure are real possibilities.

The following points form a common agenda across the industry to reduce the likelihood that the UK food and drink industry finds itself in either of the more negative scenarios –

  • The development of a clear and shared vision across stakeholders
  • Deeper and more open consultation between industry, government and society at large
  • Stronger evidence for the measures that are required to achieve the goals we set
  • Consistent and coherent regulation from government
  • Changing consumer expectations to reduce unrealistic expectations for food availability
  • Increased skills across the food industry to be able to produce in innovative ways
  • Linking innovation with clear sustainability targets in all aspects of food production
  • An openness to change for all stakeholders

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Introduction

Food is a constant backdrop to our lives. However, for many people food is taken for granted, not realising that the food industry has gone through significant changes over the past twenty years and continues to change in fundamental ways. The interaction of global economic and social trends with internal industry pressures for manufacturers, retailers and consumers is changing the types of food available, how food is manufactured and where in the value chain power and influence lie.

This report, commissioned by the Food and Drink Federation (FDF) and written based on work carried out by the Institute for Manufacturing, University of Cambridge, is an attempt to bring together the various stakeholder perspectives and key trends to develop plausible alternative futures for the food industry in the UK.

The impetus for the report comes from the lack of truly multi-stakeholder pieces on the future of the food industry, with notable exceptions such as the Food 2030 report1. By bringing together representatives from agriculture, manufacturing, retailing and civil society this report starts an important conversation that recognises differences in needs and goals, and it is hoped that it will act as a catalyst for debate on how government, consumers and the industry can find common ground to achieve their varied and sometimes conflicting goals.

Aims of this report

This report presents four possible scenarios for the future of the UK food industry to 2025. The aim is to provide a set of plausible descriptions of how the context for food manufacturers may evolve and to discuss how both industry and government might avoid the more negative scenarios and preference the positive outcomes.

The scenarios presented here are not intended to be exhaustive or to claim to represent accurate predictions. They are a blend of expert opinion, stakeholder perspectives and data from a variety of published sources. Their main use is in providing a better understanding of the issues across the food industry and in promoting a common dialogue on the future of food manufacturing in the UK and to assist senior decision-makers in developing their strategies.

Approach

The development of scenarios for an industry can be both time consuming and costly. This project's aims were to produce timely and relevant scenarios for the food industry in the UK and therefore the approach taken was to build on existing scenario work and to use workshops to gather detailed input from multiple stakeholders in as time and cost effective a manner as possible.

Figure 2 – Outline of approach for scenario development

Fig 2 - outline of scenario approach

As figure 2 shows, the first workshop worked from an understanding of the key drivers for the industry to develop dominant axes to define the foundations for the scenarios. The second workshop took the initial scenario outlines and reviewed them and developed stakeholder assessments of the impact of each scenario. The outputs of both workshops, along with input from one on one interviews, was then brought together to refine and complete the scenario descriptions that form the majority of this report.

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Last reviewed: 12 Jul 2012