New report highlights critical need for digital modernisation in supply chains

TraceGains, a leading provider of networked compliance, quality, and innovation solutions for the food and beverage (F&B) industry, has released a new report titled Old Habits, New Challenges: The Critical Need for Modernisation in Food and Beverage Supply Chains. The study, based on insights from 483 global F&B suppliers, exposes the industry’s reliance on outdated systems and the urgent need for digital transformation of supply chains to meet emerging regulatory, consumer, and sustainability challenges.

Legacy systems holding the industry back

Despite the rapid pace of regulatory changes and the growing need for supply chain transparency, nearly half of F&B suppliers are still using outdated methods to manage communication with buyers. These legacy systems not only slow down operations but also make it difficult for companies to comply with changing environmental, social, and governance (ESG) standards.

According to TraceGains, 48% of suppliers are still using manual spreadsheets to manage their daily operations, and 71% admit that outdated processes frequently cause problems in their workflows. The most common issues reported are time-consuming tasks (60%), data entry errors (39%), and miscommunication (32%).

The digital divide: regulatory and sustainability pressures mount

As consumer demand for traceability and sustainability grows, suppliers are finding themselves unprepared. A significant 25% of respondents admitted they were unfamiliar with the technology available to better manage their customer relationships. This lack of modernisation is becoming increasingly problematic as regulations, such as the upcoming FSMA Rule for Traceability (204) in the U.S. and tightening European ESG standards, put more pressure on the industry.

Those who are familiar with digital tools cited “keeping up with regulatory changes” (65%) as the primary reason for modernising, followed by faster responsiveness to consumer preferences (58%) and better agility in managing supply chain disruptions (42%). Additionally, suppliers are beginning to recognise the impact of shifting consumer behaviour, with 44% reporting that the demand for sustainable products and online delivery has significantly affected their operations.

Sustainability and compliance: a business imperative

Sustainability has moved from a ‘nice-to-have’ to a business necessity. Nearly 89% of suppliers stated that aligning with corporate sustainability goals is an essential factor in their decision-making, with more than half (53%) considering it very important.

Paul Bradley, Senior Director of Product Marketing at TraceGains highlighted that this research underscores the urgent need for suppliers to update their operations. He noted that due to increasing regulatory pressures and shifting consumer demands, “outdated methods are putting companies at risk.”

He added, “Embracing digital solutions should no longer solely be seen as a competitive advantage – it’s required for staying ahead and meeting compliance, sustainability, and market demands.”