FOOD AND BEVERAGE
Branded
World's Most Productive Companies
Branded Foods: Margin Pressure and Evolving Consumer Behavior Consumption
Branded Food & Beverage companies sell packaged food and beverage products under widely recognized consumer brands in generally mature markets. Product lines often include ready-to-eat meals, snacks, cereals, dairy, frozen foods, bottled drinks, and shelf-stable pantry staples. They face challenges such as volatile input costs, shifting consumer preferences towards healthier and more convenient options, digital transformation, and competition from private labels.
This peer group faced a large number of headwinds over the last six years (overshadowed by the demand spikes during the COVID years), including inflation, commodity spikes, and freight swings, which reshaped costs and pricing. Labor costs rose. Inflation also adversely impacted demand for these big brands, as consumers traded down to boost private label alternatives. Weather events and El Niño tightened some crops, notably cocoa. Packaging and health regulations tightened in the EU and UK, while U.S. states advanced EPR rules, influencing packaging, merchandising, and compliance costs.
Top 100 World's Most Productive Companies - Branded Food and Beverage
Productivity Snapshot
The Branded Food and Beverage Peer Group experienced a similar productivity trend to many other industries and peer groups: a surge in productivity from 2020 to 2022, followed by a regression to declining productivity in 2023 and 2024.
- Productivity in the sector has stagnated over the last six years, resulting in an overall decline of 13.44%. This segment, like Food and Beverage generally, performed below the average for manufacturers represented in the IPI. Regression is accelerating relative to most other peer groups in the post-COVID years.
- Nineteen of twenty of these companies experienced negative productivity growth in 2023 and 2024.
- 2024 Productivity declined an average of 12.6% across these companies.
- Danone earned its position within the LNS 2025 World’s Most Productive Companies by generally bucking the trend in the Peer Group by regressing productivity “only” 6.2% over the last six years, compared to the average productivity loss of 13.4%. This represents a 53.8% improvement over their peers/competitors. Danone’s leading productivity performance is driven by volume growth and the execution of its Digital Manufacturing Acceleration (DMA) programs. Over the past six years, it has outpaced many peers by systematically investing in digital, automation, OEE tools, and workforce upskilling under its “Renew” strategy.
- General Mills, Kellanova, Associated British Foods, KraftHeinz, and Hershey earned their positions on the LNS 2025 World’s Most Productive Companies by growing productivity faster than their regional/category peers over the last six years.
