FOOD AND BEVERAGE
Ingredients, Flavors and Contract
World's Most Productive Companies
Food Ingredients Leaders: Productivity Strains and Market Reset
This peer group comprises the major players in the global food and beverage industry, operating primarily as business-to-business (B2B) suppliers of food ingredients, flavors, fragrances, processed foods, and contract manufacturing services. These firms support high-volume production while meeting strict food safety and regulatory standards. While some, like McCormick, are well-known for their branded spices, a significant portion of their business is selling ingredients to other food manufacturers. They share common industry challenges, including volatile commodity costs, supply chain issues, evolving consumer preferences, and increasing regulatory pressure.
Over the last six years, Productivity has declined due to rising input costs, supply chain disruptions, a tightening labor market, increasing regulatory compliance costs, and consumer pressure for new products, which have driven up development costs. In 2024, key influences included persistent commodity price volatility, record cocoa inflation, Red Sea logistics shocks, lingering destocking, cautious consumer spending, which boosted demand for private-label goods, and ongoing labor shortages.
Top 100 World's Most Productive Companies - Ingredients, Flavors and Contract
Productivity Snapshot
The Ingredients, Flavors, and Contract Manufacturers within the Food and Beverage industry experienced a similar productivity trend to many other industries and peer groups: a relative increase in productivity growth 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 4.1%. This segment, like Food and Beverage generally, performed below the average for manufacturers represented in the IPI and has continued to regress in the post-COVID years.
- Thirteen of these companies experienced negative productivity growth in 2023 and 2024.
- In 2024, Productivity declined an average of 6.9% across these companies.
- John B Sanfilippo & Son Inc. earned its position within the LNS 2025 World’s Most Productive Companies by growing productivity 13.8% over the last six years, more than four times the average of its peers/competitors, who had negative productivity. In 2024, JBSS reduced its operating cost ratio, realized integration benefits from its Lakeville acquisition, and leveraged procurement scale to enhance throughput. Over the last six years, JBSS’s vertical integration, commodity discipline, and relatively lower complexity in nut processing have enabled steadier productivity gains compared to more complex ingredient peers.
