Most dairy processors outsource the technical aspects of their business, including equipment installation, packaging and data management.

When it comes to dairy processing, it's not what you know, but who you know that matters most.

This is evident from the report "2023 Dairy Industry Report: Innovation, Adaptation, Transformation" by PMMI Business Intelligence. More than half (63%) of dairy processors say they outsource some services in the survey conducted for this report.

Less than a fifth (19%) of dairy producers say they do not outsource at all, and a similar number (18%) say they are not sure.

Many dairy producers report that they outsource several technical aspects of their business, especially tasks related to the design, installation and commissioning of new additions to their facilities and portfolio.

The most popular types of services for outsourcing include equipment installation, machining, machine integration, and packaging.

Lack of capacity is a major factor driving outsourcing, according to a senior vice president and product science expert who notes: "There simply isn't enough aseptic production capacity to support innovation in extended shelf life products right now - even all the contract packers are full."

Line design and engineering are also key areas for outsourcing.

"We've been looking for ways to use more external engineering as the labour market continues to tighten," says the chief packaging systems design engineer at a global food company. "We need a company that can do everything - not just our dairy portfolio, but all of our products."

The software side of things can also be outsourced, with the most popular being software installation/management and data management.

One food engineering expert notes the popularity of off-site data storage, saying: "Some dairies are storing recipe data off-site to share with all plants around the world - so data security and protection is key as the food industry continues to be hit by cyber attacks."

Original equipment manufacturers and suppliers to support improvements.

Dairy producers also identified the need for more knowledgeable technicians as an important need from original equipment manufacturers and suppliers.

Original equipment manufacturers and suppliers play an important role in helping the dairy industry expand and improve by ensuring that their technicians and consultants are true experts in the field.

Original equipment manufacturers and suppliers can go even further by actively identifying where dairy producers could improve their operations and offering executable projects to implement these improvements.

Those original equipment manufacturers and suppliers who can provide consistent, proactive expertise will be well positioned to create new customer relationships and grow existing ones.

SOURCE: PMMI Business Intelligence, Dairy Industry Report 2023: Innovation, Adaptation, Transformation.