Automation to reduce costs in beverage industry
Beverage companies across the GCC are looking to increase the amount of automation that they have in their factories to reduce their operating costs while improving their production, experts at the ninth edition of the Arab Beverages Conference (ABCE 2019) said.
Taking place under the theme 'Challenging the Future!', the event brought together several senior industry experts from around the GCC and Middle East region to talk about the latest developments in the sector. Experts noted that the Arab non-alcoholic beverage industry is one of the fastest growing sectors in the Middle East region and has witnessed rapid development in the past three decades to become extremely competitive with its counterpart industries in different parts of the world.
According to a recent study conducted by Tetra Pak, a multinational food packaging and processing sub-company of Tetra Laval, the GCC consumed 3,733 million litres of dairy, 2,646 million litres of juice, nectars and still drinks, 6,909 million litres of coffee and tea, 11,310 million litres of water and 2,981 million litres of carbonated soft drinks in 2018 for a total of 27,857 million litres.
Speaking to Khaleej Times, Tony Haddad, general manager of Technica International and vice chairman of the Arab Beverages Association (ABA), noted that there has been a conscious effort towards digital transformation in the industry.
"Recently, we have seen a move towards adopting more automation in factories, and this is due to a number of reasons; more automation means that companies can cut back on human labour, improve hygiene, increase efficiency, decrease operating costs, and meet the growing demand for products by increasing production," he said.
However, the only issue with automation is the high cost of investment involved, he said. "This is why the government is giving grants to companies who want to automate their factories. In KSA, we have seen the government give up to 70 per cent of the automation investment cost as a grant and the remaining 30 per cent in loans for a five year period. This encourages companies into adopting more automation, which is a trend in the market right now."
Monther Al Harthi, chairman of the ABA, said: "ABCE will once again serve as an innovative platform for research and development as we aim to elevate the sector to newfound heights in the months and years ahead. A two per cent growth was recorded for 2018/19 and we expect this figure to continue to increase every year as more and more business and investment opportunities present themselves throughout the Arab region. We look forward to the outcomes of the many fruitful discussions that will take place over the next two days that will ultimately reflect the tremendous growth opportunities throughout the Arab Beverages industry."
Haddad also spoke about consumer preferences and the more health-conscious approach they are taking in what they buy. "Nowadays, we have seen consumers as being more educated about what they are buying. They are also very careful about the nutritional value that is listed on the back of the bottle. They are very concerned about their health so they are looking at the how much sugar is present in the product and what type of additives are present. As a result, companies are looking at introducing more healthier products. In addition, they are also looking at more sustainable packaging for the product so that they will reduce the impact on the environment."