Food and beverage companies could unlock significant value with digital and AI transformations. Senior partner Jessica Moulton and colleagues find that a sample food and beverage company with $10 billion in revenue could realize between $810 million and $1.6 billion in potential value from a digital and AI transformation across its full value chain. Customer and channel management could provide nearly half this value. Retail trade promotions, which can account for as much as 20 percent of revenue for a food and beverage company, are particularly ripe for digital and analytics optimization.
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A pair of treemaps indicate the full value at stake from successfully implementing digital and AI across a food and beverage company’s full value chain. Each treemap segment represents the potential value, measured in millions of dollars, that could be unlocked within 7 different value chain stages. The range of potential value for a hypothetical $10.0 billion food and beverage company is between $810.0 million and $1.6 billion. The smaller treemap represents the $810 million, and the larger treemap represents the $1.6 billion. Specifically, the customer and channel management stage shows the largest potential value, ranging from $230 million to $470 million. The core stage demonstrates a considerably lower value range, spanning from $20 million to $30 million. The remaining stages—consumer insights and demand shaping; product and innovation; manufacturing and operations; supply chain planning and logistics; and direct to consumer—show potential value ranges of $160 million to $300 million, $70 million to $130 million, $140 million to $230 million, $110 million to $210 million, and $80 million to $170 million, respectively.
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To read the article, see “Fortune or fiction? The real value of a digital and AI transformation in CPG,” October 3, 2024.