As consumer eating habits change, ingredient suppliers and food manufacturers are investing more in the production of plant-based meat substitutes, HC Insider explores the impact of these changes on the war for talent.
Why is the industry growing?
The industry is in transformation. Vegan and vegetarian consumers once made up most of the consumption of alternative protein. Now, it is the flexitarians, not vegans or vegetarians that are driving the explosion of the plant-based meat industry. Flexitarians are consumers that choose to minimize meat and dairy consumption due to health, animal welfare and environmental concerns. This generational shift in consumption behaviors have also been pushed by the improvements in food technology that delivers meat-like taste and texture. The plant-based industry continues to grow and to attract more consumers. According to the Good Food institute (GFI), plant-based meat sales increased by 45% to $1.4 billion in 2020.
Investors are confident in the potential of a plant-based future. Global consumption of plant-based meat substitutes continues to exponentially increase, and in 2020 investments within plant-based, cell cultivated and fermented protein companies reached $3.1 billion, tripled from 2019 according to data from the GFI. It’s projected that global plant-based food sales will increase to $1.4 trillion within the next 30 years.
What are food manufacturers doing to meet the demand?
Companies including Cargill, JBS, ADM, Tyson, Unilever and Nestle have all been investing in solutions to satisfy consumers’ hunger for protein-enriched foods and beverages. For example, Nestle acquired the Garden Gourmet brand in 2017, Unilever acquired The Vegetarian Butcher brand in 2018 and, more recently, Cargill launched a new plant-based protein brand PlantEver for consumers in China.
Last year, ADM and Marfrig formally launched their joint venture PlantPlus Foods. The venture offers a wide range of finished plant-based food products. “Consumers today are demanding food that is good for the environment, for the body, for the mind, and for the development of a better you – while still being delicious,” said Juan Luciano, ADM Chairman and CEO. “Backed by the vast capabilities of ADM and Marfrig, PlantPlus Foods brings together a unique blend of innovation, scale, insight and expertise in this exciting, fast-growing market.”
Brazilian meat giant JBS also entered the plant protein market last year when it created a new subsidiary, Planterra Foods, and launched their plant-based proteins business. In a strategic move to strengthen its global platform for plant-based protein, JBS has also announced its acquisition of Vivera, Europe’s third largest plant-based food company, for $431 million.
Challenges and opportunities
There are significant opportunities for product development and viewing alternative protein as a growth platform when bringing new products to market. Food service offers an enormous opportunity for plant protein, with more and more QSRs and establishments offering new alternative menu items and plant-based recipes.
Today, companies are focused on replicating animal meat products as that is what consumers are accustomed to. In the future, our community expects a next wave of product innovation that will provide newer solutions and experiences than what are currently available. This could mean formulating products that incorporate health and wellness benefits typically found in dietary supplement products into a finished food format.
Despite the higher demand and the innovations, plant-based and alternative proteins still sell at a higher price than animal protein. Companies need to drive access and affordability of their products to consumers, while maintaining a competitive level of flavor and texturant satisfaction found in animal protein using clean label products. Consumers are converting in part because plant protein is healthier, has a new taste and offers more protein variety in their diet. However, without the right pricing structure and access to the availability of the product via grocery, QSRs or e-commerce, sales will not materialize.
Finding the right talent to scale the business
Hiring activity has scaled up significantly across the industry. According to LinkedIn data, plant-based companies are experiencing significant employee headcount growth. Impossible Foods has grown from just under 400 employees in 2019 to approximately 800 today, while Beyond Meat has grown from approximately 250 employees in 2019 to 600 employees today. Oatly has increased from 400 employees in 2019 to almost 950 today, while NotCo experienced a 400% increase in their staff growing from 90 to over 400 employees in a little over a year. Perfect Day increased by 100% from 100 employees in 2019 to approximately 200 today.
Talent with plant protein expertise continues to be in high demand. Companies looking to compete in this market require talent who can influence the company to adapt to consumer needs, driving transformation and innovation inside the company to capture the market opportunity. The industry may be in high growth mode, but for companies to capture this opportunity they need talent with an increased level of commercial agility due to the dynamic and evolving nature of this industry, which borrows from multiple business models.
Within the sales team, companies need the right incentive structures and talent who can capture attention from buyers. It is essential to find talent who can think creatively about how to engage buyers on the future of the alternative protein industry and what their company’s brand will do for their business as this category continues to grow. Your salesforce needs more than established relationships and tenacity to be successful; you need talent who are passionate about the product and believe in the future of the industry to sell the story to buyers and get them to engage with midsize brands in a small market with significant growth potential.
There is a high level of demand for research and development and engineering talent as organizations begin to scale their business. Impossible Foods, for instance, announced late last year that it was looking to hire more than 100 scientists to double its research and development team and accelerate new product development. “Scientists and engineers, we want you,” Pat Brown CEO said. “This literally is the most urgent and important scientific engineering project in human history, and we want to get the word out about that.” The challenge is this talent pool is small, and there is a lack of university programs specific to alternative protein. This means plant-based alternative companies are competing with other industries for both existing and upcoming talent who may be concerned about moving into a less established industry.
Scientists outside of the meat processing industry may be able to create an excellent veggie burger, but they tend to have less experience creating a product which resembles the texture and flavor of meat. Making a great product is one thing but understanding how to scale a product is another. Talent who understands this intersection will continue to be in high demand. The solution to this talent challenge is building teams with diverse and complimentary skillsets with a strong leader to help the team collaborate.
From a recruitment perspective, demand remains strong for talent with the right blend of technical know-how and entrepreneurial mindset. The balance that plant-based food production has between sustainability and purpose often attracts younger workers. However, sourcing engineers with a bioprocess or regulatory process skillset is one notable restriction, as well as attracting scientists from adjacent fields, especially into pre-revenue organizations where the perception of risk is higher. The solution to this is communicating strategies, commitment and adopting post-pandemic flexible-working practices, which are increasingly becoming the new normal to be able to attract and retain talent.