In December last year, we made a few predictions on what trends would be important in the refrigeration, HVAC, BMS and retail industries in 2019. Now, at the end of the year, we look at what has played out the way we thought and where the markets took a different route than expected.
1. TEMPERATURE DUE DILIGENCE AND COMPLIANCE TO BECOME TOP PRIORITY
With a number of high-profile food safety incidents occurring in 2018, consumers and regulators were demanding tighter control and improved conditions surrounding their food. Based on this, we predicted that implementing complete Hazard Analysis & Critical Control Points (HACCP) compliance systems would be front and centre throughout 2019.
Food safety is still in the international spotlight. 2019 saw the celebration of the first annual World Food Safety Day, this year’s theme: food safety is everyone’s business. The European Food Safety Authority (efsa) illustrated how climate change is threatening food safety. In line with these issues raised by governmental organisations, temperature compliance was named as one of the top risk factors for food safety issues at the Food Safety & Quality Assurance Conference in Orlando, Florida. As these developments show, food safety and temperature compliance were important issues in 2019 and it looks like the trend will continue in 2020.
2. NEW REGULATIONS TO DRIVE HIGHER EFFICIENCIES
Companies need to reduce f-gases consumption by 2030. To adhere to this new legislation, we saw organisations update their existing heating, ventilation, air conditioning and refrigeration (HVACR) infrastructure in 2019 to move away from traditional refrigerants.
The move to new HVACR equipment was an important topic in 2019. Companies who chose to update this year will benefit in 2020 when another law comes into effect. From 1 January, R404 refrigerant gas will become prohibited in new equipment and largely restricted in existing ones.
3. COMPANIES UTILISING REAL-TIME DATA AND METRICS TO LEAD THE MARKETPLACE
Based on technology becoming smarter every day, we predicted that the capability to gather real-time data of BMS and operating processes will allow companies to make proactive decisions. Those that utilise that technology would have a competitive edge.
The trend is still growing and is supported by arising statistics. Forbes predicts that by 2021 at least 75% of retailers anticipate investing in predictive analytics for loss prevention. It is also forecasted, that the predictive maintenance market will grow from $3 billion in 2019 to $10.7 billion by 2024. Monitoring conditions in real-time to enable quick decisions is expected to provide growth opportunities for companies in various vertical markets.
4. INCREASED COMPETITION TO DEMAND TIGHTER COST CONTROL
As we saw increased competition among retailers, driven in part by online sales and market changes, we predicted that reducing operating costs and optimising processes would be essential for retailers to increase profits.
Apart from tough competition, another development in 2019 led to businesses looking to reduce operating costs in form of energy consumption and reducing waste: a dramatically increased awareness of climate change. An increasing number of organisations are targeting the use of 100% renewable energy. With net-zero targets passed into law by the UK government in 2019, changes will need to be made across all sectors and markets to reach this goal. Optimising operating efficiencies will be essential to reduce energy wasted and reduce emissions.
5. FLEXIBLE HVACR CONTROLS TO REACH PEAK DEMAND
With requirements becoming more bespoke and an increased number of suppliers and controls entering the market, we forecasted that the need for open communication would heighten in 2019. Open-protocols, such as BACnet™, modus and XML, were to become increasingly attractive as a result.
Open protocols are in greater demand for building management systems. BAC net is leading the market globally with a share of 64%. Its larger share can be attributed to its comprehensive nature, supporting multiple physical layers including standard IP networking as well as twisted pair networking.
6. ONLINE ORDERS TO DRIVE FURTHER DEMAND FOR THE COLD CHAIN
Shoppers around the world were expected to increasingly order their groceries online in 2019. Retailers were anticipating further growth and put measures in place to meet the demand.
The online grocery market is still expected to grow over the next year. In Italy, Spain, France and the UK, almost a third (30%) of shoppers expect to spend at least a quarter of their grocery budget online. Compared to 14% in 2018 and 27% in 2019, this figure is still on the rise and comes as more digital grocery shoppers are spending more online on more occasions.
7. PHYSICAL STORES TO ADOPT DIGITAL TOUCHPOINTS
At the beginning of 2019, we listed combining physical stores with digital technologies as an opportunity for food retailers to attract digital-savvy customers. Harry Walker – Industry Head, Grocery Retail at Google - was confident that by the end of 2019 the percentage of food retail journeys which involve a touchpoint will rise from 24% to 50% with the availability of innovative technology.
With no data available yet on how many digital touchpoints are now installed in stores, we cannot comment on the accuracy of this prediction. However, implementing digital touchpoints is still cited as one of the most important ways to increase sales. From apps for in-store navigation to digital price tags or voice assistants, retailers can choose from a range of technologies to implement what suits their stores best.
8. CONVENIENCE TO PROVE KEY TO CONSUMERS
Consumers have changed their grocery shopping habits from large weekly shops to more frequent trips to convenience stores. Big supermarket brands are purchasing small format, local stores in order to retain their customers. For food retailers, we therefore predicted that extending their offer to services such as Post Office stations would prove beneficial in the future.
Some convenience stores have, as predicted, extended their offers. In Glasgow, a retailer launched its first “urban transient” store, focusing on food-to-go and foodservice. An on-the-go concept with an emphasis on healthy, vegan and vegetarian options is trialled in London with results above expectations. A convenience store in Manchester expanded and is now also offering an on-site dining and café experience.
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