Dairy Processing - December 2021 - 10

IN 2022, DOES YOUR COMPANY PLAN TO SPEND
DOLLARS ON CAPITAL IMPROVMENTS IN THE
FOLLOWING AREAS? (% YES)
Equipment systems improvements
(i.e.,system integration/automation)
71%
Maintenance & replacement parts
57%
Upgrade existing building
(e.g., HVAC systems, locker/food services, offices
Facility expansion (e.g., additional line(s), building expansion)
New buildings (i.e., brick & mortar)
51%
51%
31%
Note: Multiple responses accepted
$
consumption, but consumption is up this year
- three pounds per person - demand has been
high, people have come back to the things that
they've known and they've seen value in. "
2021 VERSUS 2022
According to the survey, 49% of dairy
processors project increased 2022 capital
investments over 2021 levels and 2022 capital
spending budgets projected to slightly increase
compared to 2021 levels.
Business areas responsible for growth from
respondents who expect revenue to grow in
2021 include growth of existing product lines in
US (67%), new product launches (58%) and new
distribution channels (48%).
" I would say one of the key findings is
that we're seeing that the pandemic impact
has not been incredibly negative, it hasn't
pulled the dairy industry down dramatically, "
Hellmer said. " And so as we see, as Cypress
sees with other food processing industry
sectors that we monitor, the pandemic has
turned out to be somewhat of a boom for
many companies now. If we're taking that
30,000-foot view, we see through this research
a bounce back from the pandemic year (2020)
to 2021, and then a lot of positivity on the
10 DEC 2021 | DAIRYPROCESSING.COM
ABOUT WHAT PERCENT OF YOUR
COMPANY'S ANNUAL REVENUE
IS DESIGNATED FOR CAPITAL
SPENDING IN 2021 AND 2022
(AVERAGE %)
2021 - 9.8%
2022 - 10.6%
" Our folks are preparing to
sell a wholesome, nutritious
product that is sustainably
produced for the consumer. "
Michael Dykes, president and CEO,
International Dairy Food Association
ACTUAL
PROJECTED
part of the industry looking ahead to 2022. "
Companies are trying to keep up with
intense demand, which has required them to
shift focus. Where they would normally be
spending a considerable amount of focus on
new product innovation and support for new
product and production lines in their facilities,
there is a shift to focusing on existing products
and make serving the customer base in that way,
according to Hellmer.
" These professionals have told us their
companies are focused on growing their
business through their existing product lines,
primarily then secondarily through a focus on
new product launches. "
30% of dairy processors anticipate adding
new equipment and/or productions lines in
2022, similar to reported 2021 new equipment
investments. For equipment-related capital
projects, companies project spending on
maintaining existing equipment and production
lines (41%), upgrading existing equipment/
production lines (29%) and adding new
equipment and productions lines (30%).
71% of dairy processors plan to invest in
equipment systems improvements in 2022. 51%
plan 2022 facility expansions and 31% will invest
in brick-and-mortar. 63% of dairy processors
Cypress Research
http://www.DAIRYPROCESSING.COM
Dairy Processing - December 2021

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