Innovation in Canada’s Food Sector: A Critical Turning Point for 2025
As we navigate through 2025, Canada’s food and beverage industry stands at a crossroads. Recent data from Statistics Canada paints a picture of an industry grappling with innovation challenges while facing potential U.S. tariffs. Let’s dive into what this means for our food sector and why innovation isn’t just important – it’s essential for survival.
The Innovation Slowdown: A Wake-Up Call
Remember when everyone was talking about Canada as a food innovation powerhouse? Well, the numbers tell an interesting story. Between 2021 and 2023, about 68% of our food manufacturers introduced some form of innovation – sounds good, right? But here’s the catch: that’s actually down from 72% in the previous period. The most concerning drop? Process innovation plummeted from 48% to 39%. In today’s competitive market, that’s a trend we can’t afford to continue.
Size Matters, But Should It?
Here’s something that might raise eyebrows: if you’re a food business making over $100 million in sales, you’re probably innovating – about 77% of these companies are. But if you’re a smaller player with less than $1 million in sales? That number drops to 59%. This innovation gap between big and small players isn’t just a statistic – it’s a call to action for supporting our smaller food producers.
The Regional Innovation Recipe
Canada’s food innovation landscape is as diverse as its geography. Quebec is leading the charge with 73% of food businesses innovating, particularly in organizational and process improvements. Ontario’s taking the lead in product innovation, while BC and the territories are showing everyone how it’s done in marketing innovation. This regional diversity could be our secret sauce – if we learn to share these strengths across provinces.
Looking Ahead: Why 2025 Matters
With potential U.S. tariffs on the horizon, our food sector isn’t just thinking about innovation – they’re planning for survival. Three in five businesses are already mapping out their innovation strategies for the next three years. Their focus? Improving efficiency (70%), cutting costs (69%), and tackling labor challenges (40%).
The Sweet Spot for Innovation
Interestingly, the sugar and confectionery sector is our innovation champion, with 79% of businesses introducing new ideas. Meanwhile, other sectors like hog slaughtering (36%) are lagging behind. This disparity shows there’s room for growth – and learning – across different food sectors.
What’s Next?
As we move through 2025, innovation in our food sector isn’t just about staying competitive – it’s about thriving in an increasingly challenging market. Whether it’s developing new products, streamlining processes, or finding creative marketing solutions, the businesses that embrace innovation today will be the leaders of tomorrow. Interested in learning more about food sector innovation? Happy to connect and share insights. At Culture Advisory Group, we have the resources and funding to help you with your next innovation project reach out to bdooley@cultureadvisorygroup.com
The message is clear: in a world where trade relationships are evolving and market demands are shifting, Canada’s food sector needs to double down on innovation. It’s not just about keeping up – it’s about setting the pace for the future of food manufacturing in North America.
🍁 Is Canada’s Food Innovation at a Crossroads? The Numbers Tell a Story
Recent Statistics Canada data reveals a concerning trend in our food manufacturing sector, but also highlights incredible opportunities ahead. Here’s what you need to know:
📊 The Innovation Gap:
- Innovation in food manufacturing has dropped from 72% to 68%
- Process innovation saw the steepest decline, falling from 48% to 39%
- Yet 3 in 5 businesses are planning innovation initiatives for the coming years
🌟 Regional Champions Leading the Way:
- Quebec: 73% innovation rate, excelling in organizational improvements
- Ontario: Leading in product innovation
- BC & Territories: Setting the pace in marketing innovation
💡 Size Shouldn’t Determine Innovation: Large manufacturers ($100M+ revenue): 77% innovation rate Small manufacturers (<$1M revenue): 59% innovation rate
With potential U.S. tariffs on the horizon, our food sector’s focus on efficiency (70% of businesses) and cost reduction (69%) couldn’t be more timely.
The bright spot? Our confectionery sector is showing what’s possible, with a 79% innovation rate. 🍫
🔑 Key Takeaway: As we navigate 2025’s challenges, supporting innovation across all business sizes and regions isn’t just smart – it’s essential for Canada’s food manufacturing future. Interested in learning more about food sector innovation? Happy to connect and share insights. At Culture Advisory Group, we have the resources and funding to help you with your next innovation project reach out to bdooley@cultureadvisorygroup.com
What innovations are you seeing in your corner of the food industry? Let’s discuss in the comments below. 👇
#CanadianFood #Innovation #Manufacturing #FoodIndustry #BusinessStrategy #EconomicGrowth.
Innovation declines in the food processing industry: StatsCanada
By Food in Canada Staff December 12, 2024
Innovating businesses in the food processing industry, by innovation type. Image © Statistics Canada
Statistics Canada’s latest Survey on Innovation in the Food Processing Industry found that nearly three in five businesses (58.2 per cent) in the food manufacturing sub-sector spent on average up to 5 per cent of their total expenditures on innovation activities, such as, product, process, organizational and/or marketing innovation, in the last three fiscal years (2021, 2022 and 2023).
Slightly more than two in three food manufacturing businesses (67.7 per cent) introduced at least one innovation from 2021 to 2023, down from 72.1 per cent from 2016 to 2018. The proportion of innovating businesses declined across all four types of innovation. However, process innovation declined the most, with fewer than two in five businesses (38.5 per cent) reporting introducing it in 2021 to 2023 compared with nearly half (48.4 per cent) in 2016 to 2018.
The study found that from 2021 to 2023, the likelihood of businesses introducing at least one innovation generally increased with their food production sales. Nearly three in five businesses (59.2 per cent) with less than $1 million in food production sales in 2023 introduced at least one innovation from 2021 to 2023. Meanwhile, over three in four businesses (76.5 per cent) with more than $100 million in sales introduced at least one innovation over the same period.
Businesses in sugar and confectionery product manufacturing (78.6 per cent) were the most likely to have introduced at least one innovation from 2021 to 2023. Conversely, businesses in hog slaughtering (35.9 per cent) were the least likely to introduce at least one type of innovation.
Regional differences
The survey also found that food manufacturing businesses in Quebec were more likely to have innovated from 2021 to 2023 compared with other regions, with nearly three in four (72.7 per cent) reporting introducing at least one innovation, largely organizational (46.3 per cent) and process (43.3 per cent). Businesses in Ontario were the most likely to have introduced product innovations (39.8 per cent), and businesses in British Columbia and the territories were more likely to have introduced marketing innovations (50 per cent).
In the 2023 iteration of the survey, three in five businesses (60.5 per cent) in the food manufacturing sub-sector said they were planning plans to innovate over the next three years, mainly to improve efficiencies (69.8 per cent), reduce cost (69.2 per cent) and address labour market challenges (40.1 per cent).
The survey sampled 3,660 businesses with at least $1 million in revenue
