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Navigating the Profitability Squeeze in UK Food Manufacturing: Why Investing in People Matters More Than Ever

3 days ago by Jamie Fitzpatrick

As an operations recruiter specialising in the UK food and fresh produce industry, I’m speaking to more and more businesses that are feeling the pressure of balancing growth with long-term sustainability. One theme keeps coming up: how do you stay profitable while still investing in your team and future?

It's not just about machines or margins anymore. It’s about people. And it’s about making smart decisions that won’t just get you through the next quarter but will set you up for the next few years.

Balancing Growth and Capacity

Imagine a food manufacturer smashing its targets for the year. The board's happy, expectations go up, and suddenly there’s a push to do even more. But what often gets overlooked is whether the team on the ground actually has the resources to deliver.

Operations managers I speak to are often caught in the middle. They know their teams are stretched, they know what extra headcount or investment could do, but without the backing, they risk burnout, reduced quality, and staff turnover.

This is where the right recruitment strategy comes in. It’s not just about filling a gap – it’s about bringing in the kind of people who can drive improvement, bring fresh thinking, and support growth without compromising standards.

The Broader Industry Challenge

Across the food sector, it’s a similar story. A recent report by the Food and Drink Federation showed that production costs rose by over 9% in the year to March 2024, while average selling prices only rose by 4.3%. That’s a big gap, and it’s hitting smaller businesses hardest.

In fresh produce, the figures are even more striking. Labour costs alone have jumped by 24% over the past two years. And while many businesses are focused on cutting costs, some are doing so at the expense of recruitment, training and retention, which can create even bigger issues down the line.

Why People Are Still the Best Investment

In difficult times, it’s easy to look at recruitment as an expense. But the reality is, the right people are one of the few things that can actually improve your bottom line.

Here are a few areas where forward-thinking businesses are getting it right:

  • Hiring ahead of the curve – identifying where pressure is building and recruiting before it starts to impact performance

  • Retaining key staff – investing in training, progression and a culture where people feel valued

  • Working with specialist recruiters – building long-term relationships with partners who understand your business and can help you act quickly when the right person comes along

  • Balancing investment – upgrading equipment and embracing automation, but making sure you’ve got the right people in place to get the best out of it

Moving Forward

It’s clear the profitability squeeze isn’t going away any time soon. But the businesses that come through it stronger will be the ones who see their people as part of the solution, not just another cost.

There’s a huge opportunity here for UK food manufacturers to reassess how they approach recruitment. Strategic hiring and proper investment in people can help build resilience, boost productivity, and put your business in a stronger position for the future.

If you’re thinking about where to go next with your operations team, now’s the time to make recruitment a real part of the conversation.