Food manufacturers are once again facing challenges they cannot directly control.

Recent industry data suggests food manufacturing SMEs have seen average sales revenue fall by 37% in Q1, reflecting growing economic uncertainty and supply chain disruption.

The Strait of Hormuz concerns are the latest reminder of how quickly global events can impact UK manufacturers.

In these situations, many businesses immediately focus on increasing sales, but during periods like this, protecting margin can be just as important as generating revenue.

The manufacturers navigating uncertainty most successfully are often those with a clear understanding of their costs, supplier relationships and operational spend.

In volatile markets, control becomes a competitive advantage.

One of the most overlooked aspects of indirect spend control is demand.

Most cost initiatives focus on:

• Negotiating better prices
• Consolidating suppliers

Both are important but they tend to miss the fundamental question of “Do we need to be buying this at all?”

In indirect spend, demand is often:

• Unchecked
• Habit-driven
• Lightly governed (if at all!)

Think about what happens in business:

• Rush courier requests instead of planned shipments
• Over-spec’d PPE or consumables
• Routine lab testing that’s never been challenged
• “Just in case” purchasing behaviour

Spend control isn’t just about buying better. It’s about buying smarter and sometimes, buying less.

Because the easiest cost to remove…is the one you never incur.

Before the recent geopolitical shocks in the Middle East, UK headline inflation was beginning to look like it was stabilising around 3%—a welcome sign after years of volatility. But the war-driven energy spikes have made that stability fragile.

Beneath the headline numbers, cost pressures remain very real.  According to ONS 2026:

• Food inflation still elevated (~4–5%)
• Wage pressures continue to bite
• Energy volatility is returning in 2026
• Suppliers are passing through higher costs, keeping pressure on margins

What appeared to be a stabilising environment is masking a far more challenging reality for manufacturers and boards alike.

In other words, costs aren’t spiking, they’re sticking! And that’s where many businesses are exposed.

Because if your response has been:
“Cut budgets, pause spend, push suppliers”

Then you haven’t solved the problem. It’s just delayed it. Especially in indirect spend:

• Contracts renew at higher rates
• “Temporary” measures become permanent
• Maverick spend returns as soon as pressure eases

This is why some businesses feel like they’re winning…Until 6 months later, they’re back in the same place.

The issue isn’t inflation. It’s lack of structural control.

On paper, that sounds simple. A strong procurement team, equipped with the right tools and expertise, keeps all costs under control, reviews suppliers, and ensures the business is always getting the best deal.

But, in reality?

Most organisations don’t have that luxury. Instead, spend is spread across multiple budget holders — often department heads or managers whose expertise is in operations, production, or people, not in commercial negotiations.

And that’s where the challenges creep in:

• Purchases are made based on convenience rather than value
• Suppliers are renewed year after year without proper review
• Deals are agreed without benchmarking against the wider market
• There’s limited visibility of total spend across the business

The consequence? Costs quietly inflate, inefficiencies compound, and opportunities to add real value slip by unnoticed.

👉 The truth is, procurement isn’t just about buying. It’s about making sure the business consistently has the right solution, at the right price, on the right terms.

When businesses commit to benchmarking every cost — whether it’s raw materials or indirect categories like mobile phones, lab testing, or logistics — they gain:

✔️ Clear visibility of where money is going
✔️ Confidence that spend is delivering maximum value
✔️ Stronger supplier relationships built on transparency
✔️ Savings that drop directly to the bottom line

In today’s environment, where margins are under pressure, not benchmarking your costs is the same as leaving money on the table.

Every cost matters. The question is: are you confident you know if yours are optimised?