A digital transformation provides social and economic benefits resulting from online connections among people, businesses, devices, data and processes.

As the digital transformation unfolds, industries become smarter through communication, optimization and automation. Therefore, competitive advantage relies increasingly on technological innovation. The technology adoption among some SMEs in the agricultural industry however has been slow due to investment and a skill gap. Within the retail and marketing sectors technological innovation provides many new business opportunities, but the need of some is questionable.

Technology adoption leads to an increase of digital enablers in the value chain and provide the potential to monitor the status of products throughout a supply chain that can become increasingly complex. This allows not only the optimization of internal and external processes but also the improvement of food safety. Data is not only collected about location, but also about variables such as temperature and pH levels that will reveal information about a products quality. Subsequently, smart packaging can communicate relevant product characteristics and fulfill the consumer’s need for more information.

Some technologies such as smart tags supported by QR or Barcodes are ready for adoption. For other innovations to take place further development is required such as sufficient computational power and energy autonomy.

More value can be extracted from resources by using them more efficiently and for longer through sharing, reusing, repairing and recycling. 

It is Important in the circular economy to use resources more efficiently throughout the process and to address the current wasteful system. Initiatives to either close or narrow the loop can take place at the company level, but also through local initiatives and sector organization. An example of it can be found in the promising bio economy concept which proves that the circular economy can serve to reduce environmental as well as economic costs. It is not only about preserving value, but also about driving revenue.

The circular economy is one response to deal with higher and more volatile commodity prices. Products such as farm equipment can be provided as a service, and recycling offers opportunities as the number of consumer touch points is increased.

Closing and tightening the resource loop requires significant effort and is not an incremental innovation. Different partnerships with a variety of stakeholders are required to collaborate in order to achieve a bioregional food system that optimizes water, energy and waste.

Digital technologies are essential to guide transformations. Sharing and integrating information about the location, availability and quality of resources optimizes inputs and minimizes transaction costs and uncertainty.

Digital marketplaces have led to the immediate provisioning of goods and services as well as employment becoming detached, agile and adaptable.

Delivery has become safer and more reliable because of a smaller information gap. Brick and mortar stores are transformed into web shops and consumers are experiencing same day delivery as the new norm thanks to algorithmic efficiency.

Logistics have become a competitive advantage and the mindset “can’t touch won’t buy” belongs to the past. The next generation of logistics is fueled by technologies such as 3D printing.

The connection of people through digital infrastructures has resulted in the detachment of work and workplace. Last mile food deliverers are independent and are experiencing new levels of labor flexibility. Throughout the value chain, expertise and temporary labor will be available on demand by matching supply and demand.

For such temporary jobs, individuals can acquire highly sought-after 21st century skills. Especially in the agro-food sector with the unfolding of digitization training and expertise is required. Opportunities exist to find synergy between on demand learning and on demand labor.

There is however a dark side to this “cloud-based labor”; extreme flexibility demands, uncertainty and low prices are to be feared in the new gig economy.

Efficiency gains are required while conserving natural resources and creating ecosystems that are resilient to climate change and market volatility.

Sustainable intensification is generally associated with the focus on intensifying the production side either through increased labor, input or technology. As the objective is to design an agri-food system that is sustainable in terms of economic, social and environmental perspectives, concepts of the circular and sharing economy are part of sustainable intensification as well.

One problem lies in the definition of sustainable. More research is required to understand all linkages, in order to reach scientifically based acceptable and shared norms that allow the implementation of cost-benefit analyses in daily management practices.

Digital Innovation Hubs aid the advancement of the sector through knowledge and technology transfer. Additionally, these Hubs provide the infrastructure for the formation and development of ideas by various actors. Other forms of open innovation are taking place such as governments opening research to agri-tech experts, the formation of multi-stakeholder communities, and supply chains collaborating to innovate.

For the durability of the system, the social aspects should not be neglected. Digital technologies need to increase access to opportunities of development through social inclusion and subsequently prevent rural abandonment.

Sharing is about reducing ownership and increasing access by making underutilized assets and services accessible to off and online communities.

The sharing of resources like cars and houses has shown to be a viable business model. Some argue these models to be part of an access economy rather than a sharing economy as sharing implies some altruistic nature. Alternative Food Networks are somewhere in the middle as consumers and producers collaborate. These short distribution chains like self-harvest gardens and community-supported agriculture could experience new growth and increased member retention as labor intensity can be decreased and organization optimized with the implementation of digital technologies.

The demand for local food, the need for shorter distribution channels and the unsustainable food system for small farmers have led to the rise of regional and local food hubs. By sharing value creation, the competitiveness of stakeholders is enhanced as well as the condition of the community itself. Examples are the formation of brands around regions, and the attraction of talent.

There are however situations in which companies prefer horizontal collaboration abroad due to a lack of trust and therefore limited information exchange. Hybrid approaches that generate profit to accomplish social and environmental objectives have the opportunity to fill an important gap in the industry.