Plant-based meat manufacturing shift: overview
- Manufacturers increasingly favour flexible production over dedicated facilities
- Unpredictable demand makes dedicated facilities less financially attractive
- Contract manufacturing converts fixed costs into flexible variable expenses
- Shared infrastructure lowers costs and improves production capacity utilisation
- Repurposed assets reduce investment needs while supporting manufacturing flexibility
Plant-based meat may be recovering from its downturn.
According to Euromonitor International, plant-based meat and seafood substitute sales grew by 8.1% between 2024 and 2025.
But how such products are being made is shifting. The use of dedicated facilities for plant-based products may be on the decline, says Ewa Granosik, CEO and managing director at agritech consultancy Bright Green Partners.
Rather than using dedicated alt-protein facilities, companies are utilising contract manufacturing, as well as shared infrastructure and repurposed assets.
What has changed for plant-based?
Demand for plant-based is unpredictable, says Priyansha Reddy, commercialisation manager at nonprofit think tank the Good Food Institute (GFI) Europe. With uncertain volumes, dedicated facilities are less attractive.
“Brand-owned facilities come with fixed capital costs that are harder to spread when production volumes are low, potentially pushing up consumer prices and suppressing demand further.”
Not much has changed, other than production throughput and volumes required to sustain dedicated facilities, suggests Luke Townsend, managing director at food ingredient specialist New Leaf Foods.
Even at the height of plant-based’s popularity, says Townsend, dedicated facilities struggled to secure sufficient volumes.
Some plant-based manufacturers do continue to use dedicated facilities, says GFI Europe’s Reddy. Examples include Vivera in the Netherlands, Planted in Switzerland and the Vegan Food Group in Germany.
Yet start-ups and smaller companies are much more likely to use contract manufacturing or shared flexible capacity, especially if they want to launch new product ranges, she says.
Some companies use their own facilities for established and higher volume products, while working with partners for smaller lines and new launches.
Advantages of contract manufacturing for plant-based meat
Contract manufacturing is one alternative for plant-based meat.
In contract manufacturing, “the brand pays per kilo produced rather than covering the plant’s full fixed costs, effectively turning fixed capital and operating expenses into variable costs that naturally adjust with sales”, says Reddy. “This enables companies to launch or test new products, scale up gradually, and enter new markets without the need for upfront capital.”
The useful thing about contract manufacturing is that the investment in infrastructure has already been made, says Townsend.
Equipping a factory with everything needed to produce plant-based meat is cumbersome and expensive, especially given the diversity of products and processing technologies involved.
“Establishing a single manufacturing facility capable of emulsifying, mixing, extruding, forming, coating, steaming, frying, cooling, freezing, and packing products, as well as storing and distributing them, requires substantial capital investment. For a brand starting out, particularly one with relatively low production volumes, this represents a significant financial and operational commitment”, says Townsend.
Contract manufacturing instead offers brands the use of existing equipment and infrastructure, food safety and quality management systems, and skilled labour and technical expertise, says Townsend, without the need for significant upfront investment.
Brands can access different processing capabilities across multiple sites, and manufacture relatively small volumes or scale up as demand requires. It also reduces the financial exposure to underutilised equipment and facilities, therefore allowing them to put resources into product development, marketing and commercial growth instead.
Contract manufacturers run multiple companies’ products through the same lines, points out Reddy, meaning that machines can operate at full capacity longer than any single brand could.
Advantages of shared infrastructure for plant-based meat
Sharing infrastructure also has advantages for plant-based meat companies.
When multiple companies use the same site, fixed costs are spread out across more production runs, says Reddy. Therefore, the facility stays busier.
This can lower barriers for smaller companies, allowing them to test, scale and produce products without having to build their own facilities.
Shared infrastructure is “particularly advantageous in plant-based meat, where individual product volumes are often relatively low and production can be scheduled in batches or campaigns”, says New Leaf Foods’ Townsend.
It can also provide more flexibility to accommodate demand fluctuations, he suggests, and enables manufacturers to improve operational efficiency by reducing downtime between production runs.
However, this method does not come without its risks, Townsend points out. For example, there is a risk of cross-contamination: of vegetarian products containing egg or dairy with fully vegan products, or of allergenic plant-based proteins such as soy or wheat.
“Managing these different requirements demands effective segregation, cleaning procedures, and allergen controls, which can increase costs, reduce production efficiency and limit manufacturing flexibility.”
Advantages of repurposed assets for plant-based meat
Many manufacturing sites have already been adapted for plant-based meat, says Townsend, and repurposing them is a cost-effective approach.
Nevertheless, he says, a distinction exists between reusing equipment and repurposing manufacturing facilities.
Machinery used for conventional meat processing – including mixing, forming, coating, cooking and packaging equipment – can be used for plant-based meat with little or no modification, he says.
Repurposing facilities, on the other hand, could involve modifying processing conditions, adapting production lines, or converting sections of a factory to accommodate different ingredients and manufacturing requirements.
“Both approaches allow manufacturers to make better use of existing assets, utilise surplus capacity and diversify their product portfolios without the substantial capital investment required for dedicated facilities.”
Facilities that produce entirely different types of food can also be used for plant-based meat production, says GFI’s Reddy.
“Retrofitting old facilities, such as breweries and those used to make pasta, breakfast cereal and dried snacks, takes about a third of the lead time and a fifth of the capital cost of a new build, reducing risk and limiting the amount of money exposed if demand falls short.”
It also benefits producers from other industries saddled with falling volumes or spare capacity, as it allows them to make use of their facilities and skills.
Cutting costs
Plant-based meat is no longer as successful as it once was.
Dedicated manufacturing facilities may work well for highly successful companies processing massive volumes, but for businesses facing fluctuating demand, especially those that are not yet well established, they are not so cost-effective.
Other types of manufacturing allow such companies to be more flexible, save costs and prevent equipment from lying unused.
