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Wipfli leverages our experience in working with food and beverage companies to help you uncover new ways to build sustainable success.
Our services can reach every area of your business, from industry-experienced accounting to operations support for your food manufacturing challenges. And our responsive, proactive guidance can help you identify critical opportunities to cut costs and increase profits.
Mitigate exposure and maximize opportunities with Wipfli’s industry-experienced tax services. We provide support for critical areas, including start-to-finish entity structuring, credits and energy incentives. We also help you effectively navigate complex planning and compliance challenges.
Wipfli can help you enhance strategy and cost optimization with our organizational performance services. Whether you need to develop your promising leaders, create an agile strategy or improve processes, we help you find new ways to strengthen your business.
Wipfli’s assurance team goes beyond reports to provide essential insights for faster, better decision-making. Our audit and accounting services, including support for inventory observations and financial statement compilations, can help you drive growth by identifying risks and opportunities for improvement.
Further your digital transformation with Wipfli. We help you develop a digital strategy and adopt the right solutions, including enterprise resource planning systems for forecasting and financial reporting. We can also help improve your data governance so that you can leverage data analytics and AI while maintaining a robust cybersecurity program.
Wipfli offers end-to-end, industry-experienced support to help maximize the return on your transaction. With buy-side and sell-side M&A, valuations and investment banking services, we help you see real value from your M&A deal.
Build an experienced back office that scales to match your growth. Wipfli’s outsourced services for finance and accounting, HR, technology and operations help you keep a lean organization while providing consistent talent and leadership.
Wipfli’s multidisciplinary risk advisory team can help you navigate your compliance and risk challenges with support for critical areas, including fraud investigation, SOC audits and internal controls. We help you manage risk effectively so that you can focus on productivity and securing long-term success.
Wipfli provides estate planning, business succession and wealth management support that can help you effectively navigate your personal and business finances. We focus on listening first so that we can deliver tailored, comprehensive solutions that build a strong foundation for your multigenerational goals.
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Could a modern ERP help your food and beverage business become more competitive? Here’s what to know.
Most food and beverage producers still operate on legacy software systems. These systems may have served your business well in the past, but today, they make it harder to track materials, manage inventory and control costs . To solve these and other challenges, more food and beverage companies are turning to modern enterprise resource planning (ERP) systems. An ERP can help your business operate more efficiently and effectively by giving you new capabilities that legacy systems are simply not able to offer. Keep reading to learn more. What is an ERP? An ERP is a software platform that serves as a financial and operational hub for your food and beverage business. It allows you to understand what is happening inside your business and your supply chain so you can make smarter, more proactive decisions. Core ERP functions include accounting, finance, production and warehousing. An ERP also integrates with additional peripheral systems you may already be using, like an MES, EDI or compliance reporting. By linking with peripheral systems, an ERP helps make all of your operations more visible and effective. In the past, many ERP companies didn’t offer support for batch manufacturing. But that’s changed, with a wide range of ERP solutions now available that can help food and beverage producers leapfrog decades worth of tech-based or operational problems. How does implementing an ERP benefit food and beverage businesses? An ERP is a foundational software tool that helps a business operate more efficiently and effectively. But for food and beverage producers, specifically, it can also offer a competitive edge, because so many of your peers are still operating on older systems. Here are key benefits you could see from an ERP transformation: 1. Operational visibility A modern, cloud-based ERP gives you clear visibility into what’s happening inside your business. This includes not just your financials but also your production process, as your ERP can share data with your manufacturing execution system (MES) to give you a big-picture perspective on your production lines. As a result, your decision makers gain more real-time clarity into key questions like which of your products are most profitable, and that can help your business adapt to meet today’s challenges. 2. Work more efficiently An ERP can dramatically speed up many of your older manual or spreadsheet-based processes. For example, your team may currently be manually collecting data from peripheral systems and putting it into spreadsheets for analysis and reporting purposes. An ERP can automate that entire process, freeing up your team to focus on higher-level work. 3. Better cost controls Older systems typically only offer insight into standard and average costs. A new ERP also allows you to account for additional costs like supply chain disruptions, one-time expenses and climate or weather-related issues. You’ll also be able to more rigorously look for ways to cut down on waste in the production process. 4. Easier training Legacy systems make onboarding new team members harder because those systems have often been patchworked together over decades. Training new employees on a modern ERP allows for faster, more standardized onboarding. It also insulates your business against risks like losing the one employee who understands how your legacy accounting system actually works. 5. Integrated systems A new ERP makes all of your systems more effective because it helps serve as a hub for your peripheral systems. This allows you to bring together data much more quickly, rather than having to painstakingly pull it from each individual peripheral system, and it also makes you better able to take advantage of AI , which needs all that data to operate effectively. 6. Competitive advantage Most food and beverage producers are still running on legacy systems. If you migrate to an ERP while your competitors are still operating on decades-old software and spreadsheets, you will be digging with a backhoe while your peers are relying on shovels. 7. Happier team New systems allow your team members to avoid monotonous, time-consuming tasks. They also help you streamline your workflows, making for a better work experience for your team as a whole. 8. Experimentation Better tracking capabilities make it easier to experiment with new product ideas. You’ll be able to more quickly assess the performance of various product tests to decide if an experiment is paying off. 9. Avoid product shortages New ERPs dramatically improve your materials tracking and inventory management capabilities. This helps you avoid production slowdowns and keep shelves full of your products. 10. Simplified recall and compliance Many food and beverage companies are still handling recalls and other key compliance tasks out of spreadsheets. A modern ERP allows you to largely automate this process, quickly notifying stakeholders, tracking affected batches and more. How do you successfully migrate to a new ERP for your food and beverage business? Food and beverage CFOs and operational leaders considering an ERP migration should focus on how an ERP can help solve specific business problems. Here are key steps to a successful upgrade process: 1. Know thyself Start from a place of curiosity. You may have been running on the same systems for a decade or more. So, what new options are out there? Learn more about what modern ERPs can deliver. Then think about specific processes within your business that a new ERP could help improve. Take the time to dive in and understand how your business works right now so you can assess whether an ERP would allow you to operate more effectively. What specific business problems could an ERP help you solve? 2. Consult an advisor Once you have specific ideas about how you could use an ERP to improve your existing processes, pull in an advisory firm. Talk with your advisor about what you want to change within your business. Your advisor can help you weigh different ERP options to make sure your systems align with your needs. Look for an advisory firm that understands both enterprise tech and the food and beverage business. 3. Consider food-specific factors in potential ERPs Food and beverage businesses need specific features from an ERP. Be sure any options you are considering include capabilities like compliance, traceability, shelf life and ingredient blending, not just a generic pledge that they work for food companies. 4. Think about nonfood-specific factors as well Also consider nonfood-specific elements when choosing an ERP. Factors like purchasing, accounting, tracking profitability and managing vendor or supplier relationships all matter. A good ERP will fit your business holistically. 5. Factor in whether an ERP can be tailored Even the best ERP options probably won’t offer everything you need off the shelf, so learn more about whether your potential ERP options can be tailored, if needed. This can allow you to account for elements like protecting recipes or other trade secrets that you don’t want exposed on public cloud servers or shared with AI. Read more Why are manufacturers missing out on the 179D tax deduction? AI disruption is coming for manufacturing. How should your firm adapt? Can the qualified production property rule help your manufacturing firm reduce tax payments?
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Are outdated core systems blocking your food and beverage company from growth? Here’s what CFOs should watch for.
Food and beverage producers frequently rely on legacy software or even manual systems to run their businesses. But could those systems be an obstacle to growth that’s hiding in plain sight? Legacy systems make it harder for producers to operate efficiently. Aging core systems can also stymie executives trying to understand their costs and adapt to changing market demands. Keep reading to learn more about how food and beverage producers are currently running their businesses and when it might be time to consider a more modern approach. What core systems are food and beverage producers currently using? Some food and beverage producers are running their businesses on modern enterprise resource planning (ERP) and manufacturing execution systems (MES). But most firms are still using legacy systems, which often consist of basic accounting software and a simple production system, with spreadsheets to paper over the gaps. Food manufacturers doing under $40 million in annual revenue almost always operate on legacy systems. Mid-market firms in the $40-$100 million range typically have more complex tools for inventory management and purchase planning but may still use spreadsheets for compliance reporting and recall actions. Even producers with a certain amount of sophisticated operational software are still typically using software that is 10-15 years old, in part because for many years, ERP companies didn’t offer solutions that supported batch production. But as the business climate grows ever faster and more complex, is running on legacy software and spreadsheets still serving your business? What are the warning signs that your core systems may be out of date? Legacy accounting software and production systems could be slowing down your business. Look for key warning signs like limited ability to track raw materials, poor inventory management, inflexible cost control tools and poor traceability. Here are key indicators that your food and beverage business may be taking a hit because of legacy systems: Difficulty tracking raw materials: You need to be able to plan and track your raw materials to avoid a production outage. If you’re having trouble keeping your products on shelves, poor materials tracking capabilities could be a major bottleneck. Labor shortages: Older systems don’t cause labor shortages, but they do make it harder to adapt to them. Legacy systems tend to involve time-consuming, manual processes that take your team members away from higher-value work, straining your team’s capacity and creating burnout. Poor inventory management: Are you wasting time producing products that don’t sell? You may lack the capability to effectively track and prioritize your best-selling products. Limited traceability and recall capabilities: Legacy systems may leave you tracing lots and batches or even managing a recall in spreadsheets. This makes it harder to act quickly to protect your customers. Rigid cost control tools: Older systems typically only show you standard cost and average cost. This makes it hard to get a clear picture of your costs because you can’t fully account for unpredictable or one-time elements like seasonal products, supply chain disruptions and climate or weather events. Trouble integrating newer systems: If you have newer systems in areas like transportation management or compliance, you may be struggling to connect those with your older core systems, making it more difficult to share data between them. This can also make it harder to benefit from newer technologies like AI . The common theme to these warning signs is that you’re not able to quickly and fully understand what’s happening inside your business. You have limited visibility into materials, inventory and costs — making it harder to minimize waste or boost profitability. And your team, from your leadership on down to frontline workers, is forced to act more reactively than proactively, making it tough to pivot or move decisively when needed. What are your next steps? If you see warning signs in your own business that your systems may be blocking your growth or efficiency, consider exploring your options. CFOs and key operational leaders should seek to: 1. Identify specific pain points within your business Look at specific pain points inside your business that are being caused by legacy systems. This will help you drill down on what needs to change. You’ll also get a clearer sense of how a transformation could deliver ROI and concrete operational benefits, which will make it easier to build support among stakeholders. 2. Talk with your team about change Food and beverage producers make vital products that people depend on. This may leave leaders wary of changing existing systems and processes. Have conversations with key team members about change — what it would look like, why it could help your business and how to do it in a way that doesn’t impact production. 3. Consult with an advisor Talk with a third-party advisory firm that understands both modern enterprise systems like ERPs and the unique needs of food and beverage producers. Your advisor can help you map out what’s possible and how a systems migration could deliver concrete business results. 4. Consider your options With your advisor, evaluate different enterprise systems available on the market to determine what makes the most sense for your business. Consider both food-specific elements like the ability to track shelf life, but also broader, nonfood factors like how a new ERP would affect your accounting, purchasing and your broader tech ecosystem. Read more Why are manufacturers missing out on the 179D tax deduction? AI disruption is coming for manufacturing. How should your firm adapt? Can the qualified production property rule help your manufacturing firm reduce tax payments?
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Should you undo your 163(j) election?
The Tax Cuts and Jobs Act created Section 163(j), which limits the deduction of business interest expense to 30% of adjusted taxable income (ATI), commonly called “tax EBITDA.” Beginning in 2022, businesses were limited to “tax EBIT” and could no longer add back depreciation and amortization expense to ATI. Many businesses got hit by the limitation. Why real estate and farming businesses elect out of Section 163(j) Because real estate and farming businesses are often highly leveraged, their interest deductions may be significant. These businesses can opt out of the limitation by making a real property trade or business (RPTB) or farming trade or business (FTB) election. Many did so in 2022-2024 to avoid losing their interest deductions. However, the election came with a high cost — electing businesses are ineligible to take bonus depreciation on certain assets (qualified incentive property [QIP] for real estate businesses and single-purpose agricultural buildings, land improvements and farm buildings for farming businesses). How OBBB changes the Section 163(j) planning equation The One Big Beautiful Bill Act (OBBB) turned back the clock and restored “tax EBITDA” for Section 163(j) and made permanent 100% bonus depreciation . In 2025 and beyond, businesses can deduct 100% bonus depreciation without that depreciation severely restricting their deductible interest expense. Real estate and farming businesses that made RPTB or FTB elections in tax years 2022-2024 may now be experiencing buyer’s remorse. If they had been aware of OBBB’s favorable changes , they might not have decided to make the election. Luckily, on March 18, 2026, the IRS released Rev. Proc. 2026-17, which allows real estate and farming businesses to withdraw RPTB or FTB elections made in tax years 2022-2024. A business that wants to withdraw its election must file an amended tax return for the year the election was made and all subsequent years impacted. Withdrawing partnerships or S corporations must also issue amended K-1s to their owners, who would then need to amend their tax returns for the impacted years. What changes after the Section 163(j) election withdrawal: impact on interest limit and depreciation Once withdrawn, the business is treated as if the election were never made. This means taxable income, interest expense and depreciation deductions are recomputed on the amended returns. Because a business would no longer be exempt from the limitation in the impacted years, additional taxable income and tax due could result from the loss of interest deductions. To reduce the impact, businesses may either deduct bonus depreciation on QIP and the farming assets listed above or choose to opt out of bonus depreciation altogether in the impacted years (whichever results in the highest benefit). Additional income for 2022-2024 might be a small price to pay to take advantage of 100% bonus depreciation and reduced exposure to the interest expense limitation in 2025 and beyond. Withdrawing the election could be a valuable option for commercial lessors who make frequent tenant improvements, as well as capital-intensive farming, ranching and horticultural businesses. Businesses must act fast to take advantage of this guidance. A cost-benefit analysis is needed to make a strategic decision, and all amended tax returns must be filed by October 15, 2026 (sooner for amended 2022 tax returns). Read more How the OBBB changed taxes for real estate investors Key rules for 100% bonus depreciation How the IRS applies the 30% business interest limitation
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