Now is the time for food brands to elevate their innovation game, according to recent research from global ingredients marketplace TraceGains.
Survey responses from leaders of 261 small and large food brands across the world revealed that, despite outdated manual processes being a challenge, more than three quarters (76%) were planning NPD investment in 2024 – a 12% increase from the previous year’s figure.
The results were published as part of TraceGain’s latest research report entitled ‘R&D and Product Innovation in the Food and Beverage Industry’.
Other findings included that two thirds (60%) of brands surveyed said they thought health “better for you” formulations have the most potential to drive industry change in 2024, while 36% of respondents revealed they were testing the waters with AI in their NPD efforts.
Brands were also found to be ‘walking the talk when it comes to ESG initiatives’, with 44% of respondents saying they are now prioritising supply chain traceability, 42% are using sustainable ingredients, while 48% believe sustainable packaging will be a large innovation driver in the months ahead.
The report indicated signs of progress after a few challenging years for the food and beverage supply chain. The top three reasons for brands planning to dial up product innovation efforts in 2024 included to stay competitive (51% of respondents), to combat rising costs (46%), and to meet consumer demand (42%). However, 56% of brands reported a lack of internal tools to manage product formulations and recipes, highlighting a clear need for solutions to help automate and streamline work.
Companies highlighted several macroeconomic factors that could impact their planned investments such as rising production and labor costs (cited by 58% of those surveyed), fluctuating demand and commodity pricing (53%), availability of ingredients and materials (46%), challenges with talent acquisition (36%), and a lack of regulatory clarity (28%).
When it comes to managing product formulas and recipes, over one-third (37%) of brands said they still rely on manual processes, a quarter expressed struggles with staffing challenges, and 23% acknowledged working on outdated technology platforms.
Lastly, just under a third (32%) of manufacturers revealed they were banking on new plant-based offerings, and 26% said they will be foccusing on water and/or carbon-neutral strategies.
“Our research reveals a clear imperative for brands to invest in product innovation as numerous transformative shifts coalesce across the industry forcing them to act,” said Paul Bradley, senior director, product marketing at TraceGains.
“While it’s evident that brands require robust tools and solutions to navigate these challenges, a significant gap still exists in internal resources that may hinder their progress,” Bradley added.
The full report can be downloaded for free via TraceGains website.
Earlier this year, TraceGains acquired Barnstaple-based software company NutriCalc in a move said to enrich its offerings in the food and drink industry, including its UK bakery customers.
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