This year, Innova Market Insights identified “redefining value” as one of its top trends to watch in the food and beverage industry. While cost may be most important to consumers and developers alike, a more holistic view of “value” may be what is needed to thrive in this economy. In fact, there are a number of ways in which flavors can provide value to food developers and consumers.
There may be no better example than flavor. Yes, it is true that with approaches such as commodity reduction, flavor can directly improve your overall product costs while preserving the taste that customers love. However, I believe there are also several ways that flavor can provide great value.
Consistency – Knowing What You Want and What You Will Get
After a couple of years of supply chain instability and market volatility, you’d be forgiven if hearing the word “consistency” makes you want to roll your eyes. But, in all honesty, that’s something that flavor can provide, in more ways than one!
For starters, flavors, in addition to providing value, can help that, instead of relying on commodities and waiting for when and in what quantity some of them such as butter or cream will be available for your product, flavors can take the guesswork out and provide a level of cost consistency. Not only can this generate savings, but more importantly, it offers stability for you and price consistency for your customers.
Also, being in the dairy industry, you know that milk, butter and cheese profiles can change throughout the year depending on animal feed. This can often result in unpleasant notes, which may require masking, or missing key notes such as the “green grassy” attribute in butter, something you simply can’t have if your customers expect your product to taste a certain way. Flavors can provide consistent management of the flavor attributes that consumers look for every time they shop.
This consistency can also have downstream effects within your business, even before it reaches your customer’s plate. When developers use some flavor for a repeatable product, that consistency carries over to the manufacturing floor, making life easier for those on the production line. With standardized dosages and flavor profiles, you can optimize your process, saving you time and money.
Logistics: Saving Space, Time & Money
One of the significant taste benefits compared to a commodity is the much lower proportion in use. This by itself is extraordinarily valuable, but using much less of something can create even more value than you think.
Because of its concentration, instead of a truckload of butter (which can add certain challenges), you can get the same flavor results with just a little taste. The shipping savings alone are worth it, but they become even more impressive when combined with what you can save on storage.
On a side note, when you are a CFO, the worst money you can spend is on storage. Although it is a necessary evil, it offers one of the worst ROIs. A lot of value can be found in the speed with which you can change your inventory and the little space you use for raw materials.
The amount of storage space required for butter popsicles compared to equivalent flavor drums is immense. This is even before considering the additional resources, such as refrigeration, needed to preserve the products for what will remain a shorter shelf life than the flavors can offer.
Innovation: Small Changes That Create Big Rewards
In addition to redefining value, innovation is another idea that could use another redefinition. While there is no shortage of developers working on “the next big invention” to revolutionize the food industry, that’s not always what it takes to significantly impact the marketplace. Sometimes small changes can produce big results.
In recent years, the food-centric economy has become much more globalized. For many of us who grew up in the 70s and 80s, it would be typical to have the same weekly dinner menu. But now, in our globalized society and with the proliferation of social media and more affordable international travel, people want variety and often get bored much faster with their choices. When it comes to food, customers constantly expect a twist and options.
This is just one more level of value that flavor has to offer. Although flavor is used in a small percentage in the final product, it often has the greatest impact for consumers, allowing you to easily create line extensions and surprise your customers with new and innovative items.
Being able to quickly deliver a new SKU with very few manufacturing changes generates huge cost reductions with almost zero capital investment and extremely low risk. This is even before considering the potential profits that a successful new launch could generate, in addition to building trust and brand loyalty.
Understanding the current landscape and dynamics and listening to customers is critical to finding the right solutions and ROI analysis. Edlong Flavor Solutions consistently partners with our customers to provide added value through collaborative solutions that can result in product consistency, logistical benefits and innovation.Contact us now to understand how flavors can provide value in your next development project!
Don’t miss our webinar recording where industry experts from Edlong, Bedacom, Ingredion, and Griffith Foods talk more in depth about how flavor can be your best ally to reduce costs and commodities.
About the Author: Brenda Dehart, Edlong Chief Financial Officer
Hi, I’m Brenda Dehart! I am the Chief Financial Officer of Edlong. With over 30 years of experience in the food and beverage industry, I help companies grow, optimize and find beneficial financial solutions. My extensive experience in procurement coupled with my management experience and understanding of food science has allowed me to support clients in their quest to stabilize and grow their businesses.
From quoting a prototype to understanding financial parameters, I care about my teammates and our clients, ask cost-effective questions and do things with their best interests and goals in mind.
I would love to help make your business as successful as possible!
Topics: Commodity reductionDairy flavorsInnovation
Resource Type: Article