Understanding The Basics of Food Product Development

If you are not fully conversant about all the details regarding new food product development, then you are probably wondering what it actually is? Why is it necessary to create new products, as well as why companies feel the need to improve on a product once it has been released to the general public.

So what is product development?

The answer to these questions are actually quite simple, and they relate to the fact that humans need change, and what is good now is not always going to be good in the near future. Basically, every product, be it food related or leisure and clothing related fails to impress the general public after a certain amount of time, and for that reason, a product will need to be either replaced, or spruced up a little.

Market research is crucial

Good companies with years of experience in marketing products to the general public will be fully aware that they will need to develop new products, and they will know exactly what the consumer wants because they would have spent time and money on market research. Food companies in particular are constantly changing or developing new products in line with the forever changing tastes of the consumer. This is for the reason that the tastes of the general public is always changing and food companies always have to develop new products. So new product development has to be completed with due care and with an eye for detail because the continued success of a company largely depends on the company’s ability to produce new, interesting and varied products to the market place.

Difficulties with new product development

The problem with new product development is that it is not always straight forward, and in fact if it is done badly, then it can actually harm the profits and profile of the company, and some of the biggest global companies have got things spectacularly wrong in the past. All this is because they have got the market research wrong or have decided to not actually do any market research and have got complacent with thinking that the general public will but any product that they bring out.

Advertising the new product is crucial for the success of any new product and without a decent advertising campaign no new product is going to be a success and this has the potential to harm the profits of a company in the long term.

New Food Product Development Is an Ongoing Process

What is new product development? Why is it necessary to create new products? Once a company creates a quality product why should they create improved versions or brand new versions of the same product?

The answer is simple. Change is a process that is natural and expected. The requirements of human beings are susceptible to change. What is good for today is not enough for tomorrow. Changes are inevitable in all spheres of life. Our food, clothes, food habits, leisure, all are subject to change. Every product fails to impress consumers after a certain point of time. The quality may be good, but the consumer tastes must have changed. Here you have to upgrade the product according to public demand or create new products to meet the new requirements.

Shrewd and successful manufacturers know the importance of new product development. They keep their eyes open to read consumer pulse and fulfill their requirements instantly. If we consider our food habits, we can notice a great change in the recent past. Ready made products have emerged in large scale and there is a wide variety of junk food. Life style has become more hectic and people have less time to spend preparing nutritious food. The circumstance calls for new food product development.

New food product development is done by conducting market research to know what exactly consumers require. Food companies need capable management methods to make the process successful. Discussions on food, food products, management of food products, consumer demands etc has to be conducted during different levels of production, to get beneficial results. New food product development has to be done with care and perfection.
The profits, success and maintainability of a firm depend on the introduction of new products. New product development is divided in to two parts. The first part consists of bringing new products to market, which has fresh and new uses for the products. The second part consists of items which are not totally new but updated or improved forms of an already open product.

New product development is easier said than done. It is a procedure which takes much investigation and lots of time on the part of companies concerned. The company after doing a lot of research to know the consumer needs finally decides on an idea. The idea has to be then switched to a concept. Research is again conducted to understand the characteristics of the item and its viability. Calculating the cost of the product to be launched is the next vital step.

Customer is King and the feed back of customers is utmost important to the success of any company. After the assessment of the item a sample is produced. It is marketed and modifications which are necessary are made. Before the production of the new product begins, a final assessment of expense, production requirement and resource availability has to be conducted.

Advertisement is vital for the success of all products. Without proper advertisements you cannot reach out to customers. Every thing needed to promote products had to be done without fail. All of us are particular about the brand of the item we purchase. It is important a new product should have an impressive brand design that catches attention.

So You’ve Got a Recipe and You Want to Sell a Food Product

You’ve been making this recipe forever and every time you share the results, someone says, “Wow, this is so good! You should sell it.” And that’s where you gets stuck, because you have no idea what to do next.

When you’re at this stage, at the very beginning with no clue what to do next, you don’t know what you don’t know. You don’t know even know what questions to ask. Eight years ago I was in your shoes. I needed help; I knew I needed help, but I didn’t know where to turn.

I stumbled along, making mistakes, spending money I didn’t have and sometimes getting lucky and finding solutions that worked. I looked for help from people who’d “been there” too. Shari Fitzpatrick, founder of Shari’s Berries, and I had a conversation during which I recall asking the most intelligent questions I could come up with. She was very kind in sharing her experience, but in hindsight, and to my point, I’m not sure I got as much as I could have out of that conversation. First because it was only about 15 minutes long and more critically, because I wasn’t sure what to ask. I wonder if she hung up from that call thinking, “ha, good luck to that girl ’cause she does NOT know what she’s doing.”

Eventually, I managed to piece together enough of what I needed to know to get the right incorporation, licensing, business and liability insurance, registration for sales tax, space in which to bake, ingredient, packaging and shipping vendors and so on. Quite possibly, I may have (unknowingly) violated some laws. This was not the fast track, but there wasn’t any other way, and I was determined to keep moving forward!

There is plenty of information “out there” about starting a generic business. Much of it applies to your start-up business whether you’re a food entrepreneur or a hair stylist. And it’s still confusing. Add in that you’re producing a product that people EAT, and laws that change frequently, and now it’s even more confusing and yet important that you get it right.

Here’s a brief checklist of the first crucial steps you need to take if you want to turn a recipe into a successful food business.

1. Determine to WHOM you are going to sell. Is there even a market, beyond your well-meaning friends and family, for your product? Many of the rest of your decisions depend on this one. PS: “Everyone” is not the right answer.

2. Incorporate your business. It’s important for tax purposes as well as liability and asset protection. Which type of incorporation you choose depends on your personal situation and merits discussion with your CPA.

3. Get liability and business insurance. Especially with a food business, there are too many factors and risks lurking to play around here.

4. Take care of these first two steps BEFORE you sell one bite of anything!

5. Register your business with the state and get any local city or county licensing.

6. Find a place to produce your product that fits your (probably) limited budget. Be realistic about how much you can sell, how much space you need to produce, and how much time it will take you to do it. Some states or counties allow you to start out in a home kitchen. Many do not and you have to find a commercial facility.

7. Figure out the most cost-effective way to buy ingredients. There’s a catch-22 when you’re starting out. You aren’t producing in large enough quantities to buy from a food distribution company and you can’t afford to buy ingredients at retail grocery stores. Wholesale clubs are one solution or depending on what kind of facility you’re using for production, you may be able to participate in a group order.

8. Determine what the best equipment to get the job done is. Do you need a mixer, oven, extruder, freezer, steam juicer? Will you have to buy it or can you find another way to get use of whatever equipment you need?

9. OR, are you going to work with a co-packer/contract producer and have someone else make your product on your behalf? Make sure you get referrals and ask all the right questions before committing to this kind of arrangement.

10. Find one or two or ten reliable packaging suppliers. Get samples of what you think you want to use. Test it all out and make sure it works for your purposes. BTW, if you only have one place from which to order your “unique” packaging, what happens when they can no longer supply you? (Trust me, I speak from panicked experience on this one.)

Lots of people have great recipes and many of them have thought about selling their food products. Some even take the leap and pursue the dream. The only ones who succeed are those who find the right resources and help along the way, whether deliberately or by sheer dumb luck. Are you going to rely on luck or would you like a roadmap?

Could You Bring Your Own Food Product To Market?

If you are one of the many people who cook, make preserves and pickles or maybe even bake then you may have considered the possibility of turning your talents into a money making endeavor by selling your food products. It may be the case that your friends have urged you to sell the homemade preserves you make, or maybe you could just use a little extra income. However, developing your own food product is not as easy as it sounds. You may have a fan base among friends and family, but is your cooking really good enough to compete with others on the shelves of your local store?

Finding a Unique Selling Point

One of the key things to consider before attempting to sell your product is that there is a massive amount of competition out there. It is important to honestly evaluate your product and decide what, if anything, makes it better than the others already out there? This may not necessarily be based on taste. Your product could have one of many unique selling products. Perhaps you use only organic ingredients and recycled packaging? Is there an unusual flavor combination that no one else has used? Does your product have an interesting story behind it? The important thing to remember is that you cannot rely on the taste alone. It is naive to think that jut because you think it tastes better then everyone else will feel the same.

Selling Your Story

One of the best ways for a small, artisan food producer to get their products on the market is by placing them in independent gourmet stores rather than aiming for national grocery chains. These smaller stores cannot compete with large stores on pricing, and instead will look for more interesting and unique products. Those with a story attached are particularly popular, so if you have a heartwarming story about using your grandmother’s recipes or stumbling upon your flavor combination by accident then use it to your advantage as a sales tool. Another popular angle is the ‘local kid done good’ story so if you are a local manufacturer using local products then this can be a great advantage to you. Another alternative is to sell your product mail order or at farmer’s markets.

Asking For Help

The majority of us would not have the first idea about how to get a food business off the ground which is why asking for help is really important. If you are looking for a starting point, then it is useful to visit the food sciences department at a local university as they often like to get involved in community projects. This is a great way to get independent feedback on your product and the local market. If you are ready to take your product nationwide, then engaging the services of a broker to deal with stockists can also be useful.

Of course there are also a range of legal requirements to consider. The food must be tested for safety and hygiene standards and you may need to get some commercial kitchen space, but these initial considerations are a good place to start if you are seriously considering selling your own food products.