Innovation: Turning fresh ideas into food business growth
Food and beverage manufacturing companies are all contributing to the success of this very important industry in Canada.
Innovation is a vital ingredient to the long-term success of a food and beverage processor. And despite the economic challenges the market can face, the sector is ripe with potential. It’s the companies that dare to innovate who will become the leaders.
“All the food and beverage manufacturing companies, from a single-employee operation down to the very large companies, are all contributing to the success of this very important industry in Canada,” says Craig Klemmer, Manager of Thought Leadership at FCC, adding that food and beverage processing is now considered part of our national security and the food security conversation.
The value of being agile
The industry should be proud, Klemmer says, especially of its adaptability and ability to evolve to reflect Canada's changing demographics.
“It's increasing our opportunities for new foods that we haven't had exposure to in the past,” Klemmer says. “And it's an industry that continues to be evolving and innovating to meet future needs and creating opportunities, whether it's domestically or in the export market.”
Evaluating which innovations to invest in can be challenging. However, resources like the recently launched FCC Innovation Guide: Success Through Innovation can help entrepreneurs critically reflect on their potential products, brands and strengths.
Jo-Ann McArthur, President of Nourish Food Marketing says the most important question food and beverage processors need to consider is whether the product they want to produce fits with their strength.
“Does it tie into sourcing, your production setup, your brand story and your community?”
The power of the farmers’ market
One of the beauties of innovation is that you don’t have to finalize new products before launching them. In fact, McArthur recommends entering a small market segment with a minimum viable product and testing these five elements:
pricing
taste
consumer interest
product refinement
customer feedback
“Farmers’ markets provide small- to mid-size entrepreneurs with a living laboratory that the big guys don’t have,” McArthur says. “It’s a great place to test pricing, taste and get real feedback.”
This provides processors with market information they can take to retailers. Launching a minimum viable product into these environments also makes it easier to conduct two different streams of product testing and to receive credible feedback from consumers who will likely buy your product.
Strengthening retailer relationships
Investing in innovation can ensure that your company and its products remain not only relevant but also benefit from potential growth. Sector growth is about 1.2% a year, Klemmer says, and there’s room for more.
“By innovating and investing, there's no reason that we wouldn't be growing at a real rate of about 3% per year,” he says. “And if we can achieve that, that's going to add $40 billion to the industry, employment of around 200,000 more positions in Canada and more labour coming in.”
When selecting products for their shelf, retailers look for companies with staying power. Innovation isn’t a one-and-done strategy; rather, it’s a business process that reassures investors that entrepreneurs are committed to the industry for the long haul.
McArthur says retailers will always ask processors about their next innovation and other plans. Having a new product or an idea in mind shows you’re in business for the long haul.
Showcasing that idea can be as simple as a single slide in a presentation outlining the next steps for your brand.
A risk is worth exploring
Investing in innovation is a risk. However, the small- to mid-size processor is in the ideal position to explore those risks and, in turn, capitalize on the benefits of introducing an innovative product that resonates with their end consumers.
“Innovating is challenging and it can be scary,” Klemmer says. “Ask for help. FCC can be a partner that can connect you with great people and advisors and help in terms of moving that product forward.”
From new products to process improvements, innovation can take many forms. Get practical ideas and resources in our guide for small and mid-size food & beverage businesses.
Article by: Anne-Marie Hardie
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