New regulations, recent government policies and consumer demand are putting pressure on the food and drink manufacturing industry to make healthier products and improve nutritional quality.
The Soft Drinks Industry Levy, commonly referred to as the ‘Sugar Tax’, came into force in the UK on 6 April 2018. This charges a levy to manufacturers and importers of drinks containing added sugar: £0.18 per litre if the drink contains 5g or more of sugar per 100ml and £0.24 per litre if the drink contains 8g or more of sugar per 100ml.
And it seems that manufacturers are rising to the challenge. A logical and simple approach for many producers is to tailor the portion sizes of their products, but equally many are looking to reformulate. But what is the right approach for your company? In this article we take a look at the benefits and challenges of reformulation, and how that innovation can be protected by intellectual property (IP).
In a nut shell, reformulation relates to a process of modifying an existing recipe to improve certain properties. It is usually aimed at reducing salt, sugars, fat or total energy. However it can also be used to avoid specific ingredients such as animal products, allergens and artificial ingredients.
As well as addressing new regulations and health related demands, reformulation can be used to improve recipes by increasing ‘good’ ingredients such as fruit and vegetables, vitamins and minerals, fibre, omega-3 fats, DHA, EPA or proteins. And this type of reformulation has increased dramatically in recent years in line with customer demand for products containing ingredients perceived as more natural, such as organic ingredients.
Reformulation can be a complex and costly process. However, the effort is well spent if it allows an already established product to remain on the supermarket shelves while meeting new regulation targets. The ‘new’ product can then boast additional benefits such as lower sugar, lower salt or simply healthier ingredients, adding value to the overall brand and expanding consumer choice.
Some recent examples of successful reformulation include A G Barr, the maker of Irn Bru®, who was faced with a stark choice when the sugar tax was announced: increase prices or reformulate to avoid the tax. It chose to reformulate its drinks with less sugar, allowing 99 per cent of its products to avoid the levy. However many companies are choosing to reformulate even without government pressure. A reduced sugar version of Cadbury Dairy Milk has been announced and is due to be launched in 2019. This product does not replace the original recipe, and instead offers consumers greater choice.
Product reformulation presents many challenges for the industry, as even a small modification can have significant consequences. It takes time, it involves technical challenges and it incurs costs. Replacing one ingredient with another or reducing the level of certain ingredients is not as easy as it may appear at first.
It is crucial to ensure that the modification does not result in compromises in taste, texture, or shelf life. Changing a recipe may impact the processing steps required in production. As such, new recipes may require adaptation of the technologies and processes involved. And along with the taste aspects, salt and also sugar, are frequently added to foods for preservation purposes. Reducing the levels of these ingredients may compromise food safety and shorten product shelf-life.
Protect your innovation
There is no doubt that food and drink reformulation requires significant innovation, so if you have a new recipe, then you have generated intellectual property. It is important to ensure that competitors cannot take undue advantage of the cost, time and resources that you have invested. That is why it is vital to protect this innovation.
Some manufacturers, like Coca-Cola®, may choose to keep the recipe as a closely guarded trade secret. However trade secrets are often not practical in the food and drink industry since third parties may be able to analyse a product to determine its recipe. A more secure approach is to use IP to protect the formula, process or technique of your innovation to maximise your return on investment.