Food companies can learn from start-ups, Practical Innovation says

Practical Innovation helps food companies develop innovative products, with similar ideas to those used by start-up companies.

The aim is to get companies, stuck in their old ways, to take more risks that will benefit them long-term.

Practical Innovation pushes companies to break the old paradigm of marketing the same products on a reduced margin, which can set the product up for eventual failure.

Practical Innovation CEO Tal Leizer said gambling a company’s reputation in the market with a new product that might not survive on-shelf was a huge impediment.

“If you want to succeed in the competitive food market, the very first step is to take failure off the table and start thinking audaciously, like a start-up.”

There is a huge gap between start-ups that launch innovative products and traditional companies that don’t, irrespective of company scale.

Using the multidisciplinary expertise of professional innovators is necessary to drive the changes required and to launch win-win products.

Many established food companies want to develop new products and increase sales and revenues, but to do so involves harnessing tremendous efforts and resources that are not always available to traditional companies such as bakeries and sweetener companies.

Starting an innovation process in an existing company that has produced the same products over many years comes with challenges.

With so much at risk, older, and larger, companies often only make minor changes rather than introducing new ideas.

Being inherently risk-averse, they might only add a new flavour, improve packaging, or simply cut costs.

Leizer shares a few tips on how to revive a company’s innovation process, which include searching for creative ideas, even if those ideas seem impossible.

Identifying important food trends, and knowing what the market wanted, now and five years from now, was also important, he said.

Company’s also had to make the concept feasible and scalable, said Leizer.

 

Bega Cheese buys Western Australian dairy facility for $250m

Bega Cheese is expanding its reach by buying a Western Australian facility for $250 million.

The company is purchasing Saputo Dairy Australia’s Koroit facility, which currently processes about 300ML of dairy products per year.

Bega expects the facility to generate about $20m at its current intake per year.

Items produced include milk, retail butter and milk powders.

READ: Bega Cheese buys Vegemite

As part of the transaction, Bega and Saputo entered into agreements whereby Saputi is required to guarantee the supply of 300ML milk per year until June, 2020. The transaction is subject to ACCC approval.

Bega CEO Paul van Heerwaarden said the Koroit facitily would give Bega operational flexibility its other milk processing sites.

It would also provide the cheese company with a better presence in Western Victoria, said van Heerwaarden.

“The acquisition will support the continued growth of our core dairy business and provide domestic and export customers with an expanded range of products.

“We welcome the 108 employees of Koroit to Bega Cheese.”

Bega executive chairman Barry Irvin said it was a delight to have acquired the dairy facility.

“Bega Cheese has been collecting milk in Western Victoria for almost 1 years and the opportunity to acquire such significant and quality infrastructure will cement our presence in one of the strongest dairy regions in Australia.

“We will work closely with dairy farmers to grow supply to the Koroit Facility. This is another important step in creating an Australian owned dairy and food company that is competitive and efficient in Australia and the world.”

 

 

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