Adapting to Adversity: Reformulating Food and Drink Products to Combat Supply Chain Disruption

Supply chain uncertainty has become the new norm. You only have to look at the last two years to see how geopolitical instability, climate change and industry challenges have impacted the flow of raw materials:

• Conflict between Russia and Ukraine generating grain and sunflower oil shortages

• Political instability in Sudan affecting supplies of gum Arabic

• Extreme weather conditions across the globe impacting the production of everything from mustard seed to tomatoes

• Labour shortages slowing the harvesting of fresh produce

And that’s just a few examples.

While it’s tempting to pass these off as “temporary problems” that will soon course correct, the collective pattern of increasing supply chain disruption is concerning.

To ensure long-term food security, manufacturers and producers need to find ways to navigate disturbances, quickly. But how?

Ease Supply Chain Pressures With Reformulation

Many food and beverage companies have responded to supply chain disruptions by diversifying supplier networks. While this can provide a short-term solution (especially if new suppliers are coordinated through technology), it may not be sustainable in the medium and longer term.

The food and beverage industry is heavily reliant on a relatively small group of ingredients to meet customer demand. When you consider that 40% of the world's calorie intake comes from just three crops, ingredient shortages seem inevitable.

Grains are not the only staple at risk due to overdependence. A third of global fish stocks are overfished. And palm oil—which is found in around 50% of packaged products—is the largest driver of deforestation.

To combat increasing supply chain pressures, radical change is required. For a more reliable supply chain, food and drink brands need to consider substituting ingredients for materials that are less in demand and are more sustainably produced.

Innovate Ingredients To Safeguard Food Security

Innovation has always been critical to the food and beverage sector. There are already many examples of companies pioneering new ingredients and cultivation methods to increase food security. For example:

• Techniques like hydroponics and vertical farming are moving rural agriculture into urban settings.

• Investment in regenerative food programs such as circular seaweed farming are limiting the environmental impact of food production.

• Scaling the production of under-utilised foods (for example, substituting wheat for grains like amaranth) are bringing alternative ingredients to the fore.

• The approval of cultivated meat for consumption and sale in the U.S. is creating new, sustainably managed protein sources.

How can food and beverage companies integrate these new ingredients into existing products without impacting production or upsetting loyal customers? The answer lies in a well-executed reformulation program, driven by product lifecycle management (PLM) technology.

Create a Path for Well-Structured Product Reformulation

The key to innovative product reformulation is transparency. The quicker you can see how ingredient substitutions affect texture, taste, shelf life and cost, the faster you can formalise an alternative recipe.

Food PLM software can do the heavy lifting in the reformulation process by centrally storing data and digitally managing workflows. This will help you to track how recipes evolve during product development, monitor the impact of changes on quality and cost, and make sure your final formula is captured accurately for manufacturing.

With food PLM software, your organisation can:

• Record colleague and consumer feedback on new recipes and track resulting recipe changes. For emerging ingredients that customers may never have eaten before, it may take a few attempts to get the flavour and texture just right.

• Create version control prototypes to ensure everyone is working from the latest formula.

• Analyse ingredient composition, nutritional value and cost to produce at prototype stage to ensure your updated products meet health and profit targets. Sustainable ingredients still need to be financially viable.

• Automatically verify prototypes against your original product brief to make sure you don’t lose the essence of what makes your products desirable.

• Monitor substance thresholds and introduce quality control checks to make sure product formulas meet industry regulations. Well-regulated reformulation is particularly important if you’re working with emerging ingredients, which may be subject to Novel Food legislation alongside standard industry requirements.

• Automate product labeling to produce a list of ingredients, allergens and nutritional values for product packaging and labelling in all required languages and regional formats once the formula has been finalised.

Support Less Experienced Suppliers Using PLM Software

A well-structured reformulation process will help you to create products with textures and tastes that consumers trust, even if the recipe contains unfamiliar ingredients. But that’s not the only area where food PLM software can add value.

If you’re exploring emerging ingredients, you may be working with suppliers that have limited experience in the fast-paced food manufacturing environment. Many innovation programs are run by academic institutions and start-up businesses, which require greater support compared to established vendors.

PLM software can help you to manage inexperienced suppliers and build successful long-term partnerships. For example, Aptean PLM Lascom Edition includes a dedicated supplier portal, which gives external vendors the ability to share component and packaging data with internal teams and track mutual key performance indicators (KPIs).

Plus, if you’ve been using a food enterprise resource planning (ERP) system to manage your supply chain, product data can flow from your PLM software to your ERP software to help those vendors manage production demands.

Don’t Let Supply Chain Uncertainty Consume Your Future

It’s ironic that the only certainty of future food production is uncertainty. But brands have the option to turn current instabilities into an opportunity for product innovation.

Reformulating products with new and diverse ingredients could provide a more stable and sustainable solution to increasing supply chain resilience and meeting consumer demand. And the quicker you can put the processes in place to drive reformulation programs, the sooner you can adapt to adversity.

Aptean PLM is already supporting food and beverage companies through their product lifecycle by creating a structured approach to innovation. Now, we want to help more brands explore emerging ingredients and production methods to combat supply chain disruption.

If you’re ready to reformulate your products using PLM software, get in touch with Aptean to arrange a free demonstration.