Compliant by Design: Prioritizing Product Regulatory Compliance in New Product Development

Working in the consumer goods industry, you know just how complicated the process of new product development can be. Just as a family gathers around a newborn baby to nurture it and set the young one on the path to success, so too do your many teams all become involved in the ideation and growth of your new offering, each bringing a unique perspective, specific priorities and valuable input.

What can’t get lost in the shuffle during this busy time is the importance of regulatory compliance. Considering a single non-compliance event costs an average of $5.87 million in lost revenue and a whopping $14 million total once fines, penalties, productivity losses and reputation damage are taken into account, it’s clear this matter needs to be taken into account from the start to avoid nasty surprises down the road.

In this post, we’ll discuss the benefits of creating products to be compliant by design and recently passed compliance legislation affecting various consumer goods industries and regions, as well as how product lifecycle management (PLM) software helps ensure that all of your items adhere to pertinent regulatory standards.

The Advantages of Addressing Compliance Early in New Product Development

There are several reasons to get your compliance experts involved early on in the new product development process. For starters, you’ll be able to choose materials with greater understanding of their regulatory implications, which should help you navigate the process if you choose potentially allergenic ingredients or items with sustainability concerns. And, if you want to avoid those issues altogether, you can purposefully choose not to include them in your formulas or bills of materials.

Secondly, this strategy allows you to select your material suppliers with complete context of what to watch out for in terms of sourcing regulations. Because your business will be accountable for the compliance of both the components of your products as well as the finished goods, it’s critical that the vendors from which you buy are also adhering to relevant regulations and not in violation of any laws regarding working conditions, sanitation or traceability.

Starting the compliance process at the beginning of the product lifecycle will also help you get ahead on the required documentation for your products, including Product Information Files (PIFs), claims, disclosures, specifications, ingredient lists, nutritional data and more. The last thing you want holding up the launch of your new offerings is paperwork, so it makes sense to get a firm grasp on what you need well in advance and begin gathering any missing details right away.

Finally, taking compliance into consideration from the beginning of development will save your organization time and help get your products to market faster. When you’re aware of potential issues, you can avoid scrapping recipes, formulas and designs in later stages when such a decision would mean wasted employee hours and resources. You can narrow in on exactly what parameters will suit both consumer tastes and compliance regulations and accelerate your timeline from there.

New Consumer Goods Compliance Legislation to Consider

On a global scale, compliance legislation is evolving all the time. Depending upon the product category in which your business specializes, it can be a lot to keep up with, especially considering most of the changes occurring are putting more responsibility on the manufacturers of consumer goods to be accountable for the safety and standards of their items.

These are just a few of the most recent significant changes or additional requirements laid out by legislation across the food, beverage, personal care, cosmetics and apparel industries:

• New regulations in the UK restrict brands’ ability to apply promotions to food and beverage products that are high in fat, salt or sugar (HFSS), which are collectively deemed “less healthy” by the Department of Health & Social Care. The proper name of the legislation is the Food (Promotion and Placement) (England) Regulations 2021.

• In the U.S., the Food and Drug Administration is moving forward with their Proposed Rule for Food Traceability, which expands upon the established list of eight most common allergens with the Food Traceability List that includes 16 different foods. The rule also sets definitions for the requirements with the newly introduced Key Data Elements (KDEs) and Critical Tracking Events (CTEs).

• Claims regulations in the cosmetics industry are nothing new, but in the European Union they are currently under more scrutiny than before thanks to pushes for more innovative and functional products. Commission Regulation (EC) No. 655/2013 lays out the criteria of truthfulness, evidential support, honesty, fairness and informed decision-making that are required for all cosmetic and personal care product claims.

• The Modern Slavery Act was passed in the UK in 2015 to protect employees of all kinds from forced labor and human trafficking, but a recent study showed that 31% of apparel businesses aren’t complying with the mandatory minimum reporting requirements, putting additional pressure on organizations in an industry already under pressure to become more sustainable.

• Germany’s pending Supply Chain Due Diligence Act, set to go into law in January 2023, requires large businesses operating in the country to manage the social and environmental issues associated with their supply chains. This is particularly relevant for fast fashion businesses, as that segment has a negative reputation when it comes to sustainability, and the scope of the provisions in the act will be extended to all companies with more than 1,000 employees in Germany come 2024.

Again, this is an incomplete list of hot-button topics in consumer goods compliance legislation, but it demonstrates that governments around the world are getting tougher on the industries that fall into that larger group.

How a Purpose-Built PLM Solution Facilitates Compliance from Beginning of Lifecycle to End

The above sections have likely impressed upon you the value of making your products compliant by design by focusing on that aspect from the start of development, but you may well be wondering how to tie in these critical regulatory concerns with all of the other moving pieces involved in the process. A PLM system built for businesses like yours can give you a considerable leg up in this regard.

For example, PLM software designed for food, beverage, cosmetics and personal care manufacturers can automatically flag potentially problematic materials in ingredient lists and prompt users with alerts on the interface to notify them that further investigation may be necessary. Additionally, the packaging and labeling tools of such platforms will also help ensure that all necessary disclosures are made highly visible to shoppers.

Supplier portal features of PLM solutions further simplify the matter of compliance by allowing manufacturing businesses to import ingredient and material data directly from the vendors from which they’re purchasing. That helps prevent errors of miscommunication and speeds up the process of generating necessary documentation.

And speaking of documentation, if your organization sells products in multiple regions, you’ll not only need to fill out the appropriate forms for each country in which you market your products—you may also have to translate the information into the proper language for the destination. Here again a good PLM system will be a huge help, as advanced platforms can automatically generate the necessary paperwork in multiple languages without the need for any additional translation expenses.

Lastly, we can’t forget to stress how well a PLM can tie together the many different parts of your organization and foster creativity, collaboration and cohesion throughout the new product development journey. That’s especially crucial when you work in any of the relatively heavily regulated consumer goods verticals like those we’ve mentioned in this piece—the more visibility you can provide to everyone, especially your compliance experts, the more prepared you’ll be to face any regulatory challenges that come your way.

Aptean: Your Trusted Partner for PLM Systems

Here at Aptean, we’ve developed PLM solutions dedicated to a variety of industries, including food and beverage; cosmetics and personal care; and fashion and apparel. Our offerings are a cut above because we’ve built them with an in-depth understanding of these sectors and the common issues that companies operating within them face.

The platforms in our software lineup can help you streamline processes, bring new products to market more quickly and, critically, reduce compliance risks with easily accessible data and tools designed for that express purpose. Our PLMs can also help make your new product development efforts more cost-effective and efficient through automation and a “single source of truth” shared by the whole organization.

One final advantage of choosing Aptean is that you’ll be working not just with a business system vendor, but a partner. We are proud to offer best practice advice and guidance in the implementation process, as well as professional IT support after your go-live date to keep you firing on all cylinders into the future.

So, if you’re ready to learn more about our best-in-class product lifecycle management solutions, contact us today. We’re also happy to schedule a personalized demo at your convenience.