New product innovation and development spending among food and beverage manufacturers is expected to increase this year, according to survey data from TraceGains. The findings come from the company’s 2024 NPD Report, which utilizes responses from 261 food and beverage brands to identify key product development trends and challenges.
A noticeable increase in investment
“Our research reveals a clear imperative for brands to invest in product innovation as numerous transformative shifts coalesce across the industry forcing them to act,” said Paul Bradley, senior director of product marketing for TraceGains.
More than 75% of respondents expect to spend more on new product development in 2024, up 12% from last year, citing desires to remain competitive (51%), reduce costs (46%) and meet consumer demand (42%) as the major factors driving the uptick in investment.
A trend of keeping innovation in-house
The report showed brands also are increasingly shifting some product development processes in-house as a result of recipe formulation and intellectual property concerns, marking a notable change from pre-pandemic tendencies. For instance, over 70% of manufacturers said concept ideation, ingredient selection and recipe formulation are now handled in-house.
Common NPD challenges according to the food and beverage industry
The report also identified that brands are concerned about several macroeconomic factors and internal difficulties with product development. To see what key challenges respondents ranked, continue reading this article as originally featured in Food Business News. Or access additional insights by downloading the entire report here.
