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Dispatch from IPA 2012

Manufacturers' 'bold gamble' on R&D

By Rod Addy , 24-Oct-2012

Copyright Can Stock Photo
Copyright Can Stock Photo

European food and drink manufacturers are making a "bold gamble" on research and development (R&D) investment in the tough economic climate, according to results from the latest IPA 2012 survey.

The food industry is more positive about future investment this year than in 2010, reported the respondents to the survey conducted in May by the organiser of the IPA processing and packaging exhibition.

The figures indicate that 81% believed R&D spend would increase or remain stable, versus 67% in 2010, the last time IPA surveys were conducted. Nine out of 10 plan to launch innovations on to the market in the next two years.

On average, companies reported devoting 8% of their turnover to R&D. IPA called this a "bold gamble" in times of economic instability, reflecting growing interest in R&D and innovation.

Sustainable development

Sustainable development was a major driver for innovation cited by more than eight out of 10 respondents to the survey of processors from a range of sectors across the world.

Eco-responsible innovations cited by manufacturers include the use of eco-friendly and biodegradable packaging; the use of green energy and local products; waste reduction and raw materials savings.

"The reasons for adopting a sustainable development policy are mainly economic: projects focus on energy saving and the use of renewable energy; reducing water and fluid consumption; and packaging optimisation," said an IPA spokeswoman.

In the past two years, almost seven out of 10 respondents said they had launched at least one new product, service or process.

Incremental innovations

However, the number of incremental innovations, that is, modifications, adaptations or improvements of existing processes still outstripped the number of breakthrough innovations, they admitted.

As in 2010, the top aims of innovation cited by canvassed firms were an increase in sales and the development of a competitive edge.

In an earlier survey in March, companies predicted they would focus general equipment investment on the second half of this year.

They expected making an average investment for 2012 of more than €200,000. 46% envisaged spending more and three in 10 anticipated having a budget of more than €400,000.

Processing equipment

The majority of investments were expected to be made in processing equipment, followed by end-of-line packaging machines and then cold storage equipment.

The biggest objective for investment was increased productivity, followed by improved financial performance; improved health and safety; innovation; equipment flexibility; and finally, diversification of the product range.

"Manufacturers predict a gradual increase in their spending between now and the end of the year," said IPA exhibition director Christophe Painvin.

"In addition to equipment, they also expect to invest heavily in safety and research to boost their competitiveness and improve productivity."

The IPA March survey canvassed the opinions of 314 representatives of food and drink manufacturers, whereas the May survey received responses from 201. In both cases, more than half of the participants were from France.

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