The Inside Scoop on Outsourcing Product Development

OUTSOURCING SOME PRODUCT DEVELOPMENT AND R&D PROJECTS OFFERS ADDED FLEXIBILITY, SAVES TIME AND MONEY AND FREES PROCESSORS TO WORK ON OTHER IMPORTANT TASKS.

Lauren R. Hartman, Product Development Editor
Food Processing

Visit any food show, and you'll see entrepreneurs trying to get their items to the retail level and growing companies struggling to fulfill increasing demand with limited production capacity. Even at larger, established food companies, there's so much cost cutting, deadline tightening and operational streamlining that developing products in-house can be difficult.

Certainly, processors continue to design their own products and formulations in-house, corralling marketing, distribution and financing within their collective walls, and supporting the resulting products on their own. But contract R&D specialists usually can complete a project faster than internal teams because they apply a heightened focus and dedicated resources to the project. This can cut costs in the short term, and boost profits in the long run if the product gets to market faster.

Outsourcing is a fairly standard tactical approach in the food business, says Dave Behringer, chief technology officer at 915 Labs LLC (www.915labs.com), Centennial, Colo. (and a professional chef). "It was never meant to replace internal resources, but allows an organization to use skilled staff only when needed. Once they have an established an external ecosystem, it's easy and cost-effective to outsource activities as needed on a project by project basis."

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