Food formulation requires looking into future ingredient and material availability. With supply shortages, crop disruptions, and demand imbalance, the pressure on food developers and a procurement team to find solutions is unending, especially with clean label formulation guardrails. Michelle Tittl, Product Development Manager, ACAP, B.S., CuliNEX, gave prudent advice in her presentation “Addressing Formulation Challenges Through Supply Chain Disruptions” at the 2023 Clean Label Conference. Clients’ practical challenges and recommended strategies and solutions for ingredient reduction, replacement, and reformulation were reviewed.
CuliNEX is a food product development consultancy specializing in clean label product development from innovation to commercialization, blending culinary excellence and leading-edge food technology. Several key factors have posed industry challenges, greatly affecting product development— the COVID-19 pandemic being a prime example. When the lockdown was lifted, the number of employees that returned to the workforce was significantly reduced, posing labor shortages that impacted manufacturing. “Limited resources impacted capacity, which influenced throughput… (and) ingredient supply,” said Tittl. “Import and shipping challenges have improved within the last six to 12 months, although shipping challenges remain. Pricing of shipping containers has dropped from USD 40K to USD 2-4K. This sheds light on how complex and fragile our [food] system is and identifies opportunities for improvement,” she added.
Erratic weather changes have impacted commodity supply and availability. Geopolitical disruptions, such as the war in Ukraine, affected sunflowers and wheat. “That puts a strain on other countries to create availability for those products,” expressed Tittl. Consumer demand for animal welfare is another factor affecting ingredient supply.
Trickle-Down Effect
When industry challenges trickle down, affecting ingredient supplies, stress is placed on product development. Price increases and volatile pricing, specifically commodity-driven ingredients, involve certain specialty ingredients, particularly those formulated with a commodity item. Labor shortages and account management turnover can extend the time it takes to get a product by two to three weeks in some cases, noted Tittl.
Other product development challenges due to ingredient shortages include manufacturing and demand; higher minimum order quantities; the rise in plant-based alternatives; and the need for ethically sourced ingredients.
For product development teams, this means a constant state of urgency that can only be solved by imagining and “banking” key development strategies that can be engaged seamlessly—almost like muscle memory in an athlete. These strategies include:
- Use multiple suppliers; have a backup plan where growing season and climate can affect supply.
- Quickly order temporary packaging while you resolve supply issues.
- Screen multiple ingredient options and analyze cost impacts.
- Consider process changes with ingredient adjustments.
- Lean on ingredient suppliers for development support.
Case Studies
Tittl provided case studies as examples of ingredient supply challenges and solutions. Key aspects in three of the case studies are as follows.
Single Origin Berry Ice Cream
- Wildfires eradicated the client’s source of single-origin fruit prep.
- Client’s sales were regional; looking to expand domestically.
- CuliNEX broadened fruit prep sourcing globally to ensure volume requirements are met. Evaluated 12 different fruit preps. Found three that met organoleptic properties and added all as supply sources to mitigate future shortages.
- Used short-run packaging until the ingredient is sourced.
- Takeaways: Use multiple suppliers; have a backup plan where growing season and climate can affect supply; order temporary packaging.
Fruit-Based Pouch
- The product was a kids’-based applesauce with omega-3 added.
- The client was aware of rising prices in a commodity-based ingredient (i.e., apple purée concentrate).
- Client wanted help optimizing the formula to meet target cost and help with an off-flavor base ingredient (i.e., apple purée) associated with omega-3 near the end of shelflife.
- CuliNEX ran a cost analysis of all ingredient components to determine cost drivers in the formula. Flavor suppliers were also contacted to identify key masking agents that prevent off-flavors from omega-3 oxidation.
- Out of five flavor maskers, CuliNEX identified one that mitigated off-flavor, which enabled shelflife extension from 12 to 18 months.
- Takeaways: Run cost analysis on the formula. See where ingredient (s) can be reduced or removed.
Plant-Based Burger
- Developed plant-based burgers ready for commercialization.
- Product contained specialty palm oil granules for the visual effect of fat globules similar to meat-based burgers.
- A ban on Malaysian palm oil exports resulted in a supply shortage.
- CuliNEX expanded its search into other formats (e.g., granule, flake, block) and looked for sources from other countries. Because
formats were limited, only a block format could be used. - CuliNEX contacted co-manufacturers to determine if they could alter their current process when using the palm oil block to create a
similar fat globule effect. - In-line processing steps (i.e., chilled, bowl chopper) were added to reduce the block to flakes. Consumers thought the flakes looked more natural.
- Takeaway: Consider changing processing methods to mitigate supply chain challenges.
Tittl concluded by sharing what keeps her up at night—“Identifying the right types of co-manufacturers that have the ability, technology, and innovation to produce the products [CuliNEX] is looking for [and have a backup plan with ingredient alternatives].” The story’s moral is…work with your ingredient suppliers and be prepared!
“Addressing Formulation Challenges Through Supply Chain Disruptions,” Michelle Tittl, Product Development Manager, ACAP, B.S., CuliNEX
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