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October 2011: Bonus Product Development Insights

In “Behind the Magic,” an article by Penny McLaren published in the October 2011 issue of School Nutrition, several food manufacturers divulged some of the secrets of the product development trade, explaining the different steps involved in the long process of bringing a new product to the K-12 school segment. Other vendors serving this market face similar challenges, including those that produce beverages. And school nutrition operations rely on other products and services—ones that are consumed by their student customers. These include new equipment, software technology and cleaning supplies. The companies that produce items in this last category are being challenged not just to bring new, effective products to market—but ones that are eco-friendly.

Bill Hargis, president and chief executive officer of 4U2U Brands, offers his reflections on building a better beverage below. And Chuck Ainsworth, division manager for SFSPac Food Service Sanitation Systems, a division of Portion Pac Chemical Corporation, provides insights into how the process is similar and different when it comes to developing new cleaning materials.

Where do product ideas start for 4U2U Brands, a manufacturer of juice drinks for schools? “It starts with a crystal ball,” laughs President and Chief Executive Officer Bill Hargis. “The rules are changing every day.”

According to Hargis, the company did a lot of research into regulations governing the federal school nutrition programs before it tackled the challenge of developing healthy beverages for schools. Directors also were asked to give input, requesting products that were low in calories, could provide key nutrients—and, oh yes, taste good.

To meet those needs, 4U2U introduced its Fruit 66 brand, which features a lower calorie count than many competitors. (The trick, says Hargis, was mixing 6 ounces of juice with 2 ounces of water per serving.) Initially, the beverage contained all eight of the nutrients that directors indicated that kids needed in their diet. But the combination lent an odd flavor to the product. “Kids said, ‘Oh wow, it’s kind of a sour taste’—and they liked it, but the directors thought it tasted metallic,” recounts Hargis. Removal of iron, magnesium and folic—ingredients deemed less essential—improved the flavor profile.

According to Hargis, taste appeal with children is a top consideration. When research showed kids wanted a passionfruit-mango flavor, “We got that request too many times not to make it,” he reports. Today, it’s the company’s best-selling flavor—at least until two more kid-suggested flavors hit the market: strawberry melon and mixed berry made their debut at ANC Nashville.

Blended flavors are no easy feat to produce. Should there be more passionfruit than mango? Vice versa? Should it be 50-50? “It doesn’t make sense just to create a product on statistical data,” asserts Hargis. “Kids are not shy about telling you what they want. Kids are unfiltered in their comments and likes and dislikes.” So, each time the company is ready to test a new flavor variety, the R&D team recruits a test group of about 30 kids, ages 9 to 16. “We have five drinks that the kids come in to taste,” he explains. “Then we narrow it down to three, and then to two to choose.”

Hargis is a big fan of the reliability of customer testing. “We haven’t dropped a flavor yet,” he notes. “But it’s not because of us being so right, it’s the kids. It’s worth every penny to do [the testing].”

It’s amazing to learn the power that customer testing and feedback can have on all sorts of new product decisions—not just flavors. Hargis recounts an incident that happened at a school food show in Georgia, in which students were invited to attend and test prospective new products. The kids would come to the booth and ask, “Got anything in blue?” It dawned on Hargis that they were selecting blue popsicles and blue fruit cups—and when he changed the color of the can for one of the flavor varieties, sales went up 50%!

On the flip side, when the company first introduced its beverages in half-size cans, they learned that some student customers found them too juvenile. The answer was switching to a skinny tall can—and the kids approved.

Hargis and many of his colleagues in the food and beverage industry grew concerned when states and local authorities began writing their own nutrition standards, especially with possibly unforeseen consequences. He notes that when schools are required to serve 100% juice products, “It’s forcing kids to drink more calories. I don’t like having to do that.”

Of course, sometimes something that seems restrictive can become an opportunity. Hargis says 4U2U created its non-carbonated line to meet strict beverage regulations in Florida and Texas. But the products have been picked up enthusiastically by school districts in other states.

Indeed, nutrition standards drive much research and development among companies like 4U2U. For example, when the criteria for the HealthierUS School Challenge were developed, and stipulated restrictions against carbonated drinks, it prompted the company to develop complementary product lines: carbonated and noncarbonated. While acknowledging the frustrations that changing regulations can play with the K-12 market, Hargis concedes that he’s been impressed with his own interactions with U.S. Department of Agriculture staff. “The USDA is very helpful to manufacturers,” he asserts. “They are friendly; they take the time to explain everything. They are fantastic.”

New food and beverage products aren’t the only school nutrition solutions that take development time. A similar process applies to companies providing innovations in technology, equipment, supplies—and cleaning products. Indeed, with market demand increasing for more sustainable and “green” cleaning products—especially in schools—some companies in this area have their work cut out for them.

One definition of “sustainable” means that items don’t overuse basic resources in production and can do the required job without having a long-term effect on the environment. SFSPac Food Service Sanitation Systems, a division of Portion Pac Chemical Corporation, has the advantage of having created sustainable products right from the start. “The industry is now doing what we have done since inception,” says Chuck Ainsworth, SFSPac division manager. But that doesn’t mean the company doesn’t need to continue to innovate!

According to Ainsworth, it can take a minimum of six months to a year to develop an idea into an item ready for the market. For SFSPac, new product ideas may come from both company employees and customers. In addition, the company is always looking at what’s offered by competitors and what’s on trend with operators. For example, Ainsworth has observed that a number of school districts have reached the point where their dish machines need replacing, and many are switching to pot washer sinks as an alternative. This equipment features an agitator to wash pots, which means a foamy cleaner is not desirable.

“Suds sell,” acknowledges Ainsworth. “Consumers like suds. But because of the agitator, suds don’t work in this type of sink. So, we developed a product to go along with it.”

When SFSPac has a new product it intends to market to the school segment, it identifies a school district to use as a test site for evaluation. Ainsworth notes that this type of test usually runs at least two months to determine success.

Sometimes a product might require reformulation, and not necessarily because of performance factors. The cleaning industry is impacted by a number of environmental guidelines, approvals and seals that are put forward by government groups and third-party advocacy agencies. Green Seal, Ecologo and the U.S. Environmental Protection Agency all have varying certification requirements. SFSPac will manufacture to the most stringent of specifications. “Sometimes one organization allows certain criteria, while another does not,” explains Ainsworth. “We make sure our formulations are recognized by all the certifiers,” even though, he concedes, “that might not be cost effective from a manufacturing standpoint sometimes.”

SFSPac also prioritizes the continual update of its education and training materials, as these are an important part of the company’s service. The guides that explain how to clean using company products tend to change more frequently than the products themselves, he notes. And the company is seeking more innovative ways to share this information. At SNA’s Annual National Conference last summer, SFSPac introduced its “Learning Portal,” an online training resource for cleaning with its product line.

One of the key elements of this educational resource is a short video. “Now, we don’t have to just write our procedures, we have to film them,” says Ainsworth. “The length of time to introduce a product gets pushed back, because we have to write procedures and then film and edit the videos.” The Learning Portal also includes training quizzes.

According to Ainsworth, the company’s approach means new products are always just a part of the product line, and they do not carry an extra cost. “In our division, we do a shared-cost billing,” he explains. “With most companies, the more the customer uses, the more the company makes. We show our customers how to use the cleaning products, so that they actually use less. We bill on a set cost basis. A new product is just part of that set cost. When customers use less product, there is less packaging wasted, and there are savings for everybody.”