Innovations in food driving us in the new normal by Patrick Watson


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“And in today, already walks tomorrow” Samuel Taylor Coleridge

When Covid-19 impacted Australia in February this year, few of us would have imagined the seismic shock to our everyday lives. Overnight, our life at home and work and the way we perceive society and think about the world shifted around us. Covid19 has challenged our assumptions underpinning the relationship between food, business, the environment, and society. This relationship has never been so important to build and reinforce in the face of climate change, uncertainty and fear.  In the new and unexpected world that has emerged there are market drivers pushing us into a new normal; drivers that are forcing us to pivot and adapt our thinking around food and food security.

The impact on our health, lives, social welfare, economic wellbeing, mental health, society, and planet is still evolving.  However, we all seem to agree that our post Covid19 world will be a new world referred to now as the New Normal. The most profound impact, aside to the risk to our health has been the emergence of mass unemployment along with underemployment and a general mood of uncertainty, insecurity, mistrust and fear.

The New Normal; What Is it?

The term New Normal in a post Covid19 world has been popularly adopted to describe the new reality of 2020. What does this really mean? To better understand the New Normal, let’s start by first defining, for the Australian food industry, what the old normal was. The Old Normal in the food industry is plagued by shrinking margins, cost cutting, under investment in plant and equipment, retracting diversity, supply chains stretched globally with ‘just in time’ thinking and a focus on short term financial and operational goals.

As I wrote in the VFIN newsletter in January 2020; ‘The Australian food industry has struggled for over a decade with investing in innovation through research and development. The challenge is that R&D budgets in the Australian food industry are restrained and this means innovation will continue to be restrained. This is a big brake on growth in our food sector. There are many reasons for underinvestment in R&D in the Australian food industry such as the cost of new technology, shortage of skilled innovation practitioners, low returns on investment from ever shrinking margins, and a lack of vision and prioritisation of innovation as a business success factor.

The New Normal is pushing us to change and adapt, and just as change is inevitable, innovation is the means we can use to manage that change. In times of uncertainty and fear, investment tends to evaporate and based on my own experiences and through anecdotal conversations with industry stakeholders, this is certainly the case in the food industry across the country. Redundancies, furloughs, and downsizing are occurring in both in R&D and Quality Assurance. The biggest impact is in small to medium sized businesses (SMEs), hanging on and hoping the crisis will pass soon. As Victoria, and now NSW have shown, the course if this pandemic is unknown and the impact is ongoing without a certain end point. Hope is not enough to survive let alone grow in this environment.

Innovation is at the heart of growth and as  Bakhtiar and Breuniug (Australian Office of the Chief Economist Research Paper 2/2017)  wrote: ‘Research and development (R&D) play a central role in long-run productivity and economic growth. Theory suggests that R&D spill overs (where the R&D activity of a firm affects the well-being of consumers or the profitability of other firms) also play an important role in economic growth and that the benefits of R&D extend well beyond the firm that makes the R&D investment. Thus, the social returns to R&D as a whole may be greater than the sum of the private returns to firms who make R&D investment decision’

To meet ongoing social, economic, and environmental challenges of this pandemic and climate change, countries within the European Union are investing massive sums in R&D to drive innovation and sustainable growth as their economies re-emerge post pandemic. Yet in Australia we have not seen this. There is little national support here for SMEs to innovate out of recession and our universities, which are central to driving innovation through applied research, are starved of funding exacerbated with the disappearance of their international student base. Job keeper here is keeping many SMEs afloat preserving the legacy of the Old Normal and addressing our need to adapt. What is needed is to reimagine our food systems to foster growth in exports with greater diversity, local processing and consumption, improving food security, and sustainability for the greater good of our society.

Globally, the food industry has been impacted by Covid-19. The impact has not been totally detrimental with some positive trends emerging from the pandemic. With customers in lockdown, innovative retailers are on the initiative and pushing their supply base to pivot to meet the new expectations of their customers. At the same time, people that are ‘trend forward’ are especially interested in clean and healthy food and beverages.  They are also looking for food products that are sustainable made by ethical companies that treat their employees well according to The Hartman Group’s recent report on the future of food technology. They are also conscious of social justice issues, such as fair pay and the ethical treatment workers in the food, agricultural, and hospitality industries, the role and opportunities for women and minorities, transparent and ethical sourcing along with localism.  For your customer these are strong influencers in the decision to purchase in the New Normal.

Following are food media articles devoted to the impact of Covid-19 and the outcomes relating to the drivers for innovation in the New Normal.

Social Drivers:

Business Drivers:

Environmental Drivers:

The above three drivers can then be extrapolated to real time R&D and NPD processes to address the trends arising out of this crisis:

  • Value for money = quality, practical, experiential
  • Impact on textures and shelf life
  • Restaurant and café-style meals
  • Indulgent textures and flavours
  • Plant-based food and drinks
  • Clean label and ‘better for you’ food and beverage
  • Instore menu suggestions
  • Organic products
  • Personalise brands through transparency and provenance
  • Reinvigorate the freezer isle
  • Diversify your customer base
  • Focus on your customer
  • Reformulate with natural, sustainable inputs, reduce saturated fat and sodium
  • Look local to buy and source
  • Give back with larger pack sizes with no or little price increases
  • Packaging for greater food safety but which also meets sustainability goals
  • Immunity boost through functional benefits

“We’ve been able to rapidly adapt materials and manufacturing to meet immediate needs. We’ve seen large workforces mobilise to work differently. And we’ve seen how technology can be used to facilitate collaboration around a truly great challenge.”  CSIRO Chief Executive, Dr Larry Marshall July 2020

Along with industry working to be part of the New Normal, there is also a role for policy driven by local state and federal government. The globalisation of food systems and the subsequent integration of global food markets has shown how fragile and unstable these systems can be in dealing with climate change, economic nationalism, geo-political tensions, trade wars. The consequences following in the wake of globalism has been the degradation of our natural resources through over exploitation, loss of cultural traditions, and biodiversity and soils, water crises, and an economy dedicated to growing commodities with little thinking of the impact on local communities, diet and health.  To acknowledge these consequences means we need to think differently about food and the role of policy in this.

“My vision is for a new food economy with more and more of us growing a percentage of our own food, and preferentially purchasing in season and local food from local and sustainable farmers. This future food system will not be identical to those that I remember from my childhood in the ’50s and ’60s, since the world has changed since then. The internet and other related digital innovations including on-line marketing, and the emergence of farmers markets and community supported agriculture, are all expressions of the boundless innovation of humanity. So, let us hope that the farming community will prosper and come to play a more central role in our future food systems. Let the new food revolution flourish and thrive!” –Patrick Holden, British farmer and founder of Sustainable Food Trust. Read more here.

Patrick Holden, may have missed the many great technological innovations taking place in food and agriculture and the brilliance behind this.  In addition, he may sound naive and utopian in his thinking but it is this thinking along with our ability to innovate and to adapt and change that can smooth the shocks that crises have forced upon us. The role of government is central in driving innovation to foster localised food systems, local processing, regenerative agriculture, and mitigating climate change. This means investing in our future and building a path for our community and economy in the New Normal.

In our innovation journey to build resilience in our food systems, we need to better look at new food channels, new food categories, rediscover lost food legacies including indigenous food genius, build a circular economy, and manage the relationship between urban growth and localised food systems.  We also need to be at the forefront of mitigating and adapting to climate change. Finally, we need to encourage the equitable consumption of natural and healthy food locally and globally. It a challenge, but we as humans are more than capable of delivering this and surviving the pandemic.

Patrick Watson is a chemist and chef with his master’s in business. He has worked in some of France’s and Italy’s top Michelin starred restaurants. He has headed up some of Australia’s best kitchens. He has worked in innovation roles in the food industry, both in Australia and internationally for the last 18 years. Besides being an importer of innovative food products from small French start-ups into Australia, he is the founder and managing director of Tarn Food Consulting. patrick@tarnfoodconsulting.com

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