Product lifecycle management in the food industry: which stage matters most?

From development to decline, how do you prioritise the different stages in your product lifecycle? We break down the basics in our essential PLM guide. 

Let's set the scene. Your product concept is brilliant. The formulation has been refined over months and months. The market research has demonstrated clear consumer demand. But then at launch, it all falls apart. Consumers are disinterested. Customers grow frustrated. Product development teams’ despair.

It's a scenario that crops up all too often. In fact out of 30,000 food product launches, some 80-95% fail within the first year. But even after 12 months, the risk hasn’t passed. High-growth new launches can become unprofitable at scale. Even legacy products can quietly turn into a commercial liability.

The fact is that if you take your eye off the ball at any food product development stage – from initial development to decline – the fall-out can be swift.  Which begs the question: given endless resources aren’t unlimited, if teams could only focus deeply on one stage of product lifecycle management in the food industry which should it be – and what are the potential consequences of getting it wrong?

Product lifecycle management stages: a refresher

In all industries, product lifecycle management (PLM) typically spans five stages – but product lifecycle management in the food industry comes with additional complexity.

In food and drink, the stakes are made higher by a stringent set of regulations designed to ensure safety and protect consumer trust – and oust any product that fails to comply, at any point within the lifecycle.

This first rears its head at the development and ideation stage

The work that happens before a product ever hits the market. It’s when teams swot up on trends and market patterns to identify white space. Early product concepts are trialled, tested and iterated. But these formulations must also be cross-checked against a complex set of food and beverage regulations to ensure feasibility before they even make it out the development kitchen.

Next, comes food product launch

A coordinated effort across various teams sees the product leave the factory and hit shelves for the first time. Here the logistics of labelling compliance and supply chain readiness – alongside complex food product launch regulations – are first put to the test.

Growth follows

At this stage, market feedback may be used to iterate product or packaging or adjust availability to reflect demand, resurfacing early compliance questions. Distribution expands across multiple channels and vendors, solidifying its place on shelf but placing further strains on sourcing and supply.

Then, as the product reaches maturity a new crop of challenges arise

New scale can trigger new cost management demands, as suppliers become diversified or ingredients become exposed to market fluctuations. More optimised procurement processes – or even reformulation – may also be required to maintain a competitive edge. Amid this, compliance become more complex.

Last, comes decline and exit

The timeline may vary but each product will reach this final stage. And whether triggered by third-party rationalisation or an internal decision to discontinue and focus on other lines, it gives rise to a new set of questions. What direct or indirect effects are there across our supply chain? How can waste from products and packaging be minimised? And how does this align with our sustainability obligations?

Making the case, stage-by-stage

Each of these five stages could make a compelling case for being the cornerstone of successful product lifecycle management.

Stage 1: development

A lack of focus on regulatory feasibility at those early development stages can see money, time and resources poured into a product that is bound to fail before it even makes it onto the market.

With the introduction of the FDA’s Food Safety Modernization Act (FSMA) in the US, for example, protocols have shifted from reactive testing to proactive prevention, with food safety controls designed in at the earliest development stages.

Big-picture policies such as the EU’s Farm to Fork Strategy also mandate stricter standards on sustainability, safety and health, shaping chemical in-puts and packaging design.

Novel food regulations, including EU 2015/2283 and Singapore’s Novel Food Framework, can preclude ingredients that haven’t been channelled through complex, costly approval processes.

If compliance here is an afterthought, it can render a product unworkable from the outset, and miss opportunities to differentiate. This has a ripple effect throughout the whole product management lifecycle.

Stage 2: launch

Ensuring a food product launch isn’t scuppered by non-compliant labelling or missing paperwork can make this second stage just as fraught with risk.

Failing to take account of different market authorisation timelines can lead to delays, disgruntled distributors and an inability to meet demand after weeks, or months, of raising expectations.

The slightest labelling error can trigger expensive recalls or penalties, damaging consumer trust from the outset. Each market or region will have a detailed and distinct set of labelling requirements making this a complex task – be it governed by the EU’s 1169/2011 Regulation, the US’s FDA nutrition labelling or the GCC Standards set by member states of the Gulf Cooperation Council and Yemen.

By contrast, those companies that have scrupulously mapped out each stage of a launch well in advance – from market authorisation to labels and the logistics of first deliveries – can use this stage to gain a clear first mover advantage.

Stage 3: growth

The pace of growth will shape the future success and longevity of any food and drink product. But it doesn’t happen without persistent, proactive input.

A retail listing doesn’t secure its spot beyond the length of the contract nor protect it from rampant range rationalisation. Products must be kept relevant, through updated flavours or formats, refreshed branding or ATL campaigns, in order to sustain and grow distribution.

Robust supply chain compliance is another pillar of effective PLM, supporting ongoing growth. That includes buy-in on international best practice, such as the Global Food Safety Initiative (GFSI) benchmarked standards.

Stage 4: maturity

New products might generate buzz or interest from new shoppers, but mature product lines, with an established distribution and demand base, can be what keep the lights on.

That requires a willingness to adapt and pivot to reflect changing market conditions and regulations, rather than hold firm to the status quo. Many markets have enacted healthier eating policy pushes, like the UK’s HFSS (High Fat, Salt and Sugar) rules, or nudged manufacturers to adopt front-of-pack labelling standards, like Nutri-Score. This may require reformulation in order to stay compliant or at least stay favourable in shoppers’ eyes.

As regulators up the ante on ESG and sustainability reporting too, reviewing supply chains to ensure mature products comply or excel standards can keep them front-of-mind – and in baskets.

Stage 5: decline

It might be easy to overlook but a product’s exit from the market can be a real differentiator within product lifecycle management. For example, where a product has been delisted or discontinued with little notice, how can edible surplus be diverted or waste be minimised?

This is no longer a voluntary consideration in many markets. The introduction of the 2020 Anti-Waste and Circular Economy Law in France prohibits larger supermarkets from destroying unsold edible food. Instead, it must be donated to charities or used in animal feed.

Other European countries are likely to follow suit, given the EU’s Farm to Fork Strategy has mandated a 10% reduction in processing/manufacturing waste across all member states by 2030 as part of a wider swathe of circular economy obligations.

The decline and exit of a product isn’t the end of the conversation – and companies that recognise that will gain an edge on the competition.

Why development takes the lead

No stage of product lifecycle management is redundant and each contributes materially to a product’s longevity and commercial value. So, if teams were asked to focus the bulk of their efforts into a single stage, which should that be?

Well, given that every downstream problem – food safety recalls, reformulation, spiralling costs, poor retailer uptake and consumer rejection – can be traced back to that initial phase of ideation and development, there is a compelling case for the PLM’s first stage being its most deserving of undivided attention.

Though it might feel urgent to bring a brilliant concept to market in the shortest possible timeline, by making time at these earliest stages to bake in considerations around regulatory compliance, supply chain viability, sustainability and nutrition companies can save themselves time, cash and an almighty headache further down along in the product lifecycle.

After all, it is less onerous to redesign a non-compliant label printed once on a single test product than it is to recall a batch from shelves. Or reformulate out a novel ingredient in a development lab rather than once you’ve committed to a major production run.

The maturity stage of product lifecycle management could put up a strong counter-argument though. It is here where a product spends the majority of its commercial life and, as a result, where it accretes (or loses) the greatest cumulative value. With the right strategic attention, it can be a period of either sustained growth and performance or lead quickly into a product’s irrelevance and ultimately accelerate its decline.

Three steps to optimise food product development

1. Engage cross-functional teams from day one

It isn’t enough to have food scientists and market trends analysts round the table when it comes to developing a new product. Instead, ensure cross-functional contributions spanning legal, supply chain and sales to anticipate regulatory and commercial barriers.

2. Treat regulatory compliance as a design criterion, not an afterthought

Use this multi-disciplinary input to surface challenges – and design in solutions. How can packaging be designed to proactively meet sustainability obligations and act as USP? How can international expansion strategies be tailored to different market authorisation timelines?

3. Close the loop

Ensure you don’t repeat mistakes – or miss glaring opportunities – by using data from mature and declining products to inform this next product development cycle.

A chain reaction

Everybody wants to avoid their brilliant product concept ending up in the literal and metaphorical rubbish bin. Or their star performer quietly phased out for failing to keep up with market feedback. And through that lens, every stage of product lifecycle management deserves its fair share of attention.

In fact, it’s better to reframe product lifecycle management in the food industry as a chain reaction, rather than a hierarchy. Each stage is critical but decisions taken at that development stage ripple down the product lifecycle, setting the ceiling for what’s possible.