New Product Development at Heinz Wattie's
This case study examines the role of the Product Development team of a food manufacturer, from the initial idea of a new product through to its appearance on supermarket shelves, based on material supplied to Techlink by Heinz Wattie's. It supplements the case study Developing a new stir-fry sauce which examines the actual process of development of a specific new product by Heinz Wattie's.
The Idea
Lab testing
The process of new product development starts with an idea, or a perceived need in the market.
Ideas/needs can come from a variety of sources including:
- marketing for our own products
- supermarket brands
- restaurant chains
- marketing companies that sell but don't make products
The Product Development/Research and Development Department are then briefed on the project. The brief outlines the product or products required along with pack size and type, units per case, target cost and launch date.
Here is a sample brief:
A Japanese pet-care company wants six flavours of dog food, all in 400g cans with easy-open ends. The flavours will be kangaroo, lamb, beef, fish, ostrich and pork. They should all cost $12 for a shrink-wrapped tray of 12 cans. They want delivery in Japan at the end of June 2007.
To identify all the issues with making the products in question, the Product Development teamwould talk to Packaging Development, Production, Supply, Planning, Quality Assurance and Data Integrity. After all the information has been assembled, product costings are also completed to identify whether or not Heinz Wattie'scould meet target costs and therefore make a profit.
Using the example above it is likely that there would be difficulty making kangaroo and ostrich dog food for $12 per case due to the cost of kangaroo and ostrich meat. Packaging Development might decide that shrink-wrapped trays into Japan are not strong enough to arrive in good condition. Planning might point out that the factory is at full capacity during May and therefore production will need to be done in April. Supply might say that there is going to be a shortage of pork this year. Quality might point out that special import permits are required to import products with fish into Japan.
Everyone's input is important so that Product Development can go back to marketing or customers and give them a realistic response to their brief. At Heinz Wattie's the project generally must then be approved by the executive committee before the Product Development team start to work on the recipe. This includes approval of the cost, concept and strategy.
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