Formulation and Cost Management

Formulation management importance

Formulation is one of the decisive steps in innovation. In Food and Beverage, R&D teams need effective formulation software to deal with business constraints, cost management, formulation optimization, recipe generation, allergen management, updates and change management.

Challenges in formulation management

One of the most important issues in formulation is that food and beverage products are primarily based on agricultural commodities prices, which fluctuate based on supply and demand in real-time. Commodity price variations can be induced by the season, weather, natural disaster, or demand variation. The commodity market remains unstable both in the United States and abroad. Food companies are extremely anxious about pricing fluctuations and require a highly effective cost management.

Another concern in formulation is allergen management. The common allergens are peanuts, tree nuts, fish, shellfish, eggs, wheat, soy and milk. Dairy and wheat are the most used in a processed food industry that has relied for a long time on those two ingredients and their derivatives. They are inexpensive and wholesome sources of carbohydrates and protein that also have the advantage of being highly versatile.   All these factors, plus ease of production and abundance, have made them key components in food and beverage formulation development.

Formulation optimization

But a finished product is not set in stone. To gain market share companies have to adapt to the unstable price of raw materials. If a given raw material price increases, the percentage in finished goods may need to be reduced, or replaced in favor of a cheaper ingredient. For instance formulation optimization switching some meat proteins to less expensive vegetable proteins is daily tasks of R&D teams throughout the formulation management.

Food and Beverage companies that developed formula in a structured manner with a view toward formulation optimization delivered significantly better business results, including 15% revenue growth and 3% greater margin advantage on new products.

Lascom Solutions for an improved formulation management

Food and beverage manufacturers assess their product formulations and recipes continually, to ensure that business targets are met. At the same time, businesses have to comply with customer and regulatory requirements, in order to maintain product quality and profit margins.

Lascom formulation software is able to create new formula from scratch or from an existing formula. R&D teams create, modify, review, edit, update and simulate formula through the user-friendly platform; Lascom formulation software performs as a robust formulation management solution, providing cost optimization and allergen management to R&D professionals in real time. It also provides full support for almost any product formulation sections, including, nutritional information, chemical, physical, etc.

Lascom formulation management tool provides features to:

The formulation software provides more efficient formulation management, cost management and allergen management as well as a better traceability based on a centralized repository. R&D teams are even more aware of products specifications and nutritional information, two key factors in NPD.

Cost optimization with Lascom formulation software

Lascom formulation software handles detailed cost management. R&D professionals can choose to work with multiple cost templates for the same product formula. Templates are based on factors such as different suppliers, different volume- related costs, seasonal costing, manufacturing processes, or other variables.

Lascom formulation software and Excel connectors

Many R&D professionals use Excel files in their daily tasks. Consistent working methods are also key to smooth innovation processes and cost optimization. Users can formulate or update a product directly from the formulation software platform or using Excel. Teams can keep using Excel for calculations and as viewer as usual if desired, while all data and information will be centrally managed within Lascom formulation software base. The formulation software perfectly integrates Excel file through Excel connectors, for participants usage comfort.

The formulation software flexibility and automation ensure the accuracy of product specifications, stimulate innovation and accelerate NPD.

Success Stories

  • Lascom PLM solution for all Eili/Lilly European factories

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