UK food and drink manufacturers have increased their investment in innovation, with the latest figures from the Food and Drink Federation (FDF) reporting that over 40% of companies launched new products in the first quarter.
The group said today (26 May) that its latest business confidence survey showed a “positive picture of the level of innovation” taking place within the industry, with the number of respondents who increased their investment spend in the first quarter rose substantially against the fourth quarter of 2010.
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The net increase of combined investment in “upskilling”, capital expenditure and R&D was almost three times higher in the first quarter of 2011 than the fourth quarter of 2010, the FDF claimed. It said that levels of investment have recovered considerably since this time last year, rising quarter-on-quarter since the third quarter of 2009.
The FDF, however, found that volatile raw material prices are continuing to put pressure on manufacturers, with nearly 90% of respondents experiencing increasing cost of commodities such as wheat, corn and cocoa, with 75% of respondents expecting to see further increases over the next three months of 2011.
Also, the price of all input costs rose in the first quarter, including packaging and energy, the FDF said. Over 80% of those surveyed confirmed average cost increases and forced nearly two-thirds of members to raise product prices.
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