Buyers love getting their hands on a new product and, despite the many thousands of SKUs out there, there's always room on the shelf for genuinely innovative products. Yet the time and expense needed for research & development means buyers are often more likely to be shown new packaging or a slightly tweaked ingredient list than any true, blue- sky innovation.

Buyers acknowledge some categories are difficult to innovate, such as paperware and rice and pasta, but many are bemoaning the lack of true NPD in areas where they would normally expect it. "Yoghurts was more like OPR - old product redeveloped - than NPD last year," says one fed-up dairy buyer.

There's also the issue of price deflation to contend with. "I'd like to see an improvement in NPD but it's a vicious circle," says one buyer. "While the market is being driven down the low-price route by the major multiples, what chance have manufacturers got of trying to add value into product development and improve margins with NPD?"

Government restrictions

It seems the government is also impacting on the food industry's ability to innovate. Buyers cite strict labelling regulations, advertising rules, import tariffs and health concerns as factors which are starting to bite.

The industry already faces a ban on advertising certain HFSS food and drink products to children, and has also endured a time-consuming and costly food- reformulation programme to cut salt content and saturated fat out of their products.

"Although the government wants the industry to take out E-numbers, it's not always financially viable to replace them with natural ingredients, which can push the price up and then consumers might not want to buy them," says one buyer.

"I'd like to see fewer overnight knee-jerk reactions to health warnings, and more realistic views on things such as hydrogenated vegetable oil," adds another.

The Grocer's Top Products Survey showed that despite being blamed regularly for the nation's obesity, manufacturers have heeded demands for healthier products by reformulating mainstream lines and innovating in functional foods.

But there's still more to do. "Some big brands in the market have been very slow off the mark with regard to healthy eating and haven't rebranded to flag up dark chocolate as beneficial, for example," says a confectionery buyer.

However, a health-driven push to reformulate processed food could force manufacturers to spend time and money refining ingredients, at the expense of genuine NPD.

Labelling as a hindrance

It is coping with rules on labelling that is proving to be the biggest thorn in the side of many buyers.

The battle between the Food Standards Agency's traffic-light labelling scheme and the FDF's front-of-pack GDA scheme continues to rumble on - with some companies adopting both schemes while others are ignoring them completely.

According to our survey, 42% of buyers cited labelling as the current biggest barrier to NPD. Many buyers wish the whole industry would take one common stance on labelling. "Government should take a clear view as to which system or standard they want everyone to adopt and then support it with an educational drive," complains one grocery buyer.

Another is critical of the amount of information which needs to be squeezed onto packs. "Labelling is becoming more challenging because there is so much more information new products have to carry. This means you can lose the impact of what the product is trying to do."

Further red tape on the cards

Most agree the industry probably hasn't seen the end of these constraints and they see future legislation as the issue that is likely to be the greatest barrier to NPD.

The European Commission, for instance, is currently deciding whether labelling food with details of nutritional content should be compulsory and whether to charge for applications for approval of new ingredients and health claims.

This could mean more red tape for suppliers and the NFU has warned of 'regulatory overkill', while the Forum of Private Business warns the proposals will stifle innovation. "More government legislation could mean that buyers would be forced to source from further afield, or it might affect the price," says one buyer.

Another buyer adds: "More legislation in the future could mean NPD is slower to market, and we may miss trends. Buyers would be spending time doing the role of a food technician."

Meanwhile, importing can be an issue for retailers because some products can get held up at ports by HM Revenue & Customs.

"Import tariffs on products from different countries will make it harder for manufacturers to bring them to the UK," says one buyer.

So what ultimate impact could future government legislation and Europe have on NPD throughout this year? "Bored, uninspired customers, fewer sales and consumers buying the same products," says one buyer bluntly. We have been warned.n