Understanding R&D in the food and accommodation sectors

60 claims in 2015/2016 –only 0.28% of all claims with an average claim value of £41,500.Food and drink is an essential part of everyone’s day to day life and although many of the claims made by companies can appear to be simply designed to catch our attention it is an area rich in R&D. Our expectations of the products we buy are high and we expect them to deliver on many levels including shelf life, nutritional value, taste, sourcing and year-round availability.In addition to our demands as the consumer, the Government often moves the goalposts in relation to nutritional control over the products we buy. Arbitrary requirements such as a lower quantity of sugar in some products place great pressure on manufacturers to alter methods to meet new standards.As consumers, we are influenced by various factors as to what we put in our shopping baskets. It is for the food suppliers to keep abreast of these trends to ensure that we are able to buy the ‘latest thing’, where this is a new product there will be a need to alter manufacturing procedures, marketing, research consumer trends and develop new products.

Examples of problems to be solved through R&D within this sector

• How to adapt to changing trends by creating new products, recipes and manufacturing methods
• What new equipment to use or whether previously used equipment can be adapted to fulfil needs
• How to manage environmental factors within the supply chain and manufacturing process
• Whether the amendment to any process of producing a product is feasible, cost-effective and sustainable considering the scale of the productivity expected

Examples of what constitutes R&D in these sectors

The HMRC test as to whether a Company is performing R&D is whether there is ‘appreciable improvement’ in a situation as a result of ‘addressing a scientific and technological uncertainty’.

• Creating new recipes, testing them and scaling them up to meet productivity requirements
• The use of electricity, staffing resources, waste products and transport costs in perfecting the final product
• Experimenting and testing equipment to ensure it can create new products
• Innovating new packaging for the transport of altered products
• Sourcing a constant source of the required ingredients so that productivity is uninterrupted