August 4, 2008

Minnesota Still Food Product Development Hotbed, but Suppliers and Retailers Have Joined the Quest

By Tom Webb, Pioneer Press, St. Paul, Minn.

Aug. 4--In a high-tech kitchen at Cargill's new snacks and cereals lab in Plymouth, amid machines that puff and squash and clump ingredients in interesting ways, Jon Wiersum is armed to defy convention.

Even when it comes to the humble cereal flake.

"What does a cereal flake look like?" Wiersum asked during a lab tour. "It's round, brown and flat. Now, challenge every one of those assumptions."

Everywhere in the food industry, old assumptions are being challenged, as the entire food chain comes under new pressure to innovate. And much of that innovation -- the food products of tomorrow -- is being created in the Twin Cities today.

Every state grows, processes, packages and sells food. But almost nowhere else will you find such a chewy cluster of industry talent, influence and scale.

For decades in Minnesota, new-and-improved products came mostly from big food companies such as General Mills, Hormel, Pillsbury and Land O'Lakes. Their icons -- Cheerios, Spam, cake mixes and sweet-cream butter -- helped change how Americans ate.

But the food-innovation blueprint has changed. Major food companies are looking beyond their own labs, demanding innovation from others in the food chain. So now, ingredient-suppliers like Cargill are ramping up research facilities.


Retailers are scaling up, too, eyeing profit and possibility. Supervalu, the nation's second-largest supermarket chain, last year opened a

product-development kitchen at its Eden Prairie headquarters to create grocery products, including a gourmet line that debuts in September. Its products can hit the shelves in 5,000 stores nationwide. Operating on that scale requires more than just clever cooks.

"We have people who are focusing on package design, and advertising and marketing," said Haley Meyer, a spokeswoman for Supervalu, which operates Cub Foods stores in the Twin Cities. "We have people focusing on sourcing the product, so we have relationships with manufacturers. There's food scientists involved, so they really test the integrity of the product. There's folks who develop recipes that go along with the products.

"It's a little beehive of work over there," Meyer added. "And it's all happening in Eden Prairie."

Something similar is happening in downtown Minneapolis, where inside Target headquarters is the Our Brand Product Development Lab. That's where teams are creating Target's distinctive products bearing "innovative flavors," which can be sold in 1,648 Target stores nationwide.

Target spokeswoman Brandy Doyle noted some recent hits, such as Target's Archer Farms organic granola that now comes in a distinctive resealable canister.

That's the reality in food innovation. Creating the next Cheerios is the longest of long shots. But innovators can aim to make products taste better or prepare faster, be less fattening or more appealing, be safer or store longer, be more healthful or cost less. Or maybe, just be cooler.

So, what Foods of Tomorrow are under development here? Alas, that's a secret. Firms low on the food chain sell their innovations to the big names, which get the credit.


But major trends are no secret. Ted Labuza, a food-science professor at the University of Minnesota, notes several: food safety, foods that enhance health, foods that battle obesity. A verbal tour of Minnesota food makers highlights some innovation.

--Food safety: Hormel Foods in Austin is a leader in using ultra-high pressure to pasteurize deli meats. "We're talking about pressure that would crush a submarine," Labuza said. The meat emerges just fine, but pathogens do not.

--Promote health: Cargill has done extensive work with stanol esters, natural compounds that keep cholesterol from being absorbed by the body. They're now added to some varieties of Yoplait yogurt. "At least 50 clinical studies have shown that using it can reduce your cholesterol 15 to 25 percent," said Labuza, who speaks from personal experience. "I can testify to that, because it really worked."

--Lower risks: Amid public pressure to eliminate trans fats from food, "there were about 18 different companies that came up with new and novel ways to make fats without trans fats in them, and Cargill was one of them," Labuza said.

Then there's taste. At Cargill's new bakery lab, the marketing team notes the appetite for opposites. Foods that are healthy and indulgent. Crunchy and chewy. Sweet and salty.

"Another trend is the blurring between meals and snacks," said Wiersum, vice president of marketing for the snacks and cereal category at Cargill. "People expect their snacks to be as nutritious as a meal, and their meals to be as convenient as a snack."

Driven by consumer research, the food industry tries to invent products that meet those desires. Jean Kinsey, co-director of the U's Food Industry Center, explains the industry's mania for new-and-improved.

"Consumers will try something new and are always looking for the latest thing," Kinsey said. "If it turns out to be really good, it might take off. But of all those products that roll out, less than 10 percent of them are on the market two years later. So, you throw it out there and see what takes."


Sometimes, the big companies need an assist. Merlin Development is a small company in Plymouth that advises larger food companies how to fix or create food products.

"Sometimes, scientists can forget that food is pleasurable to people," said Leslie Skarra, Merlin's chief executive. "It needs to be cost-appropriate, but it needs to taste good, it needs to look good. It's not just a science project, although there's a tremendous amount of science that goes into it."

Over the decades, she's seen consumer innovations move up and down Minnesota's food chain.

"The large food companies and the food science department at the U have driven a concentration of talent here," she said. "The fact that there's a lot of food innovation here is not necessarily well known, unless you work in the industry."

Supermarkets are the latest big-time players to the innovation game. The Twin Cities serve as headquarters to three large food retailers -- Supervalu, Target and Nash Finch -- and each is aggressively developing its own brands.

For years, store brands were notable for bargain-basement prices or mimicking national brands. Now, retailers have loftier goals. At Supervalu, for instance, they're luring "people who want the restaurant experience at home," by creating premium prepared dishes, sauces and marinades, Meyer said.

"It drives loyalty and differentiation within all of our markets," Meyer said. "You can only get these products within all of our stores."

It probably won't make us forget Spam. But Made in Minnesota might mean something more.

Tom Webb can be reached at 651-228-5428.


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