New Realities, New Opportunities

Contact Author Richard Panzarasa, Panzarasa Group
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Years ago, when there were so many more F&F suppliers than now, companies sought to distinguish themselves from their competition. Size of the companies then was not as much a factor as it is today, the playing field was a bit more level. First came the neophyte marketing departments, offering broad industry info and a concept or two for clients. This caught on with the client companies since it was a value-added service offered for free. As time went on, the race for recognition quickened and more sophisticated marketing departments were established in even more supply companies. The concept iteself was no longer good enough. Flavor and fragrance suppliers began to develop package prototypes, trademark names, even some raw consumer testing to reinforce the power of their concept. And so it grew.

The Value-added Boom

Next came technological innovations, studies, etc. The clients loved these and began to take the offensive, in some cases asking that flavor and fragrance suppliers pick up the tab for consumer tests. Then came the demand for regulatory, toxicology experts on staff, etc. Pretty soon some flavor and fragrance professionals began to wonder what business they were in. In the meantime, another phenomenon was taking place. The client companies were consolidating, becoming bigger overnight. The flavor and fragrance houses recognized that to be able to continue to supply and service these clients they had to do the same.

The stakes rose for flavor and fragrance suppliers; while there were fewer competitors, competition grew in intensity especially among those companies that had distinguished themselves through significant acquisitions. The result of these changes was a new urgency to win, win, win. More and more money was being spent without any quantitative return. The pressure on supply houses became even more intense, and the client companies became besieged by suppliers trying to sell their ideas, technologies and programs. The largest clients began to call a halt to this unmanageable state of affairs.

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