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Please contact us to discuss how working with Myriad can maximise and secure R&D funding opportunities for your business.
Contact usFood and drink R&D (eligible under the R&D tax credit scheme) covers any project that aims to push the boundaries of knowledge and technology within the industry.
There are over 11,675 food and beverage companies, in the UK. To stand out in that crowd, innovation is key. But to develop innovative food and drink products or services, you need to invest in Research and Development (R&D). But to invest in R&D you need money.
This is where the R&D tax credit scheme can help….
From discovering a new ingredient and developing a new product range to reducing waste and increasing food production efficiency, food and drink R&D (eligible under the R&D tax credit scheme) covers any project that aims to push the boundaries of knowledge and technology within the industry.
Keep reading to find out what R&D looks like in the food and drink industry, what type of activities count as R&D, the future trends of food and drink R&D, how you can benefit from the government-backed R&D tax credit scheme, and how to claim R&D tax credits if you’re in the industry.
As we established earlier, all companies must keep innovating to stay competitive in an overcrowded, volatile market, such as the food and drink one.
Not only that, but food and drink companies must also keep developing new ingredients, products, services, processes, operations and materials, to help them meet the ever-changing needs of their consumers whilst increasing performance, productivity, and profitability.
For example, R&D in the food and drink industry can help you:
Meet new regulations: Compliance regulations, such as the food safety HACCP (Hazard Analysis Critical Control Point), for example, are often changing as universal standards become stricter. Developing new, innovative processes and products to keep up with these changing regulations will help food and drink companies continuously improve their products, services and operations to satisfy both regulators and customers.
Cut costs and waste: Developing new, streamlined ways to produce, package and preserve food and drink can help companies reduce waste–which is contributing to the environmental and global food shortage issues–and cut costs with optimised resources, more efficient production processes, longer shelf lives, and more sustainable manufacturing operations.
Develop sustainable manufacturing practices: With net zero targets weighing heavily on all our shoulders, R&D can help businesses find ways to develop and implement sustainable food and drink products, services and production processes, like sustainable packaging or sourcing methods, for example, that will contribute towards net zero goals and minimise environmental impact, preserving the future of our planet.
Overall, R&D plays an integral role in the success of food and drink companies by giving them ways to stay competitive, make money, keep up with changing market demands and meet regulatory requirements.
Examples of R&D projects in the food and drink industry
Below are a few ways R&D can help businesses with the above, in the food and drink industry:
R&D in the food and drink industry is primarily driven by the need to meet changing consumer preferences and demands, comply with strict food and drink regulations and utilise technology to keep processes lean, productive and profitable.
Here are three other major factors that are also inspiring R&D in the industry:
Environmental concerns and pressure to meet zero targets: With pressures to meet net-zero targets by 2050, all industries are looking for new ways to build sustainability practices into their manufacturing and production processes. The food and drink industry is no exception. The industry is primed for R&D projects that can reduce food waste, create eco-friendly packaging and develop products that have a lower environmental impact.
A growing focus on nutrition and health: As a nation, we’re becoming increasingly health conscious which means there’s an increased consumer demand for new healthier food and drink options. For example, people want products with reduced sugar, lower carbs, or that are enriched with vitamins, minerals, and other nutrients. So, companies within the industry are continuously researching innovative ways to improve the nutritional profile of foods, without compromising on taste or texture.
Globalisation and the availability of new, alternative ingredients: As companies expand globally, they need to consider different tastes, dietary needs and cultures of different regions and develop new products and services that meet these diverse market demands. Plus, there’s always a need to discover novel ingredients and food sources to address global food supply challenges, with R&D projects experimenting with on-the-ground natural food sources like algae, seeds and insects, or–at the opposite end of the scale–developing ingredients in labs.
The future of R&D in the food and beverage industry looks to be one of innovation, sustainability, and efficiency. The industry’s top three trends for 2024 look to include:
More restaurant-quality products, ingredients and services, at home: Perhaps it’s because of COVID or maybe it’s the cost of living crisis, either way, people are staying in vs going out. They’re looking to source new, fresh, premium ingredients to make restaurant-quality meals at home.
New plant-based food options: There are now an estimated 2.5 million vegans in the UK. That’s 4.7% of the adult population! So it’s no surprise that demand for plant-based options continues to rise.
Innovative drinks: The drinks market is growing, fast. And that’s thanks to continued innovation with single-serve drinks, functional coffees, energy drinks, different teas, and bone broths.
As you can see, there are plenty of opportunities for food and drink companies to conduct R&D and start developing new, innovative food and drink products and services that keep them competitive. Not only that, but the government-backed R&D tax credit scheme–which gives companies up to 18.6% of their R&D costs back–applies to R&D food and drink projects, as long as the project meets the HMRC tax credit criteria.
But despite this, only around 10% of food and drink companies claim R&D tax credits under the scheme.
Put simply, many food and drink companies don’t apply for R&D tax credits because they don’t know about the R&D tax credit scheme.
Many believe that R&D tax credits only apply to those in scientific or technical industries when, actually, they apply to any company within any industry, as long as they are pushing the boundaries of technology or science. Say, for example, you’ve discovered–through research and development–a way to decrease to sugar content in bread without altering the taste, texture or cost. The R&D activity you conducted to make this discovery, would qualify you for R&D tax credits, and you’d be entitled to up to 18.6% of eligible costs back.
However, because the nature of R&D activities in the food and drink industry is typically not traditional, it can be tricky for some companies to identify eligible R&D expenditures.
This is where Myriad can help.
Many food and drink companies miss out on valuable tax credits because they’re unsure about what qualifies as R&D. To make this process easier, we’ve created two free resources to help you identify and document your R&D projects:
Download Both Tools for Free and take the first step toward maximising your R&D tax relief.
Myriad has been helping clients in all industries, including food and drink, claim R&D tax credits for over 21 years. They understand the complexities surrounding submitting R&D tax credit applications and know exactly how to get you the maximum amount of R&D tax credits possible.
Firstly, our expert team of friendly R&D tax specialists will sit down with you and identify all costs that might be eligible for R&D tax credits. They then compile a detailed report explaining your R&D work and justifying your expenditure and submit it for review. Because they’ve been in the industry for so many years, Myriad have developed strong relationships with HMRC, which means they usually have a higher success rate with all their claims.
Take a look at our R&D Tax Credits page for more information about how R&D tax credits could benefit your food and drink company. Then, when you’re ready to make a claim, drop us a message or call us on 0207 118 6045 to get the process started.
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Please contact us to discuss how working with Myriad can maximise and secure R&D funding opportunities for your business.
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