“We have got to the stage where some customers are outsourcing new product development to their suppliers.”
Collaboration means sharing more information, earlier
Now this doesn’t mean Ingredion’s customers have suffered from a collective brain drain, stresses Gordon, who took the helm at Corn Products International (CPI) in 2009 and spearheaded its $1.3bn acquisition of National Starch a year later.
It simply means they now recognize they can get more innovative products to market more quickly if they work more closely with trusted suppliers, adds Gordon, who also drove moves to rebrand CPI as ‘Ingredion’.
As for the new tagline (Developing ideas. Delivering solutions), is it clichéd? Maybe, but it’s bang on the money nonetheless, notes Gordon, who was speaking to FoodNavigator-USA at the IFT show in Las Vegas.
“Food manufacturers are realizing that they need to share more information earlier and they need suppliers that are committed, that will come to them with innovation and offer solutions to their problems.
“This applies to short-term projects such as line extensions, cost optimization or nutritional improvement work, or helping them develop completely new products that might not get to market for five years.”
We want customers to see us as the go-to company, a partner
While National Starch had a reputation for being highly innovative, CPI needed to up its game, recalls Gordon, a high-flying MIT graduate currently occupying 42nd place in Fortune's ranking of America's leading businesswomen.
“Looking back at the old Corn Products, we needed to be more innovative. Bringing in National Starch was transformational for our business. It had a very strong global focus and R&D capability.”
The Ingredion branding - unveiled to the market for the first time at the IFT show - has practical as well as symbolic significance, she says, highlighting the fact that it sells a broad portfolio of food ingredients derived from a range of raw materials from tapioca and potatoes to stevia, not just high fructose corn syrup (HFCS).
“We are not an agrifood company, we are a $6bn+ ingredients company at 390 in the Fortune 500”, stresses Gordon.
“We don’t operate a commodities trading business. We don’t have a logistics business. And we don’t take physical ownership of raw materials beyond what we need to properly run our operations.
“We want customers to see us as the go-to company, a partner. The Ingredion name sends out a message to all of our stakeholders.”
But while its portfolio now contains a broad range of ingredients, including proprietary products such as resistant starch Hi-Maize, its key strength is in its ability to offer customers a complete package from consumer research and formulations expertise to labeling advice, she says.
The concepts on show at IFT make this clear, she says, from a hot and spicy salad dressing made with instant starches to reduce vegetable oil costs to all-natural, clean label reduced beverages using Ingredion’s Reb A stevia and Q-Naturale emulsifiers.
“We’ll work with customers at our Bridgwater facility and formulate on the spot yogurt texture with the right sweeteners and texturants to meet their needs and their price point.”
She also notes that several customers that made high-profile switches from much-maligned sweetener HFCS to sugar a couple of years back have quietly switched back to HFCS in recent months.
Mature markets still present opportunities
So where are the biggest organic growth opportunities?
While a lot of attention has been focused on emerging markets as many companies have seen volumes going backwards in the US and Europe, Ingredion had a strong first quarter in its domestic market, says Gordon.
“Our volumes grew 4% in North America [which includes Mexico]. Now I’m not saying we can necessarily deliver that kind of volume growth long term, but there are still opportunities in fast-growing niches in mature markets, while in emerging markets the growth is coming from rising GDP and the growth of the middle class.
“The important thing is that major food manufacturers want to work with partners on a global basis.”
On the acquisition front, are other deals on the horizon now that the acquisition of National Starch is almost complete?
Yes, says Gordon, who is eyeing up “bolt-on acquisitions” with a particular focus on China and other fast-growing markets.
But its focus will remain on sweeteners, starches and texturizers, she predicts.
“Put it this way, we’re not going to go out and buy an omega-3 company.”