Guide to Launching a Beverage Product for Industry Newcomer

Authors: Dr. Sarah Romanek, Msc Luca Bosello, Msc Andrea Derrez

Many entrepreneurs who come to us have an impressive business background, a product idea and a brand strategy. What they lack is an insider knowledge of the beverage industry. We have to say it straight up - bringing a product to a highly regulated European market is not for the faint-hearted.

So, strap yourself for a ride.

With our expert tips on how to get your beverage idea to market, you are one step closer to success.

How to create the beverage concept that consumers want AND need
How to develop and validate your beverage prototype
How to navigate regulatory requirements and compliance in bev industry
How to include sustainable practices from the start
How to pick the right strategy for packaging and labelling
How to partner with the right producers and suppliers to grow your business
How to brace yourself for operational challenges

Create the beverage concept that consumers want AND need

The beverage industry holds huge potential for entrepreneurs looking to secure their place in a thriving market. The revenue for the European non-alcoholic drinks alone was forecasted to increase by 37.8% in the next 4 years.

We can’t stress enough the importance of choosing the right beverage concept. To ensure product success both short and long term, the beverage has to deliver on both - what the consumer needs and and what the consumer wants. Whereas consumer wants are based on short term trends, their wants correlate with the needs of the entire food system. The top priorities are better health, better planet and food equity.

Choosing the right beverage category is crucial for a successful product. To ensure product success both short and long term, the beverage has to deliver on both - what the consumer needs and and what the customer wants.

With respect to what consumer wants, here is an overview of the trending beverage categories in 2023:

Functional beverages and energy drinks
According to Euromonitor International there is an increase in outcome-oriented and need-based positioning of beverages. Beverages such as energy drinks, ready-to-drink coffees, cognitive enhancers, and sports performance beverages belong to this category.
Non-alcoholic spirits and mocktails
No-alcohol beverages that offer the social experience of drinking without the alcohol content, making them appealing to a broader audience.
Plant-based dairy alternatives
These include plant-based milk alternatives (such as almond, soy, oat, and coconut milk), dairy-free yoghourts, vegan protein shakes.
Craft and artisanal beverages
Consumers are increasingly seeking unique and high-quality beverages. Craft beers, specialty coffees, small-batch spirits, and artisanal sodas are all part of this trend.
Wellness beverages
Functional benefits, such as enhanced hydration, natural ingredients, vitamins, and antioxidants, are in high demand. This includes products like infused waters, herbal teas, kombucha, and wellness shots.

To assess market potential, find statistics suited for your chosen beverage category. Great resources you can find on the following websites:

Develop and validate your beverage prototype

You have now conceptualised your beverage idea, decided on flavour profiles, ingredients, and unique selling points that will set your product apart in the market. You are off to a great start. Before getting into beverage preparation, however, we recommend validating your beverage concept by conducting a concept specific market research.

Gather feedback from potential consumers through surveys, focus groups. This will help you gauge their preferences, identify areas for improvement, and ensure that your prototype aligns with consumer expectations. After the first product validation is done, it’s time to roll out your sleeves and put on a chef's hat.

New Beverage Recipe Development

Experiment with different combinations of ingredients and proportions to create the desired taste and quality for your beverage. Test and refine the recipe through multiple iterations to achieve the perfect balance of flavours and textures.

In this stage, having an experienced professional at hand accelerates the process a lot. Industry specialists know how to reach your desired flavour by spending years crafting innovative drinks. We at Agilery can create a finished product within 6-8 weeks.

Create Prototype Samples

Once you have finalised your recipe, it's time to produce prototype samples of your beverage. Start with small-scale production to test the viability of your recipe with your customers. This will allow you to make any necessary adjustments before moving to commercial-scale production.

OUR TIP: Contract manufacturers have minimum quantity requirements set often above 5000 units. For a small scale production you can contact small bakeries, wineries, and commercial kitchens to get the volume you need to start without risking a high volume of prototype (that still might be iterated). If you use the Agilery network, you can get a list of small producers in your beverage niche ready to work with you.

Build up your own quality system

A quality system is a comprehensive framework that ensures the consistent production of safe and high-quality food products. It encompasses various processes, practices, and standards to guarantee that food meets regulatory requirements and consumer expectations.

Test for Quality and Safety

Does your prototype meet quality and safety standards? Analyse factors such as shelf life, microbiological stability, and nutritional content. Adhere to relevant regulations to guarantee the safety and integrity of your product. (learn more in the next section)

Navigate regulatory requirements and compliance in beverage industry

Beverage industry is highly regulated - from recipe, nutritional claims to packaging and production compliance. Unsurprisingly, legal fines could compromise the success of your beverage product. Regulations differ from country to country and therefore you should familiarise yourself with the local regulatory requirements and compliance standards. Here are the main areas to focus on:

Beverage ingredient formulation
Good manufacture practices (GMP)
Labelling and packaging compliance
Health and Nutrition Claims

Conduct Ingredient Analysis

Review the ingredients used in your beverage formulation. Ensure they comply with regulations regarding safety, permitted additives, and maximum limits for certain substances. Consider factors such as allergens, artificial sweeteners, food colorings, and preservatives. Conduct thorough research and consult experts if needed.

Ingredients choice also plays a central role in ensuring that a product remains safe, fresh, and appealing to consumers over an extended period. In fact, a rightful formulation will provide you with better control over the following aspects:

microbial stability
oxidation control
packaging compatibility

Gather Industry Feedback and Iterate

Distribute your prototype samples to a select group of consumers, retailers, or industry experts for feedback. Make modifications based on the feedback you received. When your prototype passes the second stage of validation it’s time to make sure that your delicious drink is also regulatory compliant.

Production and Manufacturing Practices

Make sure to choose a co-man that implements good manufacturing practices (GMP) to ensure the safety and quality of your beverage. Look for certifications such as IFS, BRC, ISO22000. Their facilities should have a set standard operating procedures (SOPs) for hygiene, sanitation, ingredient handling, storage, and production processes. Regularly monitor and document your manufacturing practices to maintain compliance.

Labelling and Packaging Compliance

Pay close attention to labelling requirements for your beverage product. Include all mandatory information such as product name, ingredients list, allergen declarations, nutritional facts, net quantity, manufacturer details, and any required health or dietary claims.

Follow specific guidelines regarding font size, placement, and language requirements. The product label empowers consumers to make informed choices about the food they buy and consume. The primary scope of food legislation is to protect consumer health, regulating the different food categories with a holistic approach (from farm to fork) through food safety regulation.

Health and Nutrition Claims

If you plan to make specific health or nutrition claims on your product, ensure they are supported by scientific evidence and comply with regulations. Avoid misleading or exaggerated claims that could violate advertising standards. Refer to authorised health claim lists from EFSA (European Food Safety Authority) or consult with regulatory authorities for guidance.

Testing and Certifications

Every commercial product has to be tested for safety and quality internally, so that you are ready to enter the market while adhering to regulatory requirements and standards. This may involve microbiological testing, chemical analysis, and sensory evaluations. Having a producer that is certified with ISO, IFS or BRC, which are example of highly appreciated quality standards among GDOs could contribute to build trust with consumers.

Stay Updated and Seek Professional Advice

Regulations can change over time, so it's crucial to stay up-to-date. If you don’t have the time to subscribe to industry newsletters, attend conferences, your best bet is to couple up with industry experts to get the needed guidance tailored to your product and market.

For example, if you launch your beverage with Agilery, you will have access to a legal advisor for your project. When you’ve ensured that your beverage prototype meets all necessary regulations, such as labelling, nutritional information, and ingredient declarations, it’s time to future proof your production strategy.

Include sustainable practices from the start

When launching a new beverage product, it is beneficial to incorporate sustainable practices from the beginning.

Start by using environmentally friendly packaging materials, reducing waste, and exploring innovative solutions. Choose sustainable and ethically sourced ingredients, optimise production processes to minimise energy, water and ingredient waste. Consider transportation methods that reduce carbon emissions. Conduct a life cycle assessment, seek certifications, and collaborate with sustainability-focused organisations. For more details, here is a great guide that goes into depth in sustainable practices.

By implementing these practices, you can create a beverage product that is both environmentally conscious and appealing to eco-conscious consumers.

Partner with the right producers and suppliers to grow your business

Finding the right contract manufacturer and establishing a reliable supply chain is critical to the success of your beverage brand. Take the time to thoroughly assess your options, prioritise quality and consistency, and build strong relationships with your manufacturing and supply partners.

Tips to get a great ingredient supplier

Identify your specific needs such as batch sizes, packaging formats, and quality standards.
Verify that your suppliers can provide documentation and traceability records for each ingredient. This helps in the event of a recall or quality issue.
Maintain an efficient inventory management system to prevent stockouts or excess inventory. Monitor demand patterns, lead times, and production schedules to ensure you have adequate stock to meet customer needs without excessive holding costs.
Work with your suppliers and logistics partners to optimise transportation and minimise lead times and cut emissions.
Establish contingency plans for supply chain disruptions, have alternative suppliers or backup manufacturing options.

How to find a great beverage manufacturer

Check MOQs, consider factors such as lead times, production capacity, scalability, and the ability to meet your future demand as your business grows.
Evaluate capabilities and expertise - do they have the technical capabilities, equipment, and processes to ensure they can handle your product formulation and packaging requirements?
Evaluate contract manufacturer's quality control measures, certifications, and adherence to regulatory standards. Inquire about their testing procedures, ingredient sourcing, and quality assurance protocols to ensure consistent quality.
Request detailed quotes from multiple contract manufacturers and compare their pricing structures. Consider factors such as manufacturing costs, packaging costs, and any additional services or fees involved. Strive to strike a balance between cost considerations and the quality and value provided.
Set up a meeting with your chosen contract manufacturer and plan the first trials.

Brace yourself for operation challenges

Is your beverage product ready for its launch? Irrespective of the extent of your preparations, you are bound to come across a few hurdles. We have identified the 5 most common challenges that you can proactively strategize for.

Challenge #1: Quality of your ingredients isn't consistent

Our tip: We can’t emphasise strongly enough the importance of partnering with credible suppliers, evaluate their track record, request samples and quality documents, and visit their facilities if possible. Once you've chosen a supplier, build a strong relationship to ensure a steady supply and to negotiate better terms in the long run.

Challenge #2: You want to choose production faciltiy, but you're unsure about the scale of production

Our tip: Make a detailed assessment of your production needs, including volume, process requirements, and budget constraints. Seek help from industry experts like Agilery if you need to connect with producers with low MOQ.

Challenge #3: You want to scale up your recipe without compromising quality, taste and texture

Our tip: Work closely with food scientists, consultants, or experienced professionals to optimise your recipe for large-scale production. Conduct frequent taste tests and quality checks to ensure consistency throughout the scaling process.

Challenge #4: You plan to launch your beverage product to more countries

Our tip: Thoroughly research and understand the regulations that apply to your beverage, including:

labelling
ingredient declaration
food safety regulations.

Seek advice from regulatory experts or hire a consultant to help ensure compliance.

Challenge #5: Managing a complex supply chain, while focusing on growing business

Our tips: To focus all energy on growth is an imperative for a young brand. Unburden your to-do list by optimising your inventory management processes to minimise stock outs or excess inventory. Consider implementing a supply chain management system to streamline operations and improve efficiency. Outsource operations to experts in the beginning.

FAQ for bringing beverage to market

How much does it cost to launch a beverage product?

Bringing a beverage to market can have a large cost range. The main factors that determine the cost are:

Product development and costs associated with recipe development, formulation, flavour testing, and product prototyping.

Manufacturing, depending on production volume, contract manufacturer fees, and the complexity of the production process, ingredients, packaging materials, labour, equipment, and overhead expenses.

Packaging, such as packaging material, label design, printing, and application costs, Marketing (branding, website development, packaging design, social media, paid media campaigns, product sampling

Regulatory compliance, obtaining necessary certifications, conducting laboratory testing, and ensuring compliance with labelling requirements.

Logistics such as warehousing, transportation, shipping, and working with distributors or retailers.

How long does it take to launch a beverage product?

As there are many steps involved, the average beverage launch takes somewhere between 2-4 years.

With Agilery, we take a lean approach in each phase of the launch and can speed up the process to only a few months. Accelerated launching process lowers your costs and with that also the risk of exploiting your funding before your beverage gets on the shelves.

Can I start a beverage brand from home?

Some of our clients have started crafting their beverage prototypes at home, which is perfectly fine. However, when it comes time to scale up the recipe, it becomes crucial to address factors like shelf life and consistency.

Typically, the final product is manufactured in a controlled setting, often partnering with a professional bottling company or co-manufacturer.

Resources

Revenue in the European Beverage Industry from 2017 to 2027 in billions EUR divided by product category. Source: Statista.

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