Case Study: BSM Partners increases formula palatability while decreasing formula cost

The challenge

Raw material supply and pricing are two of the primary drivers of increases in pet food prices that have skyrocketed since late 2020 and early 2021. Pet food manufacturers are faced with critical choices. Reformulating to reduce the ingredient cost of their products still leads to added costs if pet food packaging must be updated and decreases in product performance, either in product appearance, palatability, or functionality. Increasing the MSRP can cost loyal consumers, especially for premium products that are already demanding a high market price.
A startup with ultra-premium cat food products came to BSM for their expert formulation team, hoping to find the following solutions:

• Decrease formula cost.
• Increase formula palatability.

The solution

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BSM Partners' Product Innovation Practice utilized their formulation and product development expertise to streamline reformulation. While cost-savings projects focusing on reformulation can yield ingredient savings, there is always a concern that the cost-savings on ingredients will be outweighed by other changes.
The client had unique packaging that was not expensive to change and had already done extensive ingredient testing, which enabled the BSM Partners' team to move quickly and implement the following approach:

1. Reformulated product, prioritizing optimal nutrition for cats and increasing the nutritional quality of the formula while decreasing overall formula cost.
2. Focused on palatability enhancing formula changes, like increasing organ meats.
3. Coordinate palatability testing to confirm with cats directly.
   - Paired preference testing against old formulas.
   - Acceptability testing.

The result

All formulas saw a significant cost reduction. The client tested multiple formula options, with the second round of reformulations testing most favorably in the cat feeding panels. Not only did the product cost less to produce and feed better than their initial launch formula, but it also provided more optimal nutrition for cats.    
 

Highlights

• 16 - 52% reduction in price across all formulas.
• 2:1 preference in cats for the new formula.

BSM Partners

BSM Partners is a leading pet and human food consulting firm. BSM Partners is a collective of professionals across various industries, backgrounds, and life experiences. We leverage our shared expertise for our clients and draw on our deep connections in the industry to help them succeed. We are prepared for every challenge a business might face. From product development to replenishment, we have it covered. Our services include research, consumer insights, product innovation, food safety and quality, regulatory, nutrition, veterinary, transformation, operations support, and engineering. With BSM Partners as part of your team, nothing is impossible!

Source: BSM Partners.