Ready-To-SellDeveloping Value-Added Seafood Products

Howdoyoumakemoremoneyoutofthesameproduct?Youknow—getabiggerbangforthebuck? Ascommodityproducers,localseafoodbusinesseslikeyoursmayseemtobeatadisadvantagewithforeigncompetitorsbecauseoftheirlowerlaborcosts.Buttwocurrentmarkettrendsareinyourfavor:

Thegrowingdemandforseafoodinthiscountry,particularlylocallyproducedproducts.Demandforconvenient,ready-to-eatmealsbecausepeopleareleadingverybusylives,oftenwithlittletimetocookathome.

Followingeithertrendcanhelpyouexpandyourmarketandaddvaluetoyourexistingproducts:

Whenyouidentifyyourproductwithalocale,youareappealingtoaconsumer’sattractionforaregion’scoastalheritageortheirpreferencetobuylocallyharvestedfoods.Whenyoucreateaproductthatislessperishableandrequireslittlein-homepreparation,youaresatisfyingaretailer’sneedforanextendedshelflifeandaconsumer’sneedforconvenience.

Byformulatingaseafoodappetizerorentreethatisnutritious,flavorfulandeasytoprepare,youaregivingthatrawseafoodenhancedornewqualities—therebyaddingvaluetoyourproduct. Butmanufacturinganewseafoodproductisnotassimpleaspreparingahomemeal.Processorsmustdiscernhowtoreceive,portion,weigh,blendandcookmass

•

•

•

•

ingredientsusingdifferentkindsofprocessingequipment.Hazardanalysesmustbeconductedtodeterminewheremonitoringandcontrolmeasuresshouldbeappliedduringprocessingandstoragetoensurethatproductswillbesafeforconsumerstoeat.Creatingnewproductsisalsotimeintensive,takinguptoayearormoretodevelop. Sohowcanyou,theseafoodprocessor,createwholesomevalue-added seafood productsthatsatisfyspecificconsumerneeds?Therearetwomainanswerswe’llgooverinthisBlueprint:

Knowingwhototalkto,andUnderstandingtheproductdevelopmentprocess.

WHO TO TALK TO: A Food Technologist ThestateofNorthCarolinacanhelpyoudevelopvalue-addedfoodsthroughthreeresources:theDepartmentofFood,BioprocessingandNutritionSciences(FBNS);theN.C.DepartmentofAgricultureandConsumerServices(NCDA&CS);andtheN.C.DepartmentofEnvironmentandNaturalResources(NCDENR). It’seasiertotalktoasinglepersonwhocanhelpyounavigatealltheinformationandexpertisewithinFBNS,NCDA&CSandNCDENR.Youneedafoodtechnologist. Working with a food technologist who is skilled in product development is critical to your success. Thetechnologistcanhelpyouaccessresources

1.2.

BlueprintsNORTH CAROLINA SEA GRANT NCSTATEUNIvERSITY BOX8605 RALEIGH,NC27695-8605

UNC-SG-BP-10-10

PreparedbyBarry NashSeafoodTechnology&MarketingSpecialistNorthCarolinaSeaGrantNorthCarolinaStateUniversitySeafoodLaboratoryMoreheadCity,N.C.252/222-6337barry_nash@ncsu.edu

ImageCredit:ScottTaylor

withinFBNS,NCDA&CSandNCDENR;managetheproductdevelopmentprocess;andprovidemarketingguidance. North Carolina Sea Grantcandirectyoutoanexperiencedfoodtechnologist.SeaGrant,inpartnershipwithFBNS,NCDA&CSandNCDENR,hasassistedseafoodbusinessesincommercializingmanykindsofnewproducts.

WHO TO TALK TO: A Marketing Specialist Whenyoucommittodevelopinganewseafoodproduct,youmustfirstdecideifitwillbesoldinthewholesaletrade,theretailsectororboth.Ifyourproductrepresentsyourfirstexperienceinretail,youshouldconsiderbrandingtoprovideyourproductacommercialidentitythatwillappealtoyourtargetcustomer. Rememberthatoneofthehottrendstodayisthelocal food movement.Withlocalbranding,customersfeelasenseofconnectionwiththeirfavoritecoastalregion,orrelatetoasenseofhonorforthefishermen—inspiringthemtopaymoreforlocalproducts. Tobetterinformthepublicwhenlocalseafoodisseasonallyavailableandwhereitissold,SeaGrantledacommunityefforttolaunchCarteret Catchin2006tohighlighttheseafoodharvestedbyfishermeninthecentralcoastofthestate.ThisprograminfluencedcommunitypartnerstolaunchBrunswick Catch,Ocracoke FreshandOuter Banks Catchinlateryears,givingeachregionauniquebrandforcustomerstorecognize. Marketing specialistsatSeaGrantandNCDA&CScanhelpyouwiththebrandingprocessandwithcreatingsalesbrochurestomarketyourproduct.YoucanlearnmoreaboutbrandinganddevelopingsalesinformationintheNorthCarolinaSeaGrantpublication“BrandingSeafood:DevelopingaMarketingPlantoSellvalue-AddedSeafoodProducts”(UNC-SG-BP-06-01).

HOW TO DEVELOP IT: Lessons from the Pamlico Packing Company, Grantsboro, N.C. Toshowcasethestepsinvolvedinproductdevelopment,let’slookatacasestudyofthePamlicoPackingCompanyinGrantsboro,N.C.,whichappliedforandreceivedfundingthroughtheN.C.FisheryResourceGrant (FRG) Program(Project02-ST-04).FRG,whichisfundedbytheN.C.GeneralAssembly,hasprovidedresearchgrantstobusinessestodevelopinnovativeseafoodproducts. PamlicoPackingdevelopedalineofrefrigerated,ready-to-eat (RTE)seafoodspreadsandsaladsfortheretailmarket.Let’sseehowtheirrecipeconceptsweretransformedintofinishedproducts.

THE CHALLENGE Thoughpopularinstores,thekeepingqualityofperishable,RTEseafoodspreadsorsaladsmayonly

average7to10days,dependingonthetypeofingredientsandontheirbacterialload,aswellasonprocessing,productstorageanddistributionconditions. Thistighttimeframecanplaceprocessorslikeyouataneconomicdisadvantage.Thetimewindowinwhichaproductispurchasedbyconsumerscanbeveryshort,duetovariablesbeyondaprocessor’scontrol.Improper product rotation canresultinoldinventorygettingshovedfurtherbackintheshelf.Poor shelf visibilityatthestoremeanscustomerswon’tbuywhattheycan’teasilyfind,andmoreinventorygetsbackedup. Andwhobearsthecostsforthisunsoldinventory?Chancesareitwillbeyou. But,simplyextendingtheshelflifefrom10upto30dayscreatesamorestableproducttomarkettoretailers.Ifitkeepslonger,itcanstayontheshelflonger.Moreunitshavethepotentialtobepurchased. Now,let’sdevelopthisvalue-addedRTEproduct.

STEP 1: Refine Product Concepts In2004,oneofPamlicoPacking’sownerswasinterestedinretailingalineofseafoodsalads,dipsandspreadshiswifehaddevelopedforhercateringbusiness. Butwhichofherrecipescouldbeconvertedintocommerciallysuccessfulproducts?Thefirststepwastodeterminetherecipesthathadthestrongestsalespotential,andtolearnwhichitemswouldrequiremorerefinementtoenhancetheirconsumerappeal. SeaGrantcontactedtheFBNS’sSensoryServiceCenter,whichassembledaconsumer panel.Thepanelevaluated12prototypeshavingclams,crab,crawfish,shrimp,ortunaasprimaryingredients. Togaugeeachproduct’sappeal,about50consumerswererecruitedtorateeachitemonnumericscalesthatmeasuredpreferenceandpurchaseintent. Twoshrimpandtwotunasaladsreceivedthehighestacceptabilityscores,indicatingtheyhadthestrongestcommercialpotentialamongthe12prototypestested.Let’sfollowtheprogressofthesefourproducts.

STEP 2: Convert Recipes for Production TheingredientsineachrecipewereweighedtoconvertU.S.measurements,suchastablespoons,cups,ouncesandpounds,intometricunits(grams).Then,SeaGrantcalculatedthepercentagebyweightforeachingredientwithintherecipe. Byconvertingingredientamountsintopercentages,arecipewastransformedintoaformulation.Ingredientpricesandoperationalfixedcosts(suchasoverhead)werethenenteredintoacomputer spreadsheet,whichisavailablefromSeaGrant.Usingthespreadsheet,PamlicoPackingcouldnowadjustthepercentamountofany

ingredientinanyformulationandcalculatenewestimatesforaproduct’stotalmanufacturingcost. Thisinformationcanthenbebalancedagainstadesiredretailcostandsensorycharacteristics(texture,flavor,colorandappearance)tocreateanitemthatisbothappealingandprofitabletomanufacture.Thisiscalledleast-cost formulating.

STEP 3: Identify Industrial Suppliers of Functional Food Ingredients Tocontrolbacterialgrowthduringrefrigeratedstorageandextendshelflife,SeaGrantstaffrecommendedacommerciallyavailableblendofsodiumlactateandsodiumdiacetate.SeaGrantalsosuggestedtoPamlicoPackingotheringredientstomaintaintheoptimalflavor,textureandappearanceofeachproduct. SeaGrantprovidedthecontactinformationofsupplierswhosoldtheseingredients—savingPamlicoPackingconsiderableeffortinhavingtosourcevendorsontheirown.SeaGrantalsogaveinstructionsfortheuseofeachsuggestedingredient,whichincluded:

FlavorenhancerstomaintainproducttasteAgumpowdertocontrolmoisturelossfromtheshrimpandvegetableingredientsAnaturalantioxidanttoretardrancidityinthetunasaladsPotassiumsorbatetosuppressyeastandmoldgrowth.

STEP 4: Enhance Production Efficiencies Withtheformulationsrefined,it’snowtimetofine-tuneproductionmethods.Severaltestsmaybeneededtoverifywhetheryourproductionequipmentoperatesasexpected,andwhetheryourmanufacturingprocessproducesthehighestpossibleyieldsofsaleableproduct. PamlicoPackingdevelopedamanufacturingscheduletodeterminetheorderofingredientstobeaddedduringtheblendingstep,aswellasspecificmixingtimesbetweeningredientstoensureahomogenousproductcomposition.Filltestswereconductedtoensuretheirpackagingequipmentwasdeliveringthecorrectamountoffinishedproducttoeachretailcontainer. SeaGrantandtheFBNS Seafood LaboratoryspecialistsidentifiedequipmentsuppliersforPamlicoPackingtoobtainindustrialblenders,stainlesssteeltables,scalesandpackagingequipment.FBNScanreferyoutofoodindustryresourcesforprocessingequipmentandingredientsforyourmanufacturingneeds.

STEP 5: Conduct Shelf Life Evaluations Next,samplesofeachproductmustbesubjectedtobacterialandsensory testing.Thiswillvalidateour

••

•

•

expectationsforshelflifeandconsumerappeal,orwhethermoreadjustmentstotheformulationsareneeded. Bacterialteststellushowmanydaysittakesforspoilagemicroorganismstogrowandmakeafoodunfittoeat.Andwhileafoodmightnotspoil,itcanloseitsdesiredtasteordevelopobjectionableflavorsovertime.So,asensorytestisalsoneeded. PamlicoPackingproducedtwoversionsofeachsalad:onewithpreservatives,andonewithout.ThesaladsamplesweresenttotheSeafoodLaboratoryinMoreheadCity.Atweeklyintervals,bothversionsofeachsaladweresubjectedtobacterialandsensoryevaluations. Inbacterialtests,FBNSdeterminedthedateatwhichborderline spoilageisreached.Thisismeasuredin“colonyformingunitspergram(CFU/g)”—basicallytheaverageconcentrationofbacterialcoloniesinonegramor0.035ouncesoffood.Thecommonlyacceptedlimitis500,000CFU/g.Here,thebacterialtestsdemonstratedthatthepreservativesystemwasadequatelycontrollingthegrowthofspoilageorganisms. Thencomesthesensorytest.Individualswererecruitedtoserveassensorypaneliststoratetheflavor,texture,colorandappearanceofeachproductonascaleof1(Terrible)to7(Excellent).Thescoresprovedthattheingredientsmentionedearlierweresuccessfullymaintainingthedesiredsensorycharacteristicsofeachproduct.

STEP 6: Develop Safety Specifications and Nutritional Information Labels You’veperfectedtheformulationsandproductionprocessforyournewRTEproducts.Nextstep:complywithfederalsafetyandnutritionlabelingrequirements. Atthebeginningoftheproject,SeaGrantcontactedNCDA&CSandNCDENRtoarrangeaconsultationwiththeownerstodesignafactoryprocessingareathatmetguidelinesforproducingsafefood.Oncethefacilityandequipmentwereinplace,theSeafoodLaboratoryconductedaprocessvalidationontheheat-processingequipmentforcookingtunasteaks,toensureitwassufficienttodestroydisease-causingbacteriaasrecommendedintheU.S.Food&DrugAdministration’s“Fish&FisheriesProductsHazards&Controls”guide. Theshrimpwerereceivedfullycookedanddidnotneedanyfurtherheatprocessing.However,PamlicoPackingrequestedaletterofguaranteefromtheshrimpproducerspromisingthatsafehandlingprocedureswereobservedattheirplants. SeaGrantalsohelpedPamlicoPackingconductahazardanalysisonitsproductline,developingsafetymonitoringplansforitemsthatweresubjecttothefederal Hazard Analysis and Critical Control Point (HACCP)regulation.Theseplanswerereviewedwith

productactslikeanonlinesalesbrochure,exceptyoucanaddcolorfulphotos,videos,customercommentsandotherpromotionalfeatureswithoutthecostofprinting.Websitesnotonlyattractwholesalebuyers,buttheyalsocangenerateword-of-mouthadvertisingfromconsumers. LearnmoreaboutcreatingawebsiteforyourbusinessintheNorthCarolinaSeaGrantpublication“UsingtheInternettoEnhanceDirectMarketSalesofSeafood”(UNC-SG-10-02).

THE RESULT PamlicoPacking’snewsaladsenteredlimitedtestmarketswithgoodresults.Thebuyersattwogrocerychainswerepleasedwiththequalityoftheproductsandthequickturnover,indicatingtheitemshadhighconsumerappeal. Developingavalue-addedseafoodproductrequiressufficienttimeandresourcestoenhanceyoursuccess.Youjustneedtoplanwellandconsultwithahelpfulfoodtechnologistandmarketingspecialistforagoodreturnonyourinvestment.

To order additional copies of this Blueprint and other Sea Grant publications, call 919/515-9101 or visit us online at: http://www.ncseagrant.org/home/resource-library

NCDA&CSandNCDENRinspectorsbeforethecompanybeganproductionanddistribution. FBNSandNCDA&CShelpedPamlicoPackingdevelopandreviewnutritionalprofilesforitsnewproducts.FBNSgeneratednutritionalinformationforeachproductusingacomputerprogram.TheinformationwasthenreviewedbyNCDA&CS.Onceapproved,SeaGrantsentthedatatoPamlicoPackingsoitcouldprintproductlabels.

STEP 7: Market Introduction Beforeinvitinganentrepreneurtopresentaproduct,retailandwholesalebuyersprefertoreviewsales brochurestodetermineifaproductisagoodfitwiththeirexistinglineofvalue-addeditemsormeetscriticalconsumerneeds. Oncethesaladswerereadytobemarketed,SeaGrantassistedPamlicoPackingindesigningsalesbrochuresthatgavebriefdescriptionsofeachproduct—brandname,typeofpackaging,shipping-casedimensionsandpricing—thatallbuyersrequireforaninitialevaluation. YoushouldalsoconsiderusingtheInternettodrawattentiontoyournewproduct.Awebsiteprofilingyour

READY-TO-SELL: Steps Toward a Successful Seafood Product

ResearchPHASES

MAJORCOSTS

Create Refine Comply Promote

TimeSensory Tests

TimeIngredientsEquipment out of productionNew Equipment

TimeShelf Life Evaluations

Safety ConsultationNutritional Evaluation

Graphic/Web DesignersMarketing Consultation

SHELFIDEA

ConsumerEvaluations

In-CompanyEvaluations

IdentifyCritical

Ingredients

RunProduction

Trials

CREATEFORMULATION

& REFINEPROCESS

DEVELOP& REFINERECIPE

BacterialShelf Life

Tests

SensoryShelf Life

Tests

REFINEFORMULATION

HazardAnalysis& HACCP

Plans

FINALIZEPRODUCT

MARKETINTRODUCTION

InternetAdvertising

SalesBrochure

DevelopCommercial

BrandCommercialBuyer

Requests

TradeMagazines

NutritionLabels &

RegulatoryReview

Ben Young Landis & Barry Nash/North Carolina Sea Grant/June 2010