Establishing a Distributed Innovation System

Client: Marketer of a national beverage brand

Situation: A group of entrepreneurs purchased a failing beverage brand with the goal of revitalizing the business and harvesting it within five years. While the group had full marketing rights to the beverages, they had no operational or product development capabilities. This limited their growth potential and forced them to rely on costly contract manufacturing with the original owner.

Strategy: Enhance the value of the brand by establishing a distributed product development system, creating a new product pipeline, and reducing operating costs.

Tactics: Innovare established a distributed product development team, including outside experts in product development, ingredient technology, beverage formulation, flavor chemistry, food processing, sensory evaluation, and market research. Innovare managed this outsourced innovation team, while a phased review process allowed the owners to monitor progress and make informed decisions. Together, we drove down the cost of existing products and delivered a series of new products.

Result: The combination of increased sales and profitability, renewed excitement about the brand among distributors, and a clearly defined new product pipeline substantially increased the value of the brand. The owners were able to harvest the business two years ahead of schedule at substantial gain.

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