Litehouse Foods, R&D Teams winner in the medium-size category, has a nostalgic backstory about its strong commitment to its employees and the communities in which it operates. The company currently produces more than 138 retail salad dressings, dips, apple cider, cheeses and herbs and offers organic and non-GMO products.
Litehouse Restaurant, in the small lakeside town of Hope, Idaho, became popular for its salad dressings. In the early 1960s, the owners decided to jar and sell the dressings in nearby store produce departments. Eventually distribution expanded throughout the northwest, and by the late 1970s the processing business moved to Sandpoint, Idaho, where it has been ever since.
Litehouse has grown into one of the most successful North American refrigerated salad dressing manufacturers in the U.S., although it also produces buttermilk, yogurt, mayonnaise, sour cream, blue cheese and other cheeses, initially intended for its dressings but now available in limited produce and deli departments. It also is an employee-owned company.
Litehouse runs five production facilities: three in Sandpoint, one in Lowell, Mich., and one in Hurricane, Utah. The Sandpoint and Hurricane facilities, both producing salad dressings, are currently in expansion mode. "We're increasing overall production square footage, and significantly expanding the refrigerated and dry warehouse space," says Stuart Walker, director of research & development, who leads R&D for each of the company's three business channels: retail; value-added; and foodservice. A separate R&D product development team is devoted to each channel.
Walker manages an 18-member team within the R&D group at the corporate office in Sandpoint. Just as the company has expanded, so too has the R&D group. "We have been on a rapid growth curve to support the needs of both external and internal customers," Walker says. "R&D is a multi-million-dollar investment within Litehouse each year; averaging double-digit budgetary growth to keep up with our ever-increasing deliverables.
"Litehouse views R&D as a mission-critical investment for supporting existing [customers] and growing new sales. It's a key point of market differentiation against competitors."
The team has a flat hierarchy, he explains. "Every individual within R&D is in charge of their assigned area, which we’ve found maximizes personal growth and development, and inspires creativity and motivation. We made a conscious effort about five years ago to consolidate all R&D into the corporate location. This helped maximize inter-departmental engagement, streamline communications between functional departments and allow the entire team to brainstorm exercises and work on problem-solving activities."
On average, the department launches six to eight new products per month, most of which are for private-label customers. The company makes all of its products in-house, except its Instantly Fresh freeze-dried herbs, which are co-manufactured by a European freeze-dryer.
Although Litehouse retail product launches vary from year-to-year, largely driven by consumer demand and trends, R&D creates new products every day. "Since the project timelines and requirements are different for each business channel, each project has a different tactical focus," Walker explains.
"In 2017, R&D was responsible for creating or modifying 712 product formulas, a 34 percent increase over 2016. Some projects have a life span of six weeks, while others can last more than a year. In 2017, we focused on a packaging design refresh for the core line of Litehouse dressings and dips with a trendy look and color palette underscoring our commitment to taste, freshness and real ingredients."
Less processed, cleaner labels
" 'Because Taste Matters' is a motto and development driver here, so taste is an important attribute," Walker says. "Consumer research supports this; if a food product doesn’t taste good, consumers won’t buy it.
"First we define the project/product deliverables, then develop prototypes, source packaging, scale up the product in our manufacturing facility and conduct consumer and shelf life testing," he says. Marketing and consumer research groups test the prototypes with consumers to verify it satisfies consumer needs and to gauge purchase intent, packaging appeal and the value proposition.
"Once we combine these information streams, we clearly understand what consumers can’t find within current product offerings, what they’re drawn to and how we can address their needs," Walker explains. "Then we develop labeling and technical documents and, finally, launch the product.
"A great reminder is never judge a new product or item. Consumers will use their spending power to tell you what they want. R&D just has to develop the best possible product each and every time."
To keep tabs on market changes, flavor and recipe trends and more, the R&D teams rely on Litehouse's marketing and consumer research groups, which identify trends and the white space within the current landscape. Each of the three R&D units has strategies and priorities to support their sales and marketing peers. "We leverage those insights to inform product development, while also addressing emerging trends or unfulfilled needs," says Walker. "Our team continuously researches and develops new flavors and ingredients, striving to deliver less-processed, more natural ingredients and retail products free from artificial colors and preservatives and less sugar, salt and fat. There's a steady push to replicate the farm-to-table experience for consumers with added convenience."
Currently, the teams are streamlining ingredient lists, updating nutrition facts panels, counting calories and formulating with less salt, sugar and fat and GMOs and more healthy oils and natural preservatives. Making traditionally higher-fat/high-calorie foods more nutritious is a prime goal. One constant is to evaluate new functional ingredients and come up with innovative processing methods, all the while maintaining the same price points.
A pragmatic research technique Walker says works every time is to ask consumers what they want. "We regularly survey consumers and conduct blind taste tests to help inform our strategies. Lemon-flavored products are trending, which aligns nicely with the Litehouse Organic Lemon Herb Vinaigrette we launched last fall."
Litehouse has six retail organic pourable salad dressings. "Our Organic line is the only triple-certified dressing on the market, displaying USDA Organic, Certified Gluten Free and Non-GMO Project Verified labels," Walker points out. This May, the company added more organic products to its core spoonable dressings line with thick and creamy Blue Cheese, Ranch, Caesar and Coleslaw varieties.
Organic consumers are demanding, Walker says. "They're knowledgeable and typically want cleaner, simpler product labels, non-GMO-verified ingredients, gluten-free options and healthier products overall. Our product line grew to meet the needs for fresher, better-tasting products. Most of our expansion came from adapting in-house-produced industrial ingredients to a retail format. We're uniquely positioned to develop products that address convenience while maintaining our long-standing commitment to quality and taste."
Litehouse also has a deep, broad network of ingredient suppliers that continuously alert the company to pending or new ingredient technologies and potentially untapped ingredient functionality.
But it mostly comes down to the R&D teams themselves – the people who drive innovation every day, he says. "We have been blessed with a phenomenal group of professionals who love developing food products, troubleshooting technical issues and pushing the envelope on innovation."