Beverage formulation company – A quick guide for beginners

All great beverage companies start with a single, innovative beverage concept. And while great ideas and creativity is abundant out there, very few people actually became successful with their business. One of the major roadblocks that hinder their success is the lack of insider knowledge about beverages and the inability to commercialize that innovative beverage idea.

This is exactly the kind of problem that can be solved by a beverage formulation service. And in this article, we will guide you through everything we know to successfully cooperate with a beverage formulation company.

What is a beverage formulation company?

In short, a beverage formulation company helps customers develop a drink formula based on their ideas. Beverage formulation companies typically have a team of food scientists, chemists, and product development experts who work together to create unique and innovative beverage formulations.

They provide advice and consultancy on ingredients, manufacturing processes and material sourcing to create the desired texture, flavor, appearance and other selling points that customers require. They will also consider the scalability and production efficiency of the recipe, to make sure that clients can manufacture these products at reasonable cost while still maintaining quality.

Why do I need a beverage development/formulation company?

Many may think beverage development is a straightforward task, simply just pouring their own homemade drinks into a bottle, and they are done. But, to actually get your beverage packaged and sold on a supermarket shelf, you will need to consider many technical and commercial aspects. A beverage formulation company will be of great help with these factors:

• Sensory factors: One of the most important factors in the success of a beverage product is its flavor and taste. A beverage formulation company has the knowledge and expertise to create a beverage with a great taste and unique flavor. They can also consider other sensory factors like texture and color to create a well-rounded product that will appeal to consumers
• Marketing objectives: Do you want to create a ‘no preservative natural drink’, or maybe a ‘sugar free’ one that can be sold at supermarkets? But how can you create a formula that can be mass produced, have a good shelf life and meet the requirements of retailers’ supply chains but still have an appealing taste? Ask a beverage development company, it is not the first time they have dealt with this issue.
• Regulatory requirements: A huge task for a beverage brand is to ensure their drinks are compliant with laws and regulations, created to protect customers. So, you must know which ingredients or materials are forbidden, how to write information on your label in a legally acceptable way and how to obtain crucial certifications (FDA, Organic, etc). Without expert knowledge from a dedicated legal team, or a beverage formulation service, you will surely run into a lot of trouble.
• Production efficiency: Having a beverage formula is one thing, producing them is another. You must know how to monitor the production line, assessing its efficiency and potential risks to minimize the costs to your business. There are many ways you can go about this, from building your own factory to hiring a contract manufacturer. A formulation company will happily guide you through all this.
• Cost effectiveness: It’s always cheaper to hire some outside specialists to do it for you. They have knowledge, expertise and years of experience dealing in the industry, so they can come up with the best, most suitable solution in just a short amount of time. You also don’t have to pay for an expensive team of in-house experts to develop just a single product.

Necessary preparation before working with a beverage development company

Don’t just leave all the work to your service provider, it’s important that you have all the necessary details prepared for a smoother and more efficient process. Here are a few steps to start with:

1. Before you start creating a beverage formulation, you need to define your target market, with information about demographics, income, interest, etc. This will help you understand their needs and preferences, which can guide your recipe development process.
2. Research the market and identify market gaps: Research the existing products in the market that cater to your target audience. Which selling points can you target to stand out from competition?
3. Define your product concept: Before approaching a beverage formulation company, you need to have a clear idea of what you want to create. This includes product category, desired taste, texture, and nutritional profile.
4. Research potential partners: Do your research and identify beverage formulation companies that have experience in your product category and market segment. Look for companies with a strong track record of success and positive client feedback.

What steps are involved in working with a beverage formulation company?

Now, as you have a clearer idea of your beverage business and its needs, it’s time to begin working. While the following steps are not industry standards that everyone must follow, they do provide a rough guideline for you to get the best outcome from working with a beverage formulation company:

1. Initial consultation: Schedule an initial consultation with the beverage formulation company to discuss your product concept and goals. This is a good opportunity to evaluate their expertise, communication style, and responsiveness.
2. Brainstorm recipe ideas: Start with a broad list of ingredients that you think would work well together, and then refine your recipe through experimentation and feedback.
3. Recipe development: Once you have selected a beverage formulation company, they will work with you to develop a recipe or formula for your product. This involves selecting and blending ingredients, testing different combinations, and optimizing the recipe to achieve the desired taste, texture, and nutritional profile.
4. Testing and refinement: After the initial recipe development, the beverage formulation company will conduct sensory and analytical testing to evaluate the flavor, aroma, texture, and other properties of the product. Based on the feedback, they will make adjustments to the recipe to achieve the desired product attributes.
5. Conduct stability testing: Stability testing involves evaluating how your product performs over time. This is important to ensure that your product remains safe and enjoyable to consume throughout its shelf life.
6. Consider regulatory requirements: Depending on the nature of your product, there may be regulatory requirements that you need to comply with. Make sure that you understand the requirements and obtain any necessary certifications or approvals.
7. Production and commercialization: Once the recipe has been finalized, the beverage formulation company will provide guidance on scaling up production, sourcing ingredients, and meeting regulatory requirements. They may also provide ongoing support to help you optimize your product and grow your business.

Factors to consider when choosing a beverage formulation company

Choosing the right beverage formulation company is an important decision that can greatly impact the success of your product. Here are some factors to consider when choosing a beverage formulation company:

• Expertise and experience: Look for a company that has extensive experience and expertise in beverage formulation. Check their portfolio of successful products, and read client reviews and testimonials.

• Services offered: Consider the range of services offered by the company. Do they offer recipe development, ingredient sourcing, production consulting, and regulatory compliance services? Make sure that the company offers the services that you need to bring your product to market.

• Industry knowledge: Choose a company that has in-depth knowledge of the beverage industry. They should be up-to-date with the latest trends, regulations, and consumer preferences.

• Communication and collaboration: Look for a company that is easy to communicate with and values collaboration. They should be responsive to your questions and concerns and should work with you as a partner throughout the development process.

• Cost and payment terms: Consider the cost of working with the company, and make sure that their pricing is transparent and reasonable. Look for a company that offers flexible payment terms that work for your budget.

• Location: Depending on your location, it may be beneficial to work with a company that is local or has a presence in your region. This can make it easier to communicate and collaborate with the company throughout the development process.

• Intellectual property protection: Consider the company’s policies regarding intellectual property protection. Make sure that they have protocols in place to protect your confidential information and prevent others from copying your product.

The costs when using a beverage formulation company

The costs involved in working with a beverage formulation company can vary depending on the scope of the project, the complexity of the recipe, and the level of support required. It is important to discuss pricing and payment terms upfront with the beverage formulation company to ensure that there are no surprises later on. 

Some companies may charge a flat fee for their services, while others may charge based on an hourly rate or a percentage of the product’s revenue. 

But in general, some of the costs that you need to keep in mind when working with a beverage formulation company include:

• Recipe development fee: This fee covers the cost of developing a recipe or formula for your product. The fee can vary depending on the complexity of the recipe and the level of customization required.

• Ingredient sourcing and procurement: Depending on the ingredients required for your recipe, there may be additional costs for sourcing and procuring the ingredients. These costs can vary depending on the availability and quality of the ingredients.

• Sensory and analytical testing: Sensory and analytical testing is an important part of the beverage formulation process. This testing can help to evaluate the flavor, aroma, texture, and other properties of the product. There may be additional costs for conducting these tests.

• Regulatory compliance: Depending on the nature of your product, there may be regulatory requirements that you need to comply with. There may be additional costs for obtaining certifications or approvals, such as organic or non-GMO certifications.

• Production and commercialization: Once the recipe has been finalized, there may be additional costs for scaling up production, sourcing ingredients, and meeting regulatory requirements. There may also be costs associated with marketing and promoting your product.

Looking for quick and easy beverage development? Contact Tan Do Beverage.

Using the service of a beverage development company can be quite costly for a beverage start-up. In addition, after obtaining a formula, finding a credible manufacturer to produce your drink is another hassle, which can incur even more cost and risks.

So, you can choose another way and partner up with an OEM/ODM beverage manufacturer like Tan Do to utilize our advantages:

• 500+ market fit drinks to meet all customer’s need
• Customizable recipes, quick adjustment process
• Capable factories with advanced manufacturing equipments
• Ready-to-produce and ready-to-ship
• Low private label fees