HARVESTING MAKE SURE YOU GET THE MOST OUT OF YOUR FOOD. In the food and beverage business, identifying and controlling your competitive edge is the secret ingredient for success. At James & Wells, we have an entire team dedicated to the cause. We can help you own and leverage your innovative brands and ideas, facilitate business opportunities and ensure your labelling is compliant. www.foodtechnology.co.nz 9 LEVERAGING KIWI KNOW-HOW JAWS.CO.NZ Kiwis punch above their weight in many arenas. But there’s one race where we are now well off the pace – the innovation race. Our history of innovation is a rich one, but the world is full of creative people solving problems USA Australia Indonesia Canada Korea China Taiwan Japan Hong Kong JWS/PR/0035A – and many nations have leapt ahead of us. Innovation potential is correlated to research and development expenditure and while we spend an average of 1.3% of revenue on R&D, the OECD average is almost twice that (2.4%). Australia and China spend more than 2%, the US more than 2.5%, Denmark, Finland and Sweden 3%, Japan 3.5%, Israel more than 4% and Korea 4.2%. Only 25% of F&B firms undertake R&D, with Fonterra accounting for 70% of all R&D expenditure in the F&B sector, despite only spending about 0.5% of its revenue on R&D. To shift from a commodity producer to producing high-value products and services requires expenditure on R&D. But spending well on R&D is a waste of money if you don’t take steps to own and control your Intellectual Property (IP); you are simply funding your competitors’ R&D. Most businesses don’t intentionally infringe patents but will copy unprotected ideas. That’s business. A patent can be a significant deterrent – an opportunity cost to your competitors that can be difficult to value. It also enables you to expand into markets that you may not plan to export products into but might be eyeing with a view to exporting the technology behind the products, through licensing. On the other hand, if your competitors have been freely copying your ideas and filing their own patents for improvements to your technology, they can also stifle your freedom to operate (FTO), including in overseas markets where you may already have invested heavily in developing your 'path to market'. An FTO search can mean the difference between prosperity and growth – and heart-breaking investment losses. And it’s not just offshore that the risks are high: more than 80% (and rising) of patent filings in New Zealand are by overseas companies shoring up their intellectual property in our market. Our biggest exporters are vulnerable to disruption right under our nose. Further, patent filings by Kiwis dropped by 43% between 2012 and 2016 – an alarming trend. The F&B sector in New Zealand is exciting. We grow food well and are taking our recipes and processes in ingenious directions. But we need to be much smarter around our IP protection and market investigations - or risk the fruits of our labour being plucked from our trees and sold by others. Dr Andrew Scott is a Senior Associate in the Christchurch office of national Intellectual Property consultants James & Wells, specialising in providing IP strategies to commercialise innovation and ensure smooth entry into overseas markets. THE FRUITS OF YOUR LABOUR By Dr Andrew Scott
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