1. The point of view of the Mediterranean Cluster Federico Morais FIAB Brussels 6 april 2006

2. The European Food & Drink Industry - dominated by SMEs 282.000 companies (> 9 employees) 36.000 companies (> 19 employees) 7.000 companies (> 49 employees) 120 companies (> 499 employees) 39 companies (> 999 employees) 20,1% of the Total Turnover 37,2% of the Total Turnover 62,8% of the Total Turnover CIAA Annual Report 2004

3. We have a few very innovative businessmen because the first act of innovation consists of creating a company

4. Thesis 1: Innovation is correlated with increasing Amount of “input factors”: capacity, availability, and articulation of R&D facilities of the company, quality and level of the employed human resources, which in turn are significantly affected by the size and the culture of the firm.

5. Thesis 6: All pillars of ETP “Food for Life” are considered important by the majority of firms. However, issues about “safety”, “quality and manufacturing” and “food and the consumer” are seen by far the most important ones ; “food and Health” and “sustainable food production” are seen as slightly less important.

6. Functional foods in Spain 3,500 millons € 2005 > 14% over 2004 Source: AC Nielsen

7. QUALITY ASSURANCE PRODUCTIVITY ASSURANCE FOOD SAFETY ASSURANCE HEALTH ASSURANCE EVOLUTION OF THE COMPANIES

8. Innovation Radical Quality Incremental Innov Food Safety Based in the Kano model Add value-satisfation Effort Center of Quality Management Journal (1993) Special issue on Kano's methods for understanding customer-defined quality, Vol 2, No 4, Fall 1993Special issue on Kano's methods for understanding customer-defined quality Food risk technologies Anticontamination Technologies Novel & functional foods

9. Thesis 9: food and drink companies have a sober and realistic attitude towards initiatives of support for the industry. Opinions about future financing emphasize the role of the EU as key partner. Preferred policy measures are those that exploit more opportunity for selective spending. Big firms are in favour of fiscal incentives, SMEs look for more direct support.

10. Evolution of the tax allowance in Spain

11. Thesis 11: Influence of retailers with the innovation stratagies of the companies

12. Patents versus Industrial secrets High cost of innovation versus High cost of non innovation

14. Greece A special characteristic of the sector is that there is a significant number of companies with seasonal operation.

15. PORTUGAL Innovation, when it occurs, is often provoked by legal demands and the following of a leading player’s products but scenarios of innovation in processes provoked by cost savings or efficiency are also present. The SME’s contacted appear, largely, to be concerned with product quality particularly in those companies with niche-market products eg. Olive oil, traditional cheeses and traditional pastry products

16. SPAIN The financing mechanisms which do not correspond to the needs of a sector characterized principally by SMES Therefore, innovation can be stifled by requesting time and money of companies to implement all the different regional legislative reforms thereby limiting the means for supporting innovation On the other hand, companies think that the incentives for the innovation suppose excessive bureaucratic loads which discourage them, thereby making such incentives unattractive The presence of large retailers play a double role. On one hand, they are an incentive to innovation in the companies in that they demand new products or new characteristics in the container with the finality of differentiating themselves from the competition. On the

17. It seems therefore that the whole rhetoric of “more innovation = more business success” finds a limit in the opportunistic attitude of the front line of companies whose innovative behaviour is tempered by a realistic approach to the costs of and high demand of formalised technical innovation It is nonetheless a major result to have been capable of proving that out of the standard innovation indicators, European food companies and SMEs among them are vital subjects and struggle for increasing their own innovation propensity, often in non conventional, but equally interesting ways.

18. Food and beverages companies in Europe have a twofold attitude towards technology and innovation in general. 1. The first one is ambitious, and considers innovation as a “must” for maintaining a safe level of quality and product identity in times of increasing competitive pressure; 2. The second is conservative and is based on a sceptical evaluation of the contribution that innovation can really add to the aims of the company.