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[Graphics by Song Ji-yoon and Minu Kim]

According to Pulse by Maeil Business News Korea,

As Korean foods such as ramyun and dumplings continue to gain in popularity, major South Korean food companies are significantly increasing their research and development (R&D) investments to create products targeting the global market.

According to industry sources on Thursday, CJ CheilJedang’s R&D expenditure in 2023 hit a record high of 234.8 billion won ($180 million). This represents a 7.1 percent increase compared to the previous year, with R&D expenditure accounting for 1.31 percent of the company’s total revenue, the highest among major food companies.

“Despite a decrease in sales and operating profit in 2023, we invested about 30 percent of our operating profit in R&D expenses. With these R&D investments, we are developing next-generation products that will lead the export market as well as the Korean market,” spokesperson from CJ CheilJedang said.

One of CJ CheilJedang’s successful products from 2023 was the ‘Gourmet Sobaba Chicken,’ which quickly became a hit. Launched in May and topping 50 billion won in sales within eight months, it was evaluated as a major hit product. This is even faster than the success of Bibigo Wang Gyoza, which started the “K-dumpling” craze globally and generated 11 billion won in sales within the first six months of its launch.

Gourmet Sobaba was developed over a period of three years, with R&D personnel including food researchers traveling to five European countries to find the best frying equipment. The company’s success is attributed to the application of its unique sauce coating.

The company is also focusing on the export market and is also actively investing in patents and talent recruitment. CJ CheilJedang hired Gregory Yep, a seasoned R&D expert with over 30 years of experience in the food industry, as its chief technology officer (CTO) in 2023. The company also saw an increase in patent numbers, rising from 5,699 in 2022 to 6,490 in 2023, with 84 percent of these international patents.

Daesang and Pulmuone invested over 1 percent of their total sales in R&D expenses in 2023, with Daesang’s R&D expenditure up 21 percent on-year to hit a record high.

Daesang expanded its range from Home:ings water dumplings and home meal replacements (HMRs) to health supplements in 2023.

“We are conducting a wide range of R&D activities, not only in general food products, but also in starch sugars and biomaterials. We are making remarkable achievements in researching specialty materials such as allulose and natural flavoring materials,” a Daesang spokesperson said.

Pulmuwon changed the name of its research center to the Plant-based Alternative Meat Research Division from PIP Center in September 2023, and is currently expanding its investment in sustainable foods with brand strategies tailored to the consumers in countries including Korea, the United States, and Japan.

For their parts, Ottogi and Lotte Wellfood saw significant increases in R&D expenses in 2023, up by 38.9 percent and 22.1 percent respectively. Lotte Wellfood emphasized its ‘Health and Wellness’ business, which focuses on sugar-free and nutritionally improved products, as one of its four major future growth drivers.

The proportion of Health and Wellness in Lotte Wellfood’s total sales was 8.1 percent in 2023. It plans to increase it to 9.2 percent in 2024 and establish an integrated Health and Wellness brand in the second half of the year, and the company also announced research results related to microbiomes and fermentation strains from its central research institute.



By Kim Geum-yi and Minu Kim

Copyrights Pulse by Maeil Business News Korea. All Rights Reserved.

Source: Pulse by Maeil Business News Korea (April 5, 2024)