Understanding demand for innovation in the food industry

This paper focus on understanding how demand for innovation is articulated in low-tech industries, dominated by SMEs, where innovation is often based on informal processes and uncodified knowledge, relying on intangible assets. The theoretical framework envisages three main forms of demand: real, latent, and potential. The specific case is the food industry in Apulia, Italy. First, focus groups identified general business and technology needs. Then in-depth interviews were conducted with 87 firms, stratified in order to be representative of food firms in Apulia. Some 285 different needs requiring an innovative solution were detected. In most cases, demand for innovation was found to be latent since firms understand the areas to be improved but do not have a technological solution in mind. The findings can be used to understand how public research organizations can engage with SMEs and what policymakers can do to facilitate the interaction.