The ratings on New York, N.Y. -based International Flavors&Fragrances Inc. (IFF) reflect the company's important and defendable position as an ingredient supplier to consumer products companies worldwide. Geographic diversity is a key rating consideration, because IFF generates 72% of revenues outside North America, somewhat insulating it from regional economic weakness. Although competition is intense for new flavor and fragrance development, and the application of these technologies, IFF has achieved a leadership position in the industry through its research and development (R&D) investment of about 8%-9% of revenue. R&D expertise is a significant barrier to entry in the flavors and fragrances industry, because products are largely custom-made for customers, and IFF retains ownership of internally developed formulations. This typically
