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Trends and opportunities in the UK food service market

Healthy food options are the hottest trend in the enormous market formed by the food service sector in the United Kingdom, says a new GAIN report.

Healthy food options are the hottest trend in the enormous market formed by the food service sector in the United Kingdom, says a new GAIN report.

Reporting on opportunities for American exporters in the hotel, restaurant and institutional (HRI) market in the UK, the report says fresh and dried fruit are among the US products doing well, along with snack foods, nuts, salmon and seafood, cooking sauces, salad dressings, confectionery, dips and salsas, frozen foods, wine and beer.

“The UK government is increasingly promoting healthy eating and healthy lifestyles. There are opportunities for U.S. products that are natural, wholesome and healthy,” GAIN advises.

As an example of the focus on healthier living, it says fruit and vegetable juices are now more popular in the UK than carbonated drinks.

But despite the preference for healthy eating being the most significant trend in recent years, obesity rates in the UK – about 24% of the adult population is now technically obese  – are now the highest in Western Europe.

Other trends in food service in the UK

Burgers remain the number one item on menus, but other trends are becoming more mainstream in the UK, such as world cuisines, healthy food and indulgence.

“Consumer demand for new foods is strong in the UK and is continually driven by high numbers of non-UK citizens making the UK their home. Fastest growing business types are likely to be new fast food, street food, pop up restaurants, international cuisines, and coffee shops and sandwich bars,” the report says.

The report’s snapshot of major food service trends in the UK includes the following:

  • BBQ foods – Southern US foods or South American influences. Things like pulled pork, brisket.
  • Provenance – Products marketed with a focus on the country of origin, how the product was cooked, farm names and references to smaller, family owned business’ on labels and menus.
  • Street Food – Quality ingredients, seasonally sourced, quick food.
  • UK growth hot spots in 2014 – Glasgow, Leeds, Manchester, Bristol and London.

Growth forecast for UK food service market

In 2014, the UK food service sector (food and beverage sales to consumers) was estimated to be worth £46.6 billion ($74.5bn), up 2.9% on 2013.

GAIN says the sector has picked itself up after the economic crisis and predicts this year it will continue to grow, returning to the spending levels of 2008, a previous peak.

Source: GAIN report: “United Kingdom: Food Service – Hotel Restaurant Institutional”
Veggie burger image: By divinemisscopa (http://www.flickr.com/photos/copa41/1312623057/) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

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British-grown seedless grapes to hit UK stores in 2016

British table grapes are set to become an industry wide initiative by 2018, reducing reliance on imports and significantly decreasing its carbon footprint, Asda said.

British supermarket chain Asda says promising trials growing seedless table grapes in England make it confident of having at least two varieties on its shelves as of early 2016.

It said this would be the first time British seedless table grapes have been on sale. Furthermore, British table grapes are set to become an industry wide initiative by 2018, reducing its reliance on imports and significantly decreasing its carbon footprint, Asda said in a press release. 

It sells 1.4 million punnets of grapes a week and currently imports the fruit from 15 countries, mainly Spain but also from as far away as India, Brazil and Chile.

The grapes grown in the UK will be harvested between August–October, meaning they’re ready to go on shelf to coincide with the Spanish grape season ending,” Asda said.

Its trial took place over the last three years in Kent, in South East England, and originally 8 varieties of grapes were planted – a mixture of red, green and black. This is the first year the grape vines have been full of edible produce, Asda said. It is confident at least two varieties suitable for everyday consumption can now be grown successfully in UK soil.

Asda’s category manager for grapes Alberto Goldbacher said the main challenge in the trial was getting the sweetness right because of a lack of sunshine and light needed for this to develop within the grape. “However, we’ve now seen great promise and are happy to move forward with this trial on a much larger scale.”

“Grapes grown in the UK have previously only been suitable for making wine as they’re typically very small, have a thick skin and have a large seed in the middle. For the first time ever in the UK, these new table grapes are exactly what you’d expect to see on a supermarket shelf, in both look and taste,” Goldbacher said.

Asda said it hopes to educate growers across the UK with its findings, “to give them the skills and knowledge they need to help this become an industry wide initiative by 2018.”  

“The grape project has been made possible thanks to Asda’s ownership of IPL, the biggest single importer of produce in the UK. IPL operates a unique sourcing model which works directly with growers at source rather than going through third-parties. IPL has technologists based around the world who have built close relationships with growers; for this project IPL’s Spanish grape supplier provided the grapevines and their chief agronomist also supervised the planting,” it said.

About Asda

  • 18 million customers a week
  • 616 stores: including 32 supercentres, 332 superstores, 34 Asda Living stores, 201 supermarkets & 15 standalone petrol stations
  • 650 click and collect sites
  • main office is in Leeds, Yorkshire
  • since 1999 has been owned by Walmart

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The key issues for fresh produce in the UK

As the UK's trade association for the fresh produce industry, the FPC is working on a variety of issues affecting the sector, as its CEO Nigel Jenney also explains in this interview with Eurofresh Distribution.

Stowaways, the need for a generic promotion campaign for fresh produce, the massive potential to increase UK production of indigenous crops, the room to grow imports, and data mining. They’re just some of the topics addressed here by Nigel Jenney, chief executive of the Fresh Produce Consortium. As the UK’s trade association for the fresh produce industry, the FPC is working on a variety of issues affecting the sector, as Jenney also explains.

What are the key issues for the sector now and what do you think they will be in the next few years?

We are dealing with issues relating to consignments contaminated by stowaways onboard vehicles coming across the Channel. The UK media is focusing on Calais, but the problem is widespread. Our members report a significant increase in incidents over six months, and we’ve estimated industry costs are around £10 million. It’s a difficult issue and we’re pressing the UK Government to recognise specific problems we face whilst maintaining food safety.

Over the next few years we’ll need to meet the challenges of food security and food safety and maintain a viable profitable industry. Having fewer crop protection products in the horticultural sector will bite harder and could increase pressures in growing certain crops which meet customer specifications.

We’re seeing pressure on the availability of biocides due to new regulations to reduce residues through the supply chain but which do not take into account actual risk in relation to food safety. The presence of a residue doesn’t mean it’s harmful, but without effective products to remove microbes across the supply chain there’s a risk of increasing the number of foodborne illnesses.

What opportunities do you see for growth?

We’re proud to represent a vibrant, innovative industry, as witnessed by successes celebrated by our FreshAwards. Given the need to increase consumption of fresh produce there’s massive potential to increase UK production of indigenous crops. At the same there’s room to grow imports of products which are increasingly popular, and which we cannot grow due to our climate.

It’s been said that the FPC is an effective lobbyist on a range of issues, such as import duties and quotas, border issues and logistics. What recent achievements would you highlight and what’s pending?

Thanks to our persistent lobbying the Commission recently removed increased import controls on Kenyan beans. This is a significant saving for UK businesses of around £1.5 million.  

We put the spotlight on excessive charges of £1.6 million a year for official controls in the UK under EC Regulation 669/2009 by securing one of three government reviews. UK Ministers want industry savings and we’ll continue to press government agencies to deliver an efficient cost effective service.

How does the FPC help shape new legislation?

Most legislation comes from Brussels so we work closely with European colleagues. We shape the UK Government’s position in European discussions and ensure that our industry’s voice is heard. EU Plant Health Regulation is a critical area to ensure a risk-based approach maintains open trade and allows plant health controls to focus on areas of greater risk. This includes lobbying for a regionalised approach, taking into account differences in climate and plant health risk between southern and northern Member States.

What would you share in regard to the FPC’s campaigns and other efforts to promote fresh produce? What has worked best?

The fresh produce industry needs to get behind a generic campaign to promote fresh produce as part of a healthy diet. Too often we see successful campaigns which focus on one product, but all this achieves is a shift in purchasing habits from one type of product to the detriment of another.

We must increase consumption of fresh produce. We started this process with the Eat In Colour campaign, but this needs sustained industry support to achieve its potential.

How have you had an impact on environmental issues such as pesticide use or waste control?

We recently partnered a Surplus Food Summit by UK food redistribution charity FareShare. Diverting surplus food can help people who don’t have regular access to healthy fresh produce. We’re encouraging members to work with organisations like FareShare, and to reduce supply chain waste.

You’ve been quoted as saying the FPC should offer a dynamic range of services. If you had the funding necessary, what service would be a priority to develop?

Our Produce Integrity database collates anonymised data from individual members and their suppliers, including analyses results from sampling and monitoring programmes. Shared data allows FPC to put risk in perspective when it comes to regulatory scrutiny and investigations into alleged links between fresh produce and foodborne illness. In time we’d like to develop this further to include more tools.

JB

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Secrets to Reynolds’ success supplying the UK foodservice market

" Historically, our business has been quite heavily weighted towards restaurants and restaurant groups, supported by a good amount of hotel custom. We're now placing quite a lot of focus on the education sector."

From its origin about 70 years ago as an east London greengrocer, Reynolds has evolved into a national supplier to the catering industry, with annual turnover of £200 million (€281m).

Dedicated to supplying the UK’s foodservice market, it has a particular focus on restaurants – which account for about 60% of its business – and supplies the likes of Pret a Manger, Pizza Express, Carluccio’s and Bill’s. It also serves pubs, hotels, schools, colleges, universities and healthcare establishments.

At the London Produce Show in June, ED spoke to Reynolds’ head of marketing Andy Weir and senior buyer Matt Jones – both based at Reynolds’ National Distribution Centre in Waltham Cross – and started off by asking them what makes such businesses choose Reynolds.

AW: There are a number of reasons they use us. We have a national presence, which obviously means that wherever they open a new store, we can deliver. We have our national distribution center in Hertfordshire, where all of our fresh produce and dairy comes into, and then we truck that to our five satellites. We have one QC team at the office and that means that wherever they’re based, our customers’ outlets get the same produce into their stores – from the same grower, checked by the same people. That means they get absolute product consistency across their stores. That’s really important for any operator building a brand.

MJ: Another key benefit we offer our customers is fixed pricing for 6 month periods, which, because they know their products’ prices are fixed, guarantees their margins. That’s really important because the prices of fruit and vegetables can be quite volatile. So what we do is we lock our prices down with our suppliers and then we pass that security on to our customers. That’s a key difference between us and most of our competitors.

Who are your main competitors?

MJ: There are a couple of other large national produce suppliers in the UK, but they are owned by larger companies, whereas Reynolds is still very much a family owned and run business. There are a whole host of small suppliers, especially in London, within the markets such as Covent Garden.

Where are you making changes?

AW: Historically, our business has been quite heavily weighted towards restaurants and restaurant groups, supported by a good amount of hotel custom. We’re now placing quite a lot of focus on the education sector.
When you’re focusing on one particular market you tend to get sales peaks and troughs. By targeting other markets, such as the education sector, they tend to mirror the rest of the sector quite well. When the schools are off, the restaurants are quite busy, and vice versa. A more diverse mix of business helps us manage our fixed costs better and our technical expertise is very well suited to the education sector, where food safety is clearly very important.

What about in your supply chain?

AW: When our customers order what we call splits, which is single items – a twin pack of peppers, a cucumber, an iceberg lettuce and a punnet of tomatoes, for example – historically they’d all go in one cardboard box or several, depending on the order size. Over the last years we’ve tried to move customers away from disposable packaging and we now use returnable crates.
The driver takes the crate in, leaves the produce with the customer and then takes back the crates on the next delivery. That works really well because our customers have to pay disposal costs to get rid of waste cardboard. I think where we can get any packaging out of the chain completely it’s got to be great for everybody. It saves us money, it saves our customers money and it’s good for the environment.

What’s your biggest challenge?

AW: It’s managing the demand and supply side because we don’t know from one day to the next exactly how much of a single product our customers are going to order. Obviously we don’t want fresh products sitting in the warehouse as shelf life is limited. Equally, our customers expect us to have the appropriate stock levels to meet their demand.
Trying to predict exactly what a customer is going to order, and having the foresight to order the appropriate quantities in advance, is a very difficult balancing act. The average turnaround time in our warehouse is about a day and a half. The idea is that it comes in and goes out. We spend a lot of time fine-tuning our forecasting model to make sure we get that balancing act absolutely right and work closely with customers to understand what drives their demand, such as weather and menu changes.

What are your biggest volume products?

AW: Believe it or not, our biggest selling line overall is milk – because everybody uses it – but for fresh produce tomatoes would probably be number one. We have a couple of dozen different tomato lines, everything from standard round, single M’s, double M’s, Marzaninos, English heritage tomatoes on the vine, and everywhere in-between.

But we don’t just bring these things in and let them sit in the warehouse and hope they sell. We work with our customers to establish what product works best for them. Do you want provenance? Do you want great flavour? Do you want a product that’s going to last a long time? You tell us what you want and we’ll source the right product for you. That’s how the business has evolved.

MJ: On stock at the moment, I’m probably doing about 22 different SKUs, 22 different products of tomatoes. I would say we do 16,000-18,000 boxes a week on tomato, across all the ranges.

What else is big?

AW: Avocados are another line that’s really important for us and for our customers. Obviously when they get the avocados delivered to their store, they need to know they’re ready to eat and ready to prepare, they’ve got to be at absolute peak ripeness. If they’re too hard and they can’t use them, well they don’t have the storage space to leave them out or leave them in the fridge for a few days. It’s really important that we get that absolutely perfect. So yes, we sell an awful lot of avocados and again, we’ve got quite a few different lines depending on customer requirements.

MJ: We do about 13,000 boxes of avocado a week, which I believe is up there with some of the larger retailers. It’s a product that’s heavily used in our industry, around sandwich manufacture, guacamole, etc.

Where do you source your avocados from?

AW: It very much depends on the time of year. At the moment they will be predominantly Peruvian, supported by some South African fruit. On a product like avocados we tend to let our supplier partners manage that decision-making process for us. That’s what they’re best at and we stick to what we’re best at, which is distributing short shelf-life chilled products to our customers.

Please tell us what you do in grapes.

MJ: In grapes we just run two lines, a red and a white grape year-round. We run through about 8 seasons over the year and it’s controlled by one supply base, which manages the Brix, colour and the size of berry, according to our specifications.

What varieties are they?

MJ: Multiple. It could be Superior to Thompson. It could be anything all the way through. We take the best grapes for the time of the year, for the customer base.

AW: Having said that, there are certain customers, like maybe 5 star hotels in London, that want something different. So we do obtain specialty varieties for them, and obviously they cost a lot more than the standard red or white grape. Again it’s back down to what the customer wants, and we can source pretty much anything they want, as long as it is in season somewhere in the world. With our connections and extensive supply base we’ll find it for you.

How is demand for tropical fruit such as pineapple? What kind of volumes do you do in pineapple?

MJ: I do two types of pineapple. I do an extra sweet size 6, a large pineapple, which I do about 1,200 boxes, and a 10, which is a smaller pineapple, at about 600 boxes. About 1,800-2,000 boxes a week in total.

What are your top sellers in salad?

MJ: Cucumber would probably be the biggest, at about 6,000 boxes a week. Peppers would be next, probably roughly around 3,500 boxes of peppers a week, across the three colors, and a little bit in orange and black.

Foodservice is often where emerging culinary trends are seen first. What are you noticing?

AW: More and more demand for provenance. For the majority of our customers it’s about British produce and it’s well-known that consumers like to know now – particularly post Horsegate – where the food on their plate comes from. Whether it’s Kentish strawberries or asparagus from Hampshire, it all about menu appeal and authenticity.
Our food development team spend a lot of their time advising customers on where their produce comes from, so they can market it to consumers. If you take for example, Bill’s, which is one of the fastest growing restaurant groups in the UK – they’re one of our customers – they do a fantastic job at promoting great British produce. If you look on the menu you’ll see the appropriate product for the time of year. At the moment, there’s kale on there, and there’s strawberries, but they don’t have strawberries on there at Christmas time.
We work closely with our customers to help them map out what’s going to look good, what’s going to be appropriate on the menu in three months, in six months’ time, because these operators need to plan in advance exactly what they’re going to have on their menu and if they put something on their menu for the summer and it’s not available, obviously that’s not great for anybody. So we play a large part in advising them on what’s going to be best at what time of year, what’s going to be in season, what’s going to be British, to make sure that they satisfy their consumers’ appetite for fresh, seasonal produce.

Reynolds: http://www.reynolds-cs.com/
London Produce Show http://londonproduceshow.co.uk/

JB

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M&S still growing ahead of market in food

In its latest annual report, the UK retail chain said despite the most competitive food market of recent years, it delivered like-for-like growth in every quarter and maintained its margin.

M&S says 2014/15 was an outstanding year for its food business “in a sector that continues to go through profound change.”

In its latest annual report, the UK retail chain said despite the most competitive food market of recent years, it delivered like-for-like growth in every quarter and maintained its margin. “We have a clear and distinct offering and our growth plans look clear and achievable,” it said.

Screenshot 2015-07-13 at 20.30.44.png

M&S has two divisions: Food, which accounts for 57% of its turnover, and General Merchandise, which accounts for the remaining 43%. Overall, it has 33 million customers through its 852 UK stores and e-commerce platform. Worldwide, M&S has 480 wholly-owned, jointly-owned or franchised stores in 59 territories across Europe, Asia and the Middle East. “Our International business now includes a fast-growing standalone Food operation, meaning that more people around the world can enjoy our delicious, innovative food products,” it said.

M&S said innovation remains its core strength as a speciality retailer. “In Food, we showed that we are at the forefront of discovery and creativity,” it said.

Expansion of convenience format: Simply Food

M&S said it opened 67 new stores during the year. Of these, 62 were its Simply Food convenience store format, taking its total to 504. It said franchise partners play a key role in this growth and in March it opened its 200th Simply Food store through a partnership with BP.

“We expect Food space to increase by 4.5% in 2015/16, again driven by growth in Simply Food store numbers,” the chain said in its report.

“The Simply Food format plays into evolving shopping habits. People are shopping more regularly and more locally, meaning that our convenience format is one of our key differentiating factors.”

M&S said it has “a strong pipeline with the fastest Food store opening programme planned in M&S’s history.”

“The UK food market will remain challenging but we are well positioned with a store format that caters for how shopping habits are changing.” 

source: M&S
 

 

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UK’s second commercial apricot crop to be a bumper

Nigel_Bardsley_in_orchard_July_2015 - Edited

England’s second apricot crop is is set to be six times that of last year, thanks to near perfect growing conditions.

According to Tesco, early estimates are that English growers will produce about 200 tons – up from the 30 grown in England last year when the first English apricot crop became available.

In a press release, the the UK retailer said the first English apricots of the season went on sale on Monday and growers are reporting great quality fruit.

It also reported that last year British shoppers bought 33% more apricots than the previous year, according to Kantar data.

Tesco said careful breeding has made it possible to now grow apricots on a commercial basis in the UK, something which until a few years ago was very hard to do because of the climate.

Tesco’s English apricots are produced by one of the UK’s largest stone fruit growers, Nigel Bardsley, whose farm is based near Staplehurst, in Kent. He has 5,000 orange fleshed, French type apricot trees across 8 ha and produced his first commercial quantities – about 15 tons – last year. This year he anticipates up to 120 tons.

“We’ve had near perfect growing conditions so far this year with a cold winter to help let the trees rest; a mild spring to allow for good pollination and a warm, dry summer so far to boost growth. This combined with a unique large day/night temperature differentiation, has led to fantastic red blushed and incredibly sweet apricots,” Bardsley said.

source: Tesco
 

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Slow wholesale trade in fruit and vegetables in the UK last month

Wholesale trade in fruit and vegetables was slow and steady in the UK in the first half of June but picked up towards the end of the month as the weather improved, according to the UK Government’s Department for Environment, Food and Rural Affairs (Defra).

Wholesale trade in fruit and vegetables was slow and steady in the UK in the first half of June but picked up towards the end of the month as the weather improved, according to the UK Government’s Department for Environment, Food and Rural Affairs (Defra).

In its report on fruit and vegetable wholesale prices for June, Defra said the amount of UK-grown produce varied as some crops were coming to the end of their season and other summer crops were coming onto the market. “Imports from the continent ensured supplies of soft fruit and salad were good across the month.”

Defra also reported:

Berries
Strawberries: demand was high but prices fell 24% to £1.85/kg as more fruit including Scottish and Dutch and Belgian imports came onto the market
Raspberries: demand was also high but the price fell 11% to £6.86/kg as supplies increased. The quality of the fruit remained high across June which stopped the price falling further

Pears
UK-grown pears: supplies continue to fall as the season comes to a close
Conference pears: prices rose 13% to 0.59/kg

Vegetables
Asparagus: prices continued to fall, down 18% to £5/kg
Broad beans: prices fell 37% to £1.42/kg as supplies increased and demand dwindled
Savoy cabbage: price up 25% to £0.51/head
White cabbage: price up 33% to £0.48/kg as new season crop supplies were short
Cauliflower: prices rose across the month as supplies dwindled
Leeks: prices rose as supplies were short awaiting the new season crop

source: Defra

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It’s a good year for fresh produce, says Fresca boss

Fresca is the parent company of multiple operations including Mack, which is said to be the UK’s largest privately-owned fresh produce supplier

As chief executive of the Fresca Group Ltd, Ian Craig has an eye over wide swathes of the UK’s fresh produce sector.
Fresca is the parent company of multiple operations including Mack, which is said to be the UK’s largest privately-owned fresh produce supplier and serves an extensive customer base spanning major supermarkets, independent retailers, foodservice operators and wholesale markets, and more.
The Kent-based group also spans the major glasshouse facility Thanet Earth – which grows cucumbers, tomatoes and peppers and was headed by Craig until he took over the Fresca helm last July – and other businesses including  DGM Growers, MMG Citrus, Wallings Nursery and the importer Primafruit.
With sales of £427 million (€585m) in 2013/2014, up from £403 million (€552m) the previous year, the Fresca group returned to the black with a before tax profit of £7.4 million after a £0.4 million loss (after exceptional items) in 2012-13.
In this interview at the London Produce Show in June, Craig told ED that fresh produce is regaining its place in the sun. He said consumers just need some inspiration on usage in order to enjoy fresh fruit and vegetables he described has having “the best eating varieties” of his lifetime.

What impact is the rise in the UK of the discounters – Aldi and Lidl – having on suppliers?

We are very clear in that most of our businesses are very focused on particular retail customers. It’s a strategy that we’ve been following for some time, even extending the relationship in some cases to commit and supply in a totally dedicated business model. This strategy has helped us manage most of the potential for conflict. What we try to do is to make sure that we’re providing the service and the quality standards and the values that our customers want from us. That’s our job at the end of the day. I think the challenge for everybody in the industry is to recognise that comparatively new retail entrants into the market have brought a different value perception to some key products. That’s probably changed the perception forever in the eyes of consumers.
To maintain our success and deliver that value in the short to medium term, we have to look at our entire supply chain and how we can do things more efficiently and more effectively and look for varieties that deliver what each customer and each consumer requires.
Lining up and looking at the different channels and the different requirements of those channels is really important to make sure that we can service all of our customers successfully.

What are your challenges today in retail supply?

We’re at an interesting time in the UK. Clearly, we read about the broader challenges faced by our customers, but we’re still in the food industry, and people still eat food every day. I think fresh food and fresh produce will enjoy growth in the UK in 2015 where we can see people having more disposable income again. We can see people able to make more informed decisions about what food they choose.
I think fresh produce has its opportunity again; we need to make sure we present the right produce in the right way, with some ideas for the consumer about how they use that product. There are generations – and as a parent I see this in my children’s friends all too frequently – that don’t know what to do with some of the products we sell.
If we can get some usage education and work with our customers to do demonstrations in store, I think we can inspire people to consume even more product. It’s the sorts of things that are on the table in front of us today, they’re the best eating varieties in my lifetime. It should inspire people to eat more fresh produce.

What trends are you seeing with cucumbers and peppers?

What we’ve seen in the UK, I think, in the last couple of years, again, is peppers and cucumbers largely retailed as commodities. The clearest example is in the cucumber. In Winter 2012/13, cucumbers in the UK retailed at an average of 99 pence each. This last year, it’s probably been 50 pence, so a massive deflationary effect, with value implications right back down the chain.  It’s been a real challenge.
Having said that, the consumer has responded, they’ve seen a cheaper product on the shelf so demand/volume sales have been up in both areas, and quite dramatically in peppers over the last two winters. The traffic light pack is by far the most popular seller and all retailers need to have significant volumes of that on the shelf because it’s becoming a basket item, a weekly shopping item just like the cucumber is.

Are snack peppers doing well?

Snack peppers are interesting. We’ve committed space in our glasshouse at Thanet Earth for snacking peppers, for the small, sweet bite peppers in a multitude of colours. We’ve seen those be very successful. I think there’s more demand to be fulfilled in those areas but we need some consumer usage education on how to make use of them – not just a substitute for the normal bell peppers in cooking but how they can be used as canapes and so on. That is an interesting development.
To be quite frank, the pepper market needs some inspiration because the flat, retail pricing of the bell pepper means it grows across Europe but is not getting the returns really needed in terms of the investments to support the production of peppers. It is a challenging commodity.

How is demand for cucumbers and in what format do you mainly supply them?

Cucumbers continue to sell extremely well. In the UK consumers’ eyes, it is a very, very important weekly purchase.
The vast majority are individually-wrapped still in the shrink wrap plastic, not the most environmentally positive way of doing it, but it protects the product and reduces the dehydration effect. It makes cucumbers a very simple product to handle. There’s little scope for major innovation in cucumbers, but there’s encouraging work going on in the search for more options in virus resistant varieties.

Which tomatoes are customers preferring?

I think tomatoes is a very exciting area. We’re seeing consumers switching more and more to the smaller varieties, the sweeter eating varieties.
The key variety in tomato remains Piccolo because it is the most consistent, sweet eating variety. We have a high volume of varietal development at Thanet Earth, and we do that in conjunction with Hadlow College, as well, where we sponsor a student to look after our development glasshouses each year, and we see great feedback from that.
We work in conjunction with our customers to find the right selection for their shelves and try and offer some form of exclusivity every year on a new variety. ‘On the vine’ ranges are absolutely key to category success, and when you open the package, it’s still important to get that smell of tomatoes that we all remember from our youth. The products are a much more consistent eating quality from facilities like the high level investment we have at Thanet Earth in our glasshouses. When the product every day is consistent, we see strong consumer demand for that consistency.
Provenance also matters a lot in tomatoes, there’s strong consumer support for British production, so having the source as ‘Kent’ and having the Union flag on the pack is very strong in the eyes of the consumer, encouraging repeat purchases.

What’s happening with grapes?

Very interesting area, grapes. Again, I think grapes is one of the categories that’s come under greatest pressure from the deflationary effects in the UK retail market. We’ve seen in many ways a flattening of the retail structure on grapes, the differentiation between new varieties, different coloured varieties, has been diminished by the need to sell grapes at a known retail value, so we’ve seen grape packs being sold at values historically lower than we’ve seen for a very long time.
I think to some extent you can see the impact of that on the shelf where quality can be less predictable now than it has been in recent years.

Is avocado demand still growing in the UK?

For us this is a fantastic product area. We have excellent business with a number of retailers, and we have invested more in our ripening facilities in Kent to ensure that we can deliver the right quality at the right time.
I think the consumer’s expectation is that when they take the avocado home these days, that it’s ripe and ready to be used. We’ve worked hard on our ripening techniques and ripening management and on our sourcing.

The interesting thing about the avocado market in the UK is that it is growing substantially both in value and volume. It’s probably one of the very, very few produce categories that has shown growth, but without an obvious reason. I know how much hard work companies like us have put into quality management for avocados in recent times so my preferred theory is that the consistency and new-found reliability of the product has earned consumer trust and value perception.

Chief executive of the Fresca Group Ltd, Ian Craig

JB

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Why DPS is shortening its supply chain and adding value for the UK market

A series of apricots from the Carmingo range are among the new varieties invested in over recent years by dps, one of the main year-round suppliers of stone fruit and exotic fruit to UK retailers.

A series of apricots from the Carmingo range are among the new varieties invested in over recent years by dps, one of the main year-round suppliers of stone fruit and exotic fruit to UK retailers.

“We sold 8 tons last year and hope to have more than 10 times that available this year,” said Paul Beynon, managing director of the London-based family company which expects turnover this year of about £54 million, up from about £46 million last year.

The joint venture in the Carmingo apricots, which originated in France and have better quality eat and a longer season than other varieties, is an example of dps’s constant push to deliver what end customers want.

About a tenth of its business is evenly split between the food service and processing sectors but since 1998, dps has been focused on supplying major retail programmes in the UK and Ireland. Tesco, for example, has been one of its major clients for over 30 years.

Increased demand for ripe stone fruit

The company keeps its eye on what’s happening at the consumer end of the supply chain. In an interview with Eurofresh Distribution, Beynon spoke of a range of ways – including meeting consumers at the shelf edge, focus groups and online surveys – dps uses to increase its understanding of those who eat its fruit.

One of the trends it has identified is that when buying stone fruit, such as peaches and nectarines, UK consumers increasingly prefer to buy them ripe. In response, dps has invested in different varieties and spent about £750,000 over the last four years to increase its ripening capacity in the UK to six ripening units.

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Demand, offer rising for British produce

Beynon said British consumers are also showing strong demand for home-grown produce. The British-grown apricot and cherry offer is growing quickly, while that of plums is more stagnant.

Overall, dps’s main products in summer are peaches, nectarines, kiwis, apricots, cherries and plums. In terms of the company’s total product volume, homegrown produce accounts for about 10–15% in the case of cherries, and 5–10 % each for plums and apricots.

Big growth in demand for apricots, sharon fruit

The products where the company is seeing demand grow most are apricots – last year the value of dps’s apricot sales was 100% higher than in 2013 – and the sharon fruit.

About 65% of its apricots are from Spain, 30% from South Africa and 5% New Zealand, while for the sharon fruit it’s about 80% Spain, 20% South Africa.

Most of dps’s Northern Hemisphere produce comes from Spain and arrives by lorry, while most of that from the Southern Hemisphere comes by ship, mostly into London Thamesport and Tilbury, and a small amount by air.

Revival of demand for organic produce

dps supplies organic citrus, stone fruit, cherry and kiwi fruit, sourcing most of it from Spain, Chile, South Africa and Italy.

Beynon said demand for organic fruit was static, if not receding, in the early days of the recession, but in the last 12 months has improved. “It’s now growing again and there’s no reason for that to stop,” he said.

Consumers want consistency in quality, taste and shelf life

Though it does not have a produce brand – all the produce it procures for retailers is sold under their brands – as previously mentioned, dps takes great interest in engaging with and understanding the end consumer.

“What we find is it’s about quality, taste and shelf life,” Beynon said. Aesthetics get consumers to pick up a product but consistency in the latter three is what keeps them buying it.

An example of dps’s ongoing innovation to address these factors was the launch of a 6-fruit pouch in its kiwi line. More aesthetically pleasing than a punnet and net, it helped drive sales.

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Why shortening the supply chain is crucial

Beynon also talked about the importance of shortening the supply chain – and making it as responsive and efficient as possible – in order to ensure the freshest quality and reduce waste, and thereby costs.

With the advent of new money in the big, newer powerhouses, such as Brazil, China, the Middle East and India – dps’s sources now have many more options as to where they sell their product.

The days of Britain being the number one place to do so is not quite the case now, Beynon said. To have the best chance of securing produce from desired sources means having the most efficient supply chains. “The more efficient the supply chain the higher the grower return you can provide.”

How freight, labor costs have changed the supply chain dynamic

Beynon said dps thus constantly evaluates the way it brings product from source. For example, with plums from South America it used to bring them over in finished punnets but now tends to ship them bulk after an increase in freight prices in recent years. “It’s very important to fill that transport because that cost probably outweighs those for higher labour cost.”

In the past, higher labor costs in the UK meant DPS preferred not to pack there. “Now, due to higher freight costs, it works out more economical to pack efficiently in the UK,” he said.

dps

JB
 

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UK market sweet on honeydew, galia melons

Melon sales in the UK retail sector were up 6.2% in volume and 4.9% in value for the 52 weeks to March 29, Kantar Worldpanel data shows.

Melon sales in the UK retail sector were up 6.2% in volume and 4.9% in value for the 52 weeks to March 29, Kantar Worldpanel data shows.

Altogether 134,402 tons of melons were sold, for a total spend of nearly £135 million (€187m), with honeydew/yellow and Galia accounting for nearly 62% of that value. Honeydew/yellow sales were up 6.3% in volume and 4.1% in value on the previous 52 weeks, and Galia 4.3% for both.

But the biggest percentage change was seen for watermelon, Piel de Sapo and Charentais melons. Watermelon – which accounted for just under a sixth of the total melon spend – enjoyed growth of 13.4% in value year-on-year and 14% in volume (to 30,570 tons).

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Piel de Sapo gained almost 11% in value and 12.3% in volume (to 5,297 tons) and the specialty melon Charentais leapt up 190% in value and 171% in volume but off a much smaller base – 251 tons sold for the year to March 29.

Cantaloupe sales slipped 1.6% in value and by the same amount in volume, to 13,054 tons.

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