UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018

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UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
UNITED KINGDOM’S
ATTRACTIVENESS FOR
SWEDISH FOOD SUPPLIERS
JANUARY 2018
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
The UK offers a large market for             London’s role as a leading global
                                                        food suppliers, with consumers               city and cultural capital attracting
                                                        demanding both quality and                   visitors and investments from
                                                        convenience. However, the retail             around the world, London and the
                                                        landscape is challenging and                 UK make excellent places to build
                                                        highly competitive; hence it is              brand awareness for expansion to
                                                        important that companies looking             additional markets.
                                                        to enter the market understand
                                                                                                     This places increasing demand on
                                                        fully what it takes to succeed as a
                                                                                                     both retailers and food suppliers,
                                                        supplier in the UK.
                                                                                                     and further emphasises the
                                                        Over the years, Business Sweden              importance of knowing how to
                                                        has supported many Swedish food              attract the demanding and
                                                        suppliers to enter and grow on the           discerning UK consumer. Proper
                                                        UK market, creating valuable                 preparation and in-depth market
                                                        knowledge and a network among                insight are key to success in the
                                                        key actors and stakeholders.                 UK’s competitive retail environment.
                                                        The large market, with customers             In this report, we provide an
                                                        open to innovative and international         overview of the UK food retail
                                                        products, is extremely interesting           market, exploring both the grocery
                                                        for food suppliers from all over the         and foodservice sectors. We
                                                        world. British consumers have                analyse the market’s challenges
                                                        become accustomed to a wide                  and opportunities in order to help
                                                        variety of product choices and               Swedish food suppliers reach their
                                                        increasing convenience in how to             full international potential on the UK
                                                        shop. Furthermore, because of                market.

OVERVIEW   MARKET   RETAILERS   FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                           BUSINESS SWEDEN   2
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
THE UK FOOD RETAIL MARKET IS COMPLEX, OFFERING
  BOTH OPPORTUNITIES AND CHALLENGES
    Food & Grocery market                 Challenging Landscape                    Fragmented Foodservice           Better Health, Less Waste

           £213 bn                                                                       £57 bn
                                                          vs.                       Market value in 2017, with 3
     Market value forecast in 2020                                                    years of steady growth

      However, stagnation due to
     challenges such as consumer            Four large retailers dominate,             362,629                        Four consumer trends affect
      selectivity, price-sensitivity,      but are increasingly challenged           Total UK outlets, indicating   the entire food retailing market,
    currency fluctuations and Brexit       by discount and online players             significant fragmentation       from grocery to foodservice

    Online = #1 Market Driver             Private Label Success                    Strong Organic Segment           An Insightful Approach

           £17.5 bn                                52.5%
                                                                                   Organic segment shows strong
                                                                                    growth, with supermarkets as
     Food and drink e-commerce                 UK value share for private             the largest sales channel
                                                                                                                    Several areas to focus on to be
     market value forecast in 2023              label, highest in the EU
                                                                                                                      attractive to food retailers

                  7.5% e-commerce                         Expected to be                                                       Food Business Days
                 value share in 2017                      major source of                                                        and Try Swedish
                   (second only to                         growth for UK              Fresh produce and dairy                   provide insight and
                    South Korea)                          grocery market             anchor the organic market                  sales opportunities

OVERVIEW    MARKET   RETAILERS   FOODSERVICE     TRENDS   ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                                 BUSINESS SWEDEN   3
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
THE UK GROCERY MARKET IS LARGE BUT STAGNATING
  THE MARKET IS AFFECTED BY A NUMBER OF CHALLENGES

  GROCERY MARKET CHALLENGES                                                         MARKET VALUE OF GROCERY RETAIL UK (£BN)
                                                                                    73.7
      The UK grocery market is growing, but has                                           70.8
       stagnated in recent years; by 2020, the market is
       expected to be worth £213 bn                                                                                                                   2013/2014
                                                                                                                                                      2018/2019
      Consumers remain price-sensitive and focus on
                                                                                                          49
       seeking bargains, though they are increasingly
       selective in their choices
                                                                                                   37.4
                                                                                                               35.5 35.7
      Currency fluctuations are expected to put
       additional pressure on grocery retailers, with those
       retailers who primarily source goods from                                                                                  21.4
       overseas possibly struggling to compete based on                                                                                        16.9
       price                                                                                                               10.8                         9.4   9.3
                                                                                                                                         7.7
      Brexit, and the associated uncertainty, is likely to
       have a material impact on the sector
                                                                                   Superstores & Convenience    Small     Discounters     Online         Other
                                                                                   Supermarkets              Supermarkets                               Retailers

                                 Despite a stagnating overall market, Swedish grocery exports to the UK have grown on a
                                 yearly basis from £270M in 2011 to £420M in 2017

  SOURCE: STATISTA

OVERVIEW    MARKET   RETAILERS     FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL     ORGANIC      APPROACH                                      BUSINESS SWEDEN     4
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
THE “BIG FOUR” GROCERY RETAILERS DOMINATE THE
  MARKET REPRESENTING OVER 70%
     Tesco’s mission: “We make what matters better, together”
     Market leader in UK grocery sector for over 25 years, with sales of ₤51 bn in 2017-18 and 440,000 employees in the UK
     Despite positioning itself to lower prices and a competitive agenda, Tesco was the first UK supermarket to develop an
      online shopping presence
     Over 17 million active members for its UK loyalty card program
                      Ocado , 1,1%
           Iceland, 2%                                                        Sainsbury’s mission: “We will make customers' lives easier,
                         Others                                                offering great quality and service at fair prices, serving our
                          3.4%                                                 customers whenever and wherever they want”
                                                                              Sainsbury’s has a middle-of-the-range positioning, offering a wide
                                               Tesco
                                                                               range of prices and products, from budget to premium, and
                                               27.6%                           aiming to attract consumers from all income groups
                                                                              Sells numerous organic and environmentally friendly products
    Co-op
    6.2%
                                                                              Asda’s mission: “To be Britain’s best retailer exceeding
                                                                               customer need everyday”
   Aldi                                                                       Asda’s strap-line is “everyday low price”
   7.6%                                                                       Asda has focused on large stores and is predominately based in
                                                                               the North and South East of England
                                            Sainsbury's
       Morrisons                               16.0%
        10.5%
                                                                              Morrison’s mission: “To be the consumer’s first choice for food,
                                                                               delivering products of outstanding quality and great service at a
                              Asda
                                                                               competitive cost through working faster, simpler and together”
                              15.0%                                           With stores located throughout the UK, a typical Morrison’s store
                                                                               is aimed at the mid- to lower-end
                                                                              Approximately 55% of sales comes from private label range
  SOURCE: IBIS WORLD REPORT, KANTAR WORLD PANEL, COMPANY WEBSITES

OVERVIEW     MARKET     RETAILERS     FOODSERVICE      TRENDS       ONLINE    PRIVATE LABEL   ORGANIC   APPROACH                                    BUSINESS SWEDEN   5
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
SUPERMARKETS TO FACE COMPETITION FROM
  DISCOUNTERS, CONVENIENCE, ONLINE IN THE FUTURE
  UK FOOD AND GROCERY VALUE 2017 & FORECAST                                                 DIFFERING POSITIONS OF TOP GROCERY PLAYERS
  2022 (£ BILLION)
                91.1
           86

                              47.1

                                                                                              PRICE
                         40

                                             30.1

                                      20,1
                                                    16,2 16.3                    16
                                                                11,8 12.2 10,4

                                                                                                                 QUALITY

  SOURCE: IGD, BUSINESS SWEDEN ANALYSIS

OVERVIEW        MARKET    RETAILERS     FOODSERVICE      TRENDS    ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                BUSINESS SWEDEN   6
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
THE FOODSERVICE* MARKET IS HIGHLY COMPETITIVE
  AND COMPLEX, BUT GROWING STEADILY
  THE WHOLESALE FOOD AND DRINK VALUE (IN £BN)                                        FOODSERVICE AS AN INDUSTRY

                                                                                         Worth a staggering £57bn, the UK foodservice industry is
                                                                                          the 4th largest employer in the UK
                                                                                         The foodservice industry has experienced 3 years of
                                                                                          continuous and steady growth
                                                                                         However, the industry remains highly fragmented, with a
                 Contracted Industry &             Hotels, Pubs &                         large number of companies operating across numerous
                    Public Sector                   Restaurants                           subsectors
                         £4.0          Total            £5.0
                                    wholesale
                                   food & drink
                                       value
                                       £13bn

                                                                                                164,915                    81,642                     116,122
                                   Retail,Travel                                            hotel, pub and            retail, travel and       contracted industry
                                    & Leisure                                             restaurant outlets           leisure outlets               outlets
                                      £3.0

                                                                                                Approximately 362,629 total outlets in the UK

  THE FOODSERVICE INDUSTRY IS SIGNIFICANTLY MORE FRAGMENTED THAN THE RETAIL GROCERY MARKET

  SOURCE: FEDERATION OF WHOLESALE DISTRIBUTORS                                       *ENCOMPASSES ALL BUSINESSES RESPONSIBLE FOR MEALS PREPARED OUTSIDE OF THE HOME

OVERVIEW    MARKET     RETAILERS     FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL    ORGANIC     APPROACH                                              BUSINESS SWEDEN   7
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
OF EUROPE’S TOP 10 FOODSERVICE GROUPS, 5
   ORIGINATE FROM THE UK
                                                                  UNITED KINGDOM                                                                       SWEDEN
   Rank

                          2                       7                          8                          9               10                                   18
  Company
  Sector Turnover

                    £22.96 billion         £2.15 billion            £2.18 billion                £3.3 billion      £1.69 billion                    £38.8 billion*

                                                                                               Quick Service
                     Contracted                 Pubs                        Pubs                                      Pubs                              In-Store
                                                                                                Restaurant
  Main Brands

   SOURCE: ENDOLE                                                                                                       *USING 02 JAN 2018 EXCHANGE OF 1 EUR = 0.900380 GBP

OVERVIEW              MARKET   RETAILERS   FOODSERVICE   TRENDS    ONLINE     PRIVATE LABEL   ORGANIC   APPROACH                                      BUSINESS SWEDEN         8
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
HOWEVER, THE ENTIRE UK RETAIL FOOD MARKET
  SUPPLY CHAIN IS TAPPING INTO CONSUMER TRENDS

                            ‘Good for me, good for you’: A trend in which vegetables will become ‘the stars of the plates’ and
                             in which underutilised normally more sustainable, species of fish and lesser known cuts of meat will
                             form a bigger part of British diets.

                            ‘Gourmet get together’: Where people will eat together more to make them feel comforted in this
                             time of political uncertainty with Brexit. The Brits will choose to eat classic dishes that invoke
                             nostalgia but that have been reimagined for the modern consumer.

                            ‘Awaken my senses’: Comprising bright colours and experimental flavours as the proliferation of
                             social media brings to life ‘playfulness and creativity’.

                            ‘Telling a story’: Based on demand for seasonal produce, foraged food and artisan products that
      TEXT                   have a story behind them.

  THESE TRENDS WILL BE FELT ACROSS KEY INTERNATIONAL CUISINES - AMERICAN, MODERN EUROPEAN, ASIAN & MIDDLE
  EASTERN
  SOURCE: THE GROCER, BIDFOOD

OVERVIEW    MARKET     RETAILERS   FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                 BUSINESS SWEDEN   9
UNITED KINGDOM'S ATTRACTIVENESS FOR SWEDISH FOOD SUPPLIERS - JANUARY 2018
THE UK E-COMMERCE MARKET FOR GROCERIES IS ONE
  OF THE WORLD’S LARGEST AND CONTINUES TO GROW
    THE ONLINE GROCERY MARKET SIZE IN BILLIONS                                                FOOD AND DRINK* E-COMMERCE VALUE (£MN)
                                                                                             16000

                                                             11.5                            14000
           UK
                                                                                   17.5                                          CAGR
                                                                                             12000                               7.7%

                                                      9.4                                    10000
     France
                                                                      13.6
                                                                                             8000

                     0.99
 Germany                                                                                     6000
                              2.9
                                                                                             4000
                     0.7
      Spain                                                                                  2000
                       1.6

                                                                                                  0
                                        2018         2023                                                             2018                                 2023*

  SOURCE: KANTAR WORLDPANEL, IDG, MINTEL, EUROMONITOR, BUSINESS SWEDEN ANALYSIS              *INCLUDES GROCERY AND ONLINE PLAYERS, DOES NOT INCLUDE FOODSERVICE

OVERVIEW    MARKET         RETAILERS   FOODSERVICE     TRENDS       ONLINE   PRIVATE LABEL    ORGANIC     APPROACH                                                BUSINESS SWEDEN   10
ONLINE IS THE MAIN DRIVER ON THE UK GROCERY
  RETAIL MARKET
  UK ONLINE GROCERY MARKET CHARACTERISTICS

      Largest players within online grocery in the UK are
       Tesco, Sainsbury’s and pure player Ocado, seeing
       strong competition from newcomer Amazon Fresh
      The core online grocery buyers are younger
                                                                                               50%                       £85
                                                                                                                       is the average UK
       consumers and consumers with high income                                          of all Brits are current
                                                                                                                    online basket, making it
                                                                                        online grocery shoppers
      The average spend per purchase remains higher                                                                the largest in the world
       online than offline; this high online spend is a
       combination of shoppers choosing online primarily
       for large stock up trips and retailers requiring a
       minimum spend
      UK online grocery channel share is predicted to
                                                                                                £11.5
       grow from 6 to 7.9 percent over the next five years
      Consumers place increasing pressure on delivery
                                                                                        1 in 10  bn
                                                                                           Brits do all of their
       times, which has become a competitive advantage                                  grocery shopping online     is the value of the UK
       among online retailers
                                                                                                                    online grocery market
                                                                                                                            (2018)

  SOURCE: EUROMONITOR, KANTAR WORLDPANEL, IDG

OVERVIEW    MARKET     RETAILERS     FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                          BUSINESS SWEDEN   11
“THE UK HAS REACHED THE POINT
 WHEN ALL RETAILERS FOCUS
   HEAVILY ON ONLINE SALES
   BECAUSE THEY HAVE TO, THEIR
   CUSTOMERS EXPECT THEM TO.
   RETAILERS IN THE UK RELY ON
   DIGITAL SOLUTIONS TO MAINTAIN
   MARKET SHARE.”
TIM BARRETT, SENIOR RESEARCH ANALYST RETAILING
EUROMONITOR

                                                 12
DELIVERY WILL DRIVE GROWTH IN FOODSERVICE AS
  OPERATORS FACE CHANGING TECHNOLOGIES
  DELIVERY REACHES ALL MARKET PLAYERS                                                    BRITISH FOODSERVICE VISITS GROWTH (YEAR-ON-
                                                                                         YEAR) 2015 TO 2019
      While the foodservice industry as a whole is
       expected to continue growing, individual operators                                 1.4%
                                                                                                     1,3%
       will face significant changes in terms of
       competition and industry roles                                                     1.2%
               Leading fast food brands face increasing                                                         1%
                competition from smaller boutique chains                                  1.0%
               Operators struggle with how to best appeal                                                                                           0,8%
                to changing technologies and consumer                                     0.8%
                                                                                                                                       0,7%
                trends affecting the entire supply chain
      Delivery has risen quickly to become a significant                                 0.6%                                                0,5%          0,5%
       catalyst in the British foodservice industry, driving                                                                   0,4%
       growth in foodservice visits year-on-year                                          0.4%
      Rapid rate of expansion looks set to continue as
       companies like Just Eat, UberEATS and Deliveroo                                    0.2%
       expand their reach across the country,
       encouraging more foodservice operators to adopt                                    0.0%
       delivery as a route to market                                                                    2015     2016           2017     2018         2019
                                                                                                                      Visits      Forecast
  SOURCE: BHA MARKET REPORT 2016, NDA GROUP, THE CATERER                                 *FORECASTED FIGURES

OVERVIEW    MARKET      RETAILERS     FOODSERVICE      TRENDS   ONLINE   PRIVATE LABEL    ORGANIC     APPROACH                                   BUSINESS SWEDEN   13
PRIVATE LABEL IS EXPECTED TO BE A MAJOR SOURCE
    OF GROWTH FOR THE UK GROCERY MARKET
    SHARE OF PRIVATE LABEL VALUE IN SELECTED EU                                            PRIVATE LABEL GROWTH IN THE UK
    COUNTRIES (2018)

        UK                                                                  52.5%             In 2018, private label made up 52.5% of UK value
                                                                                               share

     Spain                                                        42.6%                       Market share in the United Kingdom stayed above
                                                                                               45% and appears ready to resume growth as
                                                                                               supermarkets expand their private label programs to
  Germany                                                        40.1%                         combat the competitive challenge from discounters
                                                                                              Private label’s share has remained above 40% in
     France                                             32.9%                                  the UK since 1997
                                                                                              Private label is now at the forefront of European
Netherlands                                          29.2%                                     retailers’ communications, looking to increase
                                                                                               shopper loyalty
       Italy                           18.1%                                                  The price gap between private label and brand has
                                                                                               closed to 29% on average, due in part to material
                                                                                               costs increasing
    Greece                            16.3%

                                Value Market Share

    SOURCE: KANTAR WORLDPANEL, NIELSEN GLOBAL, PLMA YEARBOOK

  OVERVIEW     MARKET     RETAILERS    FOODSERVICE      TRENDS    ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                            BUSINESS SWEDEN   14
A NUMBER OF PRIVATE LABEL CATEGORIES HAVE
  SHOWN STRONG GROWTH SINCE 2013
  PRIVATE LABEL VALUE SHARE BY CATEGORY

  90%          +2,6%
  80%

  70%                          +3.7%         +0.4%
                                                              -0.2%
  60%
                                                                                                               -8.9%
  50%                                                                       -0.6%
                                                                                            -0.2%
  40%
                                                                                                                        +2.1%      +1.8%            -0.9%
  30%

  20%

  10%

    0%
            Delicatessen        Bakery            Dairy       Frozen      Dry grocery     Household     Non-alcoholic   Health &    Alcoholic    Confectionary
                                                                                                         beverages       Beauty    Beverages
                                                                              2013      2017

  SOURCE: PLMA YEARBOOK 2017

OVERVIEW    MARKET      RETAILERS   FOODSERVICE      TRENDS   ONLINE   PRIVATE LABEL    ORGANIC     APPROACH                                    BUSINESS SWEDEN   15
THE ORGANIC SEGMENT SHOWS STRONG GROWTH
  ACROSS THE UK FOOD RETAIL MARKET
  ORGANIC SALES ACROSS MARKET CHANNELS (£MN), 2017-2018

                                     4.2%
    1,600
                                    Growth

    1,400                                          1,500
                          1,439
    1,200

    1,000
                                                                                         9.7%                         9.5%
      800                                                                               Growth                       Growth
      600

      400                                                                                                      328            359

      200                                                                    260                   286
           0
                               Supermarkets                              Box schemes and online                 Independents

  SUPERMARKETS ARE THE LEADING CHANNEL FOR ORGANIC FOOD BUT GROWTH IS HIGHER IN OTHER CHANNELS

  SOURCE: SOIL ASSOCIATION ORGANIC MARKET REPORT

OVERVIEW       MARKET   RETAILERS    FOODSERVICE      TRENDS   ONLINE   PRIVATE LABEL    ORGANIC    APPROACH                   BUSINESS SWEDEN   16
THE 4 LEADING ORGANIC RETAILERS ARE SAINSBURY'S,
  TESCO, WAITROSE AND OCADO
                                                                                               Importance
                                                                     Organic Market
                                              Grocery Market                                       for      PL Organic   Organic Range
    Rank       Retailer                                                  Share
                                                  Share                                         Corporate     Brand      (2015)
                                                                     (2016 estimate)
                                                                                                Strategy
                                                                                                                         709 product lines
       1                                           16.8%                    28%                   High      SO Organic
                                                                                                                         (300 SO Organic)

                                                                                                              Tesco
       2                                           28.6%                    26%                   High                   742 product lines
                                                                                                             Organic

                                                                                                                         778 product lines
       3                                            5.4%                    23%                   High        Duchy
                                                                                                                         (500 Duchy)

                                                                                                            Wholegood
       4                                            0.5%                     7%                   High                   3344 product lines
                                                                                                             + Duchy

                                                                                                              ASDA
       5                                           15.9%                    4.5%                  Low                    150 product lines
                                                                                                             Organic

       6                                           11.1%                    4.5%                  Low       M Organic

  SOURCE: KANTAR WORLDPANEL AND MARKET ESTIMATES

OVERVIEW    MARKET     RETAILERS    FOODSERVICE    TRENDS   ONLINE   PRIVATE LABEL   ORGANIC    APPROACH                         BUSINESS SWEDEN   17
THREE WELL-KNOWN INDEPENDENTS FOCUS SOLELY
  ON ORGANIC FOOD IN THE UK GROCERY MARKET

      About: While Whole Foods is not                         About: Planet Organic is an                   About: as nature intended is a
       exclusively organic, it has a strong                     independent retailer in London with            London-based, exclusively organic
       loyalty to organic products within its                   a young customer base. Planet                  chain with stores in central
       range and stocks a majority of the                       Organic sells almost exclusively               locations. It focuses mainly on
       main organic brands available                            organic food and drinks, as well as            brands and offers a good
       elsewhere in the UK. Given that it                       many natural remedies and health               ‘springboard’ for smaller, innovative
       is experienced in selling organic in                     and beauty products. Its newer                 organic brands. It prides itself on
       the US and is a key player there,                        stores focuses heavily on the ‘food            working with passionate and
       much of the future UK strategy will                      to go’ offer.                                  knowledgeable suppliers with
       likely follow a similar approach.                                                                       quality products.
                                                               No of stores: 7
      No of stores: 7                                                                                        No of stores: 6
                                                               URL: planetorganic.com
      URL: wholefoodsmarket.com                                                                              URL: asnatureintended.uk.com

  SOURCE: BUSINESS SWEDEN INTERVIEWS, COMPANY WEBSITES

OVERVIEW    MARKET     RETAILERS     FOODSERVICE     TRENDS    ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                                  BUSINESS SWEDEN   18
DURING THE LAST SIX YEARS, THE ORGANIC MARKET
  HAS GROWN STEADILY AND IS WORTH £2.2 BILLION
  2003-2017 UK SALES OF ORGANIC PRODUCTS (£ MILLIONS)

                                                                                                                                                2218
                                                   2078     2113
                                                                                                                                       2029
                                                                                                                               1954
                                         1900                                                                           1862
                                                                     1840
                                                                                                        1741    1789
                                                                                1731
                                                                                            1667
                              1600

                  1200
       1100

       +10%          +9%      +33%        +19%     +9%      +1,6%    -13%        -6%        -3,7%       +4,5%   +2,7%   +4%    +4,9%   +7%       +6%

       2003       2004        2005       2006      2007     2008     2009       2010        2011        2012    2013    2014   2015    2016     2017

  SOURCE: SOIL ASSOCIATION ORGANIC MARKET REPORT

OVERVIEW    MARKET      RETAILERS    FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL     ORGANIC      APPROACH                             BUSINESS SWEDEN   19
THERE ARE MANY POSSIBLE ROUTES TO MARKET FOR
  THE UK RETAIL MARKET

      Producer/                                                                                                    Customer
      Exporter                      Agent/Sales
                                                                                                     Retailer/
                                    Rep
                                                                      Distributor                    Convenience
                                                                                                     Stores

                                                                      Wholesaler
                                      Importer

  IT IS CRUCIAL TO HAVE KNOWLEDGE ABOUT THE MARKET IN ORDER TO CHOOSE THE MOST SUITABLE DISTRIBUTION MODEL

OVERVIEW   MARKET   RETAILERS   FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                 BUSINESS SWEDEN   20
SIMILARLY, THERE ARE MANY POSSIBLE ENTRY
  ROUTES TO THE UK FOODSERVICE MARKET

      Producer/                                                                                                      Foodservice
                                                                                                       Retailer/     Operator
      Exporter                                         Distributor                                     Convenience
                                                                                                       Stores

                                                       Cash & Carry

                                                       Wholesaler

OVERVIEW   MARKET   RETAILERS   FOODSERVICE   TRENDS     ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                   BUSINESS SWEDEN   21
WHAT DO COMPANIES THAT SUCCEED IN THE UK FOOD
  AND BEVERAGE SECTOR DO?
  SUCCESS FACTORS                                                                                         COMMON MISTAKES
                     Carry out thorough market research beforehand in order to approach retailers
                      with appropriate insights and understanding                                          Believing the consumer
                                                                                                            immediately understands
                     Make necessary adjustments to products and packaging, such as image and               your products and offering
                      language, to suit the market
                                                                                                           Not making necessary
                     Ensure a product has the necessary certifications, labelling and ingredient           adjustments to the market in
                      requirements                                                                          terms of e.g. packaging,
                     Create a marketing plan and allocate the necessary budget to build your brand         storytelling
                      and consumer awareness of your product; allocate budget for tastings, product        Being chosen by a retailer
                      samples, advertisement, campaigns, etc.                                               rather than choosing which
                     Understand your unique selling points, including what makes you different and         retailer to work with
                      how you add value, in order to tell a convincing story                               Not allocating sufficient time
                     Set up the right logistics flow in order to be able to offer an attractive market     and budget for the market
                      price to your local partners and end consumers                                       Not setting up a proper
                     Understand what your target customers are looking for and how to reach them;          logistical chain to reach an
                      similarly, understand what buyers selling to your customer group are looking          attractive price for the market
                      for, and focus on the most promising segments and customers                          Not setting proper pricing and
                     Be persistent and plan for the long-run: invest in and cooperate with local           margins when working with
                      partners to show commitment to the market                                             retailers and/or distributors

OVERVIEW   MARKET     RETAILERS   FOODSERVICE   TRENDS   ONLINE   PRIVATE LABEL   ORGANIC   APPROACH                          BUSINESS SWEDEN   22
THERE ARE SEVERAL INTERESTING FOOD INDUSTRY
  EVENTS IN THE UK TO EVALUATE FOR 2018

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     Natural & Organic Products Europe                                  London Food Tech Week                              The Lunch Show

                          Date: 7-8 Apr 2019                                      Date: 20-27 May 2019                         Date: 19-20 Sep 2019
                          Location: London                                        Location: London                             Location: London
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THERE IS AN OPPORTUNITY FOR SWEDISH SUPPLIERS
  TO SELL AT THE TRY SWEDISH SHOP AT OCADO.COM
    THE TRY SWEDISH SHOP IS HIGHLY SUCCESSFULL                                     A SUPPLIER RELATIONSHIP WITH OCADO IS THE FIRST
    AND CONTINUES TO GROW (SALES IN £MN)                                           STEP TO ACCESSING THE GROCERY RETAIL MARKET

      4                                                                             Since 2012, Business Sweden has introduced Ocado to Swedish
                                                                                     grocery suppliers that have been listed in the Try Swedish shop
   3.5                                                                              The close collaboration has resulted in the Try Swedish shop
                                                                                     being one of Ocado’s best performing international shops, with an
      3                                                                              increasing number of suppliers, products and sales figures for
                                                                                     each year of operation
   2.5                                                                              The shop offers a unique opportunity to establish sales and
                                                                                     distribution on the UK market, reaching 70% of British households
      2                                                                             Becoming a supplier to Ocado provides a shortcut to strategic
                                                                                     expansion on the UK market, as well as a test and reference case
   1.5                                                                               for selling on the UK market
                                                                                    The first step to becoming a supplier to the shop in 2019 is a pre-
      1                                                                              screening by Business Sweden followed by introduction to
                                                                                     Ocado’s buying team
   0.5
                                                                                                Interested in hearing more? Please contact:
      0                                                                                         edward.lindquist@business-sweden.se
             2013        2014         2015       2016            2017

  SOURCE: OCADO

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TEAM BUSINESS SWEDEN
  FOOD LONDON

                           Edward Lindquist
                           Phone: +44 20 7258 5145
                           Email: edward.lindquist@business-sweden.se

                           Samiksha Jalan
                           Phone: +44 20 7258 5143
                           Email: samiksha.jalan@business-sweden.se

  For continuous
                                  @BusinessSwedenUK
  updates, please
  follow us on:            http://www.business-sweden.se/Storbritannien
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ABOUT BUSINESS SWEDEN

 Business Sweden supports Swedish companies via its 50+ offices around
  the world, providing strategy and operations advisory services across
  industry sectors
 In-depth local knowledge and access to a global network of internal and
  external experts allow our 500+ professional consultants to help our
  clients reach their full international potential

    GROWING SWEDEN

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