Own-label producers need export wake-up call, supply chain expert
Returning from the MDD own-label show in late March, the expert, who asked for his name not to be revealed, told FoodManufacture.co.uk: “I was surprised to notice that from 628 own-label manufacturers exhibiting there that I could not see one British own-label supplier.”
He added: “Considering that the UK leads the own-label industry and the UK suppliers complain about continental competition, I would have expected more of them to go out there and take the competition to the market…”
“There needs to be some sort of rallying call to UK own-label manufacturers to identify and pursue near-shore export opportunities like France to grow their businesses.
But is it really that simple?
However, a spokesman for one UK-based own-label food supplier, who wished to remain anonymous, said that there were sound business and logistical reasons for not prioritising markets in mainland Europe.
If you want real market penetration in Europe, he said, “you need to establish manufacturing sites over there, otherwise problems involving shelf life and distribution [for non-ambient goods] are paramount.”
Where a large proportion of the manufacturer's income comes from chilled convenience foods, he pointed out that countries such as France and Germany sold more fresh produce, with items such as ready meals and packed salads less readily available.
“Ready meals are growing at 10%, while packed sandwiches are growing 4-5%, so the UK offers a lot more in terms of attractiveness going forward,” he said.
A spokesman for own-label producer Greencore said it was the food group’s “strategy to lead” the market in the UK and Ireland and build its relationship with retailers rather than target ‘near shore’ export markets, its US business aside.
Nonetheless, he said Greencore produced limited amounts of grocery goods for export to around 20 countries in mainland Europe and beyond, including products such as ambient cooking and table sauces in own-label and tertiary branded incarnations.
However, chilled foods were subject to the classic “short shelf-life issue, which means logistical challenges,” the spokesman added.
MDD not the only show in town
But Angus Allan, md of own-label producer, Colchester-based Indulgence Patisserie (which supplies premium frozen and chilled desserts for retail, foodservice and travel catering markets) said that MDD was quite a new show, and wasn't the only one in town.
"I cannot speak for other companies, but we are very active in export markets. Exports now account for 25% of our sales and our desserts go all over the world. Export’s share of our turnover will increase still further when our second Colchester factory opens in the Autumn," he said.
"We are exhibiting at PLMA [World of Private Label trade show] in Amsterdam again in May to build on last year’s success and to launch our new range of retail frozen desserts in the EU market."
Food and Drink Federation figures sourced from Eurostat show that UK food and drink exports (including alcohol) grew from £11.69bn to £14.39bn between January 2007 and December 2009.
