Global Foodservice Trends Bulletin
- incorporating implications for Irish foodservice suppliers
Issue two – December 2010 Prepared for Bord Bia by
Growing the success of Irish food & horticulture AIDAN COTTER
Growing the success CHIEF EXECUTIVE
BORD BIA
of Irish28food & horticulture JANUARY 2009
Introduction CONTENTS While the Irish economy continues to suffer, other countries are recovering and growing. Product trends and implications Opportunities exist for those suppliers who: What’s hot today: the low price • Study and learn from these trends; challenge. • Relate them to their customer base; What could be hot tomorrow: • Work closely with their foodservice regaining premium foodservice. customers to put them into action; • Partner with their customers to monitor any innovations and adapt them, or Consumer trends and implications extend them. Sustainable and organic food: the Irish advantage.
Food traceability gains pace in foodservice. Premium fish and chips ?
How far will traceability go?
Route to Market trends and implications
Changing role of the wholesaler? Cash & Carries benefit in the recession. Death of the wholesaler?
C&C helped by recession
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What’s hot in global foodservice today ? The low price challenge: ―Value‖ food ensures consumers can still afford the eating out experience and affects the formats of operators and the food they require.
• • •
Lower priced menu items that offer value (as opposed to cheap).
Fish and chips £11.95 London
Staple menu items (often bakery-based), that are enhanced by presentation and cooking style e.g. Fish and chips, sausages, meatballs. “One course all you can eat specials” that are even cheaper than set menus. Encourages traffic and attracts complementary purchases (extra courses/other diners).
Flams ―All you can eat‖ buffet in Paris from €15
Sausages and mash €10.95 Germany
IKEA meatballs USA
Giant bowl of noodles £9.95 London
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What’s hot in global foodservice today ? ―Portable food‖ is the fastest growing element in foodservice globally:
• • •
Busy lives mean the decline of traditional meal times and situations. Food in foodservice is increasingly bought to be consumed “on the go”.
Giant Wraps. Chamonix €4.95
Food “on the go” must be handheld, compact and usually bakery-based…wraps/tortillas, sandwiches, pasties and rolls. Recipes are increasingly taken from exotic locations such as Mexico. Yuca portable tortillas Mexico $2
Tiny‘s giant sandwich New York $6.99
Handmade Gourmet ‗Pie to Go‘ £4.95 London
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What could be hot tomorrow? Regaining premium foodservice - just hoping to increase prices when things improve is not an option, look at lessons from other countries.
• Many will concentrate on improving the experience of diners to justify premium prices.
• Establish the premium position now, even if prices must be kept down in the short term.
• Prices will not just go up when the economy recovers. The
Cooking Lessons within a restaurant in Italy
customer will want more if they are paying more:
• •
Offering cooking lessons to patrons. Taking award winning dishes from national competitions to small independent restaurants. A good place to start is the award winners at the prestigious “Bocuse D’Or” held in Lyons each January. The culinary equivalent of the Olympic Games !! Award winners at the Bocuse D‘Or
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Product trend implications for Irish suppliers Implications:
• • •
Look abroad for ideas and inspiration, don‘t be afraid to copy! Look for what‘s happening at the outlet level. How can you support your wholesaler customers in these initiatives?
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Plan initiatives with your customers
Think about premium pies and sausages with added value ingredients aimed at affordable price points. Plan an “all you can eat package” around your products. You should consider cooperation with complimentary product suppliers for your wholesale customer to achieve a total range. Sponsor with wholesaler customers “in-restaurant” cooking lessons using mainly (but not exclusively) your product ingredients. Study the Bocuse D’Or winners in January 2011 in Lyons. Plan a menu for your wholesale customers based on your products around these award winners at value prices.
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Sustainable and organic foods “Ireland is known for natural organic sustainable food” : Dutch foodservice wholesaler
A lesson from USA; Earthbound farms
Earthbound‘s mantra
Earthbound farms has now expanded into foodservice
In Europe : • 83% of consumers consider it is important to eat healthily; • 58% are more conscious of environmental issues in their choice of products today; • 56% prefer to buy from companies that are aware of the impact of environmental issues.
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Food traceability gains pace in foodservice Broad acceptance of traceability Mc Donalds has committed to it internationally
"McDonald's believes that a robust traceability system is critical to ensuring consumer confidence and building brand trust in the beef industry."
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Consumer trend implications for Irish suppliers Move away from commodities: turning sustainability, organic, provenance and artisan into profits.
• Companies that sell commodities typically must offer low prices and deal with slim margins. • Why? Because the customers’ perception of the product or service is one of ambivalence. In the customers’ mind, the product or service is just like everyone else’s, so there’s no reason to pay more for it. • Organic, sustainable, provenance and artisan however, do command a premium.
Ireland has an advantage.
If you‘ve got it—flaunt it!
Help customers build sustainability into concepts.
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The ―organic‖ logo will be standard in EU.
Consumer trend implications for Irish suppliers
How far do you go ?
Understand how your product needs to deliver from a traceability point of view.
How explicit should you be?
Traceability in coffee Traceable salads in USA
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Changing role of the Wholesaler ? Chain % value in Foodservice: 2010
100 90 80 70 60 50 40 30 20 10 0
• Chains in foodservice are increasingly looking to deal direct with producers, using wholesalers only for logistics. • However, while it is true that chains are increasing their importance in foodservice, independent operators still dominate the market throughout Europe (as the chart shows). • Independent foodservice relies on delivered wholesale and Cash and Carry, and always will do. Manufacturers such as Davigel in France are vertically integrated from product source through direct wholesaler delivery of fully finished product and are unashamedly targeting the independents. % Chains
UK Ger Ire Fra
It
Sp
% Independent
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Cash & Carries benefit in the recession • •
Until recently, Cash & Carry growth was restricted, and its customer base of independents was shrinking. Now Cash & Carry operators lead the growth in UK wholesaling in 2010, outperforming competitors in delivered foodservice.
Why is this?
•
•
Small independent operators are still the majority within the foodservice market. They look to cut cost wherever they can. This increasingly means visiting the Cash & Carry (or even the supermarket) where there are lower prices. Cash & Carries in the Netherlands see the retailer and not the wholesaler as their main competitor. They are currently in a price war with many items, such as coffee, which is sold at a considerable loss to encourage traffic.
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Route to Market trend implications for Irish suppliers Partner with wholesalers and cash & carry – they are still the most cost effective route to market for most foodservice suppliers. The wholesaler requires a partnership, not just a buyer/seller stand-off.
• • •
A partnership can include customer tastings and events. Understanding your customer’s customer (i.e. the operator) will allow suppliers to become more focussed. Customise your product to foodservice requirements – format and packaging are crucial.
The Cash & Carry should be treated much like a retailer.
• •
•
Packaging should be visible and enhance the product on display, but do not just use retail packaging. Instructions should be detailed for the foodservice professional, not for the general public.
The product in Cash & Carry sells on eye appeal just as much as in retail.
Growing the success of Irish food & horticulture
Global Foodservice Trends Bulletin
- incorporating implications for Irish foodservice suppliers
Issue two – December 2010 Prepared for Bord Bia by
Growing the success of Irish food & horticulture AIDAN COTTER
Growing the success CHIEF EXECUTIVE
BORD BIA
of Irish28food & horticulture JANUARY 2009
