The study explores the structure and regulatory challenges of selling fruit and vegetables online and analyses the format of existing web shops specialised in online sales of fruit and vegetables, their delivery model as well as compliance with the current EU regulatory framework for (online) marketing standards with multifaceted results.
While a big share of European fruits and vegetables online sales are conducted by online pure players and retailers with roughly 51% of all findings, surprisingly the study illustrated the growing share of agricultural suppliers with direct marketing to consumers. Freshfel’s Director Trade Policy and Business Development and co-author of the study, Nelli Hajdu remarks, that this study marks only the beginning of understanding the complexity of this uprising outlet: “The structure of the online landscape is characterized by national shopping ‘traditions’ and trends, a challenge for creating a favourable regulatory environment. However, the impact of COVID-19 on market structure and consumer uptake is still to be examined in detail.”
Recently, online sales have become an important outlet for food products and the COVID-19 pandemic has accelerated this trend. As little was known about the online sales and distribution system of fruits and vegetables, Freshfel Europe teamed up with the OECD to explore the structure and size of the European online fruit and vegetable market as well as its compliance with existing regulatory requirements. To quantify the size of the market, seven sample EU Member States have been selected, to compare their organisational features (online-pure players/retailers, agricultural suppliers) as well as their distribution system (delivery vs. click-and-collect). The study also examined the verification of compliance with labelling requirements of Marketing Standard Regulation EU 543/2011.
For the first time ever the ground breaking study gave an accurate picture of the size and structure of EU e- Commerce suppliers. The study found that while the overall structure of online fruit and vegetable sales can be defined by its characteristic business format, either as an online-pure player, retailer or agricultural supplier, as well as by its distribution structure, this varies strongly at national level. For example, the German online fruit and vegetable market is mainly shaped by agricultural suppliers selling directly to consumers, while in Spain smaller local ‘Fruteria’ shops have gone online to expand their customer base. France stood out with a strong and established coverage of click-and-collect opportunities. Regarding market size, the online market shows a high range of fragmentation, however this doesn’t exceed 100 to 150 web shops per country, and is depending on the maturity of the market development at national level. Regarding the compliance with labelling requirements in the context of the Marketing Standard Regulation EU 543/2011, the rate highly diverged by operator and organisational structure.
While revealing promising signs for the future of online sales, this first study also revealed key questions, which will require further investigation. This includes understanding the characteristics of successful business models for fruit and vegetable online sales, trustworthiness and verification of information provided on websites and the overall uptake by consumers. These key areas for further investigation have become even more relevant as the Covid-19 pandemic continues to accelerate overall online food availability, especially fruit and vegetable sales, with urgent need for quantification.