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South Korea retail reshapes in response to demand for convenience stores

Vegetables for sale at CU convenience store_photo BGF Retail
Photo: vegetables for sale at CU convenience store by BGF Retail

South Korea’s convenience stores have introduced new product lines and discounted prices to combat the perception of a lower-quality offering compared to larger stores, according to a report by the Korea Times. During the pandemic, consumers have increasingly turned to online shopping and nearby convenience stores rather than larger supermarkets. 

In response to this trend, BGF Retail and GS Retail have launched promotions for vegetables at CU and GS Fresh Mall, respectively. CU is BGF Retail’s convenience store brand and GS Fresh Mall is GS Retail’s online grocery store. BGF Retail had also streamlined its distribution process and worked directly with growers in order to cut prices. 

A BGF Retail official, speaking to the Korea Times, said: “Convenience stores have been offering various types of vegetables at reasonable prices and doing so has increased sales significantly. We will continue to provide convenience to our customers by introducing a greater variety of products according to their needs.” 

 

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REO Veiling: increasingly becoming a leader in tomatoes

REO Veiling: more and more a leader in tomatoes
PRESS RELEASE

 

REO’s main products are now tomatoes, which have surpassed the auction’s renowned leeks and other Belgian vegetables.

In 2020, tomato volumes reached over 64,240 tons at the Roeselare REO Veiling, ahead of the leeks, which are now stable at around 55,000 tons per year. Glasshouse vegetable production has almost doubled over the last 3 years, with 33,800 tons marketed in 2017. Production of other vegetables remains rather stable (see table below): 56,858 tons of leek, 9.5 million punnets of strawberry, 16.6 tons of endives, 9.4 million punnets of mushrooms, 37 million cucumbers, and 33.7 million heads of lettuce. Despite Covid-19 and the drought in May and June 2020, REO Veiling still had a good year. “Many people started to cook for themselves and used fresh vegetables for that,” said REO’s commercial manager Dominiek Keersebilck. The turnover of around €207 million was just €800,000 less than the record set in 2019. “We can look back on a successful year, with growth in supply of 2.5%. That is a record,” said Keersebilck.

Top 12 products of REO Veiling

1

Tomatoes

69.2 million

kg

2

Leek

56.9 million

kg

3

Strawberries

9.5 million

punnets

4

Endive

16.6 million

kg

5

Mushrooms

9.5 million

punnets

6

Butterhead lettuce

33.8 million

heads

7

Cucumber

37.7 million

pieces

8

Courgettes

30.1 million

pieces

9

Convenience

5.4 million

kg

10

Cauliflower

4.2 million

heads

11

Celeriac

7.3 million

pieces

12

White cabbage

6.2 million

heads

   

More sales to Benelux and southern European countries

REO exclusively sells the products of its members, who are based in Belgium and northern France. Due to the pandemic, Benelux countries now account for a larger part of turnover. France is the leading export market, accounting for 86% of the total volume. Germany and the UK are also key destinations. “We have been closely following everything around Brexit, and we are convinced that due to our location and the image of our products, such as leek, beef tomatoes and strawberries, we will strengthen our advantage on the UK market, in close cooperation with the main Belgian exporters,” said Keersebilck. Southern European countries are also becoming more important for the exports of the REO Veiling, in particular for open-field vegetables like leek and lettuce.

 

 

 

Flandria, Fine Fleur and Tomabel premium brands

The REO Veiling markets 3 brands: Flandria, Fine Fleur and Tomabel. “With Flandria and Fine Fleur, we focus promotion on the Belgian consumer through a variety of actions,” said Keersebilck. Cooperation with the famous European volleyball team Knack Roeselare allows REO to combine top sports, healthy vegetables and champion quality. Regarding packaging, there will be a major shift from fixed blue crates to foldable green crates in 2021. In cooperation with Europool Systems, REO is adapting and investing in new washing lines, as well as in automatic inbound and outbound processes. The auction will also develop new packaging for its top brand Tomabel, starting with strawberries.

Belgian reputation in Asia and Canada

Field vegetables from Belgium are popular specialties supplied by airfreight to long-distance markets like Canada, South Korea, Hong Kong and Japan. Among these products are curly endive, Belgian endive and special-grown leek. “We want to introduce more open-field varieties in Canada like celeriac and leek. We are also working on products containing no soil,” said Keersebilck, who also believes in the market potential of celeriac in South-East Asia, even if the pandemic currently makes it somewhat difficult to introduce new items to foreign markets.

Food safety & sustainability strategies at REO

The auction provides all the certifications required by its customers. The 10 major ones are:

  • Unitar SDG Pioneer Award 2020: REO Veiling was the first to receive the award with 88 other laureates. It recognises the numerous sustainability actions undertaken within the context of the 17 United Nations Development Goals (SDGs) over the last 3 years.
  • ACS Handel or Self-Checking Guide for trade and processing of potatoes, fruit, vegetable, and it is issued by Integra. The guide contains all the requirements and recommendations relating to food safety (including traceability and reporting obligation) and quality (considerations under the authority of the FASFC), which apply to potato, fruit and vegetable processing facilities and in trade involving PFV products.
  • Organic business certificate for companies processing organic products (issued by Integra).
  • Productcertificat Flandria® quality label,
  • FCA (Feed Chain Alliance): food for the animal feed sector, issued by Promag.
  • ISO 22000 governing food safety
  • IFS certificate issued by Integra
  • QS certificate issued by Integra
  • OVM certificate issued by the Job Centre West Flanders, a not-for-profit organisation.

REO Veiling is also investing heavily in communication and big data. The Care4Growing mobile app developed with partners is a good example of investment in technology aimed at raising competitiveness in the supply-chain.

Food surplus and waste management

REO Veiling is a pioneer in the fight against food waste in Europe. In 2017, it won the very first Food Waste Award, issued by FSE Networks in collaboration with OVAM and Komosie. Every year, REO Veiling sells about 250,000 tons of home-grown fresh seasonal fruit and vegetables. To deal with food waste, it seeks useful partnerships for these products. In the first instance, surplus food goes to the food banks of West Flanders, East Flanders, Hainaut and Namur. As a result, 500,000kg of fresh fruit and vegetables, or an average of 1 articulated lorry trailer per week, is sent to underprivileged people every year. In addition, surplus waste is also re-used to feed animals. Indeed, REO Veiling is the only Flemish vegetable auction which is FCA-certified to reuse its products as animal fodder. And it is not only dairy cows from the same region that are fed with REO products, but also animals in Bellwaerde (animal and amusement park).

enVie combines food waste and social engagement

The social enterprise enVie now allows the Belgian people to enjoy delicious soups that are “full of commitment”: each bottle of soup is made in Brussels from surplus fresh Belgian vegetables by a motivated team of employees who, through the project, have become reintegrated into the labour market after a long period of unemployment. REO Veiling supplies surplus fresh vegetables to enVie, mainly those that are suitable for making soup (e.g. courgette, leek, celery, tomato, etc.). “As a grower’s cooperative, we believe in the absolute added value of cooperation to tackle issues such as sustainability and food waste. By working together with our various partners in a targeted way, we can still make use of surplus fruit and vegetables, which means added value for us as a producer, the social enterprise and ultimately also the consumer,” said Dominiek Keersebilck, commercial director of REO Veiling. Via this initiative, EnVie has created an extra sales channel for REO Veiling in its fight against food waste.

Vacuum cooler for leafy vegetables

REO Veiling has a vacuum cooler. A vacuum is created in the vacuum box. As a result, the water evaporates at room temperature. Together with the water, heat is extracted from the lettuce, as a result of which, it is quickly refrigerated and the product can be kept for much longer. This means that the lettuce can remain longer on store shelves or can be transported by lorry to remote destinations such as Spain and Italy. REO Veiling also encourages the use of multi-use packaging for its products. The packaging comes in virtually all colours, sizes and materials, based on the customer’s preferences.

Rapid growth in organics

Organics have registered rapid growth at the REO Veiling. The main product is organically certified Tomabel special mushroom. Other key products are leek and celeriac, as well as niche products like Babyleaf. “We will continue to grow in organics,” said Keersebilck.

REO Veiling turnover with organics

2017

€6 million

2018

€7.3 million

2019

€7.9 million

2020

€10.3million

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Surinver offers fresh organic products and a convenience range

Surinver offers fresh organic products and a convenience range
Photo: Surinver

Surinver, an Alicante-based agricultural cooperative dedicated to the production and distribution of fruits and vegetables, is focused on increasing organic production this campaign, while also investing in the expansion of a factory for its convenience range and a new line of pumpkin production. The cooperative has over 400 members, 300 hectares of greenhouses and 1,600 total hectares of production of different vegetables, citrus and conventional and organic fruits. Surinver also has a range of conventional and organic convenience products, with some dedicated to the food service channel. Surinver’s organic assortment is registering very positive results, with an increase of 31% in turnover compared to last year. “For us, it is essential to guarantee the highest quality in the products we supply, as well as the best care in the field. For this, we have a quality system that guarantees products from the selection of the seed to the delivery of the product, passing through strict controls to ensure maximum quality and the efficient use of resources,” said Mª Dolores López Ruiz, of the department of marketing. Surinver’s facilities are located on an area of land of 103,000 m2, with an efficient air-conditioning system to reduce greenhouse gas emissions.

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Spain’s Minister of Agriculture congratulates Cooperativa La Palma on launch of convenience range: Cherrymole®

Spain’s Minister of Agriculture congratulates Cooperativa La Palma on launch of convenience range: Cherrymole®
Photos: Cooperativa La Palma

Last week, Cooperativa La Palma was visited by Spain’s Minister of Agriculture, Livestock, Fisheries and Sustainable Development of the Junta de Andalucía, Carmen Crespo, to whom it presented its new line of convenience range products, consisting of cherry tomato gazpacho and vegetable cream, branded Cherrymole®. Both premium elaborations concentrate the flavour and quality of the mini-vegetables of this leader in the international fruit and vegetable sector.

Crespo held a meeting with cooperative’s governing council and toured its modern facilities, where some of Europe’s most innovative and high-quality agriculture takes place. During the visit, Pedro Ruiz shared with the counselor the principles of this business model that unites 700 farmers, 1,300 workers and more than 4,000 families, based on excellence, professionalism, constant improvement and social responsibility.

Ruiz said, “In La Palma we always innovate and work to offer vegetables with the best quality, healthy, tasty and respectful with the environment. These totally natural preparations concentrate all the flavour and quality of our best mini-vegetables”, explained the president of La Palma. Both gourmet novelties satisfy consumer demand for healthy and quality food, practical and ready to drink, while preserving its organoleptic properties intact.”

During the meeting, the Governing Council highlighted several priority issues for agricultural development, including defending horticultural production against unfair competition from third countries and supporting the sector in the new Common Agricultural Policy. 

 

 

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Veggie sticks in convenient packaging at Bejo

Bejo's stand at Fruit Logistica focused on 6 concepts around the theme ‘Taste, Health and Convenience’: Coolwrap, Delicioni (fresh onion), Kohrispy (kohlrabi sticks), Cool Carrot Candy (snack carrots), Veggie corner and organic seed.

Bejo’s stand at Fruit Logistica focused on 6 concepts around the theme ‘Taste, Health and Convenience’: Coolwrap, Delicioni (fresh onion), Kohrispy (kohlrabi sticks), Cool Carrot Candy (snack carrots), Veggie corner and organic seed.

After good results in the Netherlands, Coolwrap (a flat cabbage suited to various uses e.g. wraps) will be introduced in Denmark and Sweden over this year. Delicioni is a crispy, juicy onion which was introduced in South Europe two years ago and will expand to more European markets this year.

Snacking is a key food trend which Bejo wants to dive into with its tasty, sweet Kohlrabi sticks (of the new variety Konan), a product already well-known in Germany, and its snack carrots, known as Cool Carrot Candy, which are already retailing in the Dutch market through Albert Heijn.

Bejo’s approach is to offer all the new convenient concepts to producers so they can improve sales to retailers in their own countries, in some cases with the aid of taste consumer panels.

In line with the convenience trend, Bejo´s Veggie corner offers a range of vegetables to make consumers’ lives easier and healthier. Along with carrots and Kohlrabi, The Veggie corner also contains Krunchelly celery sticks.

CVA
Photo: Bejo Veggie Corner

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Insights into food retailing in Japan

What exporters need to know about the Japanese retail food industry.

About 23% of household spending in Japan is on food. It’s a country where tastes and preferences are heavily influenced by cultural, societal and environmental drivers. Japanese culture, for instance, places strong emphasis on the four seasons, which is reflected in changes in purchase habits and gift-giving patterns over the year.

According to a USDA Gain report, Japan is also a nation that prefers convenience, quality, and single-serving sizes. More than 3 million people commute via a combination of train and walking into Tokyo every day and highly value convenience and accessibility.

Key target markets in Japan: seniors and young people

Japan’s population is aging faster than any in the world and its Generation M is the fastest growing senior population (over 65) in the world. The roughly 35 million citizens in this generation are expanding the influence of the silver demographic, estimated to now represent about 27% of the Japanese population but set to reach 36% by 2040.

The retail response has come in the form of delivery services, mobile operations, expanded internet shopping, smart phone market integration, promotions, and products developed with Generation M in mind. Because many elderly can not drive or go far to buy groceries, many get their daily meals from a local convenience store.

With such a large senior market, Japan’s youth segment is often overlooked though their consumption spending has increased. Young adults who live alone or with roommates do not cook and almost exclusively eat out. “Due to a busy lifestyle, these young people want to avoid the hassle of cooking at home. The rise of the working, single-person households is correlated to the rise in sales of ready-made, frozen, take-out, delivery, and restaurant-prepared meals,” the report says.

Recent food trends in Japan

Major trends of relevance in Japan include burgeoning demand for private brands, healthy and functional foods, and for time-saving foods (e.g. frozen foods).

There has been strong growth in the area of prepared foods, particularly home meal replacements (HMR), in the past few years, with offerings increasing in every retail area and a 13% rise in HMR consumption.

Frozen foods have a large presence in the HMR market. In response to an ever-increasing desire for convenience and value-priced food, sales of frozen food in Japan have been rising at about 3.3% annually. Frozen vegetable imports increased to a total of 142 billion yen in 2013.

Changes in Japan’s retail food sales

According to the report, the Japanese retail food industry experienced growth in all of the three major categories in 2014: large scale and conventional supermarkets, department stores, and convenience stores. Total retail sales including food, beverages, general merchandise, fabrics, apparel and accessories amounted to 69,911 billion yen in 2014, with food and beverages – which accounted for 65% of the total  – seeing a significant increase.

Total Retail Sales (Billion JPY)

How large-scale and conventional supermarkets are evolving

The report says Japan’s supermarket business is considered saturated for standard large-scale and conventional supermarkets. So as to better compete with convenience stores, many major supermarket chains are investing in city-style stores (smaller versions of supermarkets located in city centres) which allow easier access and “have been a hit with the elderly population, mothers, and value-conscious customers.”

As the Japanese market continues to mature, the two national brands AEON and Seven and I Holdings have strived to appeal to the aging population. In 2014, the Japanese retail group AEON announced it would triple the number of its “Akore” city-style stores in Tokyo, Saitama, and Chiba from 90 to 250 by 2016.

And in October 2014, AEON’s private brand TopValu expanded to include organic products. “AEON has recently taken to promoting healthy food and local community activities in order to appeal to the rapidly evolving mature and health-conscious market,” the report says.

Convenience stores thriving

Despite the growth of online shopping and a tax hike of 2014, convenience stores continue to be a major retail competitor.

They have continued to increase their market share thanks to their numerous locations and wide variety of products, with a major contributing factor to their success being their proximity to consumers’ homes. Some also offer home delivery, such as Seven-Eleven’s Seven Meal bento delivery service.

Department stores reinventing themselves

Department stores have had to employ new techniques and strategies to stay on top. For example, in December 2014, Matsuya president Masaki Akita announced stores would be hiring more foreign language speakers in order to draw in visitors from abroad. Tourists make up a large percentage of department store customers.

While department stores have seen a significant drop in profits from non-food products in the last decade, those from food products have actually risen due to their premium nature and the popularity of depachika, the ‘wonderlands of food’ found on the basement floors of department stores.

The report says department stores usually carry imported, branded food products though typically in small quantities. “Many of the items are packaged as take-out products due to the proximity to train stations and the premium nature of the products means they are often used as gifts.”

Online shopping a hit with seniors

E-commerce and m-commerce are both expected to grow in the coming years with same-day delivery services and social media awareness. Seniors are some of the most active online shoppers.

Online sales are still relatively small yet have been growing at double digit rates, dwarfing the growth of Japan’s retail market overall. While the majority of sales are for non-food items, food and beverages account for 13.7% of e-commerce sales and are increasingly bought online.

Online shopping remains a lucrative market for grocery stores with some offering home delivery for little to no charge, an option popular with seniors.

“Many major supermarkets now offer online grocery services in most parts of Japan, including rural areas. The most successful has been Ito-Yokado, whose sales grew 14.3% in 2012 with the introduction of online groceries.”

The might of mobile-driven commerce  

Many online vendors are offering m-commerce as a way to connect with mobile users, often by offering mobile-friendly versions of their site, phone apps, and special downloads for customers on-the-go.

“Rakuten is a big name in m-commerce, receiving as much as 52.2% of its total value of transactions via mobile devices in the fourth quarter of 2013, while PC driven sales fell by 8%. It is worth mentioning that food and beverage sales make up 49.2% of Rakuten’s total sales. Popular items include heavy, bulky items that are hard to transport and fresh produce.”

Food procurement by Japanese retailers

The report says that when it comes to sourcing food, Japan’s large-scale supermarkets still rely primarily on importers and wholesalers. Most are engaged to some degree in developing and maintaining private labels which they tend to outsource to food processors.

The giant, nationwide supermarket chains such as Aeon and Ito-Yokado purchase their food primarily through three channels: directly from importers, directly from manufacturers and processors, or via wholesalers and distributors. Wholesalers and big trading houses are generally interested in handling high volume products, not niche-oriented ones, it advises.

Conventional supermarkets purchase through similar distribution channels, although they mainly purchase from wholesalers, whereas the major national chains rely on more direct routes. Department stores, meanwhile, procure food items almost entirely through wholesalers and tenant merchants (who mainly purchase the ingredients for their products from wholesalers and then manufacture the products to be sold).

Convenience store chains use trading companies or wholesalers, depending on the type of product. Their management systems present the most significant challenges for imported packaged processed foods, the report says, because they require exporters to modify product taste/specifications to Japanese tastes, cut delivery times to ensure freshness, and update and introduce new products frequently.

Food exports to Japan

Japan’s food self-sufficiency rate has been declining due to the aging farm population and is only 39%, meaning there are obvious opportunities for suppliers from other countries.

It also helps that since the Fukushima nuclear reactor incident cast doubt over the safety of some domestic produce, Japanese consumers have been more open to imported food.


As can be seen in the pie chart above, the US enjoys a commanding lead among countries exporting food to Japan, helped by Japanese consumers’ preference for US goods, the report says.

Read the full USDA GAIN report: Japan Retail Foods

Main image: “Depa-Chika” at Lotte Department Store by ayustety – http://www.flickr.com/photos/ayustety/12482886/, CC BY-SA 2.0 https://commons.wikimedia.org/w/index.php?curid=12013829

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The rising relevance of mobile retail

Retailers are optimistic about location-based services – 57% consider them a great opportunity for physical stores, with more benefits than costs.

What are the top trends in retail? To find out and gain important insights into formats, internet sales, and location-based services, GfK, Germany’s largest market research institute, surveyed more than 500 people from 60 countries, including members of the retail sector and relevant experts.

In 2013, the top 3 trends in the retail sector were internet, price competition and the concentration of distribution. But by last year they had changed to convenience, internet and mobile communication. And more importantly, in the future, the key trends are expected to be mobile communication, ahead of convenience and internet, then seamless multi-channel retailing and transparency.

Thus, factors such as price competition, which is significant now, are expected to lose importance in future, while others, such as seamless multi-channel retailing, gain relevance, and mobile communication – which Gfk says is “very promising” – moves to the top. “Retail formats incorporating mobile retail solutions are expected to be most successful in future,” GfK said in its Retail Trend Monitor 2015 report. It also said that the pure internet players of today are expected to be lower on the scale of success in future.

Location-based services an opportunity

GfK surveyed the retailers and experts on their opinion of using location-based services to attract customers and/or study customer behavior in stationary (bricks-and-mortar) stores through mobile apps. An example is using beacon technology so that as a participating consumer moves through the city, nearby retailers can send them targetted offers such as coupons, discounts, and alerts to their mobile device (localised via GPS) to attract them into the store. They can also use the mobile devices to track the movement and buying behaviour of consumers participating in the service.

GfK’s main findings on use of location-based services are that:

  • Retailers are optimistic about location-based services – 57% consider them a great opportunity for physical stores, with more benefits than costs;
  • Increasing the awareness of these services still holds potential – 24% are still not familiar with them.

Source: GfK Retail Trend Monitor 2015: Nino Kereselidze, junior marketing consultant, and Markus Tuschl,global director of Digital Retail.

Image: geralt via Pixabay

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Patent sought for award-winning watermelon pouch

According to the andnowuknow website, the ‘ready-ripe watermelon pouch’ won the 2015 Innovation Award for Best New Packaging at United Fresh Produce Association trade show and has since been endorsed by America’s National Watermelon Association (NWA) for its ¼ sliced watermelon program.

A resealable, anti-fog watermelon pouch which comes with a handle for easy carrying is the subject of a United States patent application by Wisconsin-based grocery wholesaler The Fresh Group, Ltd.

The application says the zip-lock bag has a gusseted floor to accommodate a large watermelon slice. A transparent window allows consumers to see the watermelon inside the pouch, which also features an upwardly concave interior volume – to orient and stabilise a watermelon for best presentation and least damage – and sturdy sidewalls to support the pouch on a flat surface.

The packaging was developed to keep larger sliced produce, such as watermelon, viable, at a high quality level and freshness for consumption, and easy for the consumer to carry home, the document says.

In an interview with the Australian Broadcasting Corporation (ABC) earlier this year, Maglio product manager Joseph Delgadillo said an 11-day shelf life had been consistently achieved with watermelon in such a pouch. He said that in a trial in the US, the bags proved popular with consumers, who liked the added convenience, and retailers, who particularly appreciated the extended shelf-life. Delgadillo said the bag was attracting interest from other countries and markets and was a concept that would apply to other kinds of fresh produce, the ABC said.

The patent application has also been published by the World International Property Organization.

According to the andnowuknow website, the ‘ready-ripe watermelon pouch’ won the 2015 Innovation Award for Best New Packaging at United Fresh Produce Association trade show and has since been endorsed by America’s National Watermelon Association (NWA) for its ¼ sliced watermelon program.

 

Screenshot 2015-08-11 at 12.02.59 PM.png

Screenshot 2015-08-11 at 12.02.42 PM.png

Some of the drawings included in the patent application.

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Waitrose banks on omnichannel strategy

Last year Waitrose opened another 20 ‘little Waitrose’ convenience shops and 13 new core shops. It now has 339 shops in England, Scotland, Wales and the Channel Islands, including 61 convenience shops.

Upmarket grocer expanding in online and convenience as it braces for more pain in the world’s toughest food market.

In February, Waitrose regained its crown as the best UK supermarket after a year in which its like-for-like sales increased 1.4%, it had an average 400,000 more customer transactions a week, and its slice of the UK grocery market largely stayed above 5%, rising from 4.8% two years before.

Even so, a deflationary market and fierce competition from the fast-growing discounters Aldi and Lidl – forcing it to cut prices and invest in improved service – saw its operating profit tumble 23.4% to £237.4 million. And Waitrose expects returns for the grocery sector “to be materially lower for a period of time.”

Screenshot 2015-07-06 at 12.41.59.png

The UK grocery market is rapidly fragmenting and the ‘big four’ – Tesco, Asda, Sainsbury’s and Morrisons – are being squeezed at one end of the price and quality scale by Aldi and Lidl, and at the other end by upscale rivals Marks & Spencer and, particularly, Waitrose.

According to Kantar Worldpanel data on Great Britain’s grocery market, Waitrose’s share has risen from 4.6% in the 12 weeks to October 14, 2012, to 5.1% as at this June 21, while Lidl went from 2.8% to 3.9% and Aldi, overtaking Waitrose, from 3% to 5.5%.

Novel ‘Pick Your Own Offers’ scheme

Fighting back amid the unrelenting price war in the UK, in June Waitrose introduced a new scheme offering loyalty cardholders 20% off their favourite 10 items from an initial list of almost 1,000 lines.

WAITROSE Pick your own offers.png

Waitrose CEO Mark Price described the ‘Pick Your Own Offers’ scheme as ground-breaking but admitted it would be expensive for the grocer. Cherry vine tomatoes have been among the most chosen products so far.

Building online and convenience offer

Being “Britain’s leading omnichannel retailer” is now one of Waitrose’s key strategies, according to the John Lewis PLC financial statements for the year to January 31. The priorities listed under the goal include building Waitrose’s online presence, broadening its convenience offer, and developing compelling reasons to visit shops.

In order to grow its online grocery business, in March Waitrose opened a 90,000 sq ft bespoke e-fullfilment centre in Coulsdon, South London.

Screenshot 2015-07-06 at 12.20.54.png

Waitrose e-fullfilment centre in Coulsdon, South London

In regard to its convenience offer, last year Waitrose opened another 20 ‘little Waitrose’ convenience shops and 13 new core shops. It now has 339 shops in England, Scotland, Wales and the Channel Islands, including 61 convenience shops.

Central London was the focus for the new ‘little Waitrose’ openings last year but this year Waitrose has said it will go further afield in Greater London for its planned 7 new ‘little Waitrose’ shops.

little Waitrose at John Lewis Watford - Edited.jpg

The ‘little Waitrose’ shops range from 3,000-7,000 sq ft, in comparison to an average sales area of 20,000 sq ft for traditional Waitrose branches. In August last year, in a bid to attract ‘transumers’ – the fast-growing market of travelling consumers – Waitrose opened the first of its railway station outlets, a 2,500 sq ft ‘little Waitrose’ store at King’s Cross in central London.  

And among measures to encourage visits to stores and respond to changing shopping habits, Waitrose has introduced new services, hospitality – such as opening more in-store cafes – and grazing areas where shoppers can try food and drink. “Branches like Salisbury are tapping into growth in casual dining with a wine and tapas bar.”

Responding to food trends

In its Food & Drink Report 2014, Waitrose reported on its response to food trends including “a huge surge” in flexitarianism – where someone follows a plant-based diet but occasionally eats meat products.

“Shoppers are choosing a ‘hero’ vegetable – such as a stuffed mushroom or a spiced aubergine – and adding a sprinkling of bacon chunks or chorizo pieces. To meet this growing demand we have launched new vegetable meals, such as our mushroom and spinach filo parcel and a new baby kale and butternut squash microsteam pack to save time for our flexitarian shoppers.”

Waitrose also said consumers’ taste buds are demanding new, exotic flavours and increasingly there’s a mix-and-match approach, using ingredients associated with one country in dishes from another. “Yuzu, a Japanese citrus fruit, is now often used in French dressings, and Kimchi, fermented cabbage from Korea, is employed as a burger dressing.”

The same report said that compared to 2013:

  • Exotic fruit online sales were up 81%
  • Stuffed mushrooms sales were up 22%
  • Stuffed pepper sales were up 17%

​​Inside Can Wharf orig - Edited.jpg

Inside Waitrose, Canary Wharf

Summer brings higher salad, fruit sales

According to recent weekly trade updates by Waitrose, it is seeing strong increases in its sales of salad bowls and British asparagus, which for the week to June 6 were up 43% and 41% respectively on the same week last year, while frozen fruit surged 26% and soft fruit saw an 11% uplift. And for the week to July 3, it said the start of Wimbledon saw strawberry sales up 15%. Amid the good weather, its ‘food to go’ range was up 10%, with salads proving particularly popular, at 21% higher than last year​. Waitrose has also reported that with the bumper UK cherry harvest this year it has 20% more of this fruit on sale.

sources: various, including Waitrose, Kantar Worldpanel

JB

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Expansion in Ireland’s prepared fruit and vegetable market

A_salad_that_will_be_served_to_a_detainee_at_the_U

 

Growth in the fruit and vegetable convenience category is highlighted in a recent article from Bord Bia, the Irish Food Board.

Horticulture Division Manager Mike Neary writes that Kantar Worldpanel market research values Ireland’s prepared fruit and vegetable sales at €84 million at the retail point.

The growth in the prepared fruit and vegetable category in the retail market in recent years is evidence of the important role that convenience plays in the purchase decisions of households, he said.

According to Kantar, since 2008 the volume of sales in this category has grown 8%. “One of the drivers of this trend is the number of households that are now purchasing from this category, which has reached over 92% of all households. This is a 1.5% increase since 2012. The purchase frequency is 24 times per annum,” Neary said.
 

Fruit salad products performing the strongest

Private label products dominate the prepared fruit and vegetable category, with a 77% market share. Key lines in this category include vegetables, fruit, leafy salads, mixed tray salads and chilled salads, with the latter accounting for two fifths of the volume sales. However, in the last year it was fruit salad products that performed the strongest.

Neary said the Kantar research also showed people in the ‘pre- family’ stage are more likely to buy mixed tray salads, while retired shoppers are more likely to buy prepared fruit.
 

Prepared fruit & veg market benefits from convenience trend