Growing up Savid The EU Fresh-cut Fruits and Vegetables Market London, 15 June Cindy van Rijswick, Food & Agribusiness Research and Advisory Rabobank International
After a period of strong organic growth, clear decisions are needed to (re)position yourself 2
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Despite the health trend, fruits and vegetables consumption per capita is rather stable 5
in particular in western Europe 6 Source: Rabobank FAR based on Euromonitor, 2010
Fruit is predominantly bought fresh EU fruit market by segment (based on volume and excluding B2B, 2010) 7 Source: Rabobank estimate, 2010.
Vegetables are more often bought prepared or processed EU vegetables market by segment (based on volume and excluding B2B, 2010) 8 Source: Rabobank estimate, 2010.
Salads are the largest and earliest fresh-cut segment 9
Fresh-cut has been one of the most interesting fruit and vegetable segments in recent years 10 Source: Rabobank FAR estimates based on Amadeus and Euromonitor, 2010.
Wide differences in market growth pace among EU countries Growth index prepared chilled salads in selected markets Source: Rabobank based on Euromonitor, 2010 11
Fresh-cut fruit market has left its childhood behind Source: Euromonitor, 2010. 12
Long term consumption trends still prevailing, but consumers have become more critical Value for money Well-being (healthy, ethically produced) Indulgence Convenience 13
Retail and foodservice environment has become more challenging Further growth opportunities for food retail: Multi-channel approach New locations Expansion abroad Assortments regularly revised Sensitivity to ethical issues to remain high Fresh produce is key Front of retail store High margins Differentiation Food retailers are reconsidering sourcing strategies Source: Rabobank FAR
Slow recovery of foodservice turnover Growth foodservice versus consumer confidence Source: Rabobank, CBS, 2010 15
Sourcing will become more critical The fight for food, feed, fibres and fuel 16
Competitive playing field in fresh-cut fruits and vegetables still very fragmented and diverse... EU competitive playing field in fresh-cut fruit and vegetables Large dot = company with over EUR 100 mln turnover in Fresh-Cut 17 Source: Rabobank.
...with large differences in profitability EBITDA levels and margins among EU fresh-cut fruits and vegetables producers Source: Rabobank based on Amadues, 2010. 18
Companies have to get ready for a new era of growth - Players (mainly Private Label) with close often long term relationships with retail and/or foodservice customers - USPs are product range, service level, innovation Product leadership Customer intimacy Cost leadership - Players with a cost focus, mainly providing discounters, B2B market, or varying buyers with limited product range. - USPs: low product price but good basic quality products - Branded players or players specialised in a niche - USPs are brand, marketing, unique product 19
There will be fewer but larger and stronger players in the future fresh-cut industry Branded private label Continuing market growth Various opportunities:, CSR, product portfolio, distribution, quality To gain opportunities: - Sourcing - Efficiency - Tailored products Scale and/or financial strength more important National market presence versus European 20
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