A Little Wave of Optimism
A very Happy New Year to all Grocery Insider newsletter readers and podcast listeners!
I hope you’ve rested up around Christmas and New Year and now feel mentally ready to rejoin the fray. What strikes me about this January compared to last year is that there is cause for cautious optimism. Was it just me or was there, right after the election a little wave of optimism that swept around the trade? The feeling was swiftly overtaken by the creative chaos of peak trading, but you could feel something was stirring. But then came the Christmas sales numbers for the major multiples which showed tough trading.
I know of many food companies with well-defined plans to expand into new products and markets that adopted a ‘wait and see’ approach in 2019. With more certainty in the overall UK economy we should see in the first half of 2020 an unleashing of some of this investment. So it feels like a ‘bounce’ of some sort could well be on the cards.
But the question is can this ‘bounce’ turn into more substantial and longer lasting growth for food and drink companies? Optimism and increased clarity on Brexit can only take the industry so far. To feel like the end is in sight on Brexit the trade needs to feel that the EU trade negotiations are going well – which is why the mood music around one of the first elements of this, the Fisheries negotiations, will be key.
Of course, there are many headwinds the trade faces such as the need to address packaging challenges, cater to retailers reeling from sustained and successful discounter attacks and address public health concerns around sugar and additives. And the Christmas sales numbers have left gaps in suppliers P&Ls which will take time to rebuild.
As ever, for those who can truly understand what Shoppers want and deliver it to them in an attractive and sustainable way, the rewards are there. We saw a huge kick up in demand from clients asking for us to help with Food and Drink Market Research projects last year, with the team immersed in focus groups and surveys all year getting to the root of what consumers were looking for.
And of course if you want to really understand this year’s top food trends you should be paying attention to check out our free 2020 trend report here – our predictions were 90% right last year, so it’s well worth a look.
There is also not one, but two great grocery insider podcasts to inspire you this month. Firstly, I sat down with Steven Esom (who used to run Waitrose and M&S) to take stock of where the market for food and drink is at the moment, how the retailers are evolving in response and what that means for suppliers.
Secondly, we recorded a cracking podcast with Jonathan Kittow from Simply Supply Chain looking at how Supply Chains are evolving in response to online shopping, the rise of the discounters and the delayering of retailers. Both are well worth a listen – find the grocer insider podcasts by following the links. We’ve now had over 3,000 downloads so we’re chuffed with that!
Enjoy January, its usually over in a flash, and I look forward to catching up again later in the year!