1. An introduction for Peru into the UK market
Name: Elizabeth Bonsall
Date: 9th June 2016
Change date, names as appropriate

2. UK market profile What we were asked to do...
Grapes
Blueberries
Pomegranates
Desk & interview research
Macro-economic
Market data
Product data
Summer last year we were asked to provide insight into the UK market for fruit products from Peru
Decided on the 3 products
Project involved speaking with industry experts, looking at the UK market and trends, and also perceptions of Peru as a supplier
Following presentation gives a highlight of our findings

3. The UK market....

4. The UK Market.... Population
Today million
0.6% growth
2050 – 70.9 million
Source: World Bank

5. The UK Market.... Population - since 2000
-18%
+5%
+0.5%
+17%
+2%
+23%
-1%
+15%
+33%
+34%
+35%
+73%
Source: World Bank

6. The UK Market....
Source: ONS

7. The UK Market....
Source: DEFRA

8. The UK Market.... Source: Fresh Produce Journal
The UK is a large fruit market
In terms of consumption – banana’s, apples and oranges are the most popular in the UK market
In terms of value – apples, grapes and tomatoes
Growth areas are coming from new fruits and varieties, such as tropicals and berries and easy to eat fruits
Source: Fresh Produce Journal

9. Fruit Production.... Source: DEFRA
Increased from 38,000 tonnes in 2000, to over 130,000 tonnes in 2014
Strawberries main contributing factor
Superfoods buzz word, and ease of eating and integration into other products
Source: DEFRA

10. Fruit Imports.... Source: DEFRA
UK is heavily reliant on imports of temperate fruit,
However – relatively stable since 2006 – impact of economic recession – fruit looks expensive
Bananas, apples and small citrus are the main import products
Source: DEFRA

11. Fruit Suppliers.... Source: UNCT
Fruit imports sourced from a wide range of countries;
Top 10 suppliers accounted for two thirds of total imports
Spain top supplier – Free trade access, and strong production of citrus, proximity to the UK market, increase of 26% over last 10 years
Source: UNCT

12. Role of Peru as a Supplier....
19th largest supplier to UK
Greatest growth of top 25 suppliers
+ 414% over 10 years
Peru is 19th largest supplier to the UK – supplying 2% of total
Most significant growth of all suppliers at 414% over 10 years
Viewed as an important source of supply
Source: UNCT

13. Grape Imports Source: Eurostat 250,000 tonnes
SA largest supplier, Peru 7th, but increased 256% over last 5 years
UK is a seedless market – variety of packs on the selves in size, and colour
Somewhat reflects the UK gross disposable income chart – grapes are a fruit luxury – not a staple like bananas and apples
Source: Eurostat

14. Grape Imports... Projections
Future looks good – continue to increase at a steady rate
Source: Eurostat & Promar Estimates

15. Blueberry Imports Source: Eurostat Significant growth, 636%!
Chile leading supplier – 41%
Peru entered the market in 2012, tripling in volume since
Source: Eurostat

16. Blueberry Imports... Projections
Rise 12% per year,
Imports look strong going forwards, potentially reaching 30,000 tonnes by 2018
Source: Eurostat & Promar Estimates

17. Pomegranate Imports Source: Eurostat Spain is the leading supplier,
Imports reached a high in 2011 at 32,600 tonnes
Netherlands account for re-exports
0 to nearly 1,000 tonnes in 10 years from Peru
Source: Eurostat

18. Pomegranate Imports... Projections
Future is questionnable
Pomegranates are still very much a nieche fruit
Cosnumers don’t fully understand what to do with them
Often intergrated into meals, or purchased processed or juiced
Superfood status has been a main driver
Source: Eurostat & Promar Estimates

19. Grocery Retail Market Share
Modern retailing through supermarkets accounts for the vast majority of food purchasing in the UK
Grocery market in the UK is dominated by 4 largest supermarkets
However, changeable times recently
Source: IGD

20. Channel Growth Source: IGD
Main areas of growth have been convenience, discounters and online
Consumers are more price aware, and what it to fit in around their jobs
Source: IGD

21. Channel Growth Source: IGD
Last 5 years, greatest growth from discounters
Constantly opening new stores, whilst others are closing
Offer limited product lines, c.500 rather than 10,000 SKU’s in the big 4
Source: IGD

22. Who’s growing... Aldi and Lidl main discounters, but also Iceland
Whilst discounters have grown – high end has also benefited from cosnumers ‘treating’ themselves
Waitrose increased 1.2%,

23. Channel Growth Source: IGD
On-line – a large area of growth, with many of the retailers now having a presence – exception of discounters
Source: IGD

24. On-line 80% shop online at least monthly
20% research brands on social media
50% like getting offers by mobile phone
70% will to pay for same day delivery
Consumers orde online and then delivered to their home – or click and collect
New areas include lockers to pick up goods,
Main growth is the hunger for convenience and time saving

25. Structure of the Market... Key Trends
Direct sourcing
Retailers purchasing direct
Improve quality
Simplify supply chains
Customer saving
Tesco – Group Food Sourcing (GFS)
Source & ship produce
ASDA – IPL Ltd
Importing, sourcing, packing & shipping
Retailers are getting closer to their producers and suppliers
Ensure that the products are of high quality – protect their brand
Also gain savings, and more control
Tesco and ASDA created their own companies
My supply chain is better than yours

26. Structure of the Market... Key Trends
Direct sourcing
Supply chain consolidation
As a result supply chain is becoming shorter
Specialising in products categories, or customers
e.g. One major supermarket and then a number of smaller customers Or
Exotics, Fyffes is just bananas

27. Structure of the Market... Key Trends
Direct sourcing
Supply chain consolidation
Supply chain integrity
horsemeat caused a lot of public outrage
Left supermarkets and suppliers much more exposed
Put in place actions e.g. Accreditations, assurance, shorter supply chains

28. Structure of the Market... Key Trends
Direct sourcing
Supply chain consolidation
Supply chain integrity
Accreditation
BRC
GLOBAL G.A.P
Supermarket own, Tesco - Nuture
UK is one of the tougher markets to enter due to accreditation but it is stable,
Main global ones asked for are BRC and GLOBAL GAP – retailers mostly interested in these,
Also putting their own into action, to build integrity and trust

29. Structure of the Market... Key Trends
Direct sourcing
Supply chain consolidation
Supply chain integrity
Accreditation
BRC
GLOBAL G.A.P
Supermarket own, Tesco – Nuture
Convenience
Convenience major growth area,
Consumers are time poor and increasingjly eating on the go
Supermarkets have kiosks just through doors selling food-on-the-go
Fruit being processed and packaged to appeal to this consumer

30. Structure of the Market... Other key areas
Grocery Code Adjudicator, is place to ensure supply chains remain efficient, and suppliers are not mistreated

31. Structure of the Market... Other key areas
Corporate Social Responsibility
Retailers have there own to protect themselves – good to be aware of and try to align yourself

32. Structure of the Market... Other key areas
Fairtrade
In the past has been a big growth in the UK, and across a wide range of products – fresh produce – clothing
Some cosnumers expect it, Sainsburys all bananas are fair trade

33. Structure of the Market... Other key areas
Peru areas of issue picked up in the press – Water and Labour
Suppliers in the UK aware of this and do not want to be involved in any backlash

34. Structure of the Market... Other key areas
Superfoods – buzz word for last few years,
Blueberries and pomegrantes part of this – consumers wanting a healthy lifestyle and seen as trendy

35. UK Market .... Strengths Large population High disposable income
Increasing interest in food
Relatively strong economic growth compared to Europe
Increasing demand for exotic and other out of season fruit
Increasingly diverse population
Peru is seen as a strong, improving suppliers with excellent climate

36. UK Market .... Weaknesses
A potential pre-occupation with other international market and their specific varietal demands
Limited promotion of Peruvian fruit in the UK
UK consumers less aware of country of origin
Trends towards food miles and local sourcing
Peru’s distance from the UK market

37. UK Market .... Opportunities
Growth in pre-prepared salads and fruits
Increased UK demand for new products/varieties
Take full advantage of trade agreements in place between Peru and the EU and UK
Build on highly positive view on Peru from the UK trade
Consumer interest in Peru as a country is increasing
New routes to market – convenience stores, discounters, on-line, foodservice etc
Consolidation of existing business with leading supermarkets

38. UK Market .... Threats
Not building strong commercial relationships with UK imports
CSR, water and labour issues
Over production – downward price pressure
Impact of poorer quality
Focus on other markets

39. Contact Elizabeth Bonsall, ConsultantE:
M: +44 (0) W: E:
Tel: +44 (0) Fax: +44 (0)
Address:
Promar International Alpha Building, London Road Stapeley, Nantwich Cheshire CW5 7JW