UK Food Research Report[1]
Transcript of UK Food Research Report[1]
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Food Producers: UKResearch Report
Market StrategyApril 2008
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Table of contents1. Executive Summary ................................................................................... 31.1. Background and Objectives ......................................................................... 31.2. Research Findings ....................................................................................... 31.3. Project Plan .................................................................................................. 42. Introduction and Aims ............................................................................... 52.1. Background .................................................................................................. 52.2. Research Purpose........................................................................................ 52.3. Process......................................................................................................... 52.4. Agreed Outputs ............................................................................................ 62.5. Important Information ................................................................................... 73. Producer Backgrounds.............................................................................. 73.1. Annual Turnover........................................................................................... 73.2. Number of Employees.................................................................................. 83.3. Years of Operation ....................................................................................... 83.4.
Ownership .................................................................................................... 8
3.5. Quality and Technical Accreditations ........................................................... 83.6. Retail versus Foodservice Sales.................................................................. 83.7. Domestic versus Export Sales ..................................................................... 83.8. Domestic Sales Channels ............................................................................ 83.9. Key Export Markets / Priority Next Markets ................................................. 93.10. Factors influencing Current Business Growth.............................................. 93.11. Current Supply Chains Used........................................................................ 93.12. Target Customers......................................................................................... 94. UK Specific Research Findings................................................................ 94.1. Barriers to Export to UK ............................................................................... 95. Scoping Potential Project Options for UK............................................. 105.1. Introduction................................................................................................. 105.2. Individual Project Options........................................................................... 105.3. Project Activities ......................................................................................... 125.4. Commercially Successful Project............................................................... 136. Project Plan............................................................................................... 136.1. Project Objective ........................................................................................ 136.2. Project Scope ............................................................................................. 146.3. Description of Activities to Be Contained in Project ................................... 146.4. Project Plan Recommended Stages ....................................................... 176.4.1. Introduction................................................................................................. 176.4.2. Stage 1 Initial Market Research Complete........................................... 176.4.3. Stage 2 Initial Project Plan Current Work............................................. 186.4.4. Stage 3 Industry Group Session - UK Exporters Food Producers Network
Meeting....................................................................................................... 18
6.4.5. Stage 4 Capability Building and UK Preparation Visit............................. 196.4.6. Stage 5 Project Prospectus..................................................................... 206.4.7. Stage 6 Recruitment of Participants........................................................ 206.4.8. Stage 7 UK Market Visit 1....................................................................... 216.4.9. Stage 8 UK Market Visit 2....................................................................... 216.4.10. Stage 9 - Marketing Campaign .................................................................. 226.4.11. Stage 10 Project Consolidation............................................................... 236.5. Candidate Companies Open to Participation............................................. 23
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Prepared for Regional Development Victoria
April 2008
Market Strategy
Website: www.marketstrategy.com.au
Email: [email protected]
Mobile: +61414 382 738 Prepared by Market Strategy Ltd.
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1. Executive Summary
1.1. Background and Objectives
Regional Development Victoria (RDV) has identified an opportunity to leverage workdone by National Food Industry Strategy (NFIS), to gain advantage for Victorian
companies in the UK market.
This RDV UK Project was established to research and assess the current position of
Victorian food exporters to the UK; and prepare a project plan for assisting the
development of Victoria food trade with the UK retail market.
1.2. Research Findings41 producers were approached to participate in the research, of which 16 declined. In
summary the interviews with those that participated showed:
1. There are common challenges faced by Victorian producers wanting to export
to the UK. These challenges can be split into general barriers to export and
are defined as - finance (cash flow, marketing, supply chain); foreign
exchange (variations and current strength of dollar): accessing and assessing
appropriate distributors; developing customer relationships; and internal
resources (time, expertise, capital). There are specific challenges that were
identified for UK export - point of difference for products; premium pricing of
Australian product versus competition; tariff and import regulations; marketing
cost; and scale of doing business with a multiple food retailer in the UK.
2. A good portion of interviewed businesses are already undertaking trade with
the UK (9), or are preparing to undertake trade (5), or are at advanced stages
of market knowledge (3).
3. Victorian products do have points of difference in the UK. As in any market,
there are various challenges they face by product and category.
4. A substantial portion of businesses are at an advanced state of commercial
readiness, or can quickly be made ready, to make commercial presentations
in the UK.
5. RDV can put together certain activities which will benefit different businesses,
at different stages of preparedness for the UK. These activities should
concentrate on providing capability building programs, accessing supply
chain arrangements, providing access to retailers and providing cooperative
marketing activity.
6. Producers interested in this project can be grouped by state of preparednessto enter the UK market product currently sold in UK market (8); no current
sales but have appointed a distributor (2); negotiating with a distributor (3); no
sales but interested in market (10). Of this last group 3 can be described as in
a good position to quickly make ready to supply the UK, 4 are smaller
producers who would need some work done in order to generate this
capability and 2 are interested only in specific opportunities.
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This state of preparedness can be analysed against the target customer for the
producer. This analysis shows that multiple retailer, health/dietary, gifting and
gourmet are popular channels for these producers to target. The producers most
prepared to enter the market are targeting the multiple retailers.
1.3. Project PlanThe Project Plan suggests the following UK Retail Project for RDV:
Creation of a strategic RDV UK Retail Food Project designed to assist the
establishment and development of sustainable UK Retail Trade for existing or
prospective Victorian food producers.
Through investment in this project RDV could achieve an increase in sales,
employment and capital investment in the Victorian food industry. As a pilot project,
RDV seeks to demonstrate a new model for market development projects. Through
participation in arguably the worlds most sophisticated retail market, RDV would like
to build industry capability, knowledge and programs to benefit both UK and other
export trade development.
By participating in this project, Victorian producers aim to see a growth in sales to the
UK market and benefits from reduced risk capital expenditure to establish UK trade;
synergies created in marketing and distribution systems; and increased capability and
knowledge generated through gearing up to supply UK market.
RDV leadership is essential to creating a successful project. By creating capability
and knowledge for Victorian producers, RDV is improving the capacity of Victorian
producers to trade in the UK. In addition, by working strategically with industry, RDV
is creating new retail and distribution opportunities for trade development.
Participants in the project will be current or prospective Victorian food suppliers to the
UK Retail market. The project is designed to work with suppliers across the entire
demand chain. It aims to enhance commercial performance of Victorian suppliers
already in market, with a distinct pathway to market for those at various stages of
market entry development.
The project aims to undertake the following activities, which deal with different parts
of the demand chain. Many of these activities can be run concurrently to provide best
return on investment:
1. Establishment of Victorian Food Producers UK Network
2. Development of Capability Building Activities
a) Competitive Intelligenceb) UK Business Plan Production
c) Corporate Responsibility
d) Technical Requirements
3. Establishment of Relationship with UK Retailer
4. Development of UK Distribution Arrangements For Victorian Producers
5. Establishment of Cooperative Marketing Campaign
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6. Regulatory Assistance
7. Ad Hoc UK Assistance
2. Introduction and Aims
2.1. BackgroundRegional Development Victoria was a key project sponsor of the National Food
Industry Strategy (NFIS) UK Retail Project which ran from 2005 2007.
The NFIS project was designed to create an easier entry platform for Australian food
companies into the sophisticated UK retail market. The project resulted in the listing
of over 15 food companies in Sainsburys. Additional benefits included a rise in level
of awareness of existing Australian food suppliers to Sainsburys; promotional activity
generating over $4 million in sales; increased promotional opportunity for Australian
wine suppliers in Sainsburys; and capability building for Australian companies
looking to develop trade with UK market (a number of project participants actually gotaccess alternative UK retailers after being involved in certain elements of NFIS
project).
The main activity areas in the NFIS project were: market research and education on
consumer trends; business capability and feasibility advice; building presentation
skills (template) to present to Sainsburys buyers; introduction and promotion to UK
distributors; introduction, promotion and feedback from Sainsburys development
personnel; product presentation and participation in Sainsburys-internal trade show;
raising the UK as a real option for exporters; creating strong working relationships
with Sainsburys key staff at various levels; and implementing a cooperative
marketing campaign to promote Australian food products in UK.
2.2. Research PurposeRDV identified an opportunity to leverage the work done by NFIS, to gain advantage
for Victorian companies in the UK market. The RDV, UK project was established to
research and assess the current position of Victorian food exporters to the UK; and
prepare a project plan for assisting the development of Victoria food trade with the UK
retail market.
2.3. Process
Step 1
Project Set Up Activities
Market Strategy Ltd worked with RDV to set up the Project Audit Structure, agree
producer questionnaires and emails; and provide RDV with all information necessary
for the proposal.
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Step 2
Initial Contact to Companies
A list of food producers interested in the UK market was agreed between RDV andMarket Strategy. 41 producers were highlighted, based on the NFIS Retail Project
and input from RDV food team. An email from Market Strategy to each producer was
sent on RDVs behalf, informing the companies of the project and its aims.
Step 3
Telephone Interviews
Market Strategy undertook one-on-one discussions with 25 producers. 16 producers
declined to participate in the interview or had no interest in the UK market.
Step 4
Initial Verbal Report on findings to RDV
Step 5
Face to Face Interviews
7 In depth interviews with held with targeted companies, in order to find out more
detailed information and test project thinking. An informal project planning meeting
was held with RDV.
Step 6
Final Report
Final written report including interview results and detailed plan for UK Retail Project.
2.4. Agreed OutputsMarket Strategy and RDV agreed that this work would establish:
State of preparedness or capacity for individual companies to be ready to
export or expand exports to the UK.
Current or potential supply chain route to the UK.
Current obstacles to trade with UK.
How an RDV project may assist future UK export plans with individual
workshopping to guide the project plan creation.
Prioritise companies readiness or capacity to be ready. These results would
result in a short list of first priorities and a further list of the next set of
companies in the priority chain.
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Specifically the research would result in:
A grouped summary of the current state of export for each Victorian company
to the UK, current supply chain route to market and common obstacles to
trade.
Grouping of companies into prospective project participants (short / medium /
long term) based on company commitment and fit of products to market and
capacity to be made prepared.
Assessments for companies of product range fit to market (where required).
Overview of suggested project options for RDV to progress within the UK
market.
A project plan that:
o Summarises the project activities to be implemented
o Describes the processes needed to set up the activities
o Identifies candidate companies open to participation in the project
o Proposes timings for activities
o Proposes approximate costs for activities
o Identifies potential project partners
2.5. Important InformationThis project was undertaken as a qualitative survey in order to establish a detailed
understanding of the targeted Victorian food producers state of export to the UK.
By its nature, the data is not quantitative, definitive or absolute. Data includes the
thoughts, perceptions, judgements and opinions of food producers. All producers
have different methods of operating and views on the food industry.
It should also be noted that Industry is not always able to accurately assess its own
needs and the potential government programs that might be implemented to meet
these needs. The key to success is the ability for RDV to bring companies andGovernment to a conclusion.
Market Strategy Ltd does not take any responsibility for the accuracy and integrity of
information provided by food producers.
3. Producer BackgroundsThe interviews collected background information that is useful to help understand the
producers interested in the UK market.
A brief summary of this information is presented below. It is recommended to read the
detailed information provided in the Appendix. Please note that specific information
by individual businesses should be treated as confidential.
3.1. Annual Turnover3 producers have turnovers of over $10 million. 4 producers are $5 - $10 million. 6
producers are $1- $5 million. 6 producers are under $1million.
4 producers declined to answer 2 of whom are estimated to be over $10 million and 1
over $5 million.
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3.2. Number of Employees8 producers employ less than 10 people. 10 producers employ 10 50 people. 4
producers employ over 50 people.
1 large producer declined to answer.
3.3. Years of Operation2 producers have been operating for less than 5 years. 8 producers have been
operating for 5 10 years. 10 producers have been operating for 10 25 years. 3
have been operating for over 25 years.
3.4. OwnershipApproximately 25% of businesses are owned by another business.
3.5. Quality and Technical AccreditationsProducers identified their quality and technical accreditations as:
6 producers have an organic accreditation
16 producers are HACCP certified
2 producers have ISO certification
1 producer is SQF certified
4 producers identified Woolworth Vendor Quality Management Standard
1 producer identified McDonalds standards adherence
2 producers are Kosher certified
5 producers are Halal certified
2 producers are USDA accredited
2 producers are EU accredited
4.6 Product Category Supplied 6 producers supply the Biscuits and Snacks category; 1 supplies Cereals; 2
supply Confectionary; 4 supply the Deli; 3 supply Fruit and Nuts; 1 supplies
Herbs and Spices; 6 supply James, Honey and Preserves; 2 supply Meat and
Fish; 1 supplies Noodles; and 5 Supply Olive Oils and Sauces.
3.6. Retail versus Foodservice SalesApproximately 70% of respondents said that Retail accounted for greater than 50% of
their product sales.
3.7. Domestic versus Export Sales86% of respondents said that domestic sales were larger than export sales.
3.8. Domestic Sales Channels35% of respondents said that more than 50% of their domestic sales were through
Woolworths. 26% said that more than 50% of sales were through gourmet
independents.
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Foreign Exchange (variations and current strength of dollar)
Accessing and assessing appropriate distributors
Developing customer relationships
Internal resources (time, expertise, capital)
Specific Barriers to UK Export:
Point of difference for products
Premium pricing of Australian product versus competition
Tariff and import regulations
Marketing cost
Scale of doing business with a UK food multiple
5. Scoping Potential Project Options for UK
5.1. Introduction
The purpose of this section is to scope the types of projects that RDV might like to
pursue in the UK market, and the types of activities that companies might find useful.
This is a thinking section designed to show RDV the options considered when
generating the final Project Plan.
The project options and activities detailed in this section mainly concentrate on key
components and sub segments of the demand chain. The projects are stand alone
and do not involve the entirety of the demand chain. Each project deals with a distinct
group of current exporters.
Experience in the UK has shown that successful market development projects
consider the entire demand chain therefore Section 6 recommends that the project
options are brought together in order to provide an RDV UK Food Strategy. This willtake the synergies of the individual projects and ensure maximum impact and benefit
for the producers and RDVs contribution.
5.2. Individual Project OptionsThe purpose of this section is to outline summaries of distinct projects available for
RDV to implement. These projects focus on specific sections of the demand chain
and not the entirety of the chain.
1. Focus on building the sales of existing Victorian producers selling product
into the UK. The purpose of this would be to enhance existing trade with the
UK. The outcome would be increased sales and a good reputation forVictorian food suppliers. This can be capitalised by other Victorian
companies. Approx candidate companies: 8. Potential activities include:
Build a relationship(s) with a multiple food retailer for Victorian food
producers. Backed by:
Integrated food, wine and tourism promotion to drive consumer
awareness.
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Dedicated trip to market by Victorian producers to make sales
presentation.
NB. This project could also work with other retail channels health/dietary,
gifting and gourmet are lead candidates.
2. Focus on assisting those Victorian producers who have put together a supply
chain for the UK, but have yet to make any sales in the UK. The purpose
would be to assist Victorian companies with their final sell-in to UK
customers. The outcome would be increased sales into the UK. Approx
candidate companies: 3. Potential activities include:
Assist companies with accessing preferred retail channel using
contacts already established through NFIS UK Retail project and
contacts of existing Victorian UK suppliers.
Integrated food wine and tourism promotion to drive awareness of
products on launch.
3. Focus on assisting those Victorian producers who have an understanding ofthe UK market and their opportunity within it, but have yet to put together a
supply chain into the UK. The purpose would be to assist Victorian
companies with putting distribution arrangements in place. The outcome
would be distribution arrangements between Victorian companies and UK
representatives. Approx candidate companies 2. Potential activities include:
Preliminary distributor search by RDV. Outcome map of potential
distributors with genuine interest in buying product from prospective
Victorian customers.
Market mission to UK to visit prospective distributors. Could include
guided market tour and potential scoping meeting with retailers.
4. Focus on assisting those Victorian producers who are in the UK market but
are would like to change their distribution arrangements. The purpose would
be to assist Victorian companies with new distribution arrangements. The
outcome would be signed distribution arrangements between Victorian
companies and UK representatives. Approx candidate companies 4. Potential
activities include:
Preliminary distributor search by RDV. Outcome map of potential
distributors with genuine interest in buying product from prospective
Victorian customers.
Market mission to UK to visit prospective distributors. Could include
guided market tour and potential scoping meeting with retailers.
5. Focus on assisting Victorian producers that are interested in selling in the UK
market but do not currently have any understanding of the UK market. Thepurpose would be to build the Victorian producers understanding of the UK
market and make a business case for entry to the UK. The outcome would be
a business plan for entry into the UK market. Approx candidate companies 5.
Potential activities include:
Assistance in developing competitive positioning in UK for project
participants. Central resource sent to UK to collect specific
information requested.
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Translation of information into business plan for UK market with
action plan for implementation.
6. Alternatively, RDV could run a project with bespoke activities to assist
Victorian producers with ad hoc challenges they are currently facing in the
market. The approach for this would be to provide individual consultants to
assist individual businesses with challenges identified in previous sections.
Producers would be required to apply for assistance.
5.3. Project ActivitiesThe purpose of this section is to identify potential activities that would assist the
development of trade for Victorian producers within the UK market.
The activities can be grouped in the following areas (though there is some cross
over):
1. Capability building:
Set up a network for Victorian food producers currently supplying / or
interested to supply the UK.
Scoping corporate responsibility (including environmental) expectations of the
UK market, assistance in implementing where necessary.
Scoping technical accreditations (for competitive point of difference as well as
regulatory) needed for entry to UK market, assistance in implementing where
necessary.
Map and evaluation of available distributors in UK.
Map and evaluation of retail sales channels in the UK.
Guided visit to understand market in more detail.
Establishment of method and criteria for evaluating and qualifying potential
distribution partners
Assistance in generating business plan for UK market (competitive position,costs, forecasts, budgets etc). Establishment of template for future UK
exporters.
Assistance in understanding tariffs and regulatory demands of market and
accessing accurate information.
2. Relationship Building:
RDV to develop a relationship with a retailer a partnership that makes it
easier for Victorian food producers to access the UK market. This could be
multiples / gifting / gourmet / health / Asian etc.
RDV to develop relationships with UK distributors in order to more easily
introduce Victorian products to market.
Trade mission to the UK to meet with retail buyers.
Trade mission to UK to meet with prospective distributors.
Buyer visit from a UK retailer to Australia.
Buyer visit from a UK distributor to Australia.
Journalist visit from UK to Australia to meet with food suppliers.
3. Marketing:
Cooperative marketing campaign to raise profile of product, gain listings.
Marketing Victoria to trade buyers as a destination for to buy product from.
Targeted trade show assistance where appropriate.
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Shared UK based brand representative to drive market forward.
4. Supply chain:
Incubator style supply chain plan that can provide a Victorian specific
distributor. This would include consolidation in Australia; warehousing in UK;
distribution in UK; sales agency representation in UK.
Assistance with consolidation of smaller shipment with likeminded other
producers.
Joint merchandising agency to ensure store compliance.
5. Regulatory
Lobbying of government to change tariff barriers.
Lobbying of government to change quota barriers.
Lobbying of government to assist regulation compliance (eg organic, source
of origin etc).
5.4. Commercially Successful ProjectThe food producers interviewed have shown a willingness to participate in an RDV
led project.
There is emphatic support from Victorian food producers for a commercially
orientated project, facilitated by government, to develop trade with the UK.
To fully commit, producers have highlighted the need to see a detailed project
prospectus which should include:
Defined project objectives
Defined market opportunity
Defined project costs
Defined project timings
Defined project process
Defined project partners
Based on this information food producers will be able to make commercial business
decisions to participate or not based on time, cost, resources, expected outcomes
etc.
A commercially successful project will require co-investment from industry and
government. Both parties recognise that this is a fundamental necessity. Co-
investment from industry can include time, information, resource, and cash. There
would also need to be an understanding that RDV and companies are partners within
a commercially run project under a cost sharing agreement.
6. Project Plan
6.1. Project ObjectiveCreation of a strategic RDV UK Retail Food Project designed to assist the
establishment and development of sustainable UK Retail Trade for existing or
prospective Victorian food producers.
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Through investment in this project RDV could achieve an increase in sales,
employment and capital investment in the Victorian food industry. As a pilot project,
RDV seeks to demonstrate a new model for market development projects. Through
participation in arguably the worlds most sophisticated retail market, RDV would like
to build industry capability, knowledge and programs to benefit both UK and other
export trade development.
By participating in this project, Victorian producers aim to see a growth in sales to the
UK market and benefits from reduced risk capital expenditure to establish UK trade;
synergies created in marketing and distribution systems; and increased capability and
knowledge generated through gearing up to supply UK market.
RDV leadership is essential to creating a successful project. By creating capability
and knowledge for Victorian producers, RDV is improving the capacity of Victorian
producers to trade in the UK. In addition, by working strategically with industry, RDV
is creating new retail and distribution opportunities for trade development.
6.2. Project ScopeIt is important to note that:
1. Participants in the project will be current or prospective Victorian food
suppliers to the UK Retail market.
2. The project is designed to work with suppliers across the entire demand
chain and aims to enhance commercial performance of Victorian suppliers
already in market, with a distinct pathway to market for those at various
stages of market entry development.
6.3. Description of Activities to Be Contained in Project
The project aims to undertake the following activities, which deal with different partsof the demand chain. Undertaking activities along the demand chain gives RDV a
complete UK strategy, and Victorian producers a complete pathway to market without
having to be involved in every component of the project.
Many of these activities can be run concurrently which should provide best return on
RDV investment and a co-ordinated approach for companies. A process for running
the project activities in established in Section 6.4.
1. Establishment of Relationship with UK Retailer.
This would look to include the following activities where possible:
Formation of relationship with UK Multiple retailer. The project would hand toRDV a strong relationship with the retailer whereby RDV can act as an
ongoing single entity representing (not commercially) multiple Victorian
products. By acting as a trusted product conduit, RDV can more easily allow
access to the retailer for Victorian food producers.
RDV to provide category management to bring qualified, leading Victorian
food companies to the attention of the retailer. The purpose is for the retailer
to request commercial presentation of products from Victorian
representatives.
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Trade mission to be conducted to buyers head office with Australian feature
day and buyer presentations.
Potential visit to Victoria by retailer buying or business development team (in
the longer term).
RDV to look to establish a longer term relationship with the retailer to expand
the food categories.
Mapping of retail sales channels available in UK (working document for
continual update).
NB. It is important to note that this suggests a multiple UK food retailer. The grouped
summary of prospective UK suppliers indicates this should be the priority. RDV needs
to choose a retailer partner to work with on this project. After a visit to market the best
option for this project may be with health / dietary needs retailers/ gifting or gourmet
stores.
2. Establishment of Cooperative Marketing Campaign
This would look to include the following activities where possible and would occur
once the demand chains had been finalised:
Retailer relationship to be enhanced by a cooperative marketing campaign for
Victorian food and wine in store. Marketing campaign also to utilise Tourism.
Marketing campaign to support new product listings of suppliers. The plan
may include sales promotional activity; POS; leafleting; sampling; advertising;
radio; PR Journalist visits to Victoria.
NB. A marketing campaign is a milestone in the project process, as a component of a
complete demand chain process. It is not the main project purpose.
3. UK Distribution Arrangements
This would look to include the following activities where possible:
Assessment of potential distributor options in UK for Victorian producers..
This will result in a map of UK distributor options (intended as a working
document / database that can be continually updated).
Producers interested in supplying (or already supplying) the UK identified that
having a knowledge of who the main distributors are (by sector and category)
as critical information. This map would detail the distributors sizes,
categories of focus, strategies, main customers, main brands they
represented, any Australian representation etc. At present Australian industry
(and government) knowledge of UK producers is poor and this would be
critical information for both RDV and industry.
Establishment of method and criteria for evaluating and qualifying potential
distribution partners.
Match qualified prospective Victorian Suppliers with UK distributors activelyinterested in buying product.
Production of feasibility analysis for an RDV dedicated distribution centre in
UK. This will be the evaluation an incubator style supply chain including
consolidation in Victoria; warehousing in UK; distribution in UK; sales agency
representation in the UK.
Mission by prospective suppliers to meet with interested distributors.
Potential mission to Victoria by a UK distributor.
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Match consolidation needs of Victorian producers active, or looking to be
active in UK
4. Capability Building Activities
Many of the project activities will specifically build capability (examples include the UK
distributor map and assessment criteria). Additional to this, the following work should
be undertaken:
a) Competitive Intelligence
Mapping of retail sales channels available in UK (working document for
continual update). Producers expressed a huge interest in knowing the
strategies for each retailer across different retail channels. The retail map
would describe retailer size, positioning, strategies, technical accreditation
requirements etc.
In market confirmation of initial company assessment of UK competitive
position.
Guided trade mission to market for prospective suppliers.
b) UK Business Plan Production
Individual work with qualified prospective suppliers to produce business plans
for entry into UK market.
Establishment of template for future suppliers.
c) Corporate Responsibility
Corporate Responsibility is about working in a manner which respects the
many stakeholders affected by business activity. Elements of corporate
responsibility include food miles, carbon foot printing, ethical sourcing and
social issues (health, labour etc). This is a critical UK (food) trend and
Australian suppliers can expect this to become a mainstream (food) issue in
the Australian industry in the next 5 years.
An analysis of current state of corporate responsibility expectations for food
suppliers in the UK market is needed.
This analysis is to be used as a tool for Victorian food producers to assess
their business against. This tool will be useful to assist producers in gearing
up for UK supply, and preparing and positioning their business for the future.
Corporate responsibility is set to be a major international food trend of the
future.
This analysis can be used by RDV to help generate a positioning response
for Victorian food suppliers to UK (potentially with Federal bodies).
This work may highlight a spin off project for RDV to undertake in order to
grow capabilities of Victorian producers.
d) Technical Requirements Clear and easy access to regulations governing access to UK market (tariffs,
quotas etc).
Access to UK retailer expectations of supplier technical accreditations.
RDV should consider the establishment of a password protected website to store this
information.
5. Victorian Food Producers UK Network
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Establishment by RDV of a central network for Victorian food producers supplying the
UK. Facility is used to:
Establish RDV as credible UK market point of contact.
Bring together those interested in supplying or currently supplying UK market,
in order to share learnings.
Assist companies currently supplying the UK to develop further commercial
activities (synergies in supply chain, marketing etc).
Develop the capabilities and expectations of prospective suppliers to UK;
assist them in putting together a UK market plan.
6. Regulatory
The project should look to provide an information flow between industry and Federal
Government activities specifically focused on regulatory barriers to UK market (tariffs,
subsidies, labelling etc). This information should be communicated and discussed at
network meetings or via mailing lists. This activity should also allow industry to have a
coordinated voice on UK issues back to Federal government.
7. Ad Hoc UK Assistance
Through detailed involvement in UK, RDV will be able to perform some tasks for
Victorian suppliers that might not be part of the core project, but are identified as
beneficial for trade development with UK market and provide great benefit and cost
saving. Provision should be made to use synergies from UK activities to assist
Victorian companies entering the UK market outside of the core project.
6.4. Project Plan Recommended Stages
6.4.1. Introduction
Section 6.3 details the activities that RDV might carry out in order to benefit industry.
This section puts these activities into a recommended Project Plan, split into distinct
stages. For maximum benefit the project plan runs the activities identified above
concurrently.
Each stage should be treated as a milestone within the Project. On completion of
each milestone, the project plan needs to be reassessed to ensure project objectives
are met (section 6.1).
In term of the stages contained within this Project Plan. Stages 1 & 2 are completed.
Stages 3, 4 and 5 should be treated by RDV as up front risk capital to provide the
intelligence and planning to enlist companies. This is work that these companies
would not otherwise be able to undertake. RDV should seek to gain in principle
support from producers in order to progress with these stages. Stages 6 9 should
be undertaken in partnership with industry.
6.4.2. Stage 1 Initial Market Research Complete
Market Research is undertaken to confirm that a market opportunity exists. This work
has been completed previously. Key Findings:
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NFIS, Sainsburys and Tourism Australia UK consumer research showed
consumer opportunity for Australian food in UK.
Australian wine has successful track record of supply to UK market.
NFIS Retail Project demonstrated commercial success for Australian food
products in UK market.
Over 15 food producers are now in the UK market as a result of the NFIS
project.
It should be noted that the producers interviewed in the course of this discussion fully
supported RDVs initiative to develop further trade with UK.
6.4.3. Stage 2 Initial Project Plan Current Work
This report gives an initial project plan for developing further trade with the UK retail
market. The output of this report is:
Grouped summary of the export business for Victorian producers into market
(including current supply chain and obstacles to trade.
Grouped summary of producers into project participants. Assessment of producers product range fit to market.
Overview of suggested project options for RDV in UK market.
A project plan that includes summary of project activities to be
implemented; description of processes needed to set up activity; candidate
producers for participation; potential timings, costs and partners.
The output is a project plan and map of potential participants.
6.4.4. Stage 3 Industry Group Session - UK Exporters FoodProducers Network Meeting
This stage brings industry together to gather in principle support for the project, andcommence a UK Export Network.
The objectives of this meeting are to:
Inform industry of the results of the initial project plan work (and conclude that
stage of the project).
Galvanise in principle support from industry for an RDV UK Retail Project
Plan.
Gain commitment from industry to provide information necessary for Stage 4.
Bring together current suppliers to UK and prospective suppliers to UK for
inaugural Victorian Food Producers UK Network meeting.
Key activities undertaken at the meeting are:
Welcome address from senior a RDV manager Gary Gaffneyrecommended.
Presentation on RDV project plan.
Short presentations by various Victorian food producers who have been
active in UK market with positive and negative successes. A wine producer
should also present.
Provision to each company of project plan document, including bespoke letter
with RDV assessment of how this project might benefit each companys trade
development with UK.
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Each producer to be asked to sign a letter of in principle support for RDV UK
Retail Project. This letter would acknowledge a commitment to providing RDV
with information necessary to conduct Stage 4 of the project.
An undertaking of confidentiality by RDV to protect each companys
information.
The outputs from the meeting are expected to be:
Networking by Victorian food producers who are active, or would like to be
active in the UK market.
Shared learnings by experienced UK exporters with other Victorian
producers.
Feedback on RDV UK Retail Project Plan. This will be used to amend and
update the Project Plan where necessary.
Direct feedback from RDV to individual producers on how this project may
benefit their plans in UK market.
Determine the number of producers with in principle commitment to
supporting an RDV UK Retail Project.
Establish a need to set up a regular UK Exporters Network.
6.4.5. Stage 4 Capability Building and UK Preparation Visit
This stage is crucial in setting up the capability for RDV (and Victorian Producers) to
participate fully in the project. It will bring tangible benefits to producers (and project),
as well as establishing credibility for RDV and beginning to build relationships in the
market.
The objectives for this stage:
Satisfy RDV that producers own assessment of UK market position is viable.
RDV can add direct value to companies by conducting further base
competitive analysis, or feeding back individual information as requested.
Develop relationship with the London VGBO and in market representative. Scope potential relationships with retailers; complete UK part of retail
mapping work.
Scope potential relationships with distributors; assess how a specific
Victorian incubator may occur if required; meet with identified distributors to
assist mapping work.
Scope corporate responsibility requirements of supplying to UK.
Scope potential relationships with marketing service providers and partners.
Produce business planning and distributor evaluation tool for companies
looking at engaging in UK market.
Key Activities to be undertaken in this phase will be:
Two week market visit in order to meet with potential candidate retailers;
meet with potential distributors; meet with London VGBO; meet with in marketservice providers; complete competitive intelligence check work needed
Request to project participants for completion of business background
template. Project participants will also be able to request certain competitive
information to be confirmed.
Mapping of UK Retailers (multiples, health, gourmet, regional, department
store etc). This will include desk research; purchase of latest AC Nielsen
report; personal contacts; UK meetings.
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Mapping of distributor options in UK. This will include desk research, personal
contacts, potential trade shows; UK meetings; purchase of distributor report.
Research (benchmarking) of corporate responsibility models in the UK. This
will include desk research prior to UK meetings.
Production of business planning and distributor evaluation tool.
The outputs expected at this stage are:
Satisfaction from RDV that company analysis of market place positioning is
correct.
Map / Database of UK Retailers.
Assessment of retailers with which RDV might form a partnership
arrangement.
Map / Database of potential UK Distributors. Building of relationships with
candidate distributors.
Corporate responsibility requirements of supplying UK market (this may spin
off into separate major project).
Business planning and distributor evaluation tool for UK market.
Bespoke competitive intelligence by Producer where required. Commencement of relationship with London VGBO and any in market service
provider.
6.4.6. Stage 5 Project Prospectus
This stage develops the tool to officially recruit producers into the project.
The objectives for this stage are:
Development of a detailed project prospectus. The project prospectus would set out
definitive arrangements and costs for each individual project activity. This project
prospectus is to be used to recruit producers to project. Specifically the project
prospectus would detail for each activity: Defined objectives
Defined opportunity
Defined costs
Defined timings
Defined process
Defined partners
Production of project prospectus. Prospectus should be put into a format which can
be easily distributed to potential participants.
The activity required at this stage is the writing of the prospectus based on the
information found to date.
NB Should producers require specific assistance to make themselves ready for the
UK, or to participate in the project, they will be expected to invest in getting
themselves to that position.
6.4.7. Stage 6 Recruitment of Participants
The objective of this stage is to recruit participants to the project based on the project
prospectus.
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The activities required will be:
Meeting of Victorian Food Producers UK Network to present prospectus and
other work completed to date. This network meeting will be a useful tool to
raise any technical market issues that producer have, and further share their
UK learning with each other.
Individual follow up meetings with potential participants will be required.
The outcome of this stage will be a core group of producers who are willing to co
invest in various activities in order to develop trade with the UK.
6.4.8. Stage 7 UK Market Visit 1
This stage aims to confirm partnership arrangements with a retailer and providing
quick win producers with a distribution chain that allows them able to start doing
trade with UK immediately.
The objectives of this stage are to:
Confirm partnership arrangements with UK retailer.
Take those producers at an advanced stage of readiness to UK in order tomeet with prospective distributors identified in Stage 4.
The activities required will be:
Visit to UK to discuss partnership arrangements with UK retailer. This might
need some samples from producers.
Guided store visit day for producers to confirm competitive position.
Individual meetings between producer and UK distributor (arranged by RDV).
If possible, RDV to be present at meetings in viewing (and learning) capacity,
but not to take a part in commercial negotiations.
Potential to research any competitive positioning work required by companies
researching UK business plan.
The outcomes of this stage will be:
Partnership agreement between RDV and the UK retailer. This is long term
strategic relationship that will outlast the duration of this project and form a
legacy for Victorian food and wine producers to benefit from over a an extend
period of time.
Distribution agreements signed by producers on visit to UK.
6.4.9. Stage 8 UK Market Visit 2
This stage is a larger trip to UK market and takes a number of producers all at varying
stages of development. Now retailer relationships are signed off, this trip is the first
opportunity for qualified, producers to present to a retailer. At this stage it might also
be appropriate for a senior RDV representative to visit the market with this group.
The objectives of this stage are to:
Take a group of producers (potentially at various stages of development) to
market to develop an additional retailer relationship; develop a distribution
system in UK; and / or complete a fact f inding assessment of their
competitive position in UK market.
Develop in market relationships for RDV with retailers and distributors.
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Begin to assess and recruit marketing service providers and partners for a
UK marketing promotion.
The activities in this stage are:
Presentation at UK retailers head office. This would include direct buyer
presentations and a food show for producers not yet able to present to
buyers, but seeking product feedback. This will require some set up work
prior to market visit.
Presentations by suppliers to preselected distributors interested in buying
product. Various distributors may also take the opportunity meet those
looking at the UK market, while not expecting a commercial outcome from
that meeting. This will require some set up work prior to market visit.
Guided store visit day to assess competitive position for products within
market.
Meeting between RDV and marketing service providers and potential
partners.
Its worth noting that producers will be able to benefit from different aspects of amarket visit dependent on their stage of development in UK. Those producers with
least market knowledge will be able to participate in all activities in order to scope
their opportunity. Those producers integrally involved in the UK market may only have
minimal involvement, but would service existing customers during visit also.
The outcomes of this stage are expected to be:
Establishment of listings for Victorian suppliers with a UK retailer
Establishment of distributors for prospective Victorian suppliers to market.
Generation of competitive intelligence and market information for prospective
suppliers to market.
6.4.10. Stage 9 - Marketing Campaign
The aim of the marketing campaign is to increase brand exposure and drive product
sales. Marketing activity in the UK is expensive. Joint activity will make marketing
more affordable for brands that are established in the market and brands that are
launching in the market. It is highly likely that food, wine and tourism would need to
be involved in the marketing campaign.
The objective of this stage is to put together a cooperative marketing campaign for
Victorian producers focused on one UK retailer.
The potential activities required in this stage are:
Development of a cooperative marketing campaign.
Identification of marketing service providers.
Identification and recruitment of Tourism and Wine partners. Identification and recruitment of interested producers.
Sales process to retailer.
Management and evaluation of the campaign.
The outcome of this stage is expected to be a marketing campaign for a group of
Victorian food producers in the UK market.
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6.4.11. Stage 10 Project Consolidation
The objective for this stage is to consolidate the work achieved to date in the project.
It is recommended that this stage would run in parallel to Stage 8.
The activities contained within the review should be:
Activities to date should be reviewed for effectiveness. Relationships developed should be reviewed for further opportunities (extend
to other categories?).
Participants should be reviewed for further actions.
The outcome of this stage would be a revised plan for further UK market development
activities.
6.5. Candidate Companies Open to ParticipationFollowing the interview process it is possible to split candidate producers into 3
sections those who have specific interest in participating in an RDV led project into
the UK; those whose involvement is highly contingent on the project plan and targetchannel; and a producer active in UK but not currently open to this project.