Distributing Seafood

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Distributing Seafood
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The Seafood Marketing Chain
Retailer
Brokers
Secondary Processor And Manufacturer
Grower And/or Harvester
Primary Processor
Wholesaler/ Distributor
Consumer
Food Service
Seafood marketing chain - understand each links
function, operational situation and expectations.

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The Seafood Marketing Chain
Distributing Seafood
Function Buys fish, sorts, weighs, grades,
slimes and washes, head guts. May be fully
integrated into the seafood chain. Commonly
performs secondary processing.
Operational situation Proximate to harvest
grounds. Works with fishermen, market buyers.
Handles significant regulatory requirements,
including DEC permits. Employs variety of labor.
Sells to all points in the seafood chain.
Expectations/Needs Fish from harvester that
will let processor meet its buyers
specifications.
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Distributing Seafood
Function Often the primary processor.
Freezing, steaking, filleting, canning, smoking,
battering breading, portioning, vacuum packing,
gift boxing.
Operational situation Complex operation. Large
ingredient inventory. Skilled processing
workers, various equipment, and strong
manufacturing efficiencies. Often an in-house
sales staff. Product inventory large takes time
to move. Holding capacity large.
Expectations Good quality product. Will need
to offer a number of species.
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Distributing Seafood
Function Do not own product. Sell on
commission. Territorial. High volume sales.

Operational situation Little overhead.
Geographically well connected. May require
higher commissions on lower volume transactions.
Expectations Long-term relationships with
suppliers. Consistent products delivered in a
timely fashion.
Direct market targets Those handling
high-value, niche products to niche markets.
Example live geoducks to Hong Kong.
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Distributing Seafood
Function Large capital intensive operations.
Deliver to food service or retailers. Seafood
small part of product line. Fleets of trucks,
including refrigerated. Significant warehousing
capacity. Door delivery.
Operational situation Strong network of
suppliers and buyers. Significant capital
investment. Streamlined distribution/logistics
capacity.
Expectations Need a variety of products.
Appreciate fewer suppliers. Appreciate buying
from a company that has several seafood species.
Direct market target Small, regional
distributors specializing in seafood.
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Distributing Seafood
Function Sells products for home consumption.
Supermarkets, grocery stores, fish markets,
health food stores, farmers markets. Offer wide
array of products.
Operational situation Huge overhead costs.
Sustain the greatest shrinkage from poor
seafood quality. High employee turnover. Survive
on high volume, small margins bringing greatest
mark-ups.
Expectations Need seafood with greatest
shelf-life possible. Can use point-of-sale
promotional material and education for staff.
Direct market target Small, high-end locally
owned grocery stores, meat and seafood specialty
stores.
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Distributing Seafood
Function Prepare food for consumers. Single to
large franchise restaurant. Institutions like
hospitals, schools, prisons, and entertainment
venues.
Operational situation Constant flow of product.
Generally little holding capacity. Diverse
product needs. Significant labor requirements.
Expectations Use variety of products with quick
turnaround. Products are menu driven and
generally set. Efficient. Prefer to source from
one supplier. Increasing preference to
convenience.
Direct market target White table cloth,
owner-operated, restaurants.
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Distributing Seafood
Function Ultimate decision maker.
Operational situation Generally buys food one
three times a week. Limited storage. Limited
volumes.
Expectations Consistent quality. Seeking
greater ease in preparation.
Direct market target Through farmers markets,
road side, off the vessel, through food
cooperatives.
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Distributing Seafood Internationally

• General comments
• Best if you are familiar and/or have trusted
  contacts
• Select markets that would be receptive to your
  product
• Keep it simple and understand local rules
• Cover yourself financially

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Distributing Seafood Internationally

• Additional Things to Consider
• Overseas freight costs
• Certification/inspection fees
• Documentation
• certificate of origin
• Invoice
• Packing list
• Tariffs, taxes, duties
• Exchange rate differences
• Product testing
• Use of a broker/trader

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Distributing Seafood Internationally

• Know Your Market
• Oversea customs
• Seafood preferences
• Product preferences
• Nature of competition
• Finding a broker/trader to move your product
  through the foreign country may be the simplest
  step.

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Distributing Seafood Internationally

• Covering Your Transaction
• Letter of credit
• Insurance for product, transport customs
• Payment currency
• Currency hedging

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Distributing Seafood Internationally

• Resources
• Alaska Seafood Marketing Institute
• Alaska Office of International Trade
• Link to State of Alaska division that specializes
  in trade and investment development.
• http//www.gov.state.ak.us/trade/
• Alaska Export Assistance Center
• http//www.buyusa.gov/alaska/
• Food and Drug Administration
• Link to seafood portion of the US Food and Drug
  Administration site. Contains announcements,
  background, compliance, inspection, export
  certificate requirements, etc.
• http//www.cfsan.fda.gov/seafood1.html
• Foreign Agricultural Service - Forest and Fishery
  Products Division
• http//www.fas.usda.gov/ffpd/fpd.html
• NMFS Trade and Commercial Services
• National Marine Fisheries Service trade site.
  Great resource for trade statistics, tariff
  schedules, special reports, guide for exporting
  to Europe, etc.
• http//www.nmfs.noaa.gov/ocs/tradecommercial/
• World Trade Center Alaska
• http//www.wtcak.org/