Distribution into Premium Foodservice For SE Lanarkshire

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Distribution into Premium FoodserviceFor SE
Lanarkshire

• Processor Results
• February 2008

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Processor SurveyKey Results

• 71 already supply premium foodservice
• Of these, 61 sell less than one quarter of their
  total sales into this sector and wish to grow
  this share
• 25 do not currently supply premium foodservice,
  but want to develop business in this sector
• Companies use a range of distribution options
• Generally higher usage of own transport in
  central belt urban areas e.g. in Edinburgh
  Lothian 81 use their own vehicles
• 3rd party distributors are commonly used for
  rural area deliveries and to England/Wales. E.g.
  in Grampian and the Borders 46 use 3rd party
  distributors
• Royal Mail/Parcelforce is used more on the
  islands. E.g. 20 of companies use it in Argyll
  Islands, compared to 7 in Edinburgh Lothian
• Some use specialist wholesalers, but this is not
  widespread. The highest proportion of companies
  using wholesalers is in the Glasgow area at 25

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BarriersRoutes to Market

• Though most of the companies already supply the
  premium foodservice sector, almost 70 felt that
  they were still unsure about how the market was
  segmented and what the various routes to the
  market were.
• 61 find it difficult to get contact details for
  chefs and over 90 would welcome a directory of
  premium foodservice operators in Scotland
• Companies tend not to use specialist wholesalers
  very much - 73 said they were unsure as to who
  all the wholesalers were and 54 said they were
  unclear about what role they played. Again, a
  very high proportion - 95 - felt that a
  directory of wholesalers would be of benefit to
  their business
• Almost 80 feel that their current distribution
  costs are too high and a further 63 that they
  dont have many distribution options. This may
  be partly due to a lack of knowledge of whats
  already out there, but there may also be scope to
  look at developing local food distribution
  networks
• The chart overleaf shows the survey results in
  graphical form

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BarriersRoutes to Market
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BarriersProduct and Price

• 47 are unsure of chefs or other foodservice
  operators requirements, with more than 53 being
  unsure of how to price their products for this
  market
• More than 58 find it difficult to negotiate with
  buyers and would like to understand how to make a
  wholesaler relationship work.
• The chart overleaf shows the survey results in
  graphical form

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BarriersProduct and Price
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Processor SurveyWhat would help?

• Over 80 of respondents felt that having
  practical workshops on how to supply this market,
  coupled with visits to wholesalers and premium
  foodservice operators would be of benefit to
  their company
• An even higher proportion - over 95 - wanted the
  opportunity to participate in Meet the Buyer and
  networking events, bringing producers,
  processors, wholesalers, distributors and buyers
  together
• 90 wanted workshops to look specifically at
  local and regional distribution models, learning
  from what has been tried and tested elsewhere
• Again, the charts overleaf show the survey
  results in graphical form

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Development InitiativesLearning and Knowledge
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Development InitiativesEvents and Networking
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Development InitiativesInformation Access
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Distribution into Premium FoodserviceFor SE
Lanarkshire

• Wholesaler/Distributor Results
• February 2008

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Wholesaler SurveyKey Results

• 90 already supply premium foodservice. 10 do
  not currently supply, but want to develop
  business in this sector
• 90 are wholesale distributors and over one third
  say that more than 50 of their sales are into
  the premium foodservice market
• Half are also nominated wholesalers for hotel and
  restaurant groups and catering operators, such as
  Compass and Sodhexo
• Between them, they distribute to all areas of the
  UK, including the Scottish islands - though not
  necessarily on a daily basis

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Wholesaler SurveyKey Results

• Between them they cover the full range of food
  and drink products. 37 wholesale/distribute
  alcoholic drinks, while 84 cover dairy,
  preserves and sauces
• Many carry the full range of ambient, fresh,
  chilled and frozen products, but the highest
  proportion is for transportation of chilled
  products - 84
• All say that their minimum pick-up load is a
  single package/box
• 53 are, or are willing to, participate in
  backhauling
• The most common size of van used for deliveries
  is the transit (850kg), used by more than 63 of
  respondents, but again between them, they cover
  all sizes of vehicles
• The charts overleaf show the survey results in
  graphical form

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Which sectors do they supply?
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Wholesaler SurveyWhat would help?

• The wholesaler/distributors were also asked if
  they would be interested in participating in any
  of the practical initiatives that were of
  interest to the processors
• Over 76 were interested in participating in
  practical workshops and willing to host a visit
  to their premises. 72 felt it would be
  beneficial to them in turn to have an opportunity
  to visit premium foodservice operators premises
• Similar to the processors, the wholesalers would
  also welcome a directory/database of premium
  foodservice operators (95) and are also keen to
  see one developed for their own sector - again
  95
• Again, the charts overleaf show the survey
  results in graphical form

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Development InitiativesLearning and Knowledge
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Development InitiativesEvents and Networking
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Development InitiativesInformation Access
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Action

• The plan is roll out a series of activities over
  the next few months based on what you say would
  help-
• The first to be implemented will be the practical
  workshops, aiming to help companies with the
  how of getting their products into the premium
  foodservice market. These will be run in
  conjunction with visits to wholesalers and
  hotels/restaurants, giving you a chance to find
  out more about the role that the wholesaler can
  play and what exactly it is that chefs look for
  and need from their suppliers
• There will also be a workshop which looks
  specifically at regional distribution models and
• a directory of wholesalers and distributors will
  be produced by the end of March
• Networking and Meet the Buyer events will follow
  later in the year and if demand is sufficient,
  some of the workshops may be repeated
• The following slides give a little more detail of
  what the workshops would cover..

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How can we get our products into Scotlands
premium caterers? Workshop

• Background info on market segmentation and key
  characteristics of each
• (profit sector vs public)
• For premium foodservice
• Further segmentation e.g. cafes, individual
  restaurants/hotels, group hotels/restaurants,
  cafes/bars, etc.
• How food generally purchased in each segment
  (through wholesalers, direct through chefs,
  through central purchasing, etc)
• How to approach each type
• Pros and Cons of each route type
• (basic understanding of price, margins, volumes,
  product range, marketing support, delivery
  requirements, etc.)
• Key requirements for premium foodservice
  generally
• (product specifications, quality, volumes,
  production capacity, consistency, pack sizes,
  packaging, portion control, etc.)

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How can we get our products into Scotlands
premium caterers? Workshop (cont)

• The Role of a Wholesaler
• Key requirements from a wholesaler perspective-
• More detail on
• pricing and margins, payment terms
• importance of consistency of supply, product
  quality specifications
• importance of understanding production capacity
  and ability to supply
• pack sizes, packaging, portion control
• delivery schedules, paperwork issues, handling
  rejects, temperature requirements,
  monitoring/record keeping required, etc
• Advice on how to make the most of your wholesaler
  relationship

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How can we get our products into Scotlands
premium caterers? Workshop (cont)

• The Role of the Chef/Foodservice Operator
• Key requirements from a chef/foodservice operator
  perspective-
• pricing and margins, payment terms
• importance of consistency of supply, product
  quality specifications
• importance of understanding production capacity
  and ability to supply
• pack sizes, packaging, portion control
• delivery schedules, paperwork issues, handling
  rejects, temperature requirements,
  monitoring/record keeping required, etc
• Advice on how to make the most of your customer
  relationship

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How do we set up a local distribution network?

• Aimed at companies who understand the market and
  the routes to market, but for some reason feel
  these are not suitable and wish to consider
  collaborating with others to set up their own
  distribution hub
• Discussion of various models for distribution
  hubs, their pros and cons, how theyve been set
  up and financed, etc., with a range of speakers
  representing different types of hub
• Aimed at processors and distributors