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Just where is the sharp focus now in the British frozen food cabinet?

Just Where is the Sharp Focus Now In the British Frozen Food Cabinet?

The pendulum is swinging, but where it will stop is anybody's guess. Recipe dishes appear to be slipping overall, but `healthy' packs are robust. Meanwhile, Campbell's future remains unclear.

Supermarket shelves and cabinets usually tell you all that's needed to know about public attitudes towards food. Attention is focused in one decade on the frozen food cabinets; then it shifts towards the meat case or the vegetable shelves.

In Britain right now, it is not easy to see where the focus has shifted. There is less activity in the recipe sector (or so it seems) and commodity vegetables seem to be more visible than they have been for some time.

In the U.S. by comparison the frozen food cabinets have a self-confident appearance, but don't seem all that busy. In both countries emphasis has shifted in the recipe sector from low-calorie dishes towards dishes that appeal to the customers' growing knowledge of nutrition and healthy eating. And there is a less self-conscious presentation of cakes, desserts and ice cream.

What is fundamentally different between the two national markets is the response to frozen yogurt. In the American retail ice cream cabinets as much as 25% of the space is occupied by frozen yogurt. One reason acceptance is high is due to the widespread availability of frozen yogurt parlours such as Baskin Robbins, TCBY, and I Can't Believe It's Yogurt.

The latter was started more than 10 years ago by brother and sister Bill and Julie Brice, who took jobs managing a struggling frozen yogurt store to earn extra money while working towards their degrees at Southern Methodist University in Dallas. Upon discovering that the owner was willing to sell the operation, they pooled $10,000 in savings meant to finance their educations and bought the store. I Can't Believe It's Yogurt now has over 275 outlets in 42 states.

Could Europe be the next opportunity? Certainly England would respond, if only because the public wants the taste sensation as well as the assurance that what it buys from the supermarket's ice cream cabinets is healthy. France and Germany could be more difficult.

In the meantime, concern about food and health continues to direct product development and advertising in both Britain and North America. Low-calorie slimming concepts are beginning to look distinctly old-fashioned, but in their place come recipe dishes that recognize the public's awareness of nutrition and the contribution of nutritional ingredients.

In the States, ConAgra has brought out a line of Healthy Choice recipe dishes that generally sit alongside Stouffer's Right Course recipes, just a few facings away from Lean Cuisine and Budget Gourmet. In Britain the concept has been taken up by Birds Eye with Healthy Options, similar to the ConAgra range, although both will doubtless argue vigorously that they thought of the idea first.

It really doesn't seem 15 years since -- together with nutritionist Jenny Salmon -- this writer was promoting the cause of balanced diets and nutritional labelling in the U.K. Birds Eye company. It was only a few years later that we were advancing the same cause with checkout cookery books like Eating Can Be Good for You for Argyll's Presto supermarkets. How slowly public interest actually advances in marketing.

Campbell came into Britain on a great wave of expectation about its initiatives in recipe dishes, but the visibility of this brand in the British cabinets is low. In Sainsbury's, there are Campbell's quiches, but not much else. And the trade in Britain is well informed about the strife within the USA parent company, even if no statements were being made about possible plans to sell off recent British acquisitions such as Freshbake.

The financial and marketing press has given a lot of attention to the new appointments in the Campbell organization, especially the news of the replacement of R. Gordon McGovern as chief executive, by David W. Johnson. Mr. Johnson, one source speculated, believes that the company's $344 million worldwide restructuring begun last August is insufficient to bolster sagging earnings. The write-off resulted in the closing of four plants and the dismissal of 2,800 employees.

Quick Frozen Foods International put to a Campbell spokesman in New Jersey headquarters the much-heard speculation in the British trade right now that Freshbake would be sold yet again. But he seemed unclear about the precise location of Great Britain, or what was going on in its frozen food industry. This writer quoted the following report from the U.S. publication Advertising Age, but he dismissed it as "speculation" by "people paid to speculate." It is nevertheless worth giving it here in full:

Details of the new restructuring aren't available, but it will probably expand on the plan begun by former CEO R. Gordon McGovern, who resigned in November. One source said Mr. McGovern vetoed a more draconian plan last summer.

"In addition to the four domestic plants closed in the August restructuring, five overseas plants were scheduled for eventual disposition. (Campbell) could further reduce their head count and close some (more) canned food plants," said John C. Maxwell Jr., an analyst with Wheat, First Securities.

The first restructuring, the company said, would generate $15 million in savings in fiscal 1990 ending in August, and $150 million during the next four years.

Mr. Johnson apparently believes that isn't enough to fatten earnings and satisfy the company's board. Three shareholders, who are members of the controlling Dorrance family, have announced their intent to sell shares amounting to 17.4% of the company.

Wall Street analysts believe further reorganization would include the sale of Mrs. Paul's seafood products, Freshbake Foods in the U.K. and Lazzaroni Biscuits in Italy.

By the time this issue of Quick Frozen Foods International is printed, the situation may be resolved and known, but if Freshbake is sold again it will be the second time for CEO Ken Manley, and a return to the three company domination of the U.K. market that prevailed before Campbell moved in. Noises coming from corporate headquarters suggest the new CEO is not much interested in his predecessor's global aspirations, and that Campbell itself may well be acquired before anyone picks up the pieces in England.

This observer has reason to believe that such speculation is wrong and that some new groupings are in the offing.

As this article is being written, the trade in Britain is just absorbing the news that Campbell's Sittingbourne, Kent, plant is to close in April with the loss of 272 jobs. The factory, acquired two years ago when the company merged with Freshbake Foods, makes frozen convenience foods.

The company blames the closure on the factory's presence in a residential area, which prevents any possibility of expansion. Production is being switched to Salford.

Another sign of the times is the news that Terry Pryce, until recently chief executive of Dalgety, has become chairman of Corby-based chilled food company, Solway Foods Ltd. He has also bought a stake in the business. Another investor is former frozen food stalwart Joe Sprott, who founded the old Eskimo Foods concern.

Other than that the chilled food sector is quiet in Britain, although TV broadcasters are still having a field day with last year's lysteria crisis, which affected both "cookchill" foods and soft cheeses. But one senses that the public might be just getting bored with it all.

What is evident to the experienced observer is the growing interest in more exotic ice cream confections. Who would have predicted that Mars would launch four- and six-packs in supermarkets, or that it would be extending distribution and ranges into several European countries? The public is clearly searching for new taste experiences, healthy or otherwise.

Mars signalled its intention to move into new areas when it acquired Chicago-based Dove International in 1986. In Britain, Unilever's Birds Eye Wall's is the dominant brand, with 42% of the market. Lyons Maid claims another 10.4%, but the real lion's share goes to private label with a total of 28.6% and 42.5% of the take-home market, mainly from supermarkets.

The product specification for Ice Cream Mars retains the familiar taste of the Mars chocolate bar. Real dairy ice cream is used along with a milk chocolate coating.

The formula has been introduced to Marathon and Bounty Bars from the same company, which is now convinced that it will become a major force in the ice cream market. It has spent 20 million [pounds] ($34 million) in the construction of Europe's largest ice cream factory at Steinbourg in France.

Thus does the pendulum swing.

GRAHAM KEMP QFFI Special Correspondent and World FF Congress Director
COPYRIGHT 1990 E.W. Williams Publications, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990 Gale, Cengage Learning. All rights reserved.

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Title Annotation:News from the United Kingdom
Author:Kemp, Graham
Publication:Quick Frozen Foods International
Date:Apr 1, 1990
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