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The private label sector already big and getting bigger.

Quantifying the true extent of private label coffee and tea sales in major European markets is not easy. Statistics vary widely for the same markets, reflecting the difficulty in defining the exact borders of private label For example, many roasters do not produce their own decaffeinated or instant products, and often these are supplied to the roaster already packaged--this is a form of private label that is difficult to quantify. Another example, many gourmet shops or department stores offer either a house name in packaged coffee or coffee roasted in bulk per origin--these sales may not be combined with mass market supermarket-style figures. Yet another example, does one include figures for specialties such as Belgium coffee filters, or the sales of companies like Germany's Aldi which only sell their own coffee brand in store and have significant national market shares in Germany and Belgium?

Nevertheless, it can be safely said that the private label/distributors coffee and tea markets in Europe are very large, vast actually, and are growing. They are in fact the most dynamic element in most market. In some markets they have matured, and growth is potentially limited (UK, Benelux) western region Germany). But in nations where a surge in super and hypermarket expansion proceeds (southern and eastern Europe) the private label sector will boom. The following chart gives at least an approximation of some key markets. The table and chart on private label coffee performance in Spain is quite revealing as to the degree of growth the sector can experience.
 % Private Label/Distributors Coffee & Tea
 Shares of Retail Markets
 Coffee Tea
Germany 22%(excluding Aldi) 20%
Belgium 30%(including Aldi) 10%
France 18% 4%
Spain 15% ?


Clearly the private label market is divided between mass market, mostly in distributors' brands, and specialty/fine food labels. The chain stores control most of private label business and handle their own-label coffee and tea production in various ways; some have their very own buying programs and roasting/packing plants (like Albert Heijn in the Netherlands) some control buying and blending but contract the actual production to order (GB in Belgium), others acquire shelf-ready products from suppliers.

These suppliers of private label coffee and tea products also vary widely in their approach to the market, some being specialized uniquely in private label (like Union Tostadora and SEDA in Spain, Inca in the Netherlands), some are supplying (roasting/packing) for their own label as well as private label business (such as Beyers and Miko in Belgium, Drie Mollen in the Netherlands). Some are dedicated to up-scale specialty store production (like Cafes Suavor and Damman in Paris), some are oriented like France's Leporq Legal towards chainstore brand production. Some will buy, blend roast/pack completely to customer order (given sufficient size), some sell a shelf-ready product that is not customized beyond changes in artwork on packaging materials. Some stress coffee only, some do coffee and tea, in coffee most provide roasted coffee only, while a few provide roasted and instant products; some are devoted only to decaf and freeze dry products, some emphasize packaging over production, some vice versa.

Private label coffees and teas can thus be of gourmet standards or for low price bargain sectors. They can be completely original products, tightly controlled for uniqueness, or products that vary only in name from other labels. In sum they present a universe of possibilities.

A specific member of this universe of private label sector suppliers is International Catering Service (ICS), of Dordrecht, the Netherlands. ICS is specialized in producing and packaging fresh roasted coffees, fresh teas in bulk and teabags, instant coffee and tea, and a complete line of service products from cocoa to creamers and instant soups. These are products for a variety of markets--vending foremost, followed by office/institutional service, horeca, and even retail (Belgium only)--and for numerous clients, although ICS is busiest serving the farflung needs of sister member companies in the Univend Group. ICS products are active on the Benelux, German, French, U.K., Austrian and Greek markets.

The firm produces coffees and teas under the Riant, Pelican Rouge and Dutch Mill trademarks (Dutch Mill is quite new, launched only 18 months ago).

Actually, in recent years most of ICS's private label business has been in the non-coffee areas. Now, according to ICS plant-manager R. Wijnolst, the tea and coffee private label sectors are developing nicely.

Versatility, quality and the quite extensive product line are our leading virtues, reports Wijnolst. Our tea, for example, is sourced to us by a company that also supplies some of the finest tea shops in Europe. We pack bulk teas and produce teabags, with or without envelope, and in both the Dutch (1.59) and British (2g) sizes. Tea expansion at ICS has necessitated the recent acquisition of a third teabag making machine.

Relative to private label coffee, the company can produce to order in any size package, vacuumized or not, from 50g sachet to kilo, ground or bean. ICS will customize blends if order is of sufficient volume. If this is not the case, the company will work with a client, sampling the existing product, perhaps looking for ways to improve it, comparing it with the range of available ICS blends (which are necessarily numerous, due to the extent and nature of Univend Group operational needs). "The goal is to have a successful product-that means good long term business for us."

Wijnolst notes private label trends toward espresso style products, which may also explain a gaining fashion in whole bean, big valve-bag formats, and in decaffeinated coffees. To maintain control of the decaf product, ICS prepares its own green blend in advance of processing.

ICS is 18 years old, and headquartered in a new facility that combines the Riant roasting plant. K. Goedewaagen is export manager; L. Janssens is director. ICS is also home for a beautifully exhibited collection of coffee grinders and brewers.
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Title Annotation:private label coffee and tea in Europe
Author:Bell, Jonathan
Publication:Tea & Coffee Trade Journal
Article Type:Column
Date:Aug 1, 1991
Words:984
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