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We must weather the weather, whatever the weather, whether we like it or not.

We Must Weather the Weather, Whatever The Weather, Whether We Like it or Not

Decades come and decades go - and what changes they bring! In the 1960s the United Kingdom frozen food scene underwent quite extraordinary development following the establishment of a bridgehead during the second half of the '50s. The first wave brought the immediate success of fish fingers, the installation of open-top refrigerated cabinets in stores (especially in the smaller independents), and the investment in television advertising by Birds Eye. It is probably forgotten that commercial TV only got started in Britain in 1956, and that this coincided nicely with serious expansion of the QFF franchise.

Throughout the '60s Birds Eye dominated industrial development with almost weekly promotions of one new product or another. Such included breaded fish and comminuted meat items, pies and pastries, cook-in-bag entries, polybag vegetables, dairy cream sponges and Artic rolls, which helped to widen consumer interest.

That decade also saw the first real determination by multiple grocery companies to take advantage of this new sales opportunity. And the first real efforts were launched by other brands intent on giving the leader some competition. Findus and Ross became keen rivals for the No. 2 position.

Indeed, the '60s proved to be one long success story for those involved in the UK frozen food business. And that is how it was for the first year or two of the '70s, but the continued success attracted almost too much attention as far as the pioneering manufacturers were concerned. The government - at that time a Conservative one - in its need for improved public image decided to look for headlines. And what better contribution could the then Food Ministry make than to offer a couple of references to the Monopolies and Mergers Commission! They chose two "daily purchase" sectors: bread (for about the third time) and frozen foods.

It could be said that this formally marked the "coming of age" of the QFF industry in the UK, but it was also a costly and time consuming exercise that had not been completed when the OPEC-instigated world oil crisis of 1973 shocked the economics of just about all businesses. During the rest of that decade strikes and inflation took up an increasing amount of management time. This made forecasting, even over quarterly periods, extremely difficult.

Rise of Own Labels

It was also in the '70s that the large multiple groups first began to have leading volume products such as peas, fish fingers and beefburgers packed under their own labels. This was coupled with the arrival of many smaller manufacturers who were naturally interested in gaining distribution, under any label. It became sensible for transport companies to get in the business of refrigerated shop deliveries, thus breaking the dominance of Birds Eye and heralding a major change in the distribution pattern of QFF during the '80s.

Another landmark development of the '70s was the advent of hundreds of home freezer outlets which added to the opportunity for smaller manufacturers and new transport companies. Even the large multiples followed suit by opening up their own freezer centers, albeit this is a rather misleading description because the main sales in these outlets were frozen foods and not freezer appliances. But the fact that in these stores consumers usually bought bulk quantities certainly did make for an extremely rapid expansion of the consumer home freezer market.

All these changes meant that the major manufacturing companies had to become much more conscious of the need to be more productive in all aspects of their business and, this writer believes, in so doing hey also became rather less entrepreneurial. So the very characteristic which had given them the original impetus was lost. New product development had to be tested even more thoroughly, so often own label entries got into the market as soon as - or even before - branded entries.

To regain an edge, the main manufacturers sought to use special technologies to widen their range away from the more easily copied staples. More complex added value items, especially in the meals sector, were introduced. This area of development was attractive for another reason: the arrival in the UK of the microwave revolution in home cooking. Very soon meals were being produced in packaging that could be used from the freezer to the oven to the table.

By the end of the decade the considerable changes in the makeup of the total QFF market - including the important catering sector where frozen fried potatoes had become the No. 1 item - had their effect on the largest producing companies. Many mergers resulted, with UB and Campbell's making forward moves by acquisition. And, of course, more attention was being given to post-1992 EEC market possibilities by these merged groups.

Value of Perspective

If all this reads like a historic review of the UK market, that's because it is. Looking back is sometimes necessary to obtain perspective when considering the future. This longtime observer detects that 1991 is going to be one of the worst years in the UK industry. We have already heard predictions that the retail market through August would be down by around 20%, and that the catering side is even more depressed.

Of course, happily, there are always a few exceptions to the rule - but they will be very few. Even the top supermarket companies are fighting tooth and nail for the reduced consumer spend. After having forsaken pricing as a competitive edge for a number of years, price cuts are once again being featured in store advertising. The ice cream and catering sectors have been further hit by the worst spell of non-summer weather the UK, as a whole, has experienced for many years.

Yes, 1991 has not been a favorable economic or natural climate for the food industry. New products do continue to flow on the reduced market, but one has little doubt that much of the promised advertising support has not materialized.

But life must go on, for most. Many will not survive, and this means that basic business strategies should be sharpened up for use at the end of the recession when the "blue skies" will surely shine again. Already there are a few encouraging signs. It is actually said by the Central Statistical Office that provisional retail sales for June show a small improvement over June of 1990, but then inflation was also up by about 7%. Retailers have welcomed the continued trend in reducing interest rates, which has a positive effect on both operating costs and consumer spending. The more settled international scene should result in a greater movement of tourists, and the UK hopes to share in this increase.

The sun has shone occasionally in August and the school holidays always happen, whatever the weather. I remember learning as a child a rhyme which went: We must weather the weather, whatever the weather, whether we like it or not. That's useful advice in contemporary Britain, particularly to those in the ice cream business.

Some companies will be treating the soon to happen "more unified European market" seriously. However, as Paul Judge, chairman of Food from Britain, said recently: "We in the UK will have to become more marketing and export oriented if we are to improve our present negative balance of payments (upwards of 5 billion [pounds]) in the food sector."

So the '90s will certainly be different from the past several decades. The winners will be those who are both flexible and honest with themselves, as they fight the good fight.
COPYRIGHT 1991 E.W. Williams Publications, Inc.
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Title Annotation:includes related article; frozen foods industry in Great Britain
Author:Webb, Kenneth J.B.
Publication:Quick Frozen Foods International
Date:Oct 1, 1991
Words:1253
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