British bangers still sizzling hot

12 October, 2007

The UK sausage market is worth £539m a year and growing, driven by a focus on quality and provenance at the premium end, says Chloe Smith

Sausages, snorkers, bangers, snags - whatever you call them, sausages are big business. Worth £539m a year, the market has grown 4.4% in the last year, according to market research company TNS Worldpanel. This growth has been driven largely by the premium sector, which is growing far ahead of the market at 7.4%. According to another market research company, Mintel, products emphasising British heritage are important in the premium sector, as are, conversely, sausages made with more exotic ingredients. Both types of premium sausage have one thing in common though - high meat content and labels that tell consumers about the quality of the product. For example, Black Farmer sausages are labelled as 90% prime British pork, gluten free, GM free, low in carbohydrates and wrapped in a natural skin.

Steve Crawford is managing director of Walkers Midshire Foods, a premium sausage manufacturer that supplies several multiple retailers. He says while the traditional British pork sausage is still a firm favourite, the drive to innovate has changed the face of the sausage market. "Pork and apple, and pork and leek have become mainstream lines now. In order to develop the category, inevitably it has moved into more exotic recipes."

Jim Brisby, sales and marketing director of Cranswick plc, agrees: "Over the past year, there has once again been an increased emphasis on the premium end of the market, with quality and prove­nance the main drivers of changes in consumer spending habits." >>

SIMPLY SAUSAGES

<< Cranswick's main sausage brand is the recently launched Simply Sausages range, which faithfully reproduces the recipes from London's original sausage shop, established in 1991. These are produced from outdoor-reared meat and are available in three flavours, including pork with apple and acacia honey. Cranswick also produces the Duchy Originals brand on behalf of the Prince of Wales.

Sales of sausages with ingredients such as cheese, fruits and spices are booming. According to Mintel, the steady rise in popularity of ethnic foods is likely to continue and will provide inspiration for new sausage varieties.

VARIETY OF EATING USES

All this innovation means people are eating sausages in different ways than they used to. "The majority of people still eat their sausages with mash, but if you've got some different flavours it gives them options to have it with a pasta salad or to have it cold," says Crawford. "More exotic flavours sell well during the summer months, when having a barbecue allows hosts to make sausages a talking point."

However, this summer has been disastrous for barbecues, and the sales figures for sausages reflect this. While the value of the market is increasing, the volume of sausages sold is in overall decline of 2% year-on-year, according to TNS Worldpanel.

VOLUME DECLINE

"It has been very poor," says Crawford. "Coming after a very good year last year, this has been quite the opposite really, so year-on-year we've seen quite significant decreases. Last year we also had the benefit of the World Cup and various other events, so there was a lot of interest in the barbecue as a meal occasion, whereas this year it's been a bit of a washout. Personally, I've only had a couple of barbecues this year. I guess most people are the same."

Despite the dreary weather, the versatility of the sausage means sales are not totally dependent on sunshine. In fact, the sausage is such a versatile product that it can appeal to every budget, every taste, every age range and every occasion, formal or informal.

FRESH IS STILL BEST

Fresh sausages are the most popular, with more than 73% of the market in value terms. Loose and frozen sausages account for the rest and are both declining. Loose sausages are seen less and less in supermarkets as the range of pre-packed sausages increases.

The fortunes of the frozen sector continue to slump, with a decrease of 9% in the value of the market recorded by TNS Worldpanel for the year ending 9 September. According to Mintel: "The perception of frozen foods has continued to deteriorate.

"Consumers are looking for wholesome, natural and convenient foods that they believe they get in chilled and tend to associate the cheap and cheerful nature of frozen foods with poorer quality."

Brisby says: "The frozen sausage sector is still in the devalued state the fresh sausage was in 10 to 15 years ago, and the frozen food sector as a whole is still not understood by consumers as quality food. There is opportunity for innovation and improvement in quality." He warns: "It may take time."

LESS INNOVATION IN FROZEN

Brian Young, director of the British Frozen Food Federation, agrees that the frozen sausage sector does have problems. "There is far less product innovation in frozen than there is in fresh and the biggest driver of that is simply that there is money to play with on the fresh side, but very little money to play with on the frozen side."

Young believes the decrease in value in the frozen sausage market is due to average prices being slashed, rather than people buying fewer frozen sausages. "In the past two years, the average price per kilo [for fresh sausages] has gone up by 11%, but the price per kilo in frozen has dropped 12.8%," says Young, citing TNS Worldpanel figures. "

The average price per kilo in fresh is £3.32, but the average price per kilo in frozen is £1.57, Young adds.

"It would seem to me that there would be a much greater incentive >>

<< to promote and be active in the fresh market, where you can obtain a price of £3.32 per kilo, than it would be in the frozen market, where you can only achieve £1.57 per kilo.

"The problem is that we haven't got big brands that are actually developing the sector and I think that is the biggest issue."

But he argues there are positives to frozen sausages that could be promoted: "Having something in the freezer for use at short notice is much better than buying a fresh or chilled product that you have to use, even if you don't fancy it, or else throw it away."

But he doesn't hold out much hope that retailers will help boost the fortunes of the frozen sausage: "I think it's an uphill task to get retailers to change what they do with the frozen fixture. Chilled and fresh are working really well for them so I don't think they have much incentive to try to move people towards frozen."

LOW-FAT LACKS APPEAL

Another area that has not fared well is low-fat healthy sausages. In a climate where health is an important trend, low-fat sausages are not doing well. Worth £38m in 2006, according to TNS Worldpanel, growth in the low-fat sausage ground to a halt between 2004 and 2006.

Frank Hayes, director of corporate affairs at Kerry Foods, which makes Wall's and Richmond sausages as well as low-fat Bowyers and premium brand Porkinsons, agrees that it is difficult to sell a healthy product in a category associated with indulgence. "It is not a category that is growing very fast to be honest," he says.

However, Brisby argues that there are misconceptions about the quality of low-fat sausages and Cranswick has recently launched a premium WeightWatchers sausage which has been a "tremendous success," he says.

"Sausages are an indulgent product which are bought primarily on taste," says Brisby, "and in reality many of the low-fat products on the market are delivering on taste."

The Mintel position is that low-fat sausages suffer from consumers' perceptions that healthy sausages are unlikely to taste good. "Consumers know that sausages will be fatty, and accept this as the essence of the product, hence the very idea of a low-fat sausage is rather contradictory and alienates all but the most committed dieters."

PREMIUMISATION





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