Changing consumer habits creates opportunity for processors
Processors willing to embrace the chilled convenience sector and create products that save time for consumers are likely to grow faster than those who focus only on primary meat products, according to Kantar Worldpanel.
Speaking to Meat Trades Journal, Kantar’s head of retail and consumer insight Fraser McKevitt said products with “added value”, such as convenience ready meals, represent a great opportunity due to the prices of the category sustaining when fresh meat prices have dropped.
According to Kantar’s most recent Meat, Fish & Poultry Market Update, sales of fresh meat and poultry dropped in both value and volume over the 12 weeks to 26 April 2015. Value sales fell by 4.3%, with volume dropping 1.1% over the period. Although Kantar has predicted some value to return to the market, it doesn’t expect prices to rise to levels above those seen in 2013 due to shoppers seeking out the best value for fresh meat.
“Prices are falling in fresh meat worse than in most areas of the store, but the real success story is in the chilled convenience sector, where prices have barely fallen while retailers have managed to keep volumes plus the products are at a higher price point,” said McKevitt. “The whole chilled convenience area is a huge cash contributor to the total grocery sector and is doing very well in terms of keeping price levels steady.
“Not only is chilled convenience a growing market, it’s a market that is sustaining prices when the basic products are dropping. Anywhere that value has been added to a product is doing well at the moment.”
Changing consumer habits
He said the chilled convenience had seen success thanks to the change in consumer habits which mean time-poor shoppers want easy options for their meals.
“There has been a long-term trend towards convenience in the home as people want products that don’t take much effort. It does show that those processors who are willing to do more for the consumer by providing these products are probably able to protect their prices and margins better than those who are just producing primary products and are likely to be finding it tougher at the moment.”
Some processors have already identified this opportunity, with JBS hoping to grow its portfolio of prepared and convenient products through its recent acquisition of Moy Park, while 2 Sisters also announced plans to grow its branded chilled business operation.
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