Sausages ride out the recession

From premium through to value, sausages have ridden out the recession with remarkable ease, reports Adam Baker.

The sausage is one of the most instantly recognisable and oldest processed meat products out there but longevity and familiarity do not always necessarily mean popularity. A foodstuff such as the sausage can start to look stale on the supermarket shelf if not marketed carefully and negative newspaper coverage has not helped the processed meat industry one bit.

Despite this, the recession has actually been relatively kind to the humble sausage, with sales remaining buoyant. Even companies at the higher-end of the market, which must have taken a big gulp when the economy nose-dived last year, have seen sales continue to grow. Meanwhile sales of organic sausages have not suffered as badly as the organic market in general.

As recently as July, Tesco released figures showing shoppers coming back to premium and ethical food ranges with its Finest, organic and Fairtrade ranges all returning to growth despite the economic downturn. Sales for Finest Cumberland pork sausages, for example, went up 159% during July 2009, while Finest convenience foods in its fish, meat and poultry categories grew by 3% in the past year. It seems the recovery has started and that includes sausages.

British Sausage Week will (see p24) undoubtedly help the sector push on even further, but the supermarkets do not need a special week to realise the power of the sausage in a recession. Sales have been better than last year for many chains as the country slowly recovers from the credit crunch.

A look-around the various big names of the supermarket industry reveals promising results for all things sausages. Asda fresh sausage buyer Rob Benyon reckons that volume is up by 5.2% and value is up by 8.7% for his company.

The latest 12-week data shows that chilled sausages are bucking the trend of trading down, he adds, with volume growth of both the retailer's premium tiers (Parchment and Extra Special) increasing compared to last year with Extra Special up by 6% and Parchment up by 23.8%. "Ensuring the right deals within the tiers has driven sales and has prevented some down-trading which would have ordinarily been seen," says Benyon.

Asda has had success with the launch of its Extra Special Sweet Chilli Sausage, while its Blueberry and Dark Chocolate sausage took home two awards at this year's SuperMeat and Fish Awards with best sausage and best innovation keeping the trophy cabinet well stocked in 2009.

"Over the past 12 to 18 months," adds Benyon, "we have changed the meat base for the Extra Special range which has made the product leaner and thus decreased the overall fat content. We have also looked at the salt content within sausages over the past couple of years and brought them in line with the Food Standards Agency's (FSA's) target of 1.8g in cooked products.

Further work is being carried out to reduce the fat content within the standard range. From a salt point of view, we are looking to further reduce the amount within sausage over the next couple of years. There are no artificial colours or flavourings within our range of sausages."

One brand that can be found in Asda stores, as well as other supermarket chains, is Surrey-based Porky Whites, which is going from strength to strength. "Our business is increasing year on year with our current customers and we have managed to get products into Waitrose and Morrisons this year for the first time," says MD Chris Price. "Our turnover has increased from last year as we have really driven sales as the Porky Whites brand becomes more well known."

Price reckons that the premium end of the market is still growing but standard lines are also seeing an increase too as people look at better value products. He adds that the market has been saturated over the last year with supplier offers as retailers compete for sales, which makes it hard to get a true picture of the market.

The firm has seen new developments with two new seasonal lines to be launched in November in Asda with the Porky Bites Little Pork Sausages and Porky Whites Surrey Sausagemeat with Sage and Onion Stuffing. "We also launched the new Porky Whites Originals with Asda which has been one of the best selling products at the latest launch."

Meanwhile, with processed meats not getting the best of publicity this year, Price reckons a lot of the negative headlines are unwarranted and that good ingredients are important to combat criticism. "Our industry gets far too much bad press.

Our products have a high meat content, low in salt and have a fantastic flavour. They are great value for money when you realise you can get 454g of high quality sausages which can go a long way. Customers are becoming increasingly aware of what goes into processed food and the premium end of the sausage industry can hold its head up high for providing a great range of high quality products that taste fantastic."

Changing habits

As well as Asda, the Co-operative too has seen success in sausages this year despite production costs going up. "While 2009 has presented a number of challenges to the sausage category, including high raw material cost increases, the Co-operative's sausage category has performed well with 11.5% year-on-year growth," says Karl Hassall, Co-operative sausage category buyer.

"The economic downturn has altered consumer shopping behaviour at all levels. More consumers are purchasing products on promotion and trading down from the more expensive protein food groups, and there has also been a move from standard products to value lines. However, there has also been a switch in behaviour from eating out to eating at home, so purchases of premium lines to enjoy during these occasions have risen."

Hassall adds that the Co-operative offers a range of premium and standard products that cater to individual consumer needs whether the customer is looking to purchase a standard sausage or something slightly different in the premium tier but without provenance and welfare being compromised in either option.

Meanwhile at Waitrose, sales for sausages in 2009 are up over 8% compared to last year, which is down to a number of factors, says sausage buyer Anna Lloyd. She reckons that even though it was by no means a heatwave this summer, it was still better in comparison to 2008 which helped sales over the summer as people barbecued.

Sausages, Lloyd adds, are also a great value centre-piece to a meal - an important consideration for shoppers in the recession. "Our biggest growth area is our Essentials range. Our premium ranges, however, are also showing good growth with our speciality flavoured range up 11%. Sausages as a whole have benefited from the current economic climate as even the most expensive products offer great value."

At the Co-operative its premium Truly Irresistible tier has continued to perform extremely well showing 16% growth year-on-year on a like-for-like basis, says Hassall. He adds that the growth shows that consumers are still prepared to buy premium products and highlights that quality and animal welfare remain high on the shopping agenda.

"Our standard sales have seen good growth year-on-year and we have introduced two new lines to help drive sales. The Co-operative Butchers Choice Jumbo Pork Sausage 700g has been a real success during the summer months. The Co-operative Irish Recipe Pork Sausage 454g has been introduced to extend our standard range."

Additionally in January, the Co-operative launched and introduced Hampshire breed, outdoor-reared British pork as part of its Truly Irresistible fresh sausage, bacon and pork range. Hassall added that the year-on-year sales demonstrate that his customers recognise the improvements made to quality, flavour and welfare.

All fresh Co-operative own-brand sausages are made from 100% British meat while all its standard and Butchers Choice sausages are made using prime cuts of British pork belly and shoulder raised to strict welfare standards. Finally, all of the Co-operative's Truly Irresistible fresh sausages are British and made using higher welfare Hampshire breed outdoor reared pork which is said to be moist and full of flavour.

"Within our sausage range, we offer a reduced fat sausage that is 50% less fat than our Butchers Choice Pork sausage. All our sausages have the FSA traffic light system on front of pack that clearly highlights the nutritional value of each product," adds Hassall.

Flavour adventure

Waitrose often trials adventurous sausage flavours on its meat counter, for example the Berry Banger, which was sold over the Wimbledon fortnight. "We also sold a free-range smoked pork sausage this summer, which offered something a bit different for customers and was perfect for the barbecue," says Lloyd.

"We continue to launch new flavours throughout the year to make sure that the range always has something fresh and new for our customers to try. All Waitrose sausages are made using selected cuts of shoulder and belly from outdoor bred British pigs, so you can always be assured that they are great quality."

Musks of Newmarket are one of the brands that Waitrose stock in its stores as well as Henry Walker, Simply Sausages and Rankin Selection. Musks' MD Chris Sheen feels that despite the huge pork price increase during the latter half of 2008, sales of premium sausages have held up well.

"We consider that being placed at the top end of the market to be advantageous as wealthier customers aren't affected so badly by the recession, others will trade down from expensive cuts of meat to premium sausages. They in turn will compensate for those who change to buying cheaper brands. We also feel that our typical customer is in the older age bracket, is aware of what they eat, and probably have an empty nest and net expendable income."

As a whole, the sausage market has enjoyed a period of growth over the last several years that Sheen believes is due to its 'British' image and because sausages provide a meal solution for the average family on a weekly basis. "Maybe the general public is being educated by celebrity chefs to be aware of their diet and, although our sausages are not 'low fat' in the strict sense, they are much lower in fat than the average available."

Musks is a traditional family company and new products are slow in being developed, jokes Sheen. The company's main sausage, the Original Newmarket variety, has not changed its recipe for 125 years. It is not surprisingly marketed as a quality sausage that embodies all that is good about old-fashioned values. "

The spices remain a secret and are a blend of which we are justly proud. The main new variety was a gluten-free sausage which we introduced in 2001 and has proved a hit with people who have a gluten intolerance. They have enabled people who have been missing out on a typical British menu to start enjoying them again. Seasonally, we make a Christmas chipolata but through logistics problems at that time of year they have a limited distribution."

Musks only use British pork shoulder meat, sourced from farms with high welfare standards. "The fact that we use natural casings gives a far better bite than sausages encased in a collagen based product," says Sheen. "This gives us an edge in a competitive market."

Crowded market

Of course, any discussion about sausages must include the Kerry Group - the company that owns brands including Wall's, Richmond, Porkinson and Mattessons. Kerry had a successful 2008 with reported revenue growth up 6.3% to 4.2bn in the year ending 31 December, which boosted trading profit by 8% to 360.5m.

The Wall's business is doing well with volume and trade sales up. Wall's marketing manager Mark Brown says: "The mix of the market is still relatively the same however customers are participating in promotions a lot more steadily." The Wall's brand got a revamp in 2008 with butcher-style brown paper packaging but Brown added it was too early to comment on its success.

Despite Kerry's dominance of the sausage market, there is still room for a suprisingly large number of brands, catering for all tastes and budgets. Yorkshire firm Debbie & Andrew's hashad a strong 2009 performance despite the economic downturn. The company has bucked the trend by continuing to grow at a rate of more than 100%, increasing its market share from 18% to 31%.

Co-owner Andrew Keeble said: "We are now the UK's number one premium sausage brand, with twice the percentage growth of any other premium sausage brand, and we are the third largest brand in the overall sausage market.

"In the current climate, we know that shoppers are trading down from the premium cuts of meat and instead are looking for alternative quality food such as our own. The premium sausage market has seen an increase of over 17% year-on-year. People are also eating out less and looking for premium alternatives from the supermarket, including premium sausages which are outstripping total market growth."

Keeble adds that building up a loyal customer base that understands the quality and provenance of its food has been reflected in sales.

"Following rave reviews from our customers for our Harrogate gluten-free sausages we have extended our range with gluten-free Garden Herb Sausages and Harrogate Chipolatas."

This year, Debbie & Andrew's also took a strategic decision to move into the 100m cooked sausages and meat snacks market after identifying a gap in the market for lean pork shoulder cooked sausages, estimated to be worth 5m.

The company has launched a pot of 15 Perfect Little Pork Sausages which are aimed at picnics, lunchboxes, and party occasions. The snack product comes hot on the heels of a move into pre-cooked pies, as a result of an exclusive partnership with Diageo to make a range infused with Guinness, while there are also plans for a Guinness infused sausage.

"Growth into new markets is in line with our plans to de-localise the Debbie & Andrew's brand from its regional heartland, while maintaining the core values that we are famous for," Keeble says.

All Debbie & Andrew's sausages are made with high welfare, extra lean British pork shoulder, breadcrumbs and seasoning and no artificial colours or flavours. The company also makes a healthier sausage called Ellie & Roddy's which is lower in fat and salt.

It's this kind of new product development and innovation that has helped the sausage sector emerge from the recession relatively unscathed. That and the fact Brits have stuck to their bangers during the tough times.

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