Why the UK can be a market of opportunity for some Australian organic food & beverage exporters (Part-2)

Why the UK can be a market of opportunity for some Australian organic food & beverage exporters (Part-2)

The UK market offers many potential opportunities for Australian organic food and beverage producers. Currently, there’s a strong and growing trend for consumers who favour organic products, particularly those that also follow sustainable practices in their production. In the UK especially, Australian products are highly favoured as being of high quality.

 

Recently, Export Connect hosted a UK Export Market Development masterclass in association with Australian Organic Limited and included interviews with Al Overton from Planet Organic UK and Anastasia Nishnianidze from Austrade UK.

Following are some insights gathered from Najib’s interviews with Al from Planet Organic.

The changes that Al has seen in the past year

COVID-19 has had a significant impact. It has driven several changes in behaviour. Because people aren’t able to eat outside, supermarkets are doing very well, especially on premium products.

There has also been a very significant shift towards eCommerce. Home deliveries are now very active across the UK. Plus, the demand for on-demand food deliveries is constantly increasing.

Planet Organic has also seen an increase in its online business. This means the company has shifted its development focus slightly from its brick and mortar stores and invested in developing its website. The growth in nationwide deliveries has increased well over 100%.

Is it possible to replicate the store experience on an eCommerce website?

It’s quite challenging to give online customers the same type of experience they get when they visit a brick and mortar store. In-store experiences like talking to a qualified nutritionist or sampling new products are just not possible.

Therefore, it’s essential to ensure that the website is as easy to navigate as possible, and this is what Planet Organic has tried to achieve.

The most important factros the company has focused on are making it easy for customers to shop from the site and making the checkout process as easy and effortless as possible.

Has this changed the way that Planet Organic promote their suppliers’ products?

What has happened is that fewer customers are visiting the stores, but they’re buying more at each visit. Plus, they’re very focused, so promotional activity is down by about 40%.

Has there been an uptake in consumers looking for more organic produce?

Organic produce in the UK has had a record year of growth (16%). This can closely be linked to the major supermarkets and their ranging decisions. Al has witnessed supermarkets reducing their ‘everyday’ range because of logistics but increasing their premium range that includes organic products.

What future opportunities does Al see in the organic space in the UK?

Al sees an unstoppable move toward healthy foods and sustainability. There appears to be a convergence of these two elements into one. Therefore, customers will continue seeking healthy foods and making better choice from a sustainability point of view.

Planet Organic, as a retailer, has a constant hunger for new products. This has been unsatisfied this past year because producers are reluctant to release new products during the lockdown.

Of particular note, there are growing trends in Keto diets and low sugar/low-fat foods.

What challenges does Al see for Australian suppliers?

Due to Brexit, European brands face far greater challenges than Australian suppliers. European imports into the UK have become more difficult.

Australian brands have always been on the radar in the UK because they reach export readiness sooner. The major challenge is that historically, a lot of products have gone through the EU on the way into the UK. This has become particularly challenging now as this now incurs a double tariff.

In terms of sustainability, travel miles are product and category specific. Consumers in the UK have a sense of understanding where certain products ‘should’ come from. For example, porridge oats should come from Scotland and pasta sauce should come from Italy.

Which categories would be the most relevant to come from Australia?

This has changed throughout lockdown as people are not buying as many ‘snack foods’ while in-store. However, Planet Organic has seen an increased demand in speciality cooking and baking mixes.

There has also been a growing trend in traditional food preparation, such as making sourdough bread or fermenting kimchi. Therefore, there’s an opportunity in making the preparation of these easier for consumers.

Planet Organic has also seen an explosion in demand for DIY meal kits, whether from restaurants or supermarkets. However, these do pose a significant packaging challenge in terms of sustainability.

How does an Australian producer get their product into Planet Organic UK?

Although Planet Organic people are friendly people to deal with, the company only has 11 stores. So, it’s not worth exporting to the UK just to do business with them.

However, the company can offer a launchpad into the UK market. But, the logistics are quite challenging. The company has 11 stores but no central warehouse, so storage space is at a minimum. Therefore, the company deals exclusively with UK based wholesalers and distributors.

The best solution for Australian producers is to have someone on the ground in the UK to introduce their products to retailers. Also, it would be necessary to deal with an import company because most UK wholesalers are not importers.

Which Australian brands does Planet Organic currently stock?

The current Australian brands doing very well for Planet Organic are Lo Bros Kombucha, Remedy Kombucha, Pana Raw Chocolate and Pimp My Salad. As a final word, Planet Organic is constantly hungry for new brands and would love to help Australian producers to get their products onto their shelves.

From these interviews as shared over 2 blogs, you can surmise that there are some opportunities for Australian producers to export their goods to the UK. We hope that you have found this information helpful.

If you are an Australian food or agribusiness and want to explore export opportunities, please feel free to reach out to us here at Export Connect. We will be happy to assist you whichever step you are at on your export journey.

We hope you’ve found these insights on the UK market helpful. As always, if you’ve got any questions or want to discuss export opportunities for your company, feel free to drop us a line at Export Connect – we’d love to hear from you.