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15/12/16 Premium own label driving Christmas sales   Premium own-label sales are driving the grocery market in the run up to Christmas, new figures show. According to Kantar Worldpanel, top-tier private label products are now featuring in 12 per cent of shopping trips, with 88 per cent of consumers buying from these lines. In the past 12 weeks, 6.3 per cent of own-label purchases were from premium lines such as Tesco Finest and Sainsbury’s Taste the Difference, up from 5.7 per cent a year ago. Morrisons’ The Best saw sales increase by 35 per cent, while Asda Extra Special rose 15 per cent. “Over Christmas, it’s likely that premium lines will record their highest-ever sales figures as even more shoppers trade up to treat their loved ones,” said Kantar head of retail and consumer insight, Fraser McKevitt. Aldi was the only retailer to record double-digit sales growth over the past 12 weeks, with its Extra Special premium brand helping it to 10 per cent year-on-year growth. It was followed by Iceland, with an 8.6 per cent uplift. Elsewhere, there is little evidence yet of food price inflation, with a typical basket of everyday groceries 0.1 per cent cheaper than a year ago, although there have been increases in some categories such as fresh fish and chilled ready meals.   15/12/16 Asda makes own-label vegan labelling pledge   Asda has been praised by animal welfare charities after announcing that it will introduce a new vegan logo to be used on all of its animal-free own-brand products from January. The new logo will initially appear on 18 products, but will be rolled out on applicable food, household, and health and beauty products as packaging is refreshed. The supermarket is also launching a new vegan information page on the Asda Good Living website, which will allow consumers to find out which of its products are suitable for vegans. The move follows in the footsteps of Sainsbury’s and the Co-op, which are the only UK supermarkets to label the majority of their own-brand vegan lines. “We are delighted by the news,” said Animal Aid campaign manager Ben Martin. “This is exactly what we have been calling for. Up until this point, Asda had been one of the worst UK supermarkets for providing information about its own-brand vegan products, so this is a real turnaround and it will soon be among the very best. We hope that other companies will soon follow suit.”   14/12/16 Prosecco toasts sales success   Prosecco sales are continuing to sparkle in the UK and Europe, with strong sales juxtaposing stuttering sales of Champagne. While Champagne sales across Europe hit €1.4bn in 2016, compared with Prosecco’s €789m, it is growing only 0.9 per cent in value and declining 0.3 per cent in volume, according to IRI figures. By contrast, Prosecco has grown 24 per cent in value and 23 per cent in volume. And in the UK, Prosecco is outstripping its more traditional cousin, with €600m of sales, compared to only €333m for Champagne. Tim Eales, insight director at IRI, said: “While Champagne growth appears to be slowing significantly across most of Europe (although up in other parts of the world), Prosecco continues to grow in almost every market apart from the Netherlands. Even Cava, which seemed to fall out of favour with the rise in popularity of Prosecco a few years ago, has seen value and volume increases in most countries this year.”   13/12/16 Brits set for Christmas grocery splurge   British shoppers are set to spend more than £20 billion on Christmas food and groceries this year, IGD research indicates. The UK grocery market is set to experience 1.2 per cent growth over the festive period, the industry organisation said, with some £20bn being spent. Online shopping is set for the fastest growth, with a 9.3 per cent uplift generating £1.2bn in sales, while the discounters will see their income rise to £2bn on the back of 6.2 per cent growth. “For many shoppers (54 per cent), Christmas is a time to splash out on food and groceries, yet the savvy shopping habits established over many years still apply during the festive period,” said IGD chief executive Joanne Denney-Finch. “Almost half (46 per cent) collect coupon points on their loyalty cards to use at Christmas, representing a clear opportunity for retailers to lock in purchases. “By mid-November, over half of shoppers (53 per cent) had already bought some food and grocery items for Christmas but this doesn’t mean we will avoid the usual late rush. Six in 10 (63 per cent) of those early shoppers expect to use up and replace at least some of the festive items already purchased.”   12/12/16 Aldi steps up assault on premium skincare market   Aldi is continuing its drive to be seen as a reputable retailer of quality skincare products with the launch of a new range from 2017. The discounter is launching Lacura Vitacell, which it claims is a unique anti- ageing skincare range that can rival the most premium products on the market. The Vitacell range has been developed using the active ingredient Complex TCR3, which helps prolong the longevity of skins sells. Cellular activating ingredients include Vitasource, which is extracted from the Chinese plant Baicalin, and helps promote young cells. The Lacura Vitacell 24HR Cream De Luxe (£6.99), Eye Cream (£4.99) and Serum Concentrate (£6.99) are launching as a Specialbuy on 2 February.
22/12/16 M&S chairman Swannell announces retirement   Robert Swannell is to retire in 2017 following six years as chairman of Marks & Spencer. The retailer announced that senior independent director Vindi Banga will lead a process to identify a new chairman, with Swannell remaining in his role until that process is complete. Swannell said: “A year ago we chose Steve Rowe as our chief executive. Steve completed a thorough analysis of the business and developed a detailed plan to build a simpler and more relevant M&S. “This plan is now underway and I feel that it is the right time for the business to look for a new chairman. It is a real privilege to chair this iconic company and I will continue to do so until my successor is in place.”   21/12/16 Shoppers ‘less loyal to stores at Christmas’   Supermarket loyalty is on the decline, with just 12 per cent of consumers claiming loyalty to a single brand and 70 per cent shopping across two to three stores. That’s according to new research by voucher service provider Valassis, which claims that the trend is particularly pronounced at Christmas, where promotions are the deciding factor behind where the grocery shopping is done. Among female shoppers, only 10 per cent said they would not shop away from their main regular supermarket during the festive season. Half of women said they would switch supermarkets to use coupons on vouchers, although only a third of men were similarly persuaded. Coupons and vouchers are now favoured by 42 per cent of shoppers, up from 38 per cent three years ago, according to Valassis, while loyalty points are preferred by 43 per cent of Tesco and Sainsbury’s shoppers, up from 38 per cent in 2013. While consumers still prefer paper coupons, nearly half of 25-34 year old shoppers are highly likely to use a mobile coupon. “With the consumer’s head being turned every which way by promotions at Christmas and grocery loyalty being at a low, no supermarket can afford to sit on the sidelines, especially when targeting women shoppers,” said Valassis managing director Charles D’Oyly. “Within the grocery sector, digital promotions are still far from being embraced by the consumer, although younger shoppers are certainly more predisposed to use them. Clearly, offering a choice of promotional formats is currently the way to go.”   20/12/16 Waitrose makes Christmas edible   Waitrose has launched so-called ‘edible Christmas trees’ into its vegetable aisles for the festive season. Grown by Terry Wright in Lincolnshire, the Romanesco cauliflower Christmas trees come with pomegranate seeds and a star anise so customers can decorate them at home. “Cauliflower has shaken off its old-fashioned image and is currently the veg du jour,” said Waitrose’s head of fresh produce buying, Nicola Waller. “For Christmas this year, cauliflower will be taking centre stage on the dinner table.”   20/12/16 Tesco ramps up range of pet treats   Tesco is capitalising on the ‘treating animals as humans’ trend with an expanded range of pet gifts. Research by the RSPCA found that nearly eight out of 10 dog owners and 68 per cent of cat owners have bought their pets a present, particularly at Christmas. Demand for luxury pet meals – such as pigs in blankets, three-bird roasts and mince pies – is on course to double at Tesco this Christmas, the supermarket said. Tesco’s range this year includes a ‘design your own biscuit bone kit’, complete with animal–friendly icing, as well as dog and cat jumpers, Santa hats, antlers and Christmas stockings filled with edible treats. The retailer’s most popular luxury Christmas dinner for dogs is set to be turkey, sage and cranberry, while cats will be pigging out on turkey and sage.   19/12/16 ‘Ethical’ chocolate sales on the rise   Consumers are seeking out more ethical chocolate in the run up to Christmas, according to new research. Retail sales of boxed chocolate with at least one ethical label reached £1 billion in the UK in 2015, figures from Euromonitor reveal. “International brand owners are not waiting until every single chocolate lover starts to fully appreciate the resources they spend on sustainable sourcing,” said Euromonitor analyst Hope Lee. “They are making extensive efforts to run their initiatives, and these efforts in sustainable sourcing should be celebrated and applauded. But it will take time for them to standardise their ethical labelling efforts in both developed and developing markets.”
06/01/17 Researchers question value of ‘diet’ drinks   Sugar-free and ‘diet’ drinks should not be held up as beacons for controlling weight, researchers have claimed. In a new report that has riled the soft drinks industry – which has been cutting calories and reformulating products ahead of the introduction of the controversial sugar tax – researchers at Imperial College London and two Brazilian universities have argued that not only are sugar-free drinks no better for weight loss than their full-sugar counterparts, but that they may also be detrimental to the environment. Professor Christopher Millett, senior investigator from Imperial’s School of Public Health, explained: “A common perception, which may be influenced by industry marketing, is that because ‘diet’ drinks have no sugar, they must be healthier and aid weight loss when used as a substitute for full sugar versions. However we found no solid evidence to support this.” Researchers speculated that artificially sweetened beverages (ASBs) might trigger compensatory food intake by stimulating sweet taste receptors, cancelling out any perceived benefits. They also pointed out that production of ASBs “has negative consequences for the environment, with up to 300 litres of water required to produce a 0.5l plastic bottle of carbonated soft drink.” The British Soft Drinks Association hit back against the “demonisation” of lower-calorie products in the report, calling it “extremely unhelpful” and lacking evidence.   05/01/17 Vegan labelling trend set for growth   Global vegan labelling is set to grow by five per cent by 2020, according to figures from Euromonitor. Vegan labelling is projected to enjoy a compound annual growth rate of 5.2 per cent on a global scale between 2015 and 2020, the data analyst said. The figure is a more modest 2.2 per cent in the UK, where a number of supermarkets have made recent commitments to improving their vegan signposting on shelf and packs. The UK is currently third in the world in vegan labelling, behind Germany and runaway leader USA, and Euromonitor analyst Simone Baroke believes further growth is inevitable. “Vegan product labelling, in particular, may be the one to watch in the future, as an increasing number of companies go about broadening their consumer appeal by staying away from employing animal ingredients whenever feasible,” she said. “The rising demand for vegetarian and vegan proteins, which is a sub-trend within the high- protein trend, indicates where things are moving right now.”   05/01/17 Promotions and veg help Nisa to indulgent Christmas   A promotional drive and strong sales of fresh produce have helped Nisa Retail to a healthy performance over the Christmas period. The wholesale and convenience retail group reported sales up 2.7 per cent year on year to £235.6m in the 10 weeks to 1 January 2017. Volumes also rose 3.2 per cent to 19.1m cases. Profitability increased with EBITDA rising 38 per cent to £718,000. Nisa put the rise down to increased investment in Christmas promotions, as well as a 17.7 per cent increase in fresh produce sales, with the Festive 5 promotion helping parsnips to a 130 per cent increase, Brussels sprouts to a 101 per cent rise and carrots to a 288 per cent uplift. The retailer opened 77 new stores in the 10-week period, compared to 54 a year earlier. Chief executive Nick Read said: “I’m very pleased that we have been able to provide significantly greater investment in our promotions this Christmas to assist our members trading this festive period. We believe we have delivered a strong promotional mix to drive sales and footfall in our members’ stores. “This has been possible due to the strong momentum the business has now built in its three-year strategy, which has seen Nisa invest in and improve operational efficiencies while also delivering a consistently improving financial position.”   04/01/17 Waitrose predicts Polynesian foodie future   Charcoal-flavoured food, Polynesian cuisine and Poke will be the big food trends of 2017, according to Waitrose. The upmarket supermarket has been crystal ball-gazing about the gastronomic trends of the coming year, and believes that Polynesian food has a major future. Poke – pronounced POH-key – will take on sushi to become the must-eat lunch, it ventured. Often served with rice, Poke sees raw fish marinated with lime, sesame and soy, fitting the trend for lighter eating using fresher ingredients. The new year is also expected to see alternative waters such as birch, bamboo and cactus continuing their growth. The sector has already had a boost with the success of brands such as Beyoncé-backed WTRMLN WTR. Waitrose claims to be at the forefront of on-trend product innovation, with developments including adding Matcha green tea to products such as chocolate bars and juice shots. It also launched a charcoal bagel in collaboration with Heston Blumenthal last year, and expects charcoal to be introduced to more of its products over the coming months.   03/01/17 Health factor drives fruit snacks sector   A drive for health, convenience and greater choice is driving NPD in the fruit snacks segment, new research has indicated. Figures from Innova Market Insights show that fruit-based snacks’ share of global snack launch activity has more than doubled from less than eight per cent to nearly 18 per cent over the past five years. That makes it the number-three snacks sub- category overall after savoury/salty snacks and snack nuts/seeds. The sector has seen a growing popularity for fruit and nut mixes featuring more exotic varieties, while so-called superfruits are also strongly prevalent. These vary from established ingredients such as cranberries through to newer upstarts like goji and acai. Value is increasingly being added by the use of other ingredients and flavourings such as chocolate, yoghurt and coconut. Nearly half of new launches in the 12 months to September 2016 were positioned on a health platform, with interest in clean-labelling and free-from products helping drive the category. “There is ongoing activity in emphasising the snack positioning of fruit products, with more user- friendly packaging such as resealable stand-up pouches and small pots and trays, making them more suitable for anytime snacking,” commented Lu Ann Williams, director of innovation at Innova. “There has also been growth in the availability of multi-packs of individual snacks.”
13/01/17 Grocery splurge puts UK market back into growth   The UK grocery sector has seen its fastest growth since June 2014, with shoppers spending almost half a billion pounds more than a year ago. The 12 weeks to 1 January saw supermarket sales rise by 1.8 per cent compared to a year ago, according to figures from Kantar Worldpanel. That was partly explained by a poor Christmas in 2015, but analysts are also attributing the trend to a stronger appetite for celebration after a tough year. Shoppers spent £480m more at the tills than in 2015, making it a record Christmas for sales. The typical household spent £365 in December, which is £52 more than in an average month. Private label continued to be a key driving force for the category, according to Kantar head of retail and consumer insight, Fraser McKevitt. “Thanks to continued investment in premium own- label brands across the major retailers in 2016, such products finished the year with record 12- week sales of almost one billion pounds,” he said. “Top-tier lines including own-label fresh and smoked fish, cooked meats such as ham, and wine performed particularly well.” In further good news for the category, like-for-like grocery prices increased by 0.2 percentage points following 28 consecutive months of deflation. That should accelerate overall market growth in 2017, according to McKevitt. Many retailers enjoyed growth in the period, with Tesco, Morrisons and Co-op growing 1.3, 1.2 and 2.4 per cent respectively. Discounters Aldi, Lidl and Iceland saw 11.8, 7.5 and 9.6 per cent growth respectively.   12/01/17 Morrisons posts best figures for seven years   Morrisons has credited an improved offer and competitive pricing for its best performance in seven years. The supermarket reported like-for-like sales in the nine weeks to 1 January up 2.9 per cent, despite the continuing impact of store closures. The updated own-label Best range has been a hit, with over half of customer baskets including at least one item from the tier, while Morrisons said a new automated ordering system was helping with stock levels in grocery and fresh categories. “This Christmas we made further improvements to the customer shopping trip,” said chief executive David Potts. “We stocked more of what our customers wanted to buy, more tills were open more often, and product availability improved as over half of sales went through our new ordering system. Both like-for-like and total sales grew, which was very encouraging.”   12/01/17 Flat quarter for Sainsbury’s   Sainsbury’s has reported flat sales for the last three months of 2016, but pointed to a record Christmas and strong sales across the group. The supermarket arm of the business saw like-for-like sales rise 0.1 per cent in the 15 weeks to 7 January 2017, with volumes flat. Argos saw four per cent sales growth. Chief executive Mike Coupe said online and convenience channels had performed particularly well, with nine and six per cent sales growth respectively. Clothing and general merchandise also had a strong quarter. “The market remains very competitive and the impact of the devaluation of sterling remains uncertain,” added Coupe. “However, we are well placed to navigate the external environment and remain focused on delivering our strategy.”   11/01/17 Tesco to streamline distribution operations   Tesco is closing two of its distribution centres in a move that it says will make it better placed to serve the rapidly changing retail sector. Under the proposals, the supermarket giant will reduce the number of its UK distribution centres from 25 to 23, as well as simplifying the management structure across all of its DCs. It will be closing the Welham Green centre, moving its grocery operations to the Reading centre; bringing the majority of general merchandise into one DC at Middlesbrough, resulting in the closure of the Chesterfield site; withdrawing from the Daventry hanging garments shared distribution centre that is operated by DHL; and bringing all warehouse operations in house that are currently carried out by DHL and Wincanton. Tesco said that despite job losses at the closing facilities, new roles would be created elsewhere across its distribution network. “As the needs of our customers change, it’s vital we transform our business for the future,” said UK and Ireland CEO Matt Davies. “As part of this we are proposing to close two of our distribution centres in the UK. These changes will help to simplify our distribution operations so we can continue to serve our customers better.”   10/01/17 Small suppliers bearing the brunt of supermarkets’ revival   Nearly 6,000 UK food suppliers are experiencing increased levels of financial distress, a business recovery specialist has warned. Research from Begbies Traynor indicates that the upturn in fortunes among Britain’s supermarkets has come at the detriment of suppliers, who are bearing the brunt of heavy discount activity and margin pressure. The UK food and drink manufacturing sector saw a 13 per cent increase in ‘significant’ distress over the past year, according to the firm, with 5,986 businesses now struggling compared to 5,312 at the same stage the year before. Smaller suppliers have been most affected, with SMEs making up 94 per cent of companies in distress within the sector. “Following a fundamental shakeup of the UK supermarket industry over the past 18 months, which has seen countless investor revolts, numerous CEO resignations, a renewed focus on customer service and drastic cost cutting, the largest players in the UK food retail sector are finally seeing the turnaround that they have been working towards,” said Julie Palmer, a partner at Begbies Traynor. “However, it seems that the industry’s improved financial position is not being felt by their suppliers. Despite customers becoming more accustomed to rising food prices, unfortunately the supermarkets are still playing hardball with their supply chain when deciding who takes on the burden of higher manufacturing costs, rising fuel prices and adverse currency fluctuations. The UK’s smallest food suppliers are struggling most in a market beset by “miniscule margins, lengthy payment terms and overzealous cosmetic specifications for fresh produce”, she added.
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