A year we will not forget

Ian Merton, former Sainsbury’s food director and associate director of Morepeople

I believethe high streetwill be very competitive on price and the credit crunch willmake customers spend wisely and frugally. Shoppers are likely to trade down in the quality tiers, based on previous history.The demise of Woolworths will undoubtedly create some extra storesand sales for many high street retailers and loyalty to particular stores will be really tested. The weakness of sterling could create some real problems.

I predict that 2009 will be a defining year ofslow recovery from the credit crunch. I have not seen such a severe economic downturn in my working career, where so much has been in negative territory and the banks have been in such a mess.And it is likely to get worse before it gets better. It could even form the start of a new era in fresh produce, with significant changes to the supplier and grower base, and further consolidation.

The key trends are likely to be continued pressure for lower prices, more value lines and fewer prepared products. We will see greater volumes moved in low-unit price points, while lines that benefit from the relationship of sterling against other currencies could enjoy higher volumes. Shoppers will, no doubt, trade down and spend less.

I believe the growth areas will be locally grown produce and low-price lines, which could benefit many basic fruit and vegetable commodities. There will also be more price-focused offers, but if deflation occurs there will be more two for £x promotions and high street discounters will continue to expand to take advantage of the current climate.

I have two resolutions for 2009. The first is to buy moreUK-grown produceto help boost sales for growers and suppliers this year. The second is to use my40 years’ experience in businessto help clients and candidates of Morepeople through the difficult year ahead.

Nigel Jenney, chief executive of the Fresh Produce Consortium

The fresh produce industry is likely to face some tough times in 2009 as we enter uncharted territory in economic and commercial terms.At the same time, there are several challenges facing us from forthcoming legislative changes next year.

The introduction ofnew EU marketing standards in July 2009 has been heralded as a simplification of standards for the industry, but we want to ensure that consistent standards allow businesses to trade effectively in the UK and across Europe, and that this change does not proliferate a diverse range of independent standards, which will only increase business complexity and cost.

EU proposals to withdraw and substitute crop protection products will have a devastating impact on both UK and European horticulture if they are taken on board. Long-term food security will remain at risk if the European Parliament continues on its course to introduce proposals to reduce growers’ ability to fight common pests, weeds and diseases. This could see fruit and vegetable prices rocket and, in the long term, it may not be economically viable to grow certain horticultural crops in the UK.The Fresh Produce Consortium (FPC) will continue to call for a full impact assessment as part of the regulations before they are enforced - we must hold MEPs accountable to hard-pressed consumers in this difficult economic climate for the repercussions of their vote early in the new year on these proposals.

Food security will continue to be a hot topic for 2009 and there is a growing trend for NGOs and others to focus on the fresh produce sector when considering issues such as water sustainability and the other environmental impacts of food production.We need to remind them that fresh produce is not the ‘bad guy’ and that the sector is key to ensuring a healthy, sustainable diet.

We also face the challenge of reducing waste across the sector and encouraging consumers to reduce the amount of fresh produce thrown away in the home.The industry’s Eat in Colour (EiC) campaign has taken the initiative to give consumers more information on proper storage and how to make the most of their fruit and vegetables.

But there are likely to be opportunities for the industry in the coming year.Fresh produce will remain critical to ensuring the nation’s health as it continues to face rising obesity levels, issues relating to a poor diet and the need to encourage people of all ages and backgrounds to eat their 5 A DAY. EiC is well placed to meet this challenge and to develop further with industry support.

My own New Year’s resolution is for the FPC to continue to lead the way for the industry, to fight for our cause and to encourage others to support the EiC campaign.

Sarah Calcutt, pictured, writes with Dean Tunbridge, from Norman Collett Ltd

Our New Year’s resolution is to keep calm and KISS (Keep It Simple Stupid). International money markets are influencing consumer confidence in every aspect of retailing and this will continue over the next 12 months. Internally, we need to manage quality and consistency in the supply of UK produce - we are now up there with the best in the world and we need to maintain that place in a very volatile market by managing costs and efficiencies to compete with market demands, while aiming to make contributions to business development.

We think 2009 will be one of the toughest trading periods in produce for many years - several companies will not make it and the landscape of our industry will look very different in 12 months’ time.

But as the marketplace becomes increasingly crowded and consumers continue to be bombarded with an excess of choice, brand loyalty will become even more valuable. Those brands that want to succeed over the long term need to properly engage with customers - for us, that means local and British over imported produce. We are confident that the home-grown and local trends will continue to grow in popularity in the face of overseas food and health scares. The identity of the producer will continue to grow as a key message, as will the knowledge of the health benefits of a diet rich in fresh produce.

Guy Moreton, director of MorePeople

Wow, what a year we have just had and what a year 2009 will be! Let’s be frank, it is going to be very tough in the business world over the next 12 months and maybe even longer. I am one of the most optimistic people I know and even I am despondent about the UK’s prospects for economic growth over the next year or so.

My views on 2009, as you might well expect from a recruiter, centre on people and getting the most out of what is your company’s most valuable asset. In times of difficulty, good people will make the difference between success and failure, and if I have any words of wisdom to deliver it would be make sure you have the best people within your sector managing your products in the field, your suppliers, your operations, your customers, or whatever - and make sure they are well motivated, well trained and well supported so that they are able to perform to their highest level.

I am constantly amazed by the number of businesses that react to difficult times by cutting back on all types of training and development, as well as people advancement. Yes, I know that we all need to be realistic and prudent, but when a recession hits (and boy, are we in for a rough ride) most business owners will focus very hard on keeping the company going and will look at every angle to improve sales and hopefully maintain margins, as well as cutting costs accordingly.

However, they also need to recognise that their team members will also be worried by the overall economic situation and will feel demoralised and demotivated. In these circumstances, training and development will not only help improve the actual performance of an individual, but will also make them feel much more positive towards their employers and more upbeat about the future of the business.

In terms of personal resolutions, apart from wanting to try and lose a couple of stone this year and exercise more regularly (well, regularly, in fact), I want to keep my business moving forward and continue to develop a comprehensive range of people-orientated services which complement our recruitment offer. To everyone within the fresh produce sector - good luck and hold tight!

Andrea Caldecourt, chief executive of the Flowers & Plants Association

I have noticed two business responses to the credit crunch - one is to reduce all discretionary spend, cut margins, focus on local and wait for the storm to blow over. The other is to promote heavily, focus nationally or globally, chase the money that is out there and capitalise on the cautiousness of other traders - we will see which works.

Shoppers, meanwhile, are confused - should they support local growers or buy Fairtrade, should they lower their shopping bill, or their pesticide intake? And will a reduced carbon footprint mean a reduced choice of products too?

I am hoping 2009 will be a year we do not remember - for the right reasons. Lately, we have had a few too many years that illustrate the Chinese curse “may you live in interesting times”. A quiet year of steady trade and no surprises would be just fine. On the Chinese theme, 2009 is the Year of the Ox, an animal that represents hard work and stamina, patience and perseverance, sense of duty and putting others before oneself.

Interestingly, the fresh produce sector is starting to experience what the ornamentals sector has undergone for many years. The recent public interest in growing your own, encouraged by the media, has impacted on what people look for in the shops. They do not mind “mis-shapen” veg if it means cheaper shopping and more produce available, but they do mind paying high prices for fruit they can grow themselves quite simply.

The Flowers & Plants Association has for years battled against the mindset that “I have a garden, why do I need to buy cut flowers?”. This is now translating into : “I have an allotment, why do I need to buy fruit and veg?”. Link this to the global Buy Nothing Day, the growth of barter networks such as Freecycle and trials to charge households for the amount of rubbish they produce, and perhaps the next big retail trend will be not buying.

We are increasingly focusing our energies on technology to communicate and promote. It is fast and it is fully trackable so we can evaluate return on investment, and it is a two-way conversation. The danger is thinking that it is cheap - it costs the same as print or TV, just in work hours and commitment instead.

My New Year’s resolution is the same as for 2008 - smile every day and be thankful. Through an accident of birth, I live in a safe, peaceful, prosperous country with a benign climate. I have enough to eat and I can drink water from a tap in my kitchen, not a distant dirty well. I have access to education and medical care, I can vote, travel abroad, dress how I please and express my opinions freely. That is a lot to be thankful for.

David Macaulay, a director at Redfox

Theeconomic climate will be challenging for the fresh produce industry this year, with shoppers tightening their belts and moving back to home cooking and entertaining. Internally, the industry needs to start thinking strategically rather than being driven by unsustainable business, which has engulfed suppliers for the last six months. It all starts from the retailers, but the balance of power will change towards the supply base as concern about empty shelves becomes a reality.

This year will be one to remember, with even more consolidation within thefresh produce sector,as the financially strong businesses will be presented with great acquisition opportunities. I think by the end of 2009 there will be a bigger gap between the superpowers of produce and other supermarket suppliers. On that basis, we will be working with our key clients who are looking to profit from sourcing key candidates for them, to enable them to increase turnover and profitability.

A number of trends will be prevalent in the next 12 months and this could change the shape of the industry and how it operates in the future. We are seeing falling levels of recruitment in categories that are perceived as speciality or luxury, such as berries, organics and exotics, while more staple categories, such as commodity fruit and potatoes, are on the lookout for more talent.

The supply base is already planting fewer fruits and vegetables in response to high costs of production and the volatile nature of sales. This will mean more product will be traded, with the possibility of shortages becoming a reality.

On top of this,over the last six months retailers have pushed their suppliers even further than predicted, leaving them angry and disillusioned. In the most extreme cases, anyloyalty retailers thought they had is nowlost and suppliers will be actively looking for more retailers to work with in 2009.

But there are opportunities out there for the taking. The out-and-out trading businesses that just focus on price and volume have great opportunities togrow theirbusiness with the supermarkets, and this is already happening. At present, their low-cost base is very attractive to supermarkets that two years ago would not consider working with them.

My New Year’s resolutionis to keep encouraging clients and candidates that the BBC’s Robert Peston is not the “fountain of all knowledge” and to bear in mind that there are some excellent opportunities for 2009 ­- we just need to be in the right frame of mind to see them.