The top 10 global retailers could represent as much as 60 per cent of the market in 10 years, according to John Giles of Promar International.
The figure stands at around 35 per cent now, but it would be “daft to expect [the domination] to stop,” he said at PMA’s Fresh Summit in Atlanta.
“As GDP per capita in countries around the world increases, retail market share will typically rise,” he said. “If suppliers haven’t learnt to deal with the major customers by now, there is probably a fairly short window in which to do so. If you’re not in there in a few years, when there will be still fewer and more specialised supply chains, life might become difficult unless you look for other routes to market.
“While there are threats, there are also opportunities for go-ahead suppliers that are well-organised, understand markets and are willing to make bold statements to their customers, to get alongside the retailers and build meaningful relationships and partnerships.”
The major produce categories are static in many of the developed markets, said Giles. “It would be naïve to believe that the next five to 10 years will be easier than the last 10. It can be difficult to understand patterns of customer behaviour, but that is no excuse for not trying.” He pinpointed “intelligent suppliers and intelligent brands” as key in the battle for international differentiation.
“There are 50,000 horticultural enterprises around the world, chasing the business of 30-40 retailers. There is no harm being an own-label supplier and for some that might be the way forward. But being strong in your own backyard is one thing; being important around the world is critical for a brand.”
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