It’s 3am and New Spitalfields Market is vibrant with the kind of energy that you get from more than 100 separate traders, thousands of deals being done and the whir of nifty forklifts stacked high with all kinds of fruit and vegetables.
This thriving food centre is home to the largest number of wholesalers and generates one of the highest turnovers of any market in the UK, at around £650 million.
It provides the backbone for the busy London food scene, feeding everything from retailers to restaurants and hotels to more than 200 street markets across the capital from a market hall the size of six football pitches. Still lively with full occupancy, it has continued to build a name for itself as a specialist source of exotic lines that cannot be found easily elsewhere.
All this has been achieved against the backdrop of an economic crisis that has hit trade and squeezed margins like never before.
So what is the secret to making it work, when over the same two decades other wholesale markets have faltered? And what can we expect from the next 20 years?
David Smith, director of markets at the City of London Corporation, insists that the key is “a feeling of Team Spitalfields” as the market has flourished by finding its own way in a competitive environment, forging strong relationships with its customers and improving the range and quality of the fruit and vegetables on offer.
“The traders have had a tough time in the last few years but it shows the resilience of their businesses that they are surviving,” he says. “No one should underestimate how hard traders work for their living, six days a week.”
It was a different story when the traders first moved across to the Leyton site in the face of fears that the market wouldn’t last for five years and that the rise of the supermarkets would stamp out the wholesale trade.
But the market has adapted itself over time to reflect the diversity of London as a whole, defying its critics and making itself an indispensable part of the city.
“When the market moved here, an awful lot of people thought that we had bitten off more than we could chew and said we could never fill it,” Smith remembers. “Twenty years on, the market is as good as the day that it was built, we have constant demand for space, it’s well maintained and in the right location. I would like to see the market continue to adapt to meet what customers want us to provide for them. We want to stay in the premier division.”
A fresh approach
A number of companies have secured their position by responding to competition and changing demand with a rethink of their businesses. This means everything from extending their product range to seeking out new avenues for customers, such as the public sector and the catering trade.
Janet Hutchinson, chief executive of the Spitalfields Market Tenants’ Association, maintains that in the context of the economic uncertainty, “the status quo is as good as anything” but she notes there is more awareness of the role of wholesale markets, even on a political level.
In fact, the market community as a whole is keen to build on the recognition that markets serve a distinct purpose and make an avenue that the supply chain should reconnect with.
Smith insists that “a lot of growers will get better value out of the wholesale market than they will get out of a single contract with a big multinational”.
“These guys are motivated by profit as much as the multiples but they have better relationships with their customers,” he explains. “Supermarkets have reduced their ranges because it is administratively convenient, it simplifies their supply chain management and minimises waste. Markets are traditionally driven by the customer, which is why you still see this huge variety. The supermarkets run yearly campaigns, but the market changes day to day. Wholesale traders are more nimble and that’s one of the things that makes them different.”
Model examples can be found across New Spitalfields Market. Special Fruit is one of the biggest businesses on the market, with a full range of fruit and vegetables as well as extras such as eggs, cooking oil and juice. Manager Ersen Yagcioglu says the secret to prosperity is to have diversity. “We have all sorts of different products,” he says. “Everyone can find something to buy from the stand and we are very competitive.”
It is the forward-thinking firms that have inspired others to raise their game, rethink their strategies and improve their offer.
Jon Thomerson, who runs JT Produce and JT Fruit Company, knew that his business would “disappear into obscurity” if he didn’t diversify his traditional offer and with that in mind, the team launched an exotics department that has continued to grow. “It was the complete other end of the spectrum for us,” he says. “We react and we never say never.
“A lot of the well established family names on the market have disappeared over the years, with only a few exceptions,” he continues. “On the other side of the coin, the good thing is that there has been plenty of new blood coming into the market and it has helped the market tremendously. The old family businesses were stuck in the mud. These newer companies have shown companies like mine the way.”
The future starts here
The next big milestone for the market will be the much-anticipated Olympic Games next year, which will take over the capital through the summer and leave a legacy for the area. The cranes poised over construction in the Olympic enclosure are visible from the market, but as tickets are distributed and the countdown gets underway there are still a number of question marks over how it will all come together and what it could mean for its neighbour.
The opportunities for traders to get involved are still being thrashed out and to this end, the City of London Corporation is arranging a meet-the-buyer event to get alongside the major caterers and give traders the best chance to supply into contractors.
The real gain, however, is likely to be the long-term boost that will come from regenerating the area alongside a renewed emphasis on health and fitness, eating the recommended 5 A DAY and buying British.
However, it is clear that an international sporting event of this scale will bring its own set of unusual and unprecedented challenges. One of the biggest concerns is the proposal for an Olympic Road Network, which means that the 3,000 vehicles that come in and out of the market every day will have to negotiate their way around a route that will be closed for up to 18 hours a day throughout the activities. Market representatives are in talks with the Olympic Development Authority and Transport for London about the impact of this proposal, which will close roads from 6am to midnight. A formal consultation will open this summer.
The event is a double-edged sword and one that has got a mixed response from traders who are both excited to have the high-profile event on their doorstep and nervous about what the practicalities will mean for their business.
John Edwards, owner of Knights of London, fears that the Olympics will “kill” the market and he is concerned that traffic in the build up and throughout the event “will drive customers away from the market”.
“The retailers want to get in and out quickly and this market has built its reputation on that,” he says.
He is not alone in these concerns and the authorities are taking time to make sure that plans for next summer take the market into consideration.
Chris Hutchinson, chairman of the Spitalfields Market Tenants’ Association, insists that the market is “negotiating long and hard” over the disruption it might cause. “The Olympics coming to London is great for the country but we must remember, for example, that the capital’s schools, hospitals and prisons will still need feeding and these contracts are in place with many companies on the market,” he says. “They have to make it so that we can still operate.”
But Smith insists that it’s important to maintain perspective. “It’s only six weeks out of the year,” he says. “The most important thing to come out of the Olympics is that it will be beneficial in trying to persuade restaurants and catering outlets to change their business model over time to reflect this whole sustainability agenda.
“The positive bit is that this is a real opportunity and if you look at the London Organising Committee of the Olympic Games’ food vision and the sustainability agenda, what we are trying to achieve at Spitalfields is in line with that,” he continues. “The traders are here and their businesses fit in nicely with that food vision.”
The way forward
All milestones make a good time to reconsider expectations and what might come next. Talk of forming a composite market by combining fresh produce hub New Spitalfields, fish market Billingsgate and meat market Smithfields to bring together the sites operated by the City of London Corporation has been circulating in recent years. Speculation came to a head when playing fields adjacent to the market were earmarked to make an Olympics car park but this was agreed with the proviso that the site is turned back into playing fields after the event.
Smith admits that the idea is “not so much on ice as in the freezer”, but the traders remain keen on the concept.
Hutchinson is adamant that this is the best way forward for the market. “I think it’s embarrassing that London doesn’t have a composite market,” he says. “It would be environment-friendly to have one; the efficiency would be incredible. There is a fantastic opportunity for the City of London Corporation if they got the right set of circumstances to do such a thing. They would be the right people to do it, especially as they have the experience of moving us to this site.”
But whether or not this idea ever goes ahead, traders and authorities will continue to carve a role for the market in the long term and build relationships both up and down the chain.
This is where the market’s business development manager, Tim Williams, comes in. He aims to reconnect the market with both growers and suppliers and potential customers. He was posted at the market two and a half years ago as part of a scheme to appoint BDMs at each of the London wholesale markets funded by the Greater London Authority’s London Food Board, and now extended to March 2012.
Together, they worked with 184 companies in 2010, creating 51 new jobs and bringing in £20m of new business.
The project has since been taken under the wing of the NFU, which has made it easier for the BDMs to link up with UK growers.
Williams has set up a number of deals featuring the likes of Herefordshire apples, Yorkshire-grown lamb’s lettuce and organic asparagus. He is also working with Red Tractor to support the catering suppliers on the market.
He believes that the site is “crying out for a composite market” and claims it would be the “perfect decision” to reflect the legacy that will be left by the Olympic Games.
“I still believe that food is undervalued,” says Williams. “The wholesale markets still supply 40 per cent of all produce eaten in this country, but they do need to focus on packaging and presentation, as well as continually improving quality.”
The market knows what it has to do to secure its position in the future. Whether it’s making the most of opportunities beyond the Olympics or continuing to diversify the offer, it seems that New Spitalfields Market is better placed than most to start on the next 20 years in the trade.
A HISTORY LESSON
The market’s history can be traced all the way back to the 13th century, when it started out in a field next to
St Mary Spittel on the edge of the Square Mile. This was formalised in 1682 when King Charles II granted silk thrower John Balch a Royal Charter that gave him the right to hold a market on Thursdays and Saturdays in or near Spital Square. The market traded for the next 200 years as a collection of sheds and stalls to supply the capital’s growing appetite for fruit and vegetables.
By 1876, former market porter Robert Horner bought a short lease on the market and started work on a new market building that was completed 17 years later.
The City of London Corporation took direct control of the market in 1920 and for the next 60 years it continued to thrive, albeit in a small space and nestled in a network of narrow streets.
These are the main reasons why the market was forced to move in 1991, when it opened its doors in Leyton, where it still stands today.
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