In its first Fresh Produce Analysis for 2003 Plimsoll revealed four types of companies and the strategies that would best suit them individually in the coming 12 months.

Some 23.5 per cent of the companies will view survival alone as a successful year. These companies have deteriorated in recent years and debt levels are dangerously high at 18.3 per cent of sales. Sales have also fallen 13 per cent since last year. Plimsoll recommends reducing debts by cutting costs and people in order to ensure profitability. The only other option, said the publisher, is acquisition by a stronger company.

The second category is the 20.9 per cent that equate improved margins with success. These companies have the ability to take large market share, increasing sales by 21.7 per cent last year. Yet low margins and high debts have meant there is little to show for their efforts. In this case, Plimsoll suggests a slow down on sales growth to allow margins to improve from an average of 1.1 per cent to 1.7 per cent in 2003.

Third, 37.8 per cent of companies believe success will be to get back in the market. Market performance has been poor in recent years for these companies, with sales declining one per cent last year. These companies need to get back in the game for long-term staying power. Plimsoll advises these companies to stop playing it safe. To compete they will need to attain at least the industry average growth, and this may mean spending some of their two per cent margins in order to expand into the future.

Finally, 17.8 per cent will view success by maintaining high performance. Leading the industry, these companies have a strong balance sheet, 19.9 per cent average sales growth and 3.7 per cent average margins.

The most challenging strategy for this group, says Plimsoll, is not to become complacent thereby letting competitors catch up.