Constant rounds of consolidation in the UK fresh produce industry are creating a breed of super-company that is exerting increasing control over the market, industry analyst Plimsoll Publishing warns.
A massive 97 per cent of the sales growth in the sector last year went to just 98 firms among the 500 analysed by Plimsoll. But although most of those 98 firms have annual sales upward of £10 million, 10 of them have sales less than £10m, indicating that it is not just a case of smaller firms being squeezed out.
“Looked at separately these 98 super-companies are great news for the industry,” said senior analyst at Plimsoll, David Pattison. “Yet the reality is much more disturbing: these companies are forcing such intense competition that others are battling for survival.”
This is borne out by figures in the analysis showing that 91 per cent of the affected companies saw sales decline by an average of 10 per cent in one year. “More than half lost money because extra costs could not be passed on,” said Pattison.