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Northern Ireland holds its own with story of provenance
by Elizabeth O’Keefe - 23/06/2010
"Staring into the face of adversity, the fresh produce industry in Northern Ireland has had to diversify by offering added value to survive various issues such as funding cuts, competition from overseas and margin squeezes."
Elizabeth O’Keefe visits the region for FPJ’s ongoing series of regional reports around the UK.
Branding seems to be the key to the future of the Northern Ireland fresh produce industry, from battling for Armagh’s Bramley apple protected food name (PFN) to the creation of Wilson’s Country’s potato family. Once content to supply what they grow, producers are increasingly asking what the consumer wants and acting on it.
Provenance of product has had a great deal to do with this move and although the food department of Northern Ireland’s economic development agency Invest Northern Ireland (Invest NI) has taken a substantial funding cut, it is still pushing the industry forward with a clear message that the region has a lot to offer both the immediate domestic market and the UK as a whole.
What’s more, producers are finding they have a place in marketplaces further afield, with traditional grower-turned-processor Mash Direct clinching a deal with retailers in the US for its typically Irish products such as Carrot & Parsnip mash and Champ, while the mainland UK market still proves to be the golden egg.
“The fresh produce businesses in Northern Ireland have had to deal with the onset of the recession but despite that, turnover has continued to grow,” says Invest NI food division’s William Magee. “Some of the multiples are using the recession as an excuse to squeeze more out of the growers’ margins. These companies have to be externally focused to deal with this and there is a reasonably high level of innovation, where companies seem to be moving away from commodities to added value.
“Undoubtedly, the sector is facing many challenges in a rapidly changing economy, however, local successes in the wider UK market would certainly indicate that there is an increasing demand for a wide range of Northern Irish fresh produce.”
Rethinking the brand
“The economy is changing and we have to ask, where are we going to be placed?” asks Wilson’s Country’s managing director Lewis Cunningham. “We started to target customer types more. According to Kantar Worldpanel, in November 2009 half of the people who went into Northern Ireland’s blue-chip supermarkets decided to buy their potatoes from somewhere else. We needed to know why.”
Through extensive consumer research, Wilson’s Country found that customers in supermarkets generally thought that the potatoes looked plastic and manufactured. There was a general air of mistrust for the fresh products on offer. “Potatoes to Irish people is like wine to the French,” Cunningham says. “We know what we want when it comes to potatoes and we know what is good.” This process made Wilson’s Country challenge its brand and its offer. The appeal of ‘dirty’ potatoes was evident, as was a need to return to basics, with consumers looking for a clear indication of which variety was on offer, where it was grown and instructions on how to cook that particular variety on the packaging.
“There was an awful lot of information on our packaging,” explains Cunningham. “We decided to change this and print in a large interface exactly what the consumer wanted to know. It was amazing that even though consumers in some areas of Northern Ireland are up to four generations removed from farming life, they still knew the different varieties of potatoes and wanted information on that.”
Wilson’s Country relaunched its bagged potato brand at the end of 2009 and against the background of a fairly flat potato market, managed to triple its sales. The company found that providing ‘dirty’ potatoes actually improved the brand’s image and shelf life. Now, the potatoes are rolled in peat after washing, which helps retain a good moisture level within the bag and slows deterioration of the product by stopping the potatoes turning green.
“With some simple changes to our brand, we had more people buying our potatoes, more often and in larger volumes,” continues Cunningham. “We did all this with only a price deflation of 2.9 per cent, when the Northern Ireland potato market was down four per cent in volume year on year and consumption of potatoes had halved over the last eight years in the Republic of Ireland market.”
Now, after a successful TV advertising campaign that depicts a cartoon version of the Wilson potato family in favourable comparison to a nondescript family of potatoes that have no origin, Wilson’s Country is looking to make an impact on the wider UK market. The company has carried out consumer research in Glasgow and has received positive feedback from giving out potato samples at food shows. As a result, Cunningham thinks that Wilson’s Country has a place in the UK market. “The general consensus is that if they’re Irish spuds, then they have got to be good,” he says. “That’s a great start.”
This was all part of a grand scheme for Wilson’s Country, which included a brave evaluation of where the company’s strengths really lie. From the company’s inception in the 1980s, it had been diversifying and had become a prepared fruit and vegetable processor, as well as supplying ready-meal manufacturers with processed product. At the start of the millennium, the company decided to focus just on the potato business, selling off its various sites across Northern Ireland and concentrating on its £5 million investment on a 100,000sqft packhouse in Craigavon, Armagh.
“In 1987, we had a small turnover and then 10 years later with the arrival of all the GB retailers we tripled in size,” says Cunningham. “But then the recession came and our prepared fruit business halved as it was a luxury item that no-one felt they could afford anymore. That part of the business was still doing well, but we had to make a decision; we had to drive cost out of our company to be more competitive in the industry.”
But one company’s worry is another’s treasure, as Orchard County Foods found out. Based in Portadown, Armagh, the fruit processor has made a place for itself in the multiples, as well as service stations and airlines, across Republic of Ireland, Northern Ireland and mainland UK with its snack pack and pot offer. The company launched a new branding for its products – which include the new pineapple wedge – last year under the Simply Fruit range. “We are the leading producer of branded and own label freshly cut fruit in Ireland,” says Orchard County Foods’ general manager Liam Lynch. “Wilson’s Country had a strong hold on the Republic of Ireland. We have relaunched 18 products into Tesco Ireland under own brand label in May. Acquiring the fruit business from Wilson’s Country is a new opportunity for us and we are now looking at a £3m-plus investment on site to utilise the potential 60,000sqft of extra room here. We are the leading fresh-cut fruit company in the country and are projecting that we will grow by 35 per cent in the next six to seven months alone.”
Orchard County Foods is also on the look-out for innovation and has seen demand increase for the pineapple wedge, which is a stick of pineapple in a package that makes it as accessible as a chocolate bar. The company manufactures in excess of 25 tonnes of pineapple a week for this purpose, as well as beaker-style mixed fruit pots. “We have been lucky not to see a downturn and prepared fruit seems to be riding out the wave of recession,” says Lynch. “It’s a healthy option and its market segment is from schoolchildren through to food-on-the-go, so if you get the price point right then it’s going to be in that lunchbox.”
Avondale Foods hasn’t noticed a drop off in demand either. The prepared salad and vegetable processor has developed its niche in the market as one of the main suppliers of added-value prepared salads and veg, as well as wet salads to both Marks & Spencer and Waitrose in the UK and the Republic of Ireland.
“We have experienced solid growth and that mainly comes from innovation and our products’ appeal,” says managing director Georges Senninger. But unlike the majority of businesses in Northern Ireland, he sees the company’s location as a disadvantage. With some 85 per cent of Avondale Foods’ customers based in the UK, the business works maybe twice as hard as a supplier based on the mainland because of problems with transportation. “When it comes to quality and freshness, distribution is a challenge,” explains Senninger. “It is a dimension that makes our business more complex. But the main ingredient in our business is our expertise so we make it work.
“The bulk of the kind of work we do is in GB, so we would be better on the mainland. But the staff turnover here is very little; they live and breathe fresh produce, and it is very much a farming community.”
This will no doubt be a relief to the community in Craigavon, where Avondale Foods employs no less than 350 people – a huge company compared to the scale of the country. The firm, which originated as a grower but now sources from a selection of growers, has 500 product lines on its portfolio, including soups and cooking sauces, which it manufactures from eight production areas. “We have a dominant position in the wet salad arena and we are known for our ability to assemble different products for the multiples,” says Senninger. “Our future sustainability lies in these areas.”
Next stop: the world
Mash Direct has pioneered to make its mashed potato and vegetable accompaniment offer shine past the farmgate. Its array of Irish prepared mashed potato and vegetable lines have made an impression on the Northern Ireland market and the company is ready to take its brand to other marketplaces with the addition of its new offer, the Farmers’ Garden range.
The company launched its new range, which includes Baby Bakes and Potato Cakes and is aimed at the barbecue dining sector, at Balmoral Show, from 12-14 May. Mash Direct distributed 18,000 samples at the show and within weeks, Tesco Northern Ireland had sold out of its initial delivery. “The new range is doing really well; it introduces us to a new sector and we have doubled our initial volumes in a week,” says Lance Hamilton, son of Mash Direct owners and husband-and-wife team Tracy and Martin Hamilton. “It will go into Spar, Dunnes in the Republic of Ireland, as well as Musgrave Supervalu, and Sainsbury’s in Northern Ireland in the next few weeks.
“We have grown 35 per cent year on year since the beginning of the company [in 2004] and have expanded the factory three times, with a fourth expansion on the cards. We are constantly growing; we have a Mash Direct bus that we use as a promotional tool, which stops at local supermarkets to carry out tastings and it provides a mobile billboard.”
No strangers to publicity, Mash Direct was one of the selected companies in Northern Ireland that prime minister David Cameron made a visit to in his first week in office in May, and also gave a tour to Prince Andrew as part of the royal visit in September 2009.
A common aim for most Northern Ireland fresh produce companies, Mash Direct is eager to make the most of the UK market, although it has recently managed to form a deal at the beginning of May with US retailers to supply its frozen Mashed Potato, Carrots & Parsnip and Turnip. “We are always open to new markets and put a lot of research into which marketplaces we approach,” says Hamilton. “In the future, we would like to go national with the multiples and get our product into the UK.”
Hughes Mushrooms – a family distribution company that grew out of the demise of the railway system in Northern Ireland – is also keen to make the most of the mainland UK market.
Managing director Keiran Hughes is second generation of the family firm, which started with his father’s job at County Tyrone’s Tew and Moy Dungannon railway station, where the business is based in the original refurbished railway building. When the railway was shut down in 1964, Hughes Mushrooms was born and provided mushroom growers in Northern Ireland with a route to market via the road in the way of a co-operative.
“Farmers would come from far and wide to get their mushrooms on the trains, so my father saw the opportunity and bought a van to distribute for them,” explains Hughes. “In 1986, Invest NI supplied funding for us to build a storage facility and we now deal with 30 growers, although at one point it was up to 180 producing the same volume; the industry has been under pressure due to competition from Dutch and later Polish growers.”
The company has been serving Sainsbury’s both in Northern Ireland and the mainland UK for the last 15 years, but it is now determined to make a name for itself through innovation. “The margin has been squeezed out of the industry, so we need something to set us apart from the rest,” adds Hughes.
And that extra special something is selenium-enriched mushrooms. Hughes believes that mushrooms can be transformed into a functional food and has put his money where his mouth is by developing a selenium-enriched mushroom with help from experts at the University of Surrey in Guildford.
Hughes Mushrooms launched the new product at the International Food Exhibition at ExCel in London on the Invest NI stand three years ago. Research shows that selenium can have important health benefits in countering conditions such as prostate and colon cancers, viral infections and in strengthening the immune system.
Working with Professor Margaret Rayman, reader in Nutritional Medicine in the School of Biomedical and Molecular Sciences at the University of Surrey – an acknowledged expert on the benefits of selenium – Hughes developed a new growing technique that substantially enhances the existing selenium within mushrooms.
Extensive tests, including blood samples, by the university research team showed that the new mushrooms increased selenium in subjects. Volunteers at Leatherhead Food International were fed mushroom soup in closely controlled and monitored tests. The soup was made from Hughes mushrooms by food scientists at Loughry Food College in Northern Ireland.
“From the supermarket’s point of view, consumers are putting the pressure on for British food and we benefit from this because we are one of the oldest companies in Northern Ireland and we can fly the British flag,” says Hughes. “Going forward, the climate is going to be difficult but you have to look after the growers and that has always been our main aim.”
ST GEORGE’S MARKET BELFAST
St George’s Market in the heart of Belfast has been home to many a fruit and vegetable stall over its more than 100 year history. The covered market is open on Friday and Saturday and used to house fruit and vegetable wholesale companies before they moved to the outskirts of the city. It now provides five fruit and vegetable stalls among some 40 food businesses.
Despite the recession, the market has benefited from offering high-end produce, as well as the social element of a market visit. Kieran Arthurs, pictured, has been a greengrocer on the market for 10 years and hasn’t seen trade decrease.
“The range here includes the finest fruit and vegetables,” he tells FPJ. “We source globally and items like white asparagus and Jerusalem artichokes are very popular. People are looking for different kinds of fruit and veg today, and they know that the market offers value for money.”
THE WHOLESALE SEE-SAW RIDE
The fruit and vegetable wholesale industry in Belfast has seen a steady decline since the UK multiples made their impact on Northern Ireland in the 1990s and what was once a bustling Balmoral Fruit Wholesale Market is now boarded up and left to ruin. Family wholesale firm Fagan Belfast is one of three traditional fruit and vegetable wholesalers left in Belfast, but is determined that it still has a market to serve.
“We had to scale back the business in 1998 because of the supermarkets cutting out local distribution and a year later we couldn’t really see into the future,” says Paul Fagan, owner of the company. “But following the peace process, the restaurant trade picked up and in 2000 we became a smaller business again, but we were more focused. In 2006 we moved to Balmoral Industrial Estate and expanded again.”
But, yet again, the company fears that there may be more complications for the wholesale industry in Northern Ireland. “There are only 1.6 million people in Northern Ireland, yet supermarkets are still being allowed to open new stores, with the excuse of offering consumers further choice,” continues Fagan.
“But it is cancelling out choice; greengrocers are closing and businesses are suffering as a result. But the wholesale business is sustainable and it is an advantage that there are only three companies left here now.”
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