November 3, 2008
British consumers cut down on processed pork
The message from the processors and retailers in general are present that consumers are trading down on processed meats in particular.
Buyers of premium products are tending to move to standard-plus, while standard-plus consumers are moving to standard, and standard customers are trading down to value lines.
This cascading effect is particularly bad news for British-owned abattoirs because the lower kind of quality pork that consumers purchase, the less likely they are to be buying any more British meat.
The more consumers' spending is on a decline, the less likely they are to be buying British meat. A burning question remains as to what will happen to discount brands like these when the recession becomes history and consumers return to standard, standard-plus and premium lines. Pig numbers have tightened as predicted and fresh pork sales are stabilizing, but ham and bacon prices are under pressure from imports.
Producers who find themselves in the media spotlight in the coming weeks may want to stress the importance again of consumers who always look for the Quality Standard Mark.
Some industry sources have debated that the reaction from consumers is out of proportion to the levels of hardship actually being felt by the population at large, as Britain is only just entering recession.
However, several weeks of unending bad news about the economy have caused consumers to be careful of their expenditure more closely than before, even though they may not materially be affected by the economic gloom.
Pig producers looking for a ray of hope for next year may take the view that once the recession becomes old news, just something that is going to be around for a year or two, many consumers will return to their old purchasing habits, namely British bacon, sausages and ham.
Speaking after the David Black Awards, NPA chairman Stewart Houston said he had heard a lot at IGD's recent conference about the supply chain having to tighten its belt and he would like to hear retailers say they are going to cut their margins too because when their results are revealed they will not be significantly down.