After a “tremendous performance in 2018,” the frozen food industry in the United Kingdom is now worth £8.6 billion and growing year-on-year at 4%, reports John Hyman, chief executive of British Frozen Food Federation (BFFF). This makes it the fastest growing retail food category in the nation at 3.6%, ahead of ambient (3.2%) and chilled (2.1%).
Looking ahead, he forecasts that growth is poised to continue, with combined retail and foodservice frozen food sales expected to exceed £10 billion by 2025.
Delegates attending the BFFF’s recent Annual Conference in Birmingham received insight from a number of industry experts who have a positive outlook for the industry in the next six years. Hyman concurs with their positive thinking in no uncertain terms.
“We believe that frozen food is well set for future growth and with current economic trends, the position of frozen food is stronger than it’s ever been,” he said. “As consumer demands are becoming more complex and far reaching, frozen food is ideally placed to inspire consumers with innovation in premiumization and natural health, technology enabling further convenience, and as a solution to food waste.
“As online shopping becomes the norm within households, we expect to see the positive impact this has had on frozen sales continue; frozen already over-indexes online. We are also not even half way through the premiumization journey for the industry as a whole, with the aim to see premium products across every single category. So with the innovation and proactiveness that we have come to expect from our industry, I am very confident we will see further step change.”
Due to technological advances and the ability to react quickly to consumer trends, the frozen food industry has a strong advantage in that it is able to provide consumers with trend-setting dishes they’re seeing on menus, in the form of high quality versions at home, pointed out the chief executive. This level of innovation and product choice are key factors in improving the perceptions around frozen food and increasing consumer curiosity around the product offering that is available in the frozen food aisle.
“This in turn increases consumer confidence when branching out into new product categories within frozen food, increasing the number of meal occasions that frozen is a part of, which contributes to our main goal of consumers heading to the freezer as often as they use their fridge,” said Hyman.
Capitalizing on Future Trends
Noting that the United Kingdom is increasingly a society that is adapting a more plant-based diet, the BFFF chief executive said that frozen ingredients are incredibly well suited to meet this challenge as well as being an answer to the food waste problem. While consumers continue to up their vegetable intake, preparation time needed will also increase, whereas with the vast array of prepared vegetables now available across all the major retailers, preparation time is tremendously reduced if not eliminated – not to mention the cost savings associated with less waste. What’s more, waste is considerably reduced earlier in the supply chain, as products that might originally be rejected due to appearance can be prepared for foodservice or home consumption and used, eliminating a major cause of food waste.
“If we look further into the future and the continued technological developments across the entire food supply chain, frozen food continues to excel,” said Hyman. “With the rise of robotic delivery, consumers and suppliers alike can be safe in the knowledge that the integrity of their food will not be compromised in transit, offering even more freedom to purchase frozen products and eliminating the old concern that they will defrost in the car.”
Targets and Predictions
BFFF Annual Conference speaker Simon Stenning, founder and strategic director at FutureFoodservice.com, predicted plenty of growth potential in the foodservice market. By 2041 the UK population will have risen by 7.3 million, with the main increases seen in the elderly population and children, alongside the expectation of inbound tourism figures rising to 58.7 million in 2025. This will likely result in multi-generational living, and therefore a demand for outlets that cater to the entire family. Multi-age venues such as a modernized carvery, for example, will increase in popularity, as will foodservice outlets that act almost as a “community hub,” encompassing both dining and socializing.
With the vast range of meal requirements that this style of living brings with it, Stenning foresees a great opportunity for frozen food to continue to grow in the foodservice sector as it has the capacity to meet the demands for variety, innovation, portion control, waste reduction and quality expected by consumers.
Nick Downing, commercial director at IGD, echoes Stenning’s predictions around changing formats alongside the opportunity for Food-To-Go, which by 2025 is expected to “grow twice as fast as retail.” This popularity is already being brought under a traditional retail format with eat-in options becoming available within the supermarket setting. The UK market should expect to see growth through the balancing of retail and foodservice offerings under one roof, with both food to “eat now” and “eat later” options present.
Chris Hayward, head of business development at Kantar Worldpanel, focussed on online opportunity, which is already showing itself to be a key growth opportunity for frozen food producers. During the Christmas 2018 period, online sales held a record market share of 6.8%. Combined with frozen food’s dominance in this area, online is a “contributing force to the growth of frozen and needs to be utilized to drive volume and frequency,” said Hayward.
He went on to discuss the continuing rise of premiumization, pointing out that 42% of own label spend being on premium products over the Christmas 2018 period.
“So looking at what we know about the performance of frozen food online and the premiumization that is currently being seen across all categories and is only expected to grow, frozen food is in a very strong position to capitalize on these consumer trends and continue to go from strength to strength,” concluded Hyman.