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May 10, 2018 / Richard Hall

Organic momentum renewed

Organic is undoubtedly part of the ‘natural’ trend that encompasses related themes such as local and authentic, transparency and provenance.

After the 2008 economic downturn, however, organic growth faltered along with other premium and functional concepts.

Today, organic seems back on the front foot.

• UK organic food and drink purchases rose 6% in 2017, compared with 2% growth for non-organic products.

• This took sales to their highest ever level of £2,200 million in 2017, breaking the 2008 record of £2,100 million.

• Dairy products accounted for the biggest share of 29%. Chilled and delicatessen products achieved the biggest increase of 21%.

• Just 3 chains – Sainsbury’s, Tesco and Waitrose – were responsible for 70% of all supermarket trade.

It is no coincidence that Arla Foods has stepped up its focus on the organic opportunity with its purchase of Yeo Valley Dairies.

• According to Nielsen research, organic milk has reached 29% of fresh milk sales in Denmark, with a share of 16% in Sweden and 10% in Germany, but only 4% in the United Kingdom.

• Arla’s Organic Free Range milk is reported to have driven 60% of all UK organic milk growth in the past year.

May 9, 2018 / Richard Hall

61 acquisitions in April

April saw several large scale food and drink industry transactions among the 61 recorded on the mergers and acquisitions database.

7 amounted to more than $500 million, with 3 of these topping $1,000 million:

• $9,500 million for China’s Alibaba to buy the food delivery service.

• $4,200 million for US based Procter & Gamble to purchase German based Merck’s consumer health unit.

• $1,320 million for Canada’s Transcontinental to take on the Coveris Americas packaging business from US based Sun Capital Partners.

Alcohol was the most popular sector with 13 deals, followed by soft drinks on 6, with nutrition and services on 5 each, ingredients and packaging on 4, then plant-based and seafood on 3.

27 occurred within single countries, including 15 in the United States, and 34 were international.

30 of the 61 total featured the United States, followed by 8 for the United Kingdom, then 5 for Australia, Canada, France and Spain.

May 8, 2018 / Richard Hall

Good nutrition not more expensive

The prevailing view is that poor people can only afford junk food and food deserts deny them access to fresh produce.

I’ve always disbelieved this and an article in The Economist on 10th March reinforces my view.

It refers to a US academic study of grocery purchases by 60,000 households and sales by 35,000 stores from 2004 to 2015, which finds:

• “There is little price difference for categories other than fresh produce.”

• “Healthy foods such as plain yogurt and high-grain bread are actually 8% less expensive than unhealthy foods.”

• Preference, “which is partly informed by education and nutritional knowledge, is a much more significant factor.”

• The disparity “is caused more by demand than supply.”

• “Introducing low-income populations to the same grocery shopping conditions enjoyed by high-income ones reduces nutritional inequality by only 9%. The remaining 91% of the nutritional gap … can be accounted for by differences in demand.”

I’m not saying the problem doesn’t need to be addressed. I’m saying that it can’t just be blamed on supply or price and more needs to be done on education and policy too.

May 3, 2018 / Richard Hall

Traffic light labelling boost

Debate about nutrition labelling started well before the obesity epidemic and even now it is hard to find a consensus.

Two new studies favour traffic lights.

Ecuador introduced traffic light labelling for processed food packaging in August 2014. Scientists from the Universidad San Francisco de Quito found that the scheme had increased awareness, changed attitudes and “modified patterns of purchase and consumption”, concluding that it was “an effective mechanism for communicating information about the fat, sugar and salt in processed food.”

Admittedly, however, the sample was modest and another study has showed limited benefit in less educated and poorer groups.

Dutch consumers have also expressed a preference for traffic lights in a recent survey.

The Netherlands already has a voluntary scheme, but it is being phased out by October 2018 because its healthy ‘Choices’ logo can be applied to some products which are high in fat, salt or sugar.

Given a range of alternatives, 51% of those questioned by the Consumentenbond consumer group opted for the UK front of pack traffic light display. 29% supported the French five tiered Nutri-Score system and 8% liked the Nordic region’s keyhole logo.

71% wanted nutrition labelling to be on the front of packs. Other majority views supported use across all products and by all manufacturers, with 74% backing supervision by an independent body.

Other findings were that a scheme should be time-saving and deliver information at a glance.

The weight of consumers is proving hard to reduce. The weight of evidence is shifting towards traffic lights.

May 1, 2018 / Richard Hall


Zenith has just completed a survey of US beverage businesses, asking about the challenges they face in exploring international expansion. The top 5 were:

Finding the right people 21%
Identifying product potential 21%
Lack of international expertise 21%
Finding the right partner 19%
Regulation 16%

Supporting clients in international expansion is the most common type of project we undertake at Zenith, even for multinationals – where they may be considering new market sectors or existing brand market entry priorities.

The great advantage Zenith has is direct local knowledge of most markets. My own travel programme this year already includes Brazil, China twice, India, Japan twice, Malaysia, Middle East, Singapore, United States 3 times and multiple European markets.

The challenges highlighted in the survey entirely accord with our own experience. Our response would be to establish 3 project priorities:

• The first is to set a clear strategy. What scale and return is required from what level of investment and resource ?

• The second is to decide on where, when and how to manage the expansion. Often it is more appropriate to target cities or regions rather than whole countries. Products may need to be adapted to local cultures. Trusted and experienced managers are always vital. Greenfield or acquisition will be appropriate for some companies, partnership or contract packing for others.

• The third is focus on implementation. International expansion requires director attention, alignment of incentives and capacity to troubleshoot.

If your company has as yet unfulfilled international potential, do email me at Let’s see if Zenith can help. That’s why our Twitter hashtag is #askzenith.

Apr 26, 2018 / Richard Hall

Click and choice

Technology advances rain down on us almost daily. This week has seen impressive developments in click and collect as well as click and drop.

France has a very strong network of ‘drives’ – places to drive in and collect online orders. Now it’s possible to pick up deliveries on foot at 9 Carrefour ‘pedestrian drives’ in Paris.

Owners of Volvo and General Motors vehicles in 37 US cities are now able to have their online orders dropped off in their car boots by using an Amazon key app.

Apparently, a similar service already exists in Sweden and Switzerland.

In case you’re wondering what next … Soon it may be possible to have unwanted deliveries collected from your car boot. Click and re-collect ?

Apr 12, 2018 / Richard Hall


Well, it hasn’t failed if its true purpose was to boost Government tax revenue. In just 4 years, the Mexican soft drinks levy has generated $5,500 million of extra tax payments.

But, it was supposed to reduce obesity and there is no sign of that.

An exclusive interview on with ANPRAC, the Mexican soft drinks association, shows:

• Mexicans consume an average 3,072 calories per day; and
• the contribution from soft drinks has fallen by just 6.6 calories per day, a negligible 0.2%.

This is despite:

• soft drinks price increases at twice the rate of inflation; and
• a 7% reduction in the average calorie content of all soft drinks in the last 6 years.

The social consequences, however, have been serious:

• 30,000 small stores have closed, according to ANPEC, the small traders alliance; and
• 62% of the amount collected has come from the lowest income households – “the pattern of consumption of the lowest strata has not changed significantly … their economic wellbeing has been affected.”

It remains clear to me that obesity does need tackling and this requires a comprehensive strategy across all food and drink involving information, education, communication, activity and incentive.

My greatest concern is that ineffective action, as in Mexico, merely delays effective action, by creating the illusion of a strategy which is really no strategy at all.

I fear the same for this month’s new taxes in South Africa and the United Kingdom as well as next month’s in Ireland.

Apr 10, 2018 / Richard Hall

56 acquisitions in March

March seems to have been an average month for food and drink transactions, with 56 registered on the mergers and acquisitions database. Link

3 amounted to more than $500 million:

• $1,600 million in dairy for France’s Danone to reduce its stake in Japan’s Yakult from 21.29% to 6.61%.

• $700 million in nutrition for Clorox to buy Nutranext in the United States.

• €522 million in ingredients for Switzerland’s Givaudan to purchase 40.6% of France’s Naturex.

Among the 56 total, 7 were in soft drinks, 6 in packaging, 5 in alcohol, 5 in dairy, 4 in ingredients and 4 in snacks.

5 were in relatively new categories – 3 in meal kits, 1 in insects and 1 in plant-based. 11 were funding rounds.

31 were within national borders – 18 of these in the United States and 5 in the United Kingdom. 25 were international. 24 countries were involved overall.

The United States featured in 28, the United Kingdom in 9, Canada in 6, Germany in 6, followed by Australia, Denmark and France on 4 each.