Provenance, in particular UK origin, is becoming ever more of a battleground among the big grocers.
Always important, it has taken on greater significance as the supermarketing landscape shifts.
When the Jack’s value fascia was unveiled by Tesco a couple of weeks back, the British origins of most of its product was blared out at foghorn volume in-store and in publicity material.
“Eight out of 10 food and drink products at Jack’s will be grown, reared or made in Britain,” the retailer trumpeted.
“There’s one problem though. The UK doesn’t produce enough of the food it eats”
Aldi, which has done so much to disrupt Tesco in recent years, has long made British associations a key feature – it sponsored Team GB in the Olympics as well as stacking its shelves with British product.
This week, as it unveiled record results, it once again put UK provenance credentials centre-stage.
There’s one problem though. The UK doesn’t produce enough of the food it eats. According to the ONS, the UK supplied just under half of the food consumed here in 2017 and the leading foreign supplier was the EU, at 30%.
Last year a report commissioned by Morrisons, which chairman Andy Higginson said is “already British farming’s biggest single customer”, warned of potential threats to food supply ranging from climate change to political uncertainties such as Brexit.
Morrisons launched a drive, subsequently achieved, to recruit 200 more local suppliers, help them build their businesses and so provide more of what Britain eats. Over the past two years, sales of local suppliers’ products have risen 50%.
Aldi said on Monday that it has helped UK food suppliers, such as crisp company Seabrook, to build their businesses internationally.
The same can be said of Tesco, through examples such as Brew Dog.
That’s welcome. A healthy UK food supply base is in the national interest as well as that of grocers as food security post-Brexit, amid speculation about stockpiling and food rotting at ports bound up in red tape.
While there’s probably a bit of truth in it, the characterisation of Jack’s as a ‘Brexit shop’ is overdone. However, the effects of the UK’s walkout on the EU, as yet unknown, are likely to bring unwanted complexity to food supply.
The fear is surely that limited supplies of UK produce may mean that in future it could be a fixture not on the shelves of value stores but an increasingly premium-price product.
Next sets standards
On the subject of Brexit, fashion retailer Next published as part of its interims an exemplary analysis of what no deal would mean for it – an outcome, the retailer made clear, that it would prefer not to happen.
Next assessed factors such as import duties, compliance with EU standards and sterling volatility.
The retailer concluded that “we do not believe the direct risks of a no-deal Brexit pose a material threat to the ongoing profitability of Next’s business in the UK or to our €190m turnover business in the EU”.
“Next’s clarity about what no deal would mean is welcome, and sets a standard for other retailers”
It emphasised that its study was specific to it and “should not be extrapolated to other businesses or industries”.
Next’s clarity about what no deal would mean is welcome, and sets a standard for other retailers.
As the politicians peacock at party conferences, there is still no visibility on what sort of deal the UK will strike – if it strikes one at all.
Next said the “indirect risk of interruption to the smooth operation of our ports represents the biggest risk to our business from Brexit”.
Without wishing to contradict Lord Wolfson’s warning about extrapolation, that surely reinforces the need for Britain’s grocers to invest further in domestic suppliers.