The strength of the UK vegetable industry has been severely tested over the past five years by the deteriorating economic climate, rising production costs and thinner profit margins. Tighter household budgets meant people chose to cook at home rather than eat out, which supported demand for processed food ingredients to some extent.
However, weak consumer confidence translated into cautious spending and consumers traded down their food purchases, choosing low-cost items over higher value products.
Vegetables are a staple part of Britain's diet. Moreover, consumers are aware of the importance of eating vegetables on a daily basis, as part of a healthy lifestyle. However, retail price increases, combined with the economic crisis, mean that fresh produce is getting increasingly expensive for UK consumers. Although the value of the market has risen on an annual basis since 2007, volume sales have declined.
The UK vegetable industry is far from self sufficient between the winter months of November and May, during which time a large percentage of the UK's fresh produce is imported from the continent and further afield. This is understandable, as outdoor production at this time is often unachievable.
Waste is also a key issue in the industry. Vegetables are the most wasted food in the UK, followed by bread and fruit. The average family throws away £680 of food every year. This trend has a negative impact on both the environment and consumers' purses.
The major factor constraining growth within the UK vegetable market over the past five years has been fierce competition from supermarkets. Supermarkets increased their share of the fruit and vegetable retailing market over this time and are expected to account for nearly 90% of the market in 2012-13. This includes companies such as Tesco, Sainsbury's, Asda and Waitrose.
The UK vegetable market is small, counting only 456 companies in 2012. The number of companies increased by 16% over reviewed period and, consequently, turnover per company dropped to £10 million, or by 7% from 2006.
Even though nearly 70% of active companies in 2012 had fewer than 10 employees, 24 large companies generated 68% of the industry's total revenue.
For more information on the UK vegetable market, see the latest research: UK Vegetable Market
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