CULTURAL NOT FINANCIAL BARRIERS DISCOURAGE NORFOLK FOOD AND DRINK PRODUCERS FROM DOING BUSINESS WITH SUPERMARKETS, SAYS NEW SURVEY
Cultural rather than financial barriers are the reason Norfolk’s small food and drink producers shy away from doing business with supermarkets, according to a new study carried out by a leading regional accountancy firm.
However, an overwhelming majority of those who are dealing with supermarkets have found the experience positive, says the research.
Lovewell Blake, which has a specialist Food and Drink Team to provide business advice and support for the region’s producers, asked producers whether they were currently doing business with supermarkets - and if not, why they were reluctant to do so.
The research found that not wanting to lose control of their business, and a perceived incompatibility with their artisan ethos – both mentioned by around two-thirds of those producers not doing business with supermarkets – were the two main reasons for avoiding supermarket buyers.
Insufficient finance, often cited as a major barrier to breaking into the major retail sector, was only mentioned by around a third of respondents.
Meanwhile, over 70 per cent of those small producers in the region, who are doing business with supermarkets, agreed that it had been a positive experience, with 85 per cent saying they had retained control of their business – showing that fears about loss of control are largely groundless.
Only one in six of those currently doing business with supermarkets said that raising sufficient working capital had been a challenge, although two-thirds did agree that they had had to introduce new systems in the way they operate.
“This is a fascinating survey which shows that the reality of working with supermarkets is more positive than the perception for many small food and drink producers,” said Justin Wright, food and drink specialist at Lovewell Blake.
“As accountants, we can sometimes focus primarily on the financial aspects of such a decision, but for many producers, who are driven by a passion for their product, the cultural factors are more important.
“It is really encouraging that those small producers who have entered into a relationship with one or more supermarkets overwhelmingly believe that the experience has been positive and good for their business.
“That is the message that supermarkets need to get across to the food and drink producer community in East Anglia, to encourage more to consider taking that step of getting their produce into the retail environment where most people purchase food and drink.
“One small producer wrote in the survey: ‘They [the supermarkets] are not interested in dealing with small business like ours’. That is simply no longer the case, and we need to be encouraging producers to take advantage of the positives that finding a wider market can bring.”
Lovewell Blake is holding a free seminar for food and drink producers called ‘Small Producers and the Supermarket’, at which a buyer from East of England Co-op’s Sourced Locally team will explain how small producers can build a beneficial relationship with supermarkets. The event will also include a presentation from Swaffham-based Heygate Farms, which has successfully built a relationship with Tesco, to sell its Norfolk Peer potatoes.
The event takes place on Tuesday 14th April at the City College Hotel School in Norwich, and is free of charge for food and drink producers. For more details, and to register, visit www.lovewell-blake.co.uk/media-centre/events.