Frozen Foods, a category with a real future
The Frozen Food retail sector in Portugal increased by 13% in value to £1.57 billion over the last year, and by 6% in volume.
Consumers recognize that frozen foods can last much longer if kept under correct conditions while also saving them time by reducing the frequency of shopping trips.
Moreover, we have to add that they are now often more fresh, sustainable and packaged in an eco-friendly way. For example frozen fish certifications such as the MSC (Marine Stweardship Council) reassure consumers that catch practices are sustainable. And these combined with FAS practices (Frozen @ Sea) provide evidence that the fish they will eat is safe and as fresh as it gets. In terms of preservation, blast freezing processes retain the freshness of the foods from the collection point or production date. The growing concerns with eco-friendly packaging have driven manufacturers and retailers to demand FSC Certification.
Another increasingly hot topic today has to do with food waste. Recent research demonstrates that it is possible to refreeze the product after thawing, provided adequate defrosting processes were used, which is particularly important for raw products. So, consumers have enough time to consume due to longer shelf lives and can refreeze part of the raw ingredients which have been thawed. A great advantage when compared to chilled foods as far as food waste is concerned.
Other than the traditional categories such as raw foods, ice cream or vegetables, ready meals and meal components are increasing their share in the frozen aisle. The challenge for manufacturers is that the freezer cabinets are not easy to expand and new items will come at the expense of the space of existing ones. Other than a few leading powerful international companies, it is the retailer who is taking the lead in terms of innovation and assortment. That is why private label is almost a pre-condition to do business in the sector. And the PL sector is increasingly segmented allowing the development of specific niches that cater to consumer clusters. So, despite the above restrictions there could be opportunities for smaller players if they can cope with retailers’ demands and offer the required quality and differentiation at the right price.
To sum up, frozen foods will continue to expand as a sector within the supermarkets and so will the space allocated to it. We will also see the development of shops that will only sell frozen products either generic or specific to a category. That will be the case with premium meat retailers, as is already taking place in the US. The major drawback is still the consumer’s journey back home which can affect the products’ condition due to the lack of suitable bags combined with weather conditions and longer journeys. This is something that retailers need to address – with home delivery being one solution. Or indeed by designing containers that provide safe transportation and can be returned to the shop once used.
Luis Garcia, MD Green Seed Portugal
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