Local Foods – From Niche to Mainstream in 5 Years

In early 2005, the local food movement was mostly confined to farmers markets, a few intrepid souls selling by mail order or over the internet, one or two up market shops sufficiently different to flourish despite the supermarkets, and funnily enough, ASDA who had just begun to experiment with local foods in its Kendal store.

Now local foods are a feature of every supermarket’s business. ASDA has gone from strength to strength, and now asks its shoppers to write in with suggestions for local foods they want stocked. Tesco says they sold £624 million worth of local foods in 2009, around 2.2% of its sales, and a 30% increase since 2007. Morrisons make a big thing of sourcing local products such as pies, unusual cheeses and the monthly guest ale. Smaller stores are benefitting too, and shopper interest in local foods has played a part in encouraging specialised shops to return to the high street.

Recent IGD research has found that 30% of people purchased locally produced food in the last month, up from just 15% in 2006. This compares with 17% buying organic, also up from 15% in 2006.

This rapid growth comes about because people have a very clear idea about why they buy local food.

The number 1 reason for buying local is freshness. 57% of shoppers perceive local food to be fresher because it has not travelled very far. 54% buy because of a wish to support local producers. About a third buy local because they wish to support local retailers. Other reasons for buying local are environment, naturalness, and the security of knowing where the food has come from and how it has been produced.

The growth will continue. This is a trend, not a fad.

Consumers clearly like the idea of buying local. It is an easy purchase, particularly if prices are similar to a non local version, which is nearly always the case in supermarkets, and will probably need to be in smaller shops unless they are offering something very special.

One challenge is to pin down exactly what local means to consumers in terms of geography. IGD research tells us that in Scotland and Wales, “local” is seen to be from that country. In England, according to some work done by the Food Standards Agency, the definition tends to be based either on mileage (which can be anywhere from 10 miles if a country dweller, to 100 if living in London), or on counties around where the person lives. My view would be that whatever the definition, it is important that consumers don’t feel cheated by a local claim.

It is also important to avoid thinking that being local is either a substitute for strong branding or a passport to a premium price. This is especially true if selling to supermarkets.

The final comment would be that a move from niche to mainstream almost always means a move from high to lower prices.