Small UK firms benefit from resurgence in local authentic heritage products
A new report from supply chain standards member organisation GS1 UK has shown that the UK is seeing a resurgence of small businesses producing authentic, heritage products.
According to its Buying British in 2017 report the organisation has seen an uptick in more modest-sized new joiners compared to previous years, as consumers increasingly want their food, drink and clothing to have a local heritage and fewer air miles. In 2016, 78% of new members had a turnover of £500,000 or less, compared to 58% of all members in 2015, demonstrating a strong shift towards smaller businesses.
Of the major supermarkets, Tesco was found to afford the most opportunities to GS1 UK’s new joiners over the past five years followed by Waitrose.
The apparel sector was the most significant source of new joiners in 2016 at 21%. Meanwhile, businesses in the food and groceries sector comprised the largest single percentage of GS1 UK’s membership at 20% and accounted for 12% of new joiners in 2016.
The study found that 79% of consumers said they thought about the provenance of their food while just a fifth said they never considered it. Three-fifths of shoppers said place of origin was at least as important to them as other factors, such as price and quality, and 55% specifically said they preferred buying UK brands to support British businesses. Reasons given include increased trustworthiness and companies being more attuned to needs and tastes.
An uplift in demand for craft drinks was reflected in the growth of GS1 UK beverage members. Although drinks manufacturers accounted for a relatively small percentage of overall members – less than 1% of GS1 UK’s total membership – they made up 3% of new joiners in 2016.
The GS1 UK data also reveals that the most popular sales channel for 71% of members was online via their own websites. This was followed closely behind by online marketplaces such as Amazon and eBay. Reflecting the trend towards smaller local companies, only a third said they used wholesale or distribution channels, and just a quarter used other retail stores.
Gary Lynch, chief executive at GS1 UK, said:: “GS1 data shows consumers are becoming more domestically focused when it comes to their spending habits. Heritage, provenance and traceability are no longer nice-to-haves but increasingly important factors that can make the difference between where consumers choose to spend their money. While there will always be some products and services we’re happy to go to major multinationals for, supporting the local start-up is back on the agenda.”
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