It’s no secret that buying locally made products has been increasing in popularity with consumers for the past few years. But are supermarkets stocking enough locally made products and what challenges do small local businesses face when a supermarket comes knocking on their door?
In recent years both major New Zealand supermarket chains Foodstuff’s and Countdown have begun stocking more New Zealand artisan products and NZ grown produce in-store. This trend is driven by a growing number of sustainable conscious consumers who not only seek to support their local community but also care about their carbon footprint.
According to Nielsen data, 52 percent of New Zealander’s said that they try to buy NZ made products as often as possible with fresh produce being the most important locally sourced category. In fact, seven in ten Kiwis prefer to buy local produce over global. A similar portion of New Zealander’s also felt the same about buying meat, fruit, seafood, milk and yoghurt. And between 50 to 35 percent said that they prefer locally sourced products in the ice cream, cereal, confectionery and snack categories.
STOCKING NZ MADE
While high-end Auckland supermarket chain Farro Fresh probably has the most extensive range of New Zealand artisan products, major supermarket banner groups have been making an effort to stock more locally made products.
“We work with more than 1200 local Kiwi farmers and our first preference is always to buy locally wherever we can. It’s important to customers but we’re also incredibly fortunate here in New Zealand to have access to amazing fresh local fruit and veggies, dairy and meat,” said a spokesperson for Countdown.
As Foodstuffs stores are locally owned, it gives them an even greater opportunity to seek NZ made products. “Our stores are locally owned and operated, so we always strive to stock stores’ shelves with local products that are specific to local communities,” explained Phil Lemon, general manager merchandise, Foodstuffs South Island.
“It’s extremely advantageous for supermarkets to stock local products as we know consumers gravitate towards these. We actively seek out local products and are always looking to increase their numbers on our store shelves,” added Lemon.
As Kiwi’s continue to care more about where their products are coming from, supermarkets will continue to grow their local brand representation on shelf. Countdown is committing to stocking more NZ made products. The supermarket chain recently announced that 100 percent of its fresh pork would be locally free farmed and sourced from Canterbury while its wheat supply used in its bakeries would also be sourced within New Zealand.
THE CHALLENGES INVOLVED
While it’s great that supermarkets are acknowledging local producers, having large requests of products or demands from large retailers can sometimes be a challenger for small artisan producers.
Helene Mikloska from KiwiGarden believes that the company's biggest challenge is competing against more established brands with huge budgets when it comes to price promotions and in-store spending.
While other New Zealand artisan producers mentioned that having to represent themselves and their product in person can be a strain on a small independent company looking to get started in the industry. “The biggest challenge for us is being able to represent our product in person. As we are based in the far south, it is difficult to visit periodically with grocery managers who stock our product. It is important to us to have a great relationship with those retailers, receive feedback and give background information about our operation,” said Jo Daley from Kiwi Saffron.
Marleen Suy from Pete’s Natural also said that the expectation to meet in person was a challenge for a small business. “Some supermarkets expect a sales rep/merchandiser to stop by either weekly or bi-weekly. As a small company, we can’t afford to put a sales rep/merchandiser on the road to do that. Most of the merchandising companies require you to pay a monthly retainer and at this point that is way too expensive for us,” said Suy.
Stocking locally made products can also have its challenges for large retailers who want to support their community with inexperience being a significant factor. “New suppliers can sometimes be inexperienced in the grocery environment, and they may be unfamiliar with the process they have to go through to end up on store shelves,” explained Lemon (Foodstuffs). “But it’s imperative that we partner and help them as best we can. We work with our local suppliers to ensure they have successful product launches or are successfully reaching their target demographic in our stores.”
This year SupermarketNews launched the "Pitch Me" Foodstuffs NI initiative to great acclaim from both Foodstuffs and suppliers alike. "It gives me great heart that there are so many people creating something to genuinely inspire our customers,” commented Foodstuffs CEO Chris Quin. "Pitch Me" Foodstuffs 2019 is set to go ahead again next year with a new group of suppliers facing the dragons. Head to our website to register for your 2019 pack.
