8 November 2011

3 minute read

Speaking at the annual Eblex conference, Mr Phelps said that the price increase, to near 330 pence per kg deadweight, had been welcomed by the industry.

However an increase in price does not mean an increase in profits, he said. Instead producers should focus on margins - and how to improve them.

"A few changes can add a lot of value to a business."

Mr Phelps highlighted that research through Eblex suggests that for many consumers price has become higher on the agenda.

"Consumers and their concerns are what producers must take into account - as this is one sure way to improve our returns."

A number of new discount retailers have come from the EU, into the UK over the last five years, he said. And the growth they have had is staggering - especially in the current economic climate.

Many retailers are offering different types of products to the consumer - but the important thing to remember he said - is that all products must offer value for money to the customer.

Organic, premium, standard and value products are all available on supermarket shelves.

However despite the majority of consumers worried about price and the increased success of discount stores, some consumers are not concerned by the financial climate.

"We have seen Waitrose perform well over the last few years - showing that some customers will remain loyal to a brand and are willing to pay more for a point of difference."

There has been growth in the top and bottom end of the market, Mr Phelps said.

Growth has slowed down across all proteins, he highlighted that the domestic lamb market had seriously underperformed over the last year.

As suppliers we must focus on what products we put through the supply chain, to ensure that we do not lose market share.

Mr Phelps said that this was a huge opportunity, and challenged the industry to become more involved with consumers to find out what they want.

"Innovation is the key for a long term strategy. We must find ways to use the carcase more effectively, use different cuts to launch new products etc.

"We need to excite the consumer," he said.

"Consistency can be done and must be done throughout the supply chain. If we are consistent at the start - we will be consistent at the end."

Age profiles of herds are increasing and a huge difference in quality can be seen. He said we need to produce a product that will encourage consumers to come back and buy it again.

"We must keep consumers positive about red meat.

"As producers, processors and industry players we must never stop going out there and promoting high quality British beef."

November 2011