Food and Drink Links: Food and Drink Industry Food and Drink Recruitment   Recruitment case study Food Manufacturing Food and Drink Associations

Food and Drink (Food and Beverage) Industry

• The food and drink manufacturing industry is one of the two largest manufacturing sectors in the UK, with gross output of £65.7bn, accounting for 13.8% of the total manufacturing sector.

• The Food and Drink (Food and Beverage) Industry employs some 500,000 people. This represents 12.9% of the manufacturing workforce of the UK

• Total exports in 2001 for food and drink came to £8.5bn of which 60.6% went to EU members.
  Retail food prices rose by 3.3% between 2000 and 2001. Within all food the annual index for non-seasonal food rose by 1.9%.

• Food and drink remains the biggest spending category . In 2001 consumers expenditure on food and drink came to nearly £132.7 bn, representing 21.4% of total customers expenditure.

• In 2000-2001 the average gross weekly household income was £503 and the average weekly expenditure by households was £386 of which £77 was on food and drink.

• There are some 7,880 food and drink businesses in the UK.

• The industry buys two-thirds of all UK’s agricultural produce.

Source – Food and Drink Federation
 

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Week 33 – numbers of workers in each industry code

• Engineering – 22.28%
• Food – 11.68%
• FMCG – 10.94%
• Pharmaceutical – 8.92%
• Chemical – 5.30%
• Automotive – 4.83%

Food and Drink Links: Food and Drink Industry Food and Drink Recruitment   Recruitment case study Food Manufacturing Food and Drink Associations

Food Production - Where?

• Two main areas of food production in the UK – Scotland and North West of England

• Scotland – annual sales of £4.2 bn (excluding whisky)

• The Scottish Food Industry employs 59,300 people. 11.8% of all manufacturing employees.

Source – Scottish Food & Drink Federation

Food Industry - The North West

• North West Development Agency have made Food an area of strategic importance

• North West Agri-Food Sector Scoping Study by Pieda Consulting undertaken September 2000

• Far reaching study highlighting challenges facing the Food Industry in the North West of England

Food and Drink Links: Food and Drink Industry Food and Drink Recruitment   Recruitment case study Food Manufacturing Food and Drink Associations

Key Characteristics of the North West Food Industry

• Largest number of food units in the UK (after Scotland)

• More small firms (SME’s) than anywhere else in the UK

• Many of the biggest names in the sector are in the North West

• A few key “star players” are here

• Strong historical features to the fore (Liverpool point of entry to the UK, Manchester Ship Canal “corridor”)

• Basic commodity foods – milk, beer, bread and so on

• Relatively little added value

• Most, if not all, are under constant pressure from customer base

• Under capacity in some areas

• Good intentions often tempered by commercial reality

Summary of key themes

• Polarisation of the agri producing sector – commodities (tea, sugar, bread) and added value products (convenience foods – microwave meals and so on)

• Polarisation of the consumer base

• Growth of food service (pub food)

• Not just quantity of linkages, but the quality of them

• Role of NWDA and NWFA to educate, cajole, inform and persuade

Food and Drink Links: Food and Drink Industry Food and Drink Recruitment   Recruitment case study Food Manufacturing Food and Drink Associations

What can the North West food industry expect in the future?

• Farm base under pressure

• More consolidation in the manufacturing sector

• Better supply chain relationships (will take time)

• Dedicated and more specialised food plants

• More use of technology

• More food service
  No less pressure from customer base, including factory gate pricing

• The “inefficient” will be ruthlessly taken out

• Some of the leading players will exit the region

Further Findings

• Source of raw materials, customer base, pressure of exchange rates mean that -

• Companies are unlikely to relocate in the UK (point of entry is now South coast)

• What will keep food companies in the North West – local ties and history, 6 million consumers, good infrastructure, labour force, NWDA support, the “devil you know” syndrome, quality of life for Middle / Senior Management

NWDA Objective

• To increase the GDP of the regions food sector from £9.5 billion to £10.5 billion over the next 5 years

Food and Drink Links: Food and Drink Industry Food and Drink Recruitment   Recruitment case study Food Manufacturing Food and Drink Associations

North West Food Alliance

• Formed in 1999 as representative body of Agri-food and Drink Industry in the North West

• Funded via Europe by NWDA

• Three main objectives –

• Develop world class clusters of businesses, which offer outstanding employment and growth potential

• Pursue business excellence in existing business

• Accelerate new business development

Food and Drink Links: Food and Drink Industry Food and Drink Recruitment   Recruitment case study Food Manufacturing Food and Drink Associations

Summary

• Food is a key market for us

• Recession proof – will not move overseas
  But may reposition within the UK – to the South of England

• Industry in a period of change

• Supply chains being examined

• Market polarising

• Support from government bodies such as NWDA

• Companies clustering for survival

• Synergy with our business goals

• Growth of networking groups such as NWFA assist our approach
  
  
  
  
  

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