Buyers across the industry expect their businesses to increase the amount of both food and non-food they source overseas in response to rising competitive pressures.
Nearly two-thirds of buyers on The Grocer’s Reader Panel said they thought their firms would increase sourcing from overseas while 55% expected to search more for overseas suppliers in their own category. “We are looking to develop closer trading links with lower cost areas such as China,” was the response from one buyer.
Another said: “As buyers start to investigate the total costs of goods, many items are now being purchased direct from the primary manufacturer. Many of these are overseas.”
The responses come two weeks after Sainsbury group chief executive Sir Peter Davis addressed a conference marking the second anniversary of the Curry Report.
He warned that increased competition would lead to more food commodities being sourced overseas and competitive pressures could overshadow issues such as health and sustainability, a sentiment with which 40% of buyers agreed.
“It depends on the reaction to the Safeway takeover by the trade,” said one buyer.
Another said this would be the case among the big four multiples but “that will leave opportunities for other retailers to focus on health and sustainability”.
One buyer added: “I think that customers will eventually get bored of the value message and become more engaged in other issues.”
The buyers were unanimous in their view that the value of buying British should be better communicated. One said: “We also need better labelling so it is is more clearly identifiable that a lot of cheaper products are not from Britain.”