Restricted budgets and decreased anxiety around coronavirus have led to a decline in convenience delivery usage from 2021 to 2022, a new study has found.
The Lumina Intelligence’s Convenience Delivery report has also found that price has become increasingly important to consumers, with a 7 per cent increase in its importance year-over-year.
However, the report highlights potential opportunities for convenience delivery providers. Seasonality is a key driver for convenience delivery, with colder weather expected to prompt an increase in usage. Spend per item saw a peak at Easter 2022, displaying additional opportunities around seasonality.
Overall, younger shoppers aged 18-24 are the key group to target, as they over-trade by 13 per cent compared to the total convenience market.
The report found that shoppers are most likely to use convenience delivery for ‘top up, meal occasions’, ‘treats’, ‘entertainment’, and ‘gifting’ missions.
Furthermore, shoppers who purchase in convenience via delivery spend the most on entertaining, with the largest over-trade for ‘top up’ and ‘treat’ missions. These missions are key to focus on to drive higher margins.
In terms of operator’s performance, Co-op is the leading retailer in the convenience delivery market, accounting for 39 per cent of occasions. The continued expansion of Co-op's delivery channel and partnerships with Deliveroo and Just Eat have led to its success throughout 2022.
Such collaborations between operators will be critical to boosting delivery volumes and opening new routes to the market, offering benefits such as access to a larger customer base and better service levels and enhanced shopper satisfaction, the report noted.
Most (70 per cent) of consumers are more likely to visit the high street after online retailers introduce return fees, shows a recent survey, indicating a shift in consumer buying habits.
According to the findings from consumer insights platform Vypr, 70 per cent of shoppers say they are now more likely to visit bricks and mortar stores rather than shop online due to the added costs of returning unwanted items.
The research highlights a growing dissatisfaction with the rise of online return fees, with 47 per cent of consumers stating they would avoid purchasing from retailers that charge for returns as they don’t believe their products are unique enough. A further 27 per cent said they would stop shopping with such retailers as a matter of principle.
While online shopping continues to be a dominant force, the research signals potential cracks in its convenience. Brands like Boohoo and ASOS, which have recently introduced return charges, may be particularly vulnerable as shoppers lack strong brand loyalty.
27 per cent of consumers said they think these retailers offer similar products to their competitors, making it easier to shop around for better deals. 53 per cent of those surveyed will be buying less from ASOS after the charges were introduced and 51 per cent shop less with Boohoo.
The growing frustration with online shopping is further exacerbated by issues with sizing and quality. According to Vypr’s survey, the most common reasons consumers return online purchases are due to items being smaller than expected (26 per cent), lower quality than anticipated (17 per cent), and larger-than-expected sizing (14 per cent).
Ben Davies, founder of Vypr, commented, “The rise in return charges reflects a broader shift in consumer sentiment. As confidence in online sizing and quality inconsistencies drops, many shoppers are reconsidering where they spend their money. One in 10 consumers say they typically order multiple sizes of the same item, knowing they’ll return some.
"Retailers must do more to improve size guides and product descriptions to help shoppers make better-informed decisions from the outset.
"As online shopping becomes more expensive and less distinct, it’s possible we could be witnessing a return to high street shopping — not only as a more reliable option but also as a more sustainable one, given the reduced packaging waste compared to online purchases.”
The research also reveals growing support for independent retailers, with 60 per cent of consumers now preferring to shop with smaller, independent brands over larger, fast-fashion retailers. Additionally, 64 per cent of respondents reported receiving better customer service from independents, compared to the experience with major online retailers.
World foods leader Surya Foods said it has acquired a major stake in leading health snack brand Karma Bites, as part of a series of moves to up its presence in the snacking arena.
Karma Bites produces a range of naturally flavoured, popped lotus seeds, a popular snack with a rich history in Chinese and Ayurvedic medicine - recognised as among the most nutrient dense seeds on the planet.
They have the moreish crunchiness of popcorn, and are packed full of protein and nutrients. The clean label range comes in five sweet and savoury flavours including: Himalayan pink salt, Peri-Peri, Wasabi, Caramel and Coconut & Vanilla. The range is also vegan, gluten free, non-GMO and free of refined sugars.
“My Grandma introduced me to the magic of popped lotus seeds. They have been a staple in my family for three generations, so I have experienced the benefits of these miracle seeds first-hand,” Karma Bites founder Ashwin Ahuja said.
“When I launched Karma Bites I was so excited to share them with the world and spread goodness! Working alongside Surya Foods, my aspiration is to take Karma Bites on the next big step of its journey - to scale up production, distribution, enter multiple markets and expand the range.”
“The superfood credentials of lotus seeds has helped the product take off in health conscious markets across Australia and the US (Los Angeles). The UK market generally follows these trends and there is a definite shift here in people understanding how their food choices impact their health,” Ahuja added.
Surya Foods plans to expand the brand with a swathe of NPD, to up its presence in the healthy snacking arena, and use the contemporary design of the brand to gain greater access to mainstream markets.
Surya Foods achieved an impressive 30 per cent increase in revenue last year and now supplies almost half of the UK’s branded dry rice supply across its leading UK Top 10 rice brands; Laila, Salaam and Mai Thai.
The food giant has also announced significant expansion plans at its Harwich site which will bring 200 additional new jobs to the Essex area over the next three years. It is on course to open a brand new custom-built, 40 acre head office/distribution centre, with 250,000 sq ft of storage facilities in Essex by 2026.
In 2020, Surya Foods made its first move into the snacking category, pouring £2m into a state of the art snack factory at its Harwich site. The factory currently produces snacks for its market leading brands including Laila, Thai Dragon and Kingstons, as well as offering private label services across a broad range of products.
Harry Dulai, group chief executive officer of Surya Foods, said: “We are pleased to have acquired a major stake in Karma Bites, which is a stylish contemporary brand with lots of mainstream potential. It aligns well with our plans to grow our snacking portfolio with several new launches in 2025. We continue to invest in the Harwich site to support our expansion plans and are committed to creating ‘better for you’ snacks, that have an improved nutritional profile.”
Keep ReadingShow less
Paški Sir PDO (Pag cheese), a sheep milk cheese from the Croatian island of Pag
The EU will remain a key resource for the UK food and beverage industry despite the challenges imposed by Brexit, according to new insights from UK industry supply chain professionals.
A survey carried out on behalf of the European Commission, which interviewed wholesalers, importers, producers and HORECA (Hotel, Restaurant and Catering) professionals across seven different food and beverage sectors, revealed that the majority will continue to import from the EU over the next 12 months.
Respondents from the wine and dairy/cheese sectors are 100 per cent committed to sourcing additional SKUs from the EU over the coming year, the data revealed. Whilst beer and spirits (80%), charcuterie and meat (80%) and bakery (70%) also showed a clear commitment to the EU.
In contrast, it is the confectionery and fruit & vegetable sectors which expressed the highest level of uncertainty or non-commitment. Both sectors only showed a 30 per cent commitment to sourcing additional SKUs from the EU in 2025, according to the data.
UK industry respondents cited quality (95%), pricing (81%), authenticity (78%) and sustainability (77%) as the most important factors that they consider when adding new SKUs to their product ranges. In parallel, authenticity and tradition were voted the most popular characteristics of EU food & beverage products (79% and 70%, respectively), whilst diversity (64%), good taste (62%), safety (59%), and high quality (54%) also ranked highly by those who were questioned.
When it comes to the wider merits of EU food and drink, more than two-thirds of respondents (66%) agreed that the EU’s Protected Designation of Origin (PDO), Protected Geographical Indication (PGI) and Organic labels are either ‘very important’ or ‘somewhat important’ when sourcing ingredients. Overall recognition of the three labels amongst the UK industry is high – around two-thirds know what they are and what they mean. The European Organic Products label is the most widely recognised (93%), while the PGI label is the least recognised of the labels, however recognition is still high (78%).
The research was conducted in April 2024 against the backdrop of the UK government’s Border Trading Operating Model, which set out a new approach to security controls with the aim of maintaining border security while minimising trade burdens.
“These insights demonstrate that despite the challenges and complexities of new cross-border trade agreements, the EU remains a valued partner and important resource for the UK’s food and drink industry and is likely to remain that way”, says Andrew Crumpton, founder of AMC Consulting and advisor to the ‘More Than Only Food & Drink’ campaign.
Veryan Bliss, managing director of Food Intelligence and fresh produce advisor to the EU’s ‘More Than Only Food & Drink’ campaign supports this view.
“It is clear that the relationship between the UK and EU is incredibly important. In 2023 the UK was the number one destination for EU agri-food, accounting for 22 per cent of exports and with a value of €51.3 billion,” Bliss said.
“The geographical diversity of the EU ensures a steady supply of seasonal produce and often complements the UK’s own growing patterns. When certain crops are out of season in the UK, EU producers support the offer, ensuring that UK retailers can offer a consistent, high-quality selection to consumers throughout the year.
“However responses from fruit and vegetable industry professionals highlight the impact of controls for fresh produce, which have been complex and changeable.”
“But with an easement on fresh produce checks now in place until July 2025 and confirmation that several fruit and vegetable products, which were previously deemed medium risk have now been changed to ‘low risk’, there is an increased potential for UK importers to benefit from the quality of organically and sustainably grown produce from the EU.”
Keep ReadingShow less
Vuse celebrates its position as the first global carbon neutral vape brand with a carbon neutral summer voyage down the Thames in 2021
British American Tobacco (BAT) has reported significant progress in its New Categories segment—comprising vapour, heated products, and modern oral—with strong growth in revenue and profitability during the second half of 2024.
In a trading update on Wednesday, the company said it is on track to deliver its 2024 financial year guidance, with the second-half performance acceleration driven by the phasing of New Categories innovation, the benefits of investment in US commercial actions and the unwind of wholesaler inventory movements.
BAT said its flagship vapour brand, Vuse, maintained its position as the global value share leader, achieving a 40.3 per cent share in key markets. Despite challenges posed by illicit single-use vapour products, particularly in the US and Canada, BAT said its investment in innovation and regulatory advocacy has positioned it well for future gains.
“Our Quality Growth imperative is delivering higher returns on more targeted investments across all three New Categories, and that prioritisation and focus is already transforming our business in Europe,” Tadeu Marroco, chief executive, said.
“We are making further progress increasing profitability across New Categories, and I am particularly pleased with the improvements in Heated Products and Modern Oral.”
BAT reinforced its leadership in the US, where Vuse captured 50.7 per cent value share in tracked channels, benefiting from stronger enforcement against illicit products in states like Louisiana. Globally, Vuse’s share remained stable, reflecting its strong brand equity.
Velo, BAT’s modern oral brand, demonstrated robust growth with its volume share in top markets rising to 28.2 per cent. Enhanced portfolio offerings, including new flavours and nicotine levels under Velo Plus, bolstered its momentum in the US and Europe.
Innovations such as glo Hyper Pro have shown promising results in improving BAT’s share in the heated tobacco market, particularly in Japan and Italy.
The company expects low-single figure organic constant currency revenue growth and low-single figure organic adjusted profit from operations growth in 2024. Marroco highlighted the company’s strategic pivot toward becoming a predominantly smokeless business by 2035, reiterating a commitment to sustainable value creation.
“Building on the strong foundations we have established, I am confident that we will deliver an improved underlying performance as we move from investment to deployment in 2025,” he said.
“We will continue to reward shareholders through strong cash returns, including our progressive dividend and sustainable share buy-back, and we remain committed to returning to our mid-term guidance of 3-5 per cent revenue and mid-single digit adjusted profit from operations growth on an organic constant currency basis by 2026.”
A 5p reduction in business rate multiplier will save convenience stores thousands of pounds per year which will help retailers invest in their businesses, ACS Government Relations Director Edward Woodall has said while giving evidence to a Committee of MPs in parliament today (11).
The Non-Domestic Rating (Multipliers and Private Schools) Bill intends to introduce higher business rates multipliers for the largest business properties (those over £500,000 in rateable value) and lower multipliers for retail and hospitality businesses. Following the Budget, the business rates discount for retail and hospitality businesses is reducing from 75 per cent to 40 per cent in April.
One of the considerations of the Bill is the level at which the new retail and hospitality multiplier could be set at. The small business multiplier is currently set at 49.9p, while the standard non-domestic rating multiplier is set is 54.6p.
During the evidence session, Woodall told the Bill Committee that to make a tangible difference to local shops and other businesses, the new multiplier should be set up to 20p lower than it is currently which would result in savings of thousands of pounds a year for essential retailers that could be put to use effectively.
ACS Government Relations Director Edward Woodall said, “The vast majority of convenience stores would benefit from the new retail and hospitality multiplier. For a retailer that sits just outside the threshold of small business rate relief at £15-16k rateable value, a 5p reduction in the multiplier would save them around £1,000 per year while a 20p reduction would save over £3,000 a year.
"This is a significant sum to help retailers invest in their business, either defensively on crime prevention and detection, or positively in their community.
"There are however thousands of stores that are dealing with increased costs in other areas of their business, particularly on employment, so for those businesses it is likely that the money saved on rates will go straight into keeping that store trading.”
ACS wrote to the Chancellor in advance of the evidence session outlining the costs that retailers are facing as a result of the measures outlined in the Budget. Overall, the convenience sector is looking at an increase in operating costs of around £666m, primarily in additional business rates, National Insurance contributions and National Living Wage increases.
During the evidence session, Woodall also highlighted the importance of discretionary rate relief for rural businesses, particularly those that are operating as the last local shop in that village or rural area.
Woodall said, “Reliefs for businesses that are trading in rural areas with communities that rely solely on them are extremely important, but it is challenging for the Bill to be able to address this effectively as there are often more differences within a region than there are between regions.
"We believe that the most effective relief for these businesses is distributed by local authorities, but we know that their budgets are extremely stretched, so it’s important that the Government looks at putting additional resources and trust in local authorities to deliver discretionary reliefs that support the last shop trading in rural areas.”