4 years ago

The Partnership no. 10

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Growing welfare

Growing welfare determines course of product development Value creation under the influence of global trends Global welfare is steadily increasing. Many wealthy consumers are open to new foods with a high added value, including numerous non-traditional vegetables. Other developments are also leading to further differentiation of the demand. Enza Zaden responds to all this at a very early stage by developing varieties with specific characteristics. Successful introductions are spreading across the world faster and faster. This is aptly illustrated by sweet peppers. The rate of economic growth may have decreased somewhat in the past few years, but worldwide the economy is still increasing. What’s more, ever more regions in areas such as Asia and Central and South America are becoming prosperous, and this is good news. Increasing welfare tends to go hand in hand with certain trends that have a major impact on society and our consumption patterns. Examples of such trends are changes in the composition of families resulting in a larger number of small households, ageing of the population, better access to (higher) education, greater mobility and increasing cross-border traffic, more leisure time and a growing demand for (healthy) convenience products. More frequent travelling and wider access to mass media such as film, television, glossy magazines and the Internet meanwhile more often and more intensively bring us into contact with other cultures, many of which have different eating habits. Another influential factor in this respect is labour migration. The outcome of all this is that the diet of the prosperous part of the global population has become more varied than ever before. Fast spread of products Another seemingly unstoppable development is the globalisation of trade and industry, which has now also reached retail level, as can be inferred from the international expansion of for example supermarket chains in the past 25 years. These supply-and-demand-related megatrends cause products that appeal to the trends to spread across the world at a tremendous pace. They may be totally new products, or products that have long been popular in a certain culture and then suddenly start to appeal to a wider public. Initially, the products concerned tend to be exclusive luxury articles that are imported by plane and cost quite a bit, so ideal for prosperous world citizens who want to impress with their cosmopolitan outlook. But the step to wider availability, local production and lower prices is only small, and is often quickly taken. Also in fresh food Numerous examples of these developments can be given in the field of food, for instance dim sum from China, sushi from Japan and tapas from Spain. In their countries of origin they are all everyday, very affordable (and therefore popular) dishes with a marked identity of their own. When they were introduced to other parts of the world they were almost all expensive, luxury snacks with which trendy, wealthy consumers could indulge and distinguish themselves. And nowadays they are widely available in almost any metropolis, and often elsewhere too, at both restaurants and supermarkets. We see something similar taking place in fresh vegetables. The mini plum tomatoes that we have recently got to sample, and now greatly appreciate as snack tomatoes in Europe and North America, actually originated in Japan and Taiwan, where they are much less exclusive. Another group of products that has rapidly become very popular on an international level is that of babyleaf vegetables. Originally introduced in the USA, they are now grown all over the world where conditions allow their cultivation. Important role of seed companies It goes without saying that breeding companies play a crucial part in the development and distribution of new, popular vegetable varieties. Modern vegetable breeding has widely branched all over the world, in particular from the Netherlands, where many of such breeding companies were first established and have flourished in the past century. A crop that most clearly illustrates this is sweet pepper. In the 1960s the first grassy, bitter sweet peppers grown in southern Europe began to be sold in small numbers on the rest of the continent. They were eaten almost exclusively by wealthy consumers, often at high-end restaurants. The seed industry of Northwestern Europe started to experiment with these products and ultimately arrived at the sweet, shiny, blocky fruits that appealed to a larger group of consumers. Local (Dutch) production gradually increased, broadening the range with different colours, and the most successful varieties were then exported all over the world. At first it was primarily all about the fruits themselves, which were very rare, or even totally unavailable elsewhere. The peppers were exported to e.g. Canada, Korea, the USA, Japan, Hong Kong, Singapore and the Arabian Peninsula. There, the sweet bell peppers were initially a novelty and a niche product until they started to be grown locally. Now seed companies have taken over the baton and supply the seed concerned to local growers. Growers in Canada and Mexico nowadays produce plenty of blocky sweet peppers for the USA. Korea, New Zealand and the Netherlands export this fruit vegetable to Japan, but it is starting to be grown there, too. Sweet bells for China This development may very well repeat itself in China. After years of expansive economic growth and urbanisation the rapidly growing group of urban professionals has more money to spend. During holidays in Europe and America the Chinese have become acquainted with the uniform, shiny, juicy, ripe blocky sweet peppers that are offered for sale there. After two years of intensive planning, during which various phytosanitary difficulties had to be solved, the first sweet peppers are being flown from the Netherlands to China this summer. Although this is a small-scale test lasting for only two weeks, all the Dutch parties involved are confident that export will be resumed with larger volumes on a structural basis next year, and that the peppers will acquire a permanent place on wholesale markets and in supermarkets in the large cities. Marketing 18 | The Partnership The Partnership | 19

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