Bananas from the snack dispenser, peeled oranges in see-through boxes, juicy melon cubes in a cup, or salad ā la chef in plastic trays: “vitamins to go”, instead of carbohydrates – fast food is certainly “in”. Convenience food is an extremely fast-growing market. And it’s not just single people who are increasingly interested in ready-to-use products – examples of which include prepared salad in bags, chopped carrot sticks for a healthy snack, fruit salad with melon, or sandwiches ready for eating in the office. This healthy fast food has fans from all age groups and social groupings. For food and drink consumption patterns are becoming less and less likely to follow clearly-defined paths: they are becoming more flexible and individual due to the broad variety of attitudes and lifestyles. But one underlying trend is clear: most people are interested in living, and eating, more healthily. This means that supermarkets must offer fresh fruit and vegetables of consistently high quality throughout the year. At the same time, people don’t want to spend much time preparing their food.
“Contrary to all expectations, the convenience food sector has proved itself largely immune to the latest crisis in the world economy,” says Hans Renia, a Produce Chain specialist who covers the Netherlands and Germany for Nunhems, the vegetable seed business of Bayer CropScience. In the United States, the market for so-called “fresh-cut products” even grew by five per cent in 2009, despite the economic downturn. Convenience food may be more expensive than buying the raw ingredients for a meal individually, but it’s still cheaper than eating in a restaurant. And the recent recession has led many people to reduce the number of occasions on which they eat out, making them stay at home instead to enjoy a meal with family and friends. “The convenience food sector contributes the major elements of these meals,” says Renia. Although restaurants tend to rely increasingly on fresh produce, the real growth market nowadays is in the retail sector. Moreover, private consumers are willing to pay a higher premium for ready-made ingredients. The range of products is growing: “Many older and more established brands – but also many new companies – are looking to achieve competitive advantage and higher profit margins through innovation,” says Renia.
The number of consumers eating convenience food at least once a week continues to climb rapidly. According to a study by Rabobank, the fresh produce industry in the EU is expected to achieve an annual growth rate of at least four percent over the coming years. The Asian market for convenience foods is growing at an even greater speed: the annual rate of increase exceeds ten percent in many Asian countries. “The wealthy middle class is expanding rapidly. Not only do these people have little time, they are also very open to new ideas – good preconditions for convenience products,” says Renia. And the emerging countries of Eastern Europe are also discovering the advantages of fresh finished products. However, it is very difficult to obtain reliable statistics on market size: inconsistent use of definitions, the dynamics of growth, and varying regional structures make this almost impossible. In the EU for example, ready-to-eat salads represent half of the fresh produce market; in a more mature market such as the U.S., the corresponding figure is only seven percent. The US market is also much more strongly focused: 82 percent of sales for pre-packed salads is shared by five fresh products manufacturers. In Europe and Asia, market share is more fine-grained: “There are many more participants in the market, and thus a predominance of smaller players,” says Renia.
Listening carefully to the customer
A major center of innovation for convenience foods is the West coast of the United States. “Many new product ideas are being generated in California that then spread to the rest of the country. In Europe, the United Kingdom is leading the way in fresh-cut products from the refrigerated counter. Here, pre-packaged sandwiches and salads to go are very much in fashion. And in the area of fresh-fruit salads, pre-cut portions are becoming ever more popular. In many countries, you can find them everywhere these days,” says Thomas Gruenewald, Head of Product Area for fresh and frozen articles at Lekkerland, a European full-service specialist company for all strategic convenience food distribution channels. For example, Lekkerland supplies fresh sandwiches and ready-mixed leafy salads to gas station shops, grocery stores, bakeries, canteens and convenience stores.
Gruenewald lists some of the important demands made of his convenience retail partners, “Standardized procedures are very important for maintaining a consistently high level of product quality. For us, it is critical not only that our partners work professionally: they also need to support this fact through certification. Sourcing fresh salads or sliced tomatoes is particularly highly demanding in terms of manufacturing and logistics.” Vegetables must be easily transported and capable of storage. And they actually continue to live on after harvest: valuable constituents are broken down and loss of quality can occur through fungal growth. For the trade and logistics companies, this means a race against time. For Lekkerland’s convenience food experts, the refrigeration chain is a key element: it must function seamlessly, starting with the harvest, via processing, and through to sale in gas stations, supermarkets or snack bars. Proper cooling is achieved at between two and seven degrees Celsius. At storage temperatures higher than seven degrees Celsius, there is a much greater possibility that a lot of fresh produce starts to deteriorate. The industry calculates, for example, that each hour of interruption reduces the shelf life of prepared salads by about a day.
Innovation drivers in the area of convenience foods can be found in nearly all of the participating branches: from seed producers to processing plants and from machinery manufacturers to packaging designers. But it’s fruit and vegetable breeding in particular that’s occupying a central role in satisfying the growing demand for convenience food: “For us, innovation starts with the seed. In that regard, we work effectively with all representatives involved in the convenience market, including food processors, catering companies and retailers, “says Daniel Kretzschmar, Nunhems Produce Chain Manager for Europe, Middle East and Africa. The breeders therefore always listen closely to the consumer: sweet cherry tomatoes should disappear in a single mouthful, and heart-shaped tomatoes are considered a popular party gimmick. New varieties tend to be the result of a ten-year process of crossing and selection.
Special varieties required
Large food chain players usually have specific requirements of raw commodities for convenience foods. And these often differ from the requirements consumers have for fresh fruit. Take melons and watermelons for example: processors tend to prefer larger fruits for making fruit salads than most consumers do, because the recovery rate is much higher with larger fruits. A German food retailer stipulates strict cultivation conditions to suppliers of its salad vegetables, peppers and grapes. The basis for this is the standard Global GAP (Good Agricultural Practice). But on top of this, this retailer tolerates only a certain percent of the legally-permitted maximum residue limits of crop protection products, and controls this through systematic, intensive monitoring that involves frequent quality checks, starting in the field and continuing right into the retail trade. And this retailer only accepts from its suppliers specific varieties of lettuce that are capable of good processing. After cutting, the lettuces are immediately washed in ice water, so that the cut surfaces quickly close over and the products are made more durable.
“We strive to obtain a good insight into the complex production process. That helps us to learn a lot about individual processing procedures and current consumer trends. This, in turn, helps us to develop varieties that start new trends in the industry,” says Kretzschmar, describing the Nunhems approach. For example, it is essential that processing plants can obtain a steady supply of fresh, raw products throughout the year. This is why a processor might use varieties from different growing regions: the consumer may not notice the difference. Depending on the season, fresh-product companies based in the Benelux countries might process Nunhems melon varieties that have been grown in Spain, Senegal, Brazil or Central America. Having a uniform product is particularly important when fruit and vegetables are processed automatically: for example, the machines that cut watermelons and honeydew melons into bite-sized cubes for pre-packaged fruit salads only work well for a particular size and shape of fruit. This requires special varieties that can be grown to the same quality standard in different countries,” explains Kretzschmar.
Optimizing industrial processing
Besides the current trend towards ready-portioned fruit salads, there’s a convenience food classic that is still selling extremely well: the sandwich. And it doesn’t matter whether the filling is chicken breast, ham or salami – tomatoes, cucumber and lettuce leaves must always be added. But “sandwiches are a major challenge for the food processing industry,” points out Kretzschmar, because “simply everything has to be right. The ingredients have to be easy to handle and available all year round. They must arrive in a ripe and easily-processed condition, and must match the other ingredients in the sandwich. They should not make the bread go soggy; they must look fresh and have a pleasant, sweet taste - and of course, they must be inexpensive. “
This is why researchers and breeders at Nunhems have developed a range of varieties specifically for the convenience food industry. The IntenseŽ tomato simplifies tomato processing, especially for hotels, restaurants and catering companies. And Veronica Castaneda Muņoz, a nutrition scientist from Mexico, is enthusiastic about her encounter with Intense: “One bite was enough to convince me. There was no squirting, and it tasted wonderful.” The special feature of the tomato is its dense structure. The juice is retained even under pressure, so that the fruits can be cut into very thin slices. “This makes it ideal for sandwiches, which would otherwise be completely soggy after only a few hours,” says the Mexican lady, who has worked for two years now at her father’s market garden in Camalu, and manages some 83 hectares of tomato plantations. “The fact that the tomato doesn’t lose any juice is a big benefit for food safety, as bacteria can develop rapidly in liquids” says Kretzschmar.
The manufacturers of processing machines also play an important part in the value chain, because “the growing convenience food market can only be satisfied through optimal industrial processing,” explains Stephan Zillgith, Managing Director of Kronen Nahrungsmitteltechnik (Food Technology) GmbH, a machine producer that has specialized in processing equipment and is present in all of the major markets. Their machines chop, cut or slice up to 2,000 kilograms of fresh produce an hour: cabbage heads are chopped into strips for salads; carrots are peeled and cut automatically into thumb-length pieces. And crisp apples are turned into bite-sized morsels.
Zillgith’s most important customers include companies in the U.S., Britain and the rest of the EU. But he also observes growth in convenience food in the Middle East, because demand for processing machines is increasing in the region. “You see more and more finished products in airports, hotels and tourist centers.” And even in countries with relatively low wage levels, such as Thailand, producers of convenience foods are keen on technology – using it to cut the very popular pineapple into bite-size pieces. “Machines can be sterilized, whereas people can introduce contaminating germs, thus reducing the shelf-life considerably, “explains Zillgith. He has also supplied machines to Turkey for de-stoning apricots, and even the traditional strawberries served at Wimbledon have their stalks removed by Kronen machines before being filled with vanilla sauce.
Innovative convenience food marketing
Large retail chains such as Del Monte are also constantly looking for innovative ways of introducing new convenience products in the market. For example, the company has worked with its partners to develop a concept for the sale of individual bananas from snack (vending) machines: they also offer grapes, pineapple chunks, apple slices, baby carrots, celery sticks and grape tomatoes too. “We are responding to the demand for healthy food in new situations by offering fresh products in places such as schools, universities and theaters,“ explains Dennis Christou, Marketing Vice-President, speaking during the “Fresh Connex 2011” exhibition in Berlin. Christou – who is always on the lookout for new distribution channels – also sees a growing demand and great growth potential for convenience foods in other major markets in Europe and the Middle East.
The successful introduction of new convenience products requires not only novel ideas for products, but also accurate knowledge of the requirements and needs of all market participants. Bayer CropScience’s experts therefore try to establish close links with, and between, growers, consultants, processors, food wholesalers, importers, exporters, retailers and catering specialists, in order to achieve a better understanding of the demands of consumers and the industry. “Consumers around the world have become more demanding in terms of the quality of fruits and vegetables. They want to know where, and how, their food was grown, “explains Dr. Birgitt Walz-Tylla, Head of Bayer CropScience’s Food Chain Partnership team. This program benefits consumers as much as it does transporters, distributors, food distributors and farmers around the world: “We launched the Food Chain Partnership concept in order to provide benefits for each link in the food chain, “says Walz-Tylla. In addition, Bayer CropScience also supports fruit and vegetable growers to market their products at the international level.
Traceability, sustainability and food safety
“But it’s also important that farmers adapt their farming practices and production methods to meet the needs of the convenience food industry,” emphasizes the Nunhems expert Renia. This particularly applies to issues such as traceability, sustainability and food safety: “And it’s paying off for farmers and plantation owners, particularly in the convenience food area, because pre-prepared fresh products have a much higher value than unprocessed foods, frozen or canned foods. Moreover, profit margins are considerably higher in the fresh products sector. The growing convenience segment therefore presents a huge opportunity for fruit and vegetable growers around the world: “For companies that produce ready-made fresh products, reliable partners – those who can supply over the long term – are essential,” says Renia.
