coconut water

For a master class in how to create value in food & drink, look no further than coconut water.

With UK sales now past the £100m mark, the sector has grown from little-known niche to mainstream contender in a matter of a few short years.

The fact a lot of coconut water is a by-product, previously chucked away, only enhances its value creation props (though, as we set out in our major feature on the sector, that’s only half the story). But rapid growth has also created vulnerabilities, grey areas and bandwagon jumpers. Standardisation has become an urgent priority - no easy feat in a market where 40+ different brands are on sale in the UK alone. Labelling is a minefield, testing procedures are complex and costly, and undeclared added sugar is cited by many suppliers as a growing concern.

There is, however, encouraging work taking place to clamp down on standards and ensure a level playing field for all. Brands will be at the coalface of these efforts, but they need allies. And there is no greater, more powerful ally in this situation than an engaged, well-informed retail buyer. This isn’t just true of a young market like coconut water, but every sector. Time and again, brands tell us alert buyers who ask smart questions about supply chains, standards and quality checks make a real difference. And, by contrast, how disheartening it is when the only question that gets any attention is price.

Price is important, of course. Consumers expect great value. But that’s so much more than price - it’s also about great values. Crucially, it’s about having the right structures and organisational culture in place. Retailers have a responsibility to ask tough questions of the products on their shelves - be it brands or own label - and that means buyers need breathing space to explore their categories beyond immediate, narrow commercial concerns. There may be good reasons to stop them from becoming overly attached to a particular set of suppliers, but there must be better solutions to this than constantly shuffling buyers from category to category.

Buyers need to be able to leverage true category expertise. Long-term sustainable growth depends on it.

Topics