Best of British

Bowler hats, a stiff upper lip and rain at Wimbledon – some things are quintessentially British. But there are other, less traditional facets that also make up the British character – creativity, innovation, an openness to new ideas, an appreciation of eccentricity and a reputation for premium quality. And these are helping increasing numbers of British food and drink brands to fly the flag overseas.

UK food and drink exports are booming, according to export consultants Food from Britain. They have had a third straight record year and, by the end of 2008, are expected to have topped £13bn. By June, exports of alcoholic drinks, the largest category, had already jumped 17.5% year-on-year to £1.5bn; meat and dairy have recovered from the effects of BSE and foot and mouth; and dairy exports have shot up 18.8% to £482m.

There’s no doubt exports have been boosted by the weakened pound, which makes British products more affordable for overseas markets. Increasing price pressure from UK retailers has also played a part, by encouraging suppliers to seek higher margins abroad. Few companies could survive on exports alone but for many, overseas markets are now proving more profitable than the domestic market.

However, the single-biggest reason for the export boom, believes Chris Brockman, FFB head of research and consultancy, is the amazing reputation of UK suppliers. “Even with the exchange rate differences stripped out, exports would still be up,” he says. “Consumers – even in this country – may view British food stereotypically but the trade knows different. Our reputation is rising and the quality ethos is rising, too. The UK truly outpunches its weight on an international scale.”

Much of this success is down to suppliers pioneering new categories or trends and new players entering the market, says Brockman. “In the 1990s, we were too reliant on meat but we have diversified and now that meat is coming back up, it is just adding weight,” he says. “We have a strong reputation that should not be underestimated. The UK leads the world in some of the grocery trade’s most vibrant sectors, particularly chilled and convenience foods, which raises the profile of British suppliers. European buyers come here to see what’s going on.”

Besides this sea change in perceptions internationally, the definition of what constitutes a ‘British’ brand or company is also evolving. Heritage, quality, provenance, domestic popularity and cultural references are among the many factors that can come into play these days. As a result, the roll call of best of British now extends far beyond British beef, Scottish salmon and Welsh lamb to Tetley, Hovis and Marmite, not to mention newer brands such as Innocent Drinks and Kettle Chips.

Britain’s multicultural heritage has added another dimension. With chicken tikka masala arguably the national dish, major players such as Patak’s, Sharwood’s and Geeta’s are leading the charge for British-created ‘ethnic’ foods, with smaller players such as Mumtaz and The British Curry Company bringing up the rear. As the range of British products available increases, so does the number of potential markets, each of which has distinct needs and demands.

The global expat market tends to be the focus for older, more traditional products. One in 10 British citizens lives overseas – including semi-permanent residents – according to the Institute of Public Policy, and these consumers want to eat and drink the trusted British brands they’ve grown up with. Marmite, Branston, Bisto, Oxo and Baxters go down well with this group, particularly in Spain, France and the Antipodes. British expats in the US, meanwhile, go out of their way to buy imported Heinz Beanz, which though produced by a US company are made to a completely different recipe from their American counterparts.

The market for products perceived as distinctively British, such as whisky, beef and lamb and seafood, also continues to go from strength to strength. Whisky exports reached an historic high of £2.8bn last year, generating the equivalent of £90 a second. The Chinese love it and the Russians are catching on fast. Meanwhile, the French, who already love British lamb, have begun to take to the UK’s regional cheeses, Canada relishes British tea and Ireland can’t get enough of our biscuits, bread and cakes. Indeed, overseas consumers like some products even more than British consumers do. We export more langoustines to Spain than we eat here, for example.

The third most significant market is for innovative new products that reflect modern Britishness. This is where smaller, more flexible companies tend to thrive. Think Tyrrells, Feelgood Drinks and Dorset Cereals, which have taken their expertise in snacks, soft drinks and breakfast cereals across the globe. Big can be beautiful too. Greencore’s might, for instance, has helped it expand to the US, as more countries look to harness UK skills in chilled and prepared foods.

Brockman singles out healthier, free-from, organic and functional as the fastest-growing categories. He flags up Linwoods, a Northern Irish dairy, bakery and health foods supplier, which started exporting its seed and superfruit snacks this year, as a star performer in the functional arena. UK suppliers are becoming increasingly confident, too. Gü Chocolate Puds, winner of Food from Britain’s overall Food and Drink Export Award 2008, has been wowing our Gallic neighbours by taking French-style desserts to patisserie’s homeland.

“They are proof that export success doesn’t necessarily require years of experience,” says John Adams, FFB’s chief executive. “You need to do your research, establish your strategy and stick to it.” Research and strategy are only two of the keys to success, though. Commitment and investment are also important. “Companies need to look at the export market as a long-term opportunity, not a short-term fling,” says Brockman. “They have to manage accounts like they would for the UK and give them the same investment as for, say, Tesco or Sainsbury's. Research, development and promotion all have to be done properly. It takes a lot of time and effort to get into export but the hardest challenge is to keep on top of what’s going on in each market. We advise trying one market at a time to get a handle on what’s going on.” While established markets are healthy – sales to Ireland, the UK’s biggest export market, were up 12.4% year-on-year in value by June, and those to the Netherlands were up a whopping 35% – there are plenty of emerging markets to consider. Western Europe accounts for more than two thirds of sales but Brockman points to Russia, the Gulf States and Central and Eastern Europe as important for the future.

“There is rising wealth and that has an effect on import demands, particularly for premium lines,” says Brockman. “Russia is now the UK’s 16th-biggest market, while Poland is 17th. A few years ago, they would barely have featured.”

Volatile global economic conditions are also having an impact. “We are starting to see the effects of recession in Europe,” says Jeremy Filmer, general manager, marketing operations at export management company Tudor Rose. “Fewer Brits are likely to take holidays next year, which will also affect sales. However, selling to the dollar-based market in the Caribbean and the US is easier and growth is good in Africa and the Middle East.”

As this year’s export figures show, the financial crisis presents as many opportunities as threats to British exporters. Read the markets right and there shouldn’t be any need for stiff upper lips just yet.