GS1 UK, the supply chain standards member organisation, said there has been a resurgence in small businesses producing heritage products.
The UK is seeing a resurgence of small businesses producing authentic, heritage products according to Buying British in 2017, a report from GS1.
GS1, which numbers 31,000 UK businesses in its membership, said Waitrose and Tesco had led the way in taking on more British suppliers.
It added that there had been a growth of niche firms, with a 20% pick-up in smaller businesses joining its books.
It said new GS1 membership data reflected current business and consumer trends. “It shows an uptick in more modest-sized new joiners compared to previous years, as consumers increasingly want their food, drink and clothing to demonstrate their local heritage and have fewer air miles.”
In 2016, 78% of new members had a turnover of £500,000 or less, compared to 58% of all members in 2015, demonstrating a strong shift towards smaller businesses.
Businesses in the food and groceries sector accounted for the largest single percentage (20%) of GS1 UK’s membership. The sector is also one of the fastest-growing, with 12% of new joiners in 2016 originating from the food and groceries sector as shoppers seek to buy British.
In terms of actively thinking about the provenance of food, 79% of consumers said it was a consideration (63% some of the time, 16% all the time) and just a fifth said they never thought about it.
Three-fifths of shoppers said place of origin was at least as important to them as other factors, such as price and quality, and 55% specifically said they preferred buying UK brands to support British businesses (citing reasons, such as increased trustworthiness and being more attuned to needs and tastes).
Online sales surge
GS1 data also revealed the most popular sales channel for members was online via their own websites, with 71% doing this. Following closely behind were online marketplaces, such as Amazon and eBay, with just over two-thirds (67%) using such platforms that allowed them greater scale and visibility than they could achieve under their own steam.
Reflecting the trend towards more smaller local companies, only a third (35%) used wholesale or distribution channels, and just a quarter (26%) used other retail stores (i.e. not their own premises).
Of the major supermarkets, Tesco, as the largest retailer, afforded the most opportunities to GS1’s new joiners over the past five years (33%). However, Britain’s seventh-largest supermarket Waitrose sat in second place – defying its 5.3% market share – by providing opportunities to 18% of GS1’s new joiners.
Gary Lynch, CEO at GS1 UK, said: “Buying British is back in vogue. And smaller companies are driving this trend. Brits love an underdog story and this affinity to the unlikely hero isn’t limited to the sporting arena, with shoppers being just as likely to back the small guy at the checkout.
“Heritage, provenance and traceability are no longer nice-to-haves but increasingly important factors that can make the difference between where consumers choose to spend their money.
“While there will always be some products and services we’re happy to go to major multinationals for, supporting the local start-up is back on the agenda.”