Food manufacturing industries

Food manufacturing industries

I Food manufacturing industries

While many food retailers have, so far, remained predominantly national in their ownership and direction, many companies on the food-manufacturing side of the food industry have become increasingly multinational.

Although there are a large number of different food manufacturers, with many small and medium enterprises (SMES) also supplying the big firms, there has been an increasing tendency towards concentration of food manufacturing into relatively few large-scale multinational companies, operating in many different countries. The 100 largest food companies in the world account for one quarter of the output of food products. Of those 100 largest companies, some 40 are European, with 35 from the United States, 13 from Japan, and only 12 from the rest of the world. In the top three, two of the largest food companies are European, one of which is British-Dutch owned, and the other Swiss, and these two companies dominate the world ice cream market. The third company is US owned, and is the world’s largest coffee processing company. The majority of large food companies in the European Union are British, with some major French companies.

There has been increasing interest in “fair trade”, where raw material producers receive a better price for good quality ingredients, and these larger companies are beginning to sell fair-trade food products.

 Food manufacturing industries
Food manufacturing industries

II Food retailers

The big change in food-buying habits over the past quarter of a century has been the rapid growth of large supermarkets run by large food-retailing organizations. These sell well-known food brands, or own-label products made to their specifications by the extensive food industry manufacturing sector which supplies them.

Originally, people grew much of their own food, and supplemented this with purchases at local markets. They came increasingly to rely on purchases from village shops. Such shops were usually a mix of specialists, such as a baker, butcher, dairy, greengrocer, and general grocer. The multiple grocer, selling many different types of food product, became increasingly successful, and some, with origins going back a hundred years, have developed into today’s large retailers.

In many developed countries, a few large food retail organizations have increasingly managed to dominate our food purchases. In some countries, for example the Netherlands, many food stores are still situated in towns and cities, and people shop frequently, often using bicycles. In the United Kingdom, some new city-centre stores have proved successful. However, in the United Kingdom the top four retailers, who now control more than two thirds of our food purchases, have built ever-larger supermarkets, often towards the edges of towns or at out-of-town locations that are readily accessed by car, with plentiful car-parking facilities. Such large superstores sell the complete range of foods, from fresh fruit and vegetables to a wide range of convenient ready-to-eat meals, with perhaps as many as 20,000 different food products in one store. Concentration of the retail food market is even more pronounced in other European countries, with the top three food retailers controlling 95 per cent of food purchases in Sweden, 86 per cent in Norway, 80 per cent in Switzerland, and 75 per cent in Finland; this contrasts with only 17 per cent in the United States, although the US does host the world’s largest food retailers.

In an effort to recapture some of the individuality of the original baker, fishmonger, or butcher, in-store specialist units have appeared, with in-store baking or other preparation taking place, and the enticing aromas of fresh bread being pumped out into the car park to attract people arriving at the store. Nowadays, many people shop just once a week, and expect to find nearly all their food requirements in the one large superstore. In-store butchery has not done well in the UK, with most supermarket meat now pre-packed, while traditional butchers shops have received some increased business. Meanwhile, the larger retailers have through takeover and re-development been opening new smaller, local “express” or “metro” branches, resulting in Britain’s largest food retailer now having some 2,000 UK stores.

 Food manufacturing industries
Food manufacturing industries