reLAKSation
208.
Put your money where your mouth is: Before leaving Beijing where he had reached an agreement to resolve the immediate problem of Bra Wars, EU Trade Commissioner Peter Mandelson mounted a withering attack on protectionist forces inside the EU. According to the Guardian newspaper, Mr Mandelson said a ‘Maginot Line’ mentality should not be allowed to distract the European Union from the reforms needed to compete in world markets. He said that the Bra Wars had shown that Europe could no longer rely on short term political fixes to stave off the pressures of globalisation. He added that the attempt to manage trade was a cul-de-sac which inhibits innovation and entrenches uncompetitiveness. Mr Mandelson did not name any specific countries, his reference to the ‘Maginot Line’, the ulimate useless defensive barrier built by the French in the 1930’s hinted at his frustration with one of the three countries that has pushed hardest to restrict Chinese textiles. He said that he holds onto the view that it would be wrong to build new barriers and to protect the EU behind unrealistic walls. Such walls are like the ‘Maginot Line’. For those in any doubt, Mr Mandelson made it absolutely clear that he is totally in favour of liberalisation and open trade.
If this is the case, then we, at Callander McDowell, would call on Mr Mandelson to put his ‘money’ where his mouth is and immediately remove any barriers that his directorate have imposed on salmon trade. The various attempts to manage the salmon industry over the past decade are a prime example of the inhibited innovation and entrenched uncompetitiveness to which he refers. Political pressure has ensured that the independent salmon industry in Scotland has been able to build its own defensive barrier – ‘The EUSPG Line’, which time will show will be as equally useless. Currently, ‘The EUSPG Line’ takes the form of a MIP, but past experience has shown that this trade measure will not help those who have sought such protection.
Mr Mandelson needs to consider that ‘The EUSPG Line’ does not even protect a national industry but rather a tiny minority of producers who have taken advantage of WTO rules to claim that only they represent Scottish salmon farmers. If he is so ready to criticise three key member states for their stance on open trade, then perhaps he needs to look again at how a handful of farmers have been able to persuade his directorate to impose international trade barriers. Maybe he will find that everything is not quite what it seems. If Mr Mandelson is so in favour of open trade then the time has come for him to stand by his views. He can start by removing all barriers from the one industry that certainly doesn’t need them – farmed salmon!
Price, price, price: In what we hope is the last reference to Bra Wars, we, at Callander McDowell, were interested that whilst Peter Mandelson has reached a deal with the Chinese, the general feeling in the press appears to be that it is simply a postponement of the inevitable. The editor of City AM, a London financial newspaper, argues that there is a fundamental problem with the truce and that is that its not going to last. He says that this is because the consumer will eventually force the hand of governments and take the side of the Chinese demanding as many of their products as they can produce. The reason is because they are cheap.
The paper says that this is a logic which has been staring major retailers like Marks & Spencers in the face for some time now. The British public, as well as other European shoppers, do not appear to care where something is made, how it is made or whether the workers have been paid a fair salary. The only issue to concern consumers is price. The fact that the goods coming in from China are as good quality as anything found in M&S is just a bonus.
We, at Callander McDowell, have tried to argue exactly the same point about salmon but this is something that the EUSPG and others simply don’t want to hear. The overriding factor determining salmon purchases is price. It makes no difference whether the salmon is from Scotland, Shetland, Ireland, Norway or Chile, the majority of consumers just look at price. This is why country of origin is of little interest. It is why the Tartan Quality Mark failed to become established in the retail sector. It is why seeking Protected Geographic Indication was a complete waste of time. The majority of consumers are just not interested.
Fritz Harald Wenig of DG
Trade said that consumers must be willing to pay a fair price for the salmon
they buy. No they’re not, as Marks & Spencer has discovered to their cost.
If they cannot offer clothes at a price their customers are prepared to pay,
then they will simply go elsewhere. Consumers do not have to buy salmon. They do
so because it is a value for money meal choice. If trade measures make it
something else, then consumers will just walk with their feet and buy something
else. Salmon are not a special case. What applies to the whole retail sector
applies just as readily to salmon irrespective of whether producers want to hear
it or not.
Where’s the fish?: One of the reasons that the European Commission have become involved in the business of the salmon industry is because the independent Scottish sector held a specific vision as to how their salmon should be sold. This meant that they were not only very blinkered to any other opportunities in the marketplace but also they had little idea as to what consumers actually want. This is quite surprising considering the amount of information which is readily available. Yet, it is not just about obtaining information, but also interpreting it correctly.
An article in IntraFish suggests that British consumers have become increasingly attracted to ready meals that mirror those found on restaurant menus but that the manufacturers paint a confusing picture of the prospects for seafood in this growing retail category. The article focuses on Indian dishes which have become increasingly popular since the 1980’s such as chicken tikka masala. Sales of Indian ready meals alone generate £331 million a year in retail sales. However, according to the article, few if any of these ready meals use fish as a main ingredient. They cite the example of Goan Fish Curry, which failed to attract buyers when it was launched in Sainsburys. As a result, Noons, the manufacturer, has concentrated on more popular ingredients like chicken. IntraFish say that despite the British public’s adventurous tastes, market research has so far failed to pin down the reason why fish has failed in this category.
We, at Callander McDowell, would suggest that in common with salmon farmers, market researchers are simply closing their eyes to answers that are otherwise staring them in the face. Sales of Indian ready meals may be huge, but they are not the only cuisines in the ready meal sector. The ready meal sector has called on cuisines from all around the world and some are more suited to fish dishes than others. For example, salmon is widely used in recipe dishes especially Italian meals. Salmon appears to go well with pasta and many variations appear on supermarket shelves. Salmon has also been used in a number of Indian dishes but these are usually marketed as Limited Editions or specials. This is because salmon is not a widely used ingredient in Indian restaurants. In fact, fish is not widely available on most Indian restaurant menus, which is why fish ready meals have not proved popular. Instead, restaurants feature chicken, lamb and prawns and so do most supermarket ready meals. IntraFish pointed out that most British consumers are attracted to ready meals that mirror those found on restaurant menus, so if they are not on the restaurant menu, then supermarkets have a harder task on their hands to persuade their customers to try them.
Finally, it is worth remembering that a majority of consumers never consider buying fish all, so it becomes more difficult to convince them to try fish even when it is available in a more familiar form, i.e. in a ready meal format. However, the sales growth of fish dishes has shown that such consumers may be much more willing to try fish in this form than buy it directly from the fresh fish counter.
The ready meal sector
certainly has a enormous growth potential. Salmon is one ingredient that is so
versatile that it can be adapted to suit many cuisines. It is just that it may
take a little longer to find the right combinations for some cuisines than
others. The opportunities are there for the taking; it just requires that their
eyes are open enough to see them.