By Kunal Sawhney, CEO of Kalkine (www.kalkine.co.uk)
The autumn surge in coronavirus cases in Britain appears to have no solution as of now, with industries suffering to generate revenue and the government imposing new lockdown restrictions across the country.
Among various industries, the UK’s hospitality sector is severely impacted by the Covid-19 outbreak.The vibrant industry is on the verge of losing 300,000 jobs due to the pandemic.
In view of the growing uncertainty in the market, not-for-profit company Business West, which provides support to startups and emerging businesses, has launched a scheme that facilitates food and drink enterprises in the South West of England to foray into the Chinese market.
BACKGROUND
The factor that triggered the launch of the scheme comes in the back- drop of the increasing demand for UK food and drink products in the Chinese market.According to a report published by the UK’s Food and Drink Federation (FDF), Britain’s export of food and drinks in the top markets plunged in the first half of the year.
The Great British Food Programme, in which Business West is tying up with Chinese digital marketing firm Regroup China and logistics company Elander, will support the UK’s food and drink enterprises to promote themselves through the Chinese social media platform WeChat. The social media channel has a 1.2 billion user base.
The Great British Food Store, the specific mini programme, is set to launch next month and it aims to run as a cross-border global sales solution, allowing opportunities for B2C sales and export to China with the least hassle.
With this mini-program, the food and drinks companies in the South West of England can display and sell their products to Chinese con- sumers.
BENEFITS FOR UK FOOD AND DRINKS FIRMS
According to the latest H1 2020 FDF statistics, China remains a big market for food exporters, with the UK exporting £344.8 million goods to China, an increase of 0.3 per cent.
Among Britain’s’ top 50 trade partners (in value terms), China saw year-on-year growth in food and drink exports of more than 20 per cent.
In fact, an HM Revenue and Customs report stated that the food and drink exports to China have increased in recent years – nearly 6 times since 2010.The UK’s meat industry has seen substantial growth in terms of sales over the years. For instance, Britain’s meat exports to China (in terms of kg), were 3.6 million in 2010, and it has reached 137.9 million in 2019.
The top food products which Britain exported to China in H1 2020 included pork (£132.2 million sales), whisky (£40.8 million) and infant food (£19.2 million).
Considering these numbers, the food and drink companies in Britain have a big scope to expand their businesses at a greater length and grab a larger share in the Chinese market.
Paul Rostand, the founder of Forest-based Great British Biscotti, said China offers a huge potential for growth for food services and even the retail segment.We have been seeing China as a target market for a long time.
Echoing similar views, James Monk, Director at commercial services of Business West, said China was Britain’s sixth-largest export destination in 2019 and with the launch of The Great British Food Store, the food and drink companies in the UK can expand their businesses.
CONCLUSION:
Undoubtedly, China is a lucrative market for UK’s food and drink companies.The demand for British food products from China has been surg- ing over the years.
Looking ahead, UK’s food and drink products can continue to thrive in the Chinese market; however, it could face challenges as sometimes accessibility can be a difficult task due to regulatory requirements.
Moreover, the Covid-19 pandemic, which resulted in strict lockdown across the major economies, including China and the UK, has disrupted the trade flow. For the UK’s food and drinks industry, there could be a slight interruption in exporting food products to China for the time being due to pandemic.
Another interesting form for the UK’s food and drink might be witnessed after Brexit. If Britain moves without a deal, then there could be a chance of British food products seeing a paradigm shift in the business model.
Overall, Britain’s food and drink companies appear to be going strong, and in the coming days, the export to China could grow further unless any disruption in trade, demand and supply surfaces.
