How to do Business in the
German Market
Presented by Judith Clinton, Trade Marketing Specialist
Marketplace Training
13th November 2014
Growing the success of Irish food & horticulture
AIDAN COTTER
Growing
the success
CHIEF
EXECUTIVE
BORD BIA
of Irish
food & horticulture
28 JANUARY
2009
Germany in Figures
82.4 million
€3.08 trillion
€571m
food & drink
Source: IMF World Economic outlook 2014
Growing the success of Irish food & horticulture
Total Grocery Market valued at €176bn
Irish Food Exports to Germany - €571m in 2013
Pigmeat
5%
Seafood Sheepmeat
4%
4%
Beverages
10%
Beef
17%
+8.6% vs 2012
Dairy
40%
Prepared
foods
19%
Source: IGD 2013
Growing the success of Irish food & horticulture
Retail Market Shares
1%
11%
21%
15%
Others
36%
16%
13%
Top 5 Retailers =
76% market share
Source: Trade Dimensions 2014
Growing the success of Irish food & horticulture
Foodservice: Routes to Market
SUPPLIER
Through FS distributor
(incl. C&C)
Direct route
FS Operators - Institutions
FS Operators - Commercial
Food Service Sector was worth €69.4 bn in 2013
Growing the success of Irish food & horticulture
Foodservice: Supply Chain
30%
60%
Delivered Wholesale
Cash and Carry
6%
4%
Contract Distribution
& Direct
Retail
• REWE GVS
• Metro
• WLS / Havi
• Aldi
• Gafateam /
Intergast
• Fegro Selgros
• DHL
• Lidl
• Como
• Handelshof
• Edeka
• GV Partner
• Servicebund
• Vierlande
Pro Intal, German Foodservice Market, June 2010
Growing the success of Irish food & horticulture
Why target Germany?
German affinity for “Die Grüne Insel“
One of Europe’s top retail food markets = €220bn in 2013
Growing appreciation of food quality
Sustainaility is an important issue
High disposable incomes
Loyalty of retailers
Opportunities in Private Label
WILD ATLANTIC WAY
Er ist das irische Pendant zum California’s Pacific Coast Highway
und zur Australia’s Great Ocean Road.
Growing the success of Irish food & horticulture
German Consumer Trends
Growing the success of Irish food & horticulture
German Market Dynamics
Domestic food producers dominate
German household sizes are declining: 76% < 2 people
Major retailers have set tender dates
Private label is a growing sector
It can take 18 months from first contact to shipment
German buyers value professionalism
Organic is growing, + 7% in 2013
Growing the success of Irish food & horticulture
Role of Sustainability in Germany
Growing the success of Irish food & horticulture
Product Suitability
Labelling must be in German
Uncluttered labels with clear messaging
Recipes adapted to German tastes
Pack sizes to reflect declining household size
Packaging to be reduced and recyclable
Packaging and waste disposal fees to be paid
Growing the success of Irish food & horticulture
Challenges of doing business in Germany
Good knowledge of the German market
Punctuality
No flexibility – deliver on promise!
Value for money - know your USP
Mature and over saturated retail market
German language – they buy in German
IFS and BRC (only IFS for Aldi) and some prior export experience
Provide a delivered price to designated depot
German contact number (e.g. local agent)
Growing the success of Irish food & horticulture
Margin Expectations
Discounters:
30-45% brand
24-45% private label
Retail and C+C:
40-60% brand
27-49% private label
Foodservice/
20-45% brand + PL
Wholesalers:
VAT on Services:
19%
VAT on Food:
7%
Growing the success of Irish food & horticulture
Logistics
Find a logistics solution
Logistics must be included in the initial price
Main players are Dachser and Nagel
Use groupage for smaller volumes
German retailers require delivery on multi-trip Euro pallets
Promotional off-shelf placements need to be on multi-trip ¼ Chep
pallets.
¼ chep pallet
Growing the success of Irish food & horticulture
Euro pallet
Targets for Marketplace 2015
Number of buyers targeted:
•
•
•
•
•
•
•
Alcohol
Dairy ingredients
Seafood
Frozen
Confectionery/Snacks
Grocery
Bakery
Total
Growing the success of Irish food & horticulture
20
20
20
10
10
10
10
100
Bord Bia Office Services
Category
Analysis
Market Research
Buyer
Engagement
Store Audits
Market Data
Buyer Presentations
Product Retrieval
Consumer Insights
Translations
Market Study visits
Buyer Contact
Details
Distributor Searches
Growing the success of Irish food & horticulture
For more information…..
Donal Denvir
Manager
donal.denvir@bordbia.ie
Judith Clinton
Trade Marketing Specialist
judith.clinton@bordbia.ie
Please contact our team in Düsseldorf:
Growing the success of Irish food & horticulture
Sinead Leatham
Marketing Assistant
sinead.leatham@bordbia.ie
Tel: + 49 211 8681 497