Hosted by UK Ministers on 9 August 2012, the Global Business Summit for Retail, Food & Drink was a one day conference bringing top global decision makers together to discuss the key challenges and opportunities specifically facing retailers, and food and drink manufacturers.
Opening the Summit, Rt Hon Dr Vince Cable MP, Secretary of State, Department for Business, Innovation & Skills welcomed the appointment of Paul Walsh, CEO Diageo plc, as a Business Ambassador for the food and drink industries. He also noted that food and drink is the biggest manufacturing sector in the UK and that the British retail sector is the third largest in the world, hiring 10% of the UK labour force. Further facts and company announcements were made in the day’s press notice along with UKTI’s plan to present a new retail strategy, “Delivering for the Global Consumer”, at the World Retail Congress 19-21 September 2012.
By 2050 food production will need to increase by about 70% to feed the world's population and food waste must reduce (currently, it’s one third of all food, according to Fairtrade).
Sustainability, discussed by speakers from Kraft Foods, Marks & Spencer, Fairtrade, Tesco and Coca Cola Enterprises, was generally considered to be a "growth driver". Speakers believed the benefits outweigh the costs; especially if Government, business and Non-governmental organisations (NGOs) work together to educate consumers.
Many consumers do care about sustainability and expect companies to pay a fair price to the producers – with 40% of people actively seek Fairtrade products. However, Tesco finds that although people care, they don’t currently have the money to pay for these type of products.
The contribution of food to public health is increasingly seen to be everyone's business, and Government and industry are now working more closely together on health issues. More than 20 million adults in the UK are at risk of malnutrition; four out of five Internet searches are health related; and health and wellness are expected to be the biggest public spending areas in the coming years.
Companies such as Alliance Boots and Nestlé Health Science S.A. are recognising the role of retail in preventive healthcare, and using scientifically-based personalised nutrition strategies to help prevent and manage chronic conditions, such as diabetes, obesity and Alzheimer’s.
Multi-channel retail was the third theme discussed, including by key speakers from Westfield, PayPal, Dixons Retail and ASOS. It was agreed widely that companies need multi-channel retailing and to recognise that once on the Internet, you are a global company. By 2020, the UK High Street is expected to have 31% fewer stores than today and off-line shopping is likely to be at fewer, bigger and better venues and stores, such as the Westfield Shopping Centres.
Customers' increasing use of the Internet for research as well as transactions, with half of all offline purchases starting with online searches. With the growth of mobile technology, online retailing is 24/7 and mobile payments are growing, including in-store. Social media is raising customer expectations regarding service and retail experience, and technology is increasingly integrated into the in-store experience, e.g. use of iPads by sales people when serving customers to communicate with other stores.
The rapid technological advancements present many challenges – especially for SMEs – and creates considerable scope for errors. But it also offers opportunities, including the use of digital information to understand customers and their behaviour, and a variety of combinations of in-store and online services.