Smaller brands set to take a larger share of the retail market

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26 October, 2018

Analysts in 2018 certainly thought that change was on the horizon with the rise of vegan options and consumer focus on transparency across the whole supply chain driving more conversations between retailers and independent, start up brands.

While vegans still only make up less than 1% of the population, demand for vegan products is spreading far outside true vegans, with both vegetarians and health conscious meat eaters actively selecting smaller vegan brands for their weekly shop. This is reflected in the selection of brands chosen by The Hatchery, one of the latest incubator programmes launched in the sector. Each brand selected is a start up and Planet Jason, which offers a new range of vegan meat alternatives is one of these. While none of the brands selected yet have retail deals, that’s not necessarily their aim, as this incubator programme sees the future of retail sitting firmly in the direct to consumer space.

That seems a realistic future state for the food and drink sector as one of the opportunities that it looks likely that Brexit will open up is export opportunities for smaller brands. These are brands who might not have got a look in before the cost of exporting to key markets was reduced by the UK’s separation from the EU bloc. Direct to consumer is also backed by the likelihood of even larger problems for retailers in 2018 just to keep going. Business failures were up by 28% in 2017 and consumer focus on smaller brands with provenance, all natural ingredients and integrity in their brand story is likely to push retail business failure up a notch. That’s due in part to consumers’ increasing reliance on digital channels to locate brands that resonate across the whole of their lifestyle.

This puts a lot of power in the hands of a smaller brand with the vision to invest in putting an interesting brand story directly onto consumers’ mobiles, sharing it with voice activated assistants and taking it right into their living rooms. This year may be the year when vegan food becomes truly mainstream but what it certainly is, is the year that the smaller brand can realistically start to outperform the mega giants of the sector.

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