Bacon report: Bacon goes the whole hog

Firstly, a report from the University of Alabama revealed that a fried breakfast, such as a full English including bacon, is a healthier way to start the day and better for the heart, waistline and blood pressure than having carbohydrate-rich cereals, breads and pastries. Secondly, a study from the Scripps Research Institute in Florida has found that foods such as bacon are apparently as moreish as heroin and tobacco, meaning that once a person has the taste for bacon, they find it difficult to stop. It seems, then, that people cannot get enough of bacon and, if some of the negative reports about eating bacon were to be countered with reports such as University of Alabama findings, then the market for bacon could see some good times ahead.

Positive performance

So far in 2010, Bpex has found that, in the 52-week period ended 21 February, total bacon expenditure was up by 3.7%, while volume sales rose by 3.3%, contributing to a bacon retail market in the UK valued at £1.23bn. According to Kantar Worldpanel, bacon value and volume sales increased in the 12-week period to 24 January and there was a price increase of 5p to £6/kg. "Any market going ahead like that in volume is doing well, and any market going ahead like that in both volume and value is doing very well," says Bpex consumer marketing manager Chris Lamb.

The term 'back to basics' was once an ill-fated political soundbite of the 1990s, but Lamb reckons this is exactly what consumers should be encouraged to do during a recession and suggests that bacon is the perfect antidote. "Bacon is so simple to prepare; you always love it and it always delivers."

Lamb also notes that the two meal-time growth areas for bacon have been at breakfast and in the evening, both up by 3% in consumption terms.

Breakfast boom

In the foodservice sector, the recession has also been a blessing rather than a curse, with the breakfast market seeing a boom in bacon sales. Bpex estimates that 5.7% of dishes served in the foodservice sector contain bacon within the meal and breakfast is seeing the greater benefits of this. "In 2009, during the recession, fewer people were eating out and, in 2010, it is not much different. There is no sizeable increase," says Bpex foodservice trade manager Tony Goodger. "But there are opportunities for bacon at breakfast, with JD Wetherspoon and McDonald's both reporting increases." However, the high street restaurant chains do not have the monopoly on the bacon market, as there are also great opportunities for department stores that serve breakfasts, such as John Lewis, Debenhams and BHS.

With sales of bacon sandwiches in the foodservice sector in particularly good form, Goodger says that contract caterers have been doing well out of the recession, partly due to changing work habits. "People are working harder and not having breakfast until mid- to late morning then they are going for bacon sandwiches," he says.

With jobs on the line during the early part of 2008, throughout 2009 and a redundancy cloud still hovering in 2010, many people are trying to impress employers by getting into the workplace earlier, giving the impression they are working harder and trying to prove their position is indispensible. This means they will often skip breakfast at home to get in before 9am. As a result, staff canteens and local cafés are seeing a pick-up in breakfast trade.

Helen Davies, director of Bedfordshire based butcher's and farm shop Woburn Country Foods, which sells to the catering trade, says she has seen an increase in demand from her catering customers in 2010 for cheaper, wet-cured bacon. "They are concerned about their portion costs and, for breakfast in particular, they do not think the quality of the bacon needs to be as good. Our customers are still insisting on the bacon being English, just not necessarily dry-cured."

A big challenge for Bpex's Tony Goodger, therefore, is getting the message out about more assured bacon for the foodservice sector. He says that if caterers are not getting assured bacon, then they should be asking their suppliers for it.

Working with catering educators, such as Westminster Kingsway College in London, is also a big priority for Bpex and Goodger is involved with rewriting the bacon sections for manuals used to train chefs. "Bacon is not just a centre of protein, but is also used in ingredients," he says. And with the emphasis on getting the next generation of chefs to appreciate and learn about the versatility of bacon, the future of bacon in foodservice should be secured.

Rosy for retailers

On the retail front, data in January 2010 shows that the major multiples' grip on the bacon market is increasing year-on-year. For the 52 weeks to 24 January, the top four Tesco, Sainsbury's, Asda and Morrisons accounted for a 65.5% share of the bacon market. Broken down further, the statistics reveal that Tesco accounts for a 24.3% share, Sainsbury's 14.6%, Asda 13.9% and Morrisons 12.7%, while The Co-operative and Somerfield's combined share was 8.6%.

Two of the top four retailers increased their bacon value share, while three out of the four saw value sales increases. Tesco reports that it has seen a steady increase in demand for bacon so far this year, compared to 2009, especially in its Premium Finest range. "We feel this is driven by people trading up and treating themselves. Tesco has also seen a growth in gammon sales, as customers take advantage of this versatile and great value-for-money product," says Tesco bacon and gammon buyer David Stokes.

Sainsbury's pork, sausage, bacon and gammon buyer Siobhan Barnes adds: "So far this year, we are showing strong growth in the bacon category. The extremely cold weather at the start of the year saw bacon sales rise by over 20% year-on-year during the first few weeks in January."

Waitrose reports growth across its whole range, including both standard and premium, but claims the rise has been strongest in its essential Waitrose line. Anna Lloyd, Waitrose pork, bacon and sausage buyer, says: "It has been a really strong year for Waitrose, with our essential Waitrose bacon range now having been in-store for a year. Our investment in pricing, which strongly supports British pig farmers, has really helped to deliver excellent sales. We also have grown our market share. All Waitrose bacon own-label and branded comes from British, outdoor-bred pigs."

With regards to consumer demand for standard-premium bacon, Barnes adds that she does not think there has been a huge swing so far this year and says core lines are comprising the bulk of the market's sales. "However, customers are increasingly looking for premium bacon be that for flavour, thickness and so on. We have seen some incredible growth in gammons and bacon joints so far this year. Promoting gammon has seen Sainsbury's share rise considerably and the customer numbers coming into the category have more than doubled. This has been a really good news story, as new shoppers return to this old favourite. Bacon loin joints are another old favourite, which have also done well so far this year."

Labelling Code welcomed

The labelling Code of Practice for pork, officially launched at the National Farmers' Union conference at the end of February, has certainly added a new dimension to the UK bacon market, but many of the big supermarkets say they had already put the labelling changes in place way before the Bpex Code was finalised. "We took the decision early last year to move bacon packing to match our position on pork, which is in line with the Code from Bpex," says Barnes. "This means that, from the start of this year, all our bacon carries the country of origin labelling on the front."

Meanwhile, Tesco says it already labels the country of origin on thousands of its products to help customers make informed choices and is currently working on providing more country of origin information on more of its products.

Waitrose has also signed up to the voluntary labelling Code and all its products are already labelled appropriately, claims Lloyd. "It helps that all our bacon is made from outdoor-bred, British pigs, so the message to customers is simple. Also, at Waitrose, British has always meant British, and that the pigs are born, reared and slaughtered in the UK. The major benefit for Waitrose, with the voluntary code in place, is that customers will see consistent messaging on-pack across all retailers," she says.

Continuing the local theme, in Northern Ireland, Tesco has announced that it will boost its spend on local pork for stores by £2m a year, which will mean that it now spends £11m a year on local Northern Irish pork and bacon. Tesco's campaign, 'Putting Pork into the Spotlight', begins in-store from April, when the retailer will offer many traditional favourites at promotional prices and give customers at larger stores the chance to try the bacon and pork for themselves through a touring roadshow, in collaboration with the Ulster Pork & Bacon Forum.

Battle of the brands

Some of the larger bacon brands have reported encouraging signs for 2010 and many of the smaller, independent premium and organic suppliers are also noting that recession has not been too bad for their products either.

Danepak has announced plans to spend over £4m in the next year in a TV campaign, starting this month. The adverts will be placed around all of Channel 4's food programmes, including Jamie Oliver, Heston Blumenthal's Feast and Gordon Ramsay's Great Escape, after the company announced a "phenomenal" year-on-year growth of 24%, which means the Danepak brand is now worth £52m. Sophie Colquhoun, Tulip group marketing director, says: "We are continuing to invest in the brand and this latest TV campaign will reach an estimated 87% of our target audience, who will, on average, each see a Danepak commercial 10 times during the courseof the year, helping to cement its position as the UK's favourite pork and bacon brand."

And Tulip is not alone. In its trading performance for the year to 31 March 2010, Cranswick Food Group, with bacon brands including Jack Scaife and Richard Woodall, saw bacon sales increasing by 70% in the first nine months of the year.

It seems the snowy start to the year has also been of great benefit to bacon. George Streatfeild, MD of Dorset farm producer Denhay, says the bacon market has performed "better than last year, thanks to the snow. We had a very strong January and February when others could not get to work," he says. "We think they stayed at home and had cooked breakfast or went tobogganing and then had bacon butties."

Woburn Country Foods says it has found that its bacon sales have increased over the year and that it has taken on a number of new customers, with bacon sales up proportionately to its total sales. The company introduced its Black Bacon last year, which has continued to sell well, according to Helen Davies, and all its pork for its home-cured bacon is local, she claims.

Meanwhile, Tim Powell, managing and sales director for the International Food Products Group, the sole importer and distributor in the UK for Oscar Mayer bacon, says: "Despite the financial difficulties that this country is enduring, the market is holding up well compared to 2009 and we still have a number of encouraging and additional volume retailers that we are processing at this time to increase our market base."

Fergus Howie, farming partner at Essex-based Wicks Manor, adds that the bacon market has performed very well year-on-year, considering the economic environment. "Bacon is the cornerstone of our business one of our key products. Growth has been seen over the year, but only 5% year-on-year. However, our strategy for the year was consolidation, as we expected the recession to affect us worse than it did."

At the premium end of the market, many bacon suppliers note that performance during 2009 was much better than expected in terms of demand. Tim Finney, MD of Wiltshire-based organic producer Helen Browning Organics, reckons that the demand for premium bacon is strong, with the recession not giving its consumers too much pain, while Denhay's Streatfeild agrees. "Consumers are looking for that old-fashioned expression 'value for money'. They are buying premium bacon because it gives great flavour, does not shrink in the pan and does not give off watery residue."

Howie adds: "We have some fantastic new products up our sleeves, but not yet marketed. We will move to place these lines over the next year. This last year has been focused on strengthening our brand and maintaining current sales with a lower cost base. I was nervous about how the marketplace might perform in a recession, as a premium bacon in the fridge could have been something the consumer would live without. I was prepared for the worst and was not interested in launching new lines in a potentially challenging year."

The smaller brands have also welcomed the new country of origin labelling Code. "The new labelling code is excellent news," says Howie. "But there is still a flow of meat entering the marketplace and being mislabelled to look as if it could be produced from British pigs. These new labelling rules should help stamp that out. After all, this imported meat has been produced in standards illegal on farms in this country. This labelling awareness has meant much better understanding from chefs as to the meat they are using and, therefore, more interest in products with traceability to a particular farm. This has also meant more consumer awareness of the importance of local and premium products as a whole."

Streatfield concurs: "We welcome the change. Denhay only ever uses British pork and the clearer labelling means consumers are more easily able to make a choice of British, with a higher-welfare standard, against pork from other sources."

What becomes clear, though, is that bacon is a great survivor in years of boom and gloom and this can only mean that the year ahead will be even sunnier.

Dealing with salt reduction

In response to the Food Standards Agency's (FSA) commitment to reducing people's average salt intake to 6g a day, Tesco has removed over 3,000t of salt from products in the UK since 2006, without compromising on flavour, it claims. "A significant proportion of our pork products already meet the 2010 target and we will continue to work closely with our suppliers over the year ahead," says Tesco bacon and gammon buyer David Stokes.

Waitrose pork, bacon and sausage buyer Anna Lloyd says the retailer has an ongoing programme of salt reduction for customers and claims to have already met the Government's 2010 salt targets in all categories, including sliced back, streaky, smoked and unsmoked bacon, as well as bacon joints.

The FSA pressure to reduce salt levels has also not caused too much trouble for bacon brands, as many claim their products already meet the requirements. Tim Powell, managing and sales director of Oscar Mayer distributor International Food Products Group, says: "Our salt levels have always been way below the standards expected and we have never had an issue in this respect."

However, Wicks Manor farming partner Fergus Howie talks about the difficulties that tough salt restrictions have on the bacon sector. "Salt targets have been challenging for the industry as a whole. In cured produce, salt levels have historically been much higher than today's levels as this was the place people got their salt from. However, with so much salt in everyday food, cured products have had to do their bit to remove salt as well. This is tricky to achieve when you need salts as the primary curing agent, as reducing levels may ultimately affect shelf-life and taste.

"With bacon and sausages, we have been working with our curing and seasoning suppliers to ensure that taste and shelf-life are not compromised, but that targets are met."

Woburn Country Foods' Helen Davies says its products have a lower-than-average salt content, as the company use a honey cure instead of all salt.

Denhay MD George Streatfeild adds: "Denhay Dry Cured bacon was below the FSA guidelines before they even came out. Reducing salt is always a compromise with taste and food safety. Salt is a preservative and if you reduce the amount of preservative, you will need to reduce the shelf-life correspondingly. On taste, it is possible to make very bland bacon if the salt is too low. Allowing the bacon time to mature allows flavour development."

Helen Browning Organics MD Tim Finney says the firm is looking to reduce nitrite levels, also required by the FSA, but notes that it is hard to do this and reduce salt at the same time. "Their priorities are unclear," he adds.

Bacon of the future

With pressure to reduce salt levels in bacon, many should take a leaf out of Quality Meat Scotland's (QMS) book, with the launch of a new 'healthier' bacon unveiled in February.

The production process to make the bacon, said to be 25% lower in salt and more than 20% lower in fat than the industry average, was developed as part of a QMS project, match-funded by Scottish Enterprise, to investigate the potential to lower the salt and saturated fat content of eight traditional Scots favourites, such as bacon. The £40,000 project saw QMS working with seven different meat producers and the food innovation team at Abertay University to develop the healthier formulations.

NFU Scotland president Jim McLaren said at the launch: "By reducing the salt and fat content of a number of red meat products, while maintaining exceptional quality, this collaborative project further shows how red meat can be enjoyed as part of a healthy and balanced diet."

Dietian Jennifer Robertson, QMS health and education co-ordinator, adds that a major challenge of the project had been the need to avoid compromising on flavour, which bacon and other Scottish favourites are famed for. "The development of this bacon involved a wet-curing process and the meat is cured with the skin intact," she says. "Through this process the skin absorbs some of the salt, and the salt content of the bacon is then lowered when the skin is removed. Extra trimming of fat after the curing process creates a lower fat content.

"The result is a bacon that has a salt content of 2.29g per 100g, comfortably below the Food Standard Agency's 2012 salt target for bacon, which is 2.88g per 100g."

Taste trials of the healthier bacon conducted by QMS, involving schoolchildren, were said to have proved successful.

Moreover, having become involved in QMS' new product development project to develop the bacon formulation, Irvine's of Perthshire has switched its entire wet-cure bacon range to the new production method. "The resulting lower-salt bacon has proved so successful that it is now our standard product and the feedback we've had from customers has been very positive," says Kenny Allan, Irvine's of Perthshire general manager.

Case study: Bacon growth during a recession

The recession has been bad news for many food companies, but for international bacon supplier Henry Hirst of Newcastle, investing in staff training has meant the firm has grown, despite the economic difficulties. Over the years, the company has developed into an international bacon supplier, with two state-of-the-art factories in Newcastle and Glasgow, and over 100 staff on its payroll. The company has also recently been successful in securing a major new deal to supply Iceland stores with its products. A key measure taken to ensure it continues to prosper is in the extensive training provided to its employees through the North East England Food & Drink Group's (NEEFDG) current training programme an example that should serve as a salutary lesson to other bacon firms about the importance of staff investment in a downturn.

Malcolm Quinn, Henry Hirst general manager, says: "So far, over 20 staff members have been provided with training that will develop their skill levels and increase the company's productivity at this crucial time. The training on offer to producers through the NEEFDG is very comprehensive and well-delivered. It was really useful having some of our courses run on-site in an authentic working environment, recreating scenarios that might actually happen in the workplace.

"All the staff that received training passed and gained new accreditations, which is great for their personal development and has significantly strengthened the company. Most received food hygiene training, but others also underwent training in auditing and health and safety."

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