"Consumers are increasingly focused on health and convenience. But the enjoyment aspect is becoming more and more relevant," according to Wim Kleinjan, Managing Director, and William de Vries, Commercial Manager of Fruity Pack.
"We're working hard to further develop our innovative convenience concepts. We're expanding our Pick and Mix range - where consumers can choose between sliced fruit, indulgent snacks, raw salad, soft fruit, and little salads - and we're investing in a new location for our new segment: meals like meal salads, lunch salads, and poké bowls."
This consumer focus and investment are the positive results of the dip Fruity Pack experienced during the pandemic. "At first, 2020 hit us very hard," says Wim, "but we came out of it very strong." He is referring to the temporary closure of the hospitality and food service sector. It created a shift at Fruity Pack from being primarily focused on sliced fruit to a broader range of convenience foods.
Complementing the market
"The pandemic showed us that the food service sector could unexpectedly become a vulnerable sales market. So, we asked ourselves how we could do more in the retail channel."
Fruity Pack found the answer by broadening its assortment under the brand name Healthy Hand. "We want to establish a category that complements the market with, say, artisanal poké bowls, luxury lunches or raw vegetable salads, and luxury indulgent snacks, such as bavarois with fresh fruit. We can develop the retail market tremendously with that," Wim explains.
Sliced fruit and dairy with fruit are prepared at the company's main branch in Rotterdam. It has a new branch for the other products under the Healthy Hand brand: Fruity Pack Kitchen. "Everything there is prepared fresh, every day, to make artisanal quality products available for retail," says WIlliam. Fruity Pack thus positions itself in the market as a counterpart to home-delivered meals. "Then, people are quite happy to pay €15 for a poké bowl. We try to bring the same quality and luxury to stores at a lower price. Then retailers can compete with home-delivered meals."
Wim sees that Fruity Pack's flat, flexible organization contributes to its ability to market competitively-priced luxury products. "That lets us market a very nice product with an efficient cost price and leads to us being able to offer products that match mass-produced products, price-wise," he says.
William adds that the Healthy Hand Kitchen is also a so-called 'dark kitchen'. "More and more formulas add hospitality elements to their concepts with convenience and to-go products. That's where stores often want to bring tastier, nicer, but also convenient products. We make these products fresh every day in our dark kitchen," he explains. Fruity Pack, which is IFS Higher Level certified, has ensured expansion at both the company's locations. "We have huge ambitions to grow further in this category, and we've created space for that," says Wim.
Yet, all these good prospects do not negate the fact that there are challenges, he admits. Besides product availability due to, say, weather changes, personnel is an issue. "It's hard to find workers, and there's the collective bargaining for sharply increased wages in the fruit and vegetable sector. For a production worker, that means, between January 2022 and January 2023, a roughly 20% rise in pay." On the one hand, this presents opportunities. "It will become too expensive for those in the food service channel to make products," says Wim. On the other hand, this development will contribute to higher prices. "Our products will become increasingly expensive in stores. We'll all have to try to find a solution to that in the coming years."
Wim adds that the current economic shifts affect consumers too. "Purchasing power in our category of products is under pressure." He indicates that although the company is growing as a whole, several categories are still shrinking under the economic condition's pressure. Whereas he sees long-term growth opportunities, the current conditions have led Wim to adjust his short-term expectations. "In the short term, we may all have to go through a downturn. But I'm very optimistic about the long term. Everyone in our family business is on the same page, and our category will grow. I'm convinced of that. We're confident about the future," he concludes.
Earlier this year, Fruity Pack took a stake in Soupy, which makes fresh soups using self-made broth. "These are an extension of the Healthy Hand products that let us fill in another dining moment. Soupy has the same DNA as the Healthy Hand Kitchen: fresh products at affordable prices." Fruity Pack, thus, expects there's still a long way to go in the area of fresh soups in stores. "With the fresh soups, we've added a category with which we can delight our customers."
"We switched to customized order picking years ago," Wim says. In a recent development: stores can now order by consumer unit. "Our clients can realize high returns because they can buy in a very targeted way." Also, Fruity Pack has a logistics platform to which other parties can connect if their customers want. Wim points out this is especially suitable for products with a short shelf life in the same cold chain. "We want to get the entire convenience category to retailers very efficiently and sustainably." Fruity Pack is open to expanding this service to more retailers.
For more information:
Wim Kleinjan, Managing Director
3079 DA Rotterdam
Tel.: +31 010 303 5100
William de Vries, Commercial Manager