04 Feb 2021 --- The first-ever extensive study on fresh produce e-Commerce highlights the growing share of agricultural suppliers with direct marketing to consumers. It also reveals how online sales of fresh produce have been shooting up throughout the COVID-19 pandemic.
The study gave an accurate picture of the size and structure of EU e-Commerce suppliers. It found that, while the overall structure of online fruit and vegetable sales can be defined by its characteristic business format, either as an online-pure player, retailer or agricultural supplier, and by its distribution structure, this varies strongly at a national level.
Freshfel Europe and the Scheme for the Application of International Standards for Fruit and Vegetables of the Organisation for Economic Cooperation and Development (OECD) published the study entitled “Online Sales of Fruit and Vegetables in Europe,” exploring the structure and regulatory challenges of selling fruit and vegetables online.
e-Commerce an “uprising outlet”
The study analyses the format of existing webshops specialized in online sales of fruit and vegetables, their delivery model as well as compliance with the current EU regulatory framework for (online) marketing standards with multifaceted results.
While a significant share of European fruits and vegetables online sales are conducted by online pure players and retailers with roughly 51 percent of all findings, surprisingly, the study illustrated the growing share of agricultural suppliers with direct marketing to consumers.
Freshfel’s Director of trade policy and business development and co-author of the study, Nelli Hajdu, remarks that this study marks only the beginning of understanding this uprising outlet's complexity.
“The structure of the online landscape is characterized by national shopping ‘traditions’ and trends, a challenge for creating a favorable regulatory environment. However, the impact of COVID-19 on market structure and consumer uptake is still to be examined in detail,” he says.
Recently, online sales have become an important outlet for food products, and the COVID-19 pandemic has accelerated this trend.
As little was known about the online sales and distribution system of fruits and vegetables, Freshfel Europe teamed up with the OECD to explore the structure and size of the European online fruit and vegetable market and its compliance with existing regulatory requirements.
To quantify the size of the market, seven sample member states were selected to compare their organizational features, including online-pure players/retailers, agricultural suppliers, and their distribution system (delivery vs. click-and-collect).
Regional differences
The study also examined the verification of compliance with labeling requirements of Marketing Standard Regulation EU 543/2011.
The study also gave an accurate picture of the size and structure of EU e-Commerce suppliers. It found that, while the overall structure of online fruit and vegetable sales can be defined by its characteristic business format, either as an online-pure player, retailer or agricultural supplier as well as by its distribution structure, this varies strongly at national level.
For example, the German online fruit and vegetable market is mainly shaped by agricultural suppliers selling directly to consumers. In contrast, in Spain, smaller local ‘Fruteria’ shops have gone online to expand their customer base.
France stood out with a strong and established coverage of click-and-collect opportunities.
Regarding market size, the online market shows a high range of fragmentation, however, this doesn’t exceed 100 to 150 webshops per country and is depending on the maturity of the market development at national level.
Regarding the compliance with labeling requirements in the context of the Marketing Standard Regulation EU 543/2011, the rate highly diverged by operator and organizational structure.
While revealing promising signs for the future of online sales, this first study also revealed key questions, which will require further investigation.
This includes understanding the characteristics of successful business models for fruit and vegetable online sales, trustworthiness and verification of information provided on websites, and consumers' overall uptake.
These key areas for further investigation have become even more relevant throughout the COVID-19 pandemic, which continues to accelerate overall online food availability, especially fruit and vegetable sales, with an urgent need for quantification.
Freshfel Europe says it will continue to work toward more transparency and knowledge building in the fruit and vegetable online segment to facilitate favorable regulatory conditions to sell fruit and vegetables online.
Edited by Gaynor Selby
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