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New Covent Garden Soup Company's Organic Range About the company The company's founding director had the original idea for fresh soup on his return from a sailing trip. His mother had prepared a salad to eat, but he was cold and asked for soup instead. She cooked the salad and transformed it into a hot soup from fresh ingredients. The only way to buy soup at that time was in a can, as a sachet of instant powder mix or a dried mix. Today the fresh soup market is worth around £52 million per year. This is a classic example of how a company and product can be created from a good idea. Two years after the idea was conceived, the first New Covent Garden Soups appeared on the supermarket shelves. The company sticks to its original principles that products must be 'fresh' and of a 'home made' quality. Modified starches, thickening agents, artificial colours or flavourings are not used. About the product When the New Covent Garden Soup Company was set up, a food scientist was employed to research and develop fresh soups. This resulted in a unique patented production process and a chilled product with a reasonable shelf life. The chilled food market was in its infancy at this time and retailers were unwilling to buy very short life products as these were seen as potential loss leaders. By developing a chilled product with a longer shelf life than similar products, this problem was overcome. The organic, gourmet range was launched in September 1999. The rationale for launching organic soup stemmed from a shift in consumer buying. This presented the company with an opportunity to develop a new range, building on an existing product that was known and trusted by consumers. Retailers had recognised the need to stock organic alternatives, so demand came from them too. In fact, if the company had not launched an organic range, they would have lost shelf space to others who did. There was no specific consumer research undertaken for this product range, although market research was used. The company realised that the market was right for this development and needed no further evidence to justify it. Feedback from retailers identified that customers were looking for organic products and more 'gourmet style' recipes. It was decided that the organic range should be more 'up market'. It could then sit alongside the core range of New Covent Garden soups without competing with it. About the design and
development process Eight ideas from the company's recipe database were developed. Some
were obsolete products from previous launches that needed small changes.
Others had been developed previously but not used. The following recipes
went forward to launch: There were two main guidelines for texture and taste: About ten weeks later, factory samples were available for trade and press. This was a considerable achievement given the challenge of sourcing the raw ingredients and acquiring Soil Association approval. About the manufacture The manufacturing processes employed at New Covent Garden are well established and no new equipment or packaging was required for the organic range. However, both the company's manufacturing plants had to be inspected by the Soil Association as part of the accreditation process. Gaining accreditation is important as it gives the consumer confidence that the product is genuinely organic which in turn helps justify the higher price. Certain technical issues had to be resolved during testing and before proceeding to full-scale manufacture. The availability of certified organic produce all year round at an agreed quality is difficult to guarantee. Currently, only 30% of the organic produce sold in the UK is grown there. The majority is imported from other countries. Many large-scale food manufacturers buy their raw ingredients through brokers who source ingredients worldwide and guarantee availability and product quality at an agreed price. At certain times of year, the price the manufacturer pays may be higher than it would be if grown locally, but this balances out over the year. It also removes the risk of lost sales if core lines cannot be produced, eg. broccoli may be imported from China when there is a European shortage. During the soup trials for this range, non-organic ingredients were used to save time while organic equivalents were sourced. When organic ingredients became available the soups were re-tested to allow for differences in flavour. This is important as the intensity of flavour in vegetables, herbs and spices grown in different places can affect the finished soup. Although the production process is the same for organic and non-organic products, the Soil Association has strict guidelines on product segregation. Organic products have to be scheduled for production directly after cleaning of the production line and all equipment has taken place. About the marketing The number of manufacturers competing for the fresh chilled soup market is most significant in supermarkets where own label products are placed next to the New Covent Garden brand at a seemingly lower price point. Their containers are often smaller and comparisons in cost per ml of soup may show little real difference in price. Sales of New Covent Garden Soup are greater in London and the South East. Although sales in the north are increasing, Scotland is the fastest growing region. They are sold in most supermarkets, small independent chains and privately owned food shops. Sales of the organic soups have exceeded targets and it is acknowledged that the range is a successful addition to the business. Sales figures comparing sales of NCGS organic soup to similar
NCGS non-organic soups
In 1998, 320ml single serve cartons were introduced for the growing lunch and snack market. This also meets the needs of single person households, which are on the increase in the UK. The company also produces fresh gravies, launched in 1996. Fresh baked beans were launched in 1997 in the same type of cartons. However, consumers were not fully aware that the cartons of beans were not soups and were unsure about the product, so these were withdrawn from the market. Possibly baked beans is a product that the consumer expects to be sold in cans! New Covent Garden Soups has also moved into the food service industry, selling a range of 2 litre catering packs of soup to sandwich bars, restaurants and motorway service stations, which has proved to be a growing market. A chain of branded soup bars has been set up, known as 'Soup'. After testing the concept, a flagship store was opened in April 1999 in London. Now, outlets can be found in the Millennium Dome amongst other nationwide locations. About issues and values The increase in sales of organic food has been identified as the most significant trend in food retailing in the past few years. Once seen as a quirky fad and virtually ignored by the mainstream multiple supermarkets, they now sell 60-70% of all organic foods in the UK. Up until recently, organic foods have been found outside the fresh chilled sector, but consumer demand is now high in all market sectors. It is higher amongst the under-35's living in London and the South East, and by families with young children and single households. Chilled foods have also become very popular with consumers who like to eat foods that taste freshly prepared, but do not always want to do the preparation themselves. Products are prepared, cooked and chilled rapidly to maintain the qualities of 'freshly cooked food' as far as possible. The main advantage with this process of extending shelf life is that the food can be kept at this quality for longer and there is little loss of flavour, texture, appearance or nutritional value. Making use of the case
study - things to think about and do
Further useful
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The
New Covent Garden Soup Company started production of fresh chilled soups
in 1988. The concept was completely new and there were no competing
products at the time. The company pioneered the fresh soup market and
is the brand leader whose value share is currently 39.8%.
