Iceland Buoyed by Frozen Food Trend

The expansion of the high street business, which bought 51 Woolworths stores in January, accompanies new research that claims UK consumers are turning to frozen foods for better value in the current economic downturn.

Malcolm Walker, Iceland’s chief executive, said the company was close to agreeing deals with Woolworths’ landlords across the country, according to a report in the Daily Express newspaper.

In 2008 Walker led a failed £50m bid to rescue Woolworths before it went into administration and is eager to buy up its high street sites.

“There’s about 500 empty Woolworths stores, some in locations that would suit us,” he said. “We’re talking to landlords and I have no doubt that we will pick up some more for opening later this year.”

Iceland: benefiting from frozen food trend

Iceland, which operates almost 700 stores, is also reported to have acquired a number of underperforming Simply Food stores from Marks & Spencer.

The expansion of the company comes as a leading UK food organisation reveals consumers have a new appetite for frozen foods.

The Food and Drink Federation's (FDF) Frozen Food Group’s research found half of consumers (49%) believe that frozen food will help them through the credit crunch. And 70% of consumers understand the main benefits of frozen food – it minimises waste and means shoppers need to shop less often.

According to researchers, over 80% of consumers also value the key attributes of frozen food – storage, convenience and quality – while 75% agree that quality is better than it used to be. A total of 73% of consumers think frozen food offers a good range of premium products.

Norman Soutar, chairman of the Frozen Food Group, and managing director of William Jackson Food Group, said: “Consumers appreciate that there is less waste with frozen food and, in fact, over two-thirds (67%) choose frozen food because it minimises food wastage. Less wastage means that money is saved, which is obviously of concern to people in these tough times.

“Consumers also find frozen food convenient to use, with good nutritional value, which is good news for manufacturers and retailers alike as the industry responds to changing consumer needs with innovative NPD and marketing campaigns.”

Soutar is upbeat about the category’s future prospects. “We saw good sales growth in frozen food last year, and we expect to see continued growth over the coming months.”