1. THE FUTURE of the FRESH FISH Market personnel views to stimulate discussion & possible actions

2. the Fresh Fish Market Yesterday »When everything was better Today »Problems, always problems Tomorrow »Surely it cannot get worse !

3. Yesterdays Fish Market Predominantly FRESH Local or Regional –shout auction –payment guarantee MANY retail outlets Exports PROCESSED –dried –salted –smoked –frozen

4. Fresh Fish market TODAY Globalised EU imports more than it catches Retail dominated by Supermarket chains 75% in Europe Auctions –professional –automated –In competition Direct Sale Other auctions Farmed fish Imports Falling volumes –Fewer fishing boats –Less fish landed –Reduction in buyers Prices static –Real value reduced – = cheap imports Exports include fresh –Airfreight –Chill container Costs Rise whilst Income Falls

5. Fish Catch Index - Tonnes 1960111 1970147 1980100 1990 72 2000 66 2005 55 source FAO statistics Fish Prices Index - real terms 1980100 1985 92 1990105 1995 84 2000 88 2003 88 2005 ? ? ? Based on UK DEFRA statistics Looking back over 25 years + EFAD project identified long term fall in first point of sale fish prices in real terms European Fish Auction Datanet

6. Update study by EAFPA (2003-2005) confirmed that this problem continues

7. TOMORROW ? THREATS? Reduced catch levels Failure to Rationalise –Too many independent auctions Lack of Identity –no recognised brand for fresh captured fish Low Cost Imports –Farmed product Illegal Fishing Direct Purchase –By supermarkets Chickenisation –Fish as a commodity fewer fishermen smaller landings reduced buyer competition increased unit costs Socio-economic FAILURE OR THE NEXT DECADE

8. FUTURE of the FRESH FISH Market IS THERE ONE? I THINK THERE IS Provided WE ACT NOW To prepare for tomorrow…

9. Objective: for the fish sales organisation Maximise unit values –fish prices per kilogramme Minimise unit marketing cost –defray fixed expenditure Offset central purchase control –Avoid there being a dominant buyer Establish long term markets –To complement long term investment

10. HOW? Replace Volume –With Value New business –services –products utilising assets Embrace Quality –BRAND it SELL it –DELIVER IT Change price dynamics –repackaging –distribution –vertical selling own account partnering others Sales platform for –Farmed fish –Imported fish Promote WILD fish –as the new organic

11. Scale Economies Supply Volume Leverage AUCTION Captured Fish Imported Fish Farmed Fish services logistics services sales Market development consumer direct auction wholesale supermarket contract BUYERS LIKE VOLUME and CHOICE EXPERIENCE HAS SHOWN THAT THEY DESERT FAILING AUCTIONS

12. Auctions (and the ports they operate) have a proven track record in innovation EU regulations Vessel Design Premises Grading Packaging Cool Chain E-commerce Money Transfer

13. SALES are the KEY Quality can not be compromised TACs are unlikely to increase Costs continue to rise in real terms Continuous development and investment needed Maintaining a viable sector?

14. Fish Prices at first sale Lack elasticity due to alternative »species »sources of supply »food products Do not reflect production cost Are subject to globalisation –and the buying power of the uro Fish is in danger of moving to a commodity basis –through centralised buying policies –Homogenisation of products CHICKENISATION

15. Can we build on e-commerce Exploiting existing buyer contact While developing new Or is it an opportunity missed?

16. first auction clock was made in Utrecht 1902 (electro-mechanical) Dutch Auction (falling price) Effective for fresh products –Flowers –Vegetables –Fish… Physical presence required

17. Computers arrive first for administration –Records –Accounts then as the auction engine linking sales. to billing

18. Today there are many Fish e -auctions Fair Transparent Efficient Effective aiding Traceability Business

19. Some Fish e-auctions

20. e -auctions Technology has changed what we do and how we do it Electronic Retail is now normal ebay has brought internet auctions into the home Flights and Travel are booked online In UK Tesco, supermarket chain, has 5 million internet customers –Shop Online – Store delivers e -commerce now valued at 7 trillion pa (Forrester Research Inc.) Fish Auctions have used Electronic Auction for decades –Present systems well established –Potential still to be realised…

21. e e-commerce upward trend continues UK online purchases in 2003 –B2C 170 per capita –fish is bought online by Trade B2B by CONSUMER B2C 300% growth in B2C by 2008 (Forrester Research) EU B2B e -commerce in 2004 250.000.000.000 –Fish Auctions are B2B What is growth path? –NEW product –B2C ?

23. Can fresh fish Auctions and their suppliers, fishermen and fish farmers, benefit from the growth of direct consumer buying over the internet Consumers will not pay more –Introducing efficiencies through direct supply should increase producer income Auctions provide a secondary sale outlet –Adopting volume internet trade terms Investing in systems, staff and service On the back of this –Quality products could be delivered To the upper quartile of consumers that will pay a premium for the best From a mobile phone tomorrows fresh fish could be ordered today –Cheap, simple to use, tomorrow is here today!

24. Buying Unseen Consumers will buy based on description –Where this is backed by a standard Witness ebay sales EAFPA has considered developing an EAN code based on product not processor –This could form a common standard –Providing: Information on what it is and where it came from –Not a subjective quality but just data facts As ever funding is the prime issue –But can we wait, doing nothing Or make a start as part of a certification scheme –Ecolabel – Traceability – Service Quality

25. Future e-commerce ? ? ? Direct Sale –to end customer Seamless Buying –Buy many places –Delivery inclusive Track & Trace –RFid SMS (mobile phone) 3G web systems ebXML (OASIS)

26. Product Demand Smart Sales systems help but they are no substitute for understanding, and meeting Product Demand Auctions may only receive information on consumer trends second hand Large supermarket chains are taking an ever growing share of fish retail supply Perceived wisdom may be false –e.g. fish is price capped by the consumer Unfulfilled demand may exist The customer (consumer) »is King (and Queen) »Do they know what could be available…

27. Retail Trends – Consumer Choice Supermarket chains 70 % of chilled fresh 90 % of frozen fish 90 % of pre-prepared Consumers Price driven purchases Organic Healthy Food Quality & Eco Labels Fresh and Traceable Supermarkets can control Local prices Consumers look for Quality labels Supermarkets promote THEIR OWN brands Fish bought (imported) at lowest cost

28. Organic produce has captured a small, but significant, share of the fresh food market: those willing to pay a premium for quality food from an environmentally acceptable source. An EU directive has decreed that nothing captured or harvested from the wild can be labeled as 'organic'. Currently only farmed fish can be given the organic label –Natural feeding being uncontrolled and unsupervised Certification bodies contend with : –pollution levels in the sea –over-fishing and depleted fish stocks –environmentally aware fishing techniques –pesticides treatments in conventional fish farms Wild, captured fish, if they can not be organic (!?!) can be –Environmentally acceptable –Ecologically sound –Traceable –Certified as free range Ecolabeling must not become the province of the retailer –They promote Own Brands Not source products Traceability can be used as a tool to promote wild fish In combination an 'eco-friendly' labelling system that give guidance for the concerned consumer could be the NEW ORGANIC

29. In an increasingly Globalised marketplace Auctions must be proactive delivering what the buyer wants Even if they do not know what this is until it is supplied Working with fishermen to maximise Quality Providing the essential link for Traceability promoting end consumer confidence ensuring that Fishermen make a reasonable Return (on their catch) and Buyers also Return