PARIS (Reuters) - The financial crisis may be a time to tighten belts but the food-centric French are unlikely to go on a diet just yet, producers say.
Top-end brands are betting that consumers will eye gourmet food products as a relatively cheap source of pleasure.
“Food products cost less than handbags and could be a haven for people who want to indulge themselves,” Claudie Le Souder, head of communication at French luxury food maker Fauchon, said at the international food show SIAL in Paris.
The average grocery basket amounts to 30 euros in France, far above Britain (21 euros), Spain (18 euros) and Germany (12 euros), a study by British analyst Europanel showed.
Fauchon, which focuses on typical French products like chocolates, foie gras or truffles, is still optimistic for next year but remains watchful, she said.
Sales of fine foods carrying the name of the famous Parisian restaurant Maxim’s have lost 5 percent since the peak of the crisis in mid-September due to lower traffic in airports, their main market, but the firm still envisaged its sector as a relatively safe place to be.
“Luxury food is different. If people will easily postpone buying an apartment or a car by six months, they won’t shun a candy box worth 15 euros to give themselves a treat,” said Gilles Poisson, marketing director of the Maxim’s brand.
While fine food producers remain upbeat, middle market players may need to rethink their strategy.
Most producers anticipate that the year to come will be difficult as national growth forecasts are lowered to take account of the worst financial crisis in over 80 years.
Sharon Greene, author of a study on European consumers’ food habits, stressed that the reaction to the financial crisis would be different depending on the purchasing power of the family.
“In France there is already an important culture of hard discount within low income groups so that is going to continue and play a very important role. Gourmet cuisine will continue to be important for the higher revenues,” she said.
Although official data was not yet available for French consumption in 2008, a survey last month showed that galloping inflation had eaten away at French spending on food in general, making shoppers turn more to discount chains while cutting back on restaurant visits.
To fight an expected drop in sales some companies, especially those in the mid-market, are broadening their ranges and extending their reach into new territories.
French ready-to-use food maker Pierre Martinet said it will launch products, like carrot servings, at less than one euro each while Doux, Europe’s largest poultry maker, which exports to 130 countries, said it will focus on foreign markets.
“Even if there is a slowdown in France, global demand is on the rise as a swelling population looks for protein-rich meat,” said Guy Odri, CEO of Doux, citing the Middle East and Asia as fast-growing markets.
France’s biggest food producer Danone, which said on Wednesday it stuck to its targets for sales and profit growth this year, has launched new “Ecopacks” of cheaper yoghurts aimed at cost-conscious shoppers in France.
Producers of organic food expect their market to stagnate as consumers try to save money but here again, they are confident they will not be on top of shoppers’ black list.
“People will tend to make sacrifices on other things. Feeding one’s child is a priority,” Serge Dobelmann, from Germany’s organic baby food giant Hipp, which after a 60 percent jump in sales over the past year expects at worse a stable 2009.
A Dutch organic cookie maker believed people were still ready to pay for premium food even if their income dropped.
“It’s like wine or champagne, it doesn’t matter what the price is,” Bil Klaas, the founder of Bill’s Natuurbakkerij said.
Additional reporting by Elizabeth Pineau; editing by Elaine Hardcastle