Trawl for profit

In times of recession, it pays to back the right horses or seahorses, in this case.

Seafish, the UK marketing and research body for the seafood trade, says pollock or fish such as basa and talapia, sourced cheaply from sustainable fish farms in South East Asia, are sure bets.

By contrast, the going is not good for high end varieties such as monkfish and halibut, sales of which have fallen by 20-30% in volume and value over the past year. Shellfish, crab and lobster have also suffered overall, falling prey to delisting by retailers, says Seafish.

In category terms, the organisation claims frozen value sales have risen 5% and promotional tactics have shifted, with discounts preferred over two-for-one deals. "While like all businesses we have had to find ways to be more cost-efficient, the economic climate has brought some benefit in that it has helped fuel considerable growth in the market for frozen fish," says Steve Lidgett, operations director at Young's Seafood.

Frozen fish fingers, by virtue of value and versatility, have been big winners, says Karen Galloway, Seafish market planning manager. "We have seen salmon, haddock, pollock, gluten-free and microwaveable fish fingers launched in the past year at significantly reduced prices."

Convenience is still popular. Birds Eye and Young's Seafood, producing natural products to be cooked simply with vegetables, and Marks & Spencer's (M&S's) £10 meal deals illustrate the trend, says Galloway.

Against this backdrop, the key is to turn the odds in your favour in a market in which preserving margins and slashing overheads has become more vital than ever. And that means ruthless attention to efficiency.

Accepted wisdom is that in tough times it is still better to invest where necessary in order to save in the long run. And there have been some large investment programmes.

Dawnfresh Seafoods, for example has channelled funds into Bellshill-based Scot Trout, which it bought 18 months ago. "We've spent £1.25M on the integration and have built a 4,000m2 trout factory at Uddingston," says Dawnfresh md Steve Flack.

Lidgett says: "Our biggest single investment this year has been around £1.5M for reconfiguring our Humberstone Road facility in Grimsby taking out complexity, refurbishing the factory and investing in new product lines.

"Other than that we are in a constant process of investing to ensure our production facilities continue to facilitate the right level of product innovation. One recent example is the investment of around £125,000 in a packaging change for our core Young's fish pies that will reduce waste by about 12%, affecting some 40M packs a year."

Packaging and waste are also concerns for Dawnfresh, which has been rolling out Cryovac Darfresh packaging and associated machinery. Darfresh uses packaging more sparingly than many other systems, allows more packs on store shelves, extends shelf-life and lets shoppers see inside packs more easily, making better marketing sense.

"We launched Darfresh with Asda 18 months ago and with M&S this year," says Flack. "It holds the product vertically, so you can see it. There isn't anybody else out there displaying fish in that way."

Dawnfresh's genotyping project, aimed at growing a species of uniformly sized trout in conjunction with salmon breeding expert Landcatch, is also designed to cut waste. With retailers scrupulously paying for precise product weights and anything extra representing lost profit, it's an important area to get right, says Flack. "We'll be able to deliver the right age of trout, improved flavour and texture and yield improvements. There are significant processing benefits."

The initiative is expected to deliver results in 2011 and will enable Dawnfresh to more accurately manage supply and demand and giveaway in packs.

Giveaway is giving Systems Integration Trading traditionally a supplier of hardware and software to meat processors more business opportunities in fish processing. The firm specialises in traceability and stock management. One tool that handles these issues, offering great potential for the sector, is its touchscreen outer case marker and end of line weigher, says md Rob Stephens.

The machine can make yield calculations that identify giveaway, enabling processors to know if they are hitting their targets. It generates labels for outer cases by product type, size and order, says Stephens, adding: "It can capture data, so it can give live stock updates. Say you need to process 100 salmon fillets by four o'clock, you're near the deadline and the live stock update is only showing 20 you can act to resolve the situation."

It can be integrated into planning software, he says, can create production plans based on sales orders that can be imported from external systems and can incorporate product details, enhancing traceability.

Factory floor data capture via weighing systems is something fresh fish and seafood supplier Kingfisher has also been working on, via Bristol-based software and IT service provider Sanderson's Formul8 package.

Sanderson says the software replaces spreadsheet and manual procedures and will automate each area of Kingfisher's business, from stock purchasing to product delivery. "The Sanderson solution will assist in improving stock management and visibility, with increased efficiencies across the business," says Roger Stares, general manager of the food and process industries at Sanderson.

All round, it's clear that the recession hasn't dampened shrewd investment, but it's not just flash kit that can enhance efficiency. Whitby Seafoods is proof positive that improvements can be achieved equally well through minimal spend on training in smart working practices, with the help of Lauras International.

The lean management consultancy backed three improvement workshops, training a continuous improvement champion from Whitby Seafoods so he could continue the good work once Lauras had moved on.

After Lauras spent four days reviewing past and present performance, internal teams of production workers were taken through their paces for a day and a half, then let loose to conduct analyses.

Factory output was improved from 600kg/h to more than 750kg/h, avoiding substantial capital outlay and enabling the firm to win more business. "Before Lauras came I was facing a £2M factory extension project as my only solution for growth," says Whitby Seafoods md Graham Whittle.

Work began in January and encompassed areas including the scampi shelling line, where slower line speed, denser product coverage on the belt and better labour allocation and temperature control boosted yield by 2%. "The scampi want to be as cold as possible, but sufficiently thawed so that the shell and the meat can be separated," says Simon Spanyol, a partner at Laurus International working closely with Whitby Seafoods.

Better lane feed on the firm's fish cakes line and increased marinating time for its spicy prawns accomplished further quality and yield benefits. And separating orders into three streams, including ad hoc, potentially large orders, helped avoid the trap of last minute line changes.

So, whether through training or capital investment, the seafood industry is equipping itself to surf the waves of future trends. FM