Despite having to keep a close eye on travel costs these first few months of 2009, I’ve been fortunate enough to actually have crossed the “pond” twice; the first trip involving the ISM/ProSweets show as well as visits to manufacturers and suppliers in Germany; the second tied to our annual European Suppliers Roundtable held in London.
Both of these were “musts” on my agenda because they are harbingers of industry trends and challenges. As the world’s largest confectionery exposition, ISM always delivers the latest “buzz” in what’s happening within the global confectionery community.
And despite the recessionary fears having an impact on all industries throughout the world, it was uplifting to see many of the familiar faces in force in Cologne again.
Yes, there were several large candy manufacturers that opted out of the fair, creating quite a “green” space for several small, organic companies. And granted, one could tell that there was a drop in attendance as well as in exhibitors. But in chatting with the many mid-sized confectionery companies who did show up, there was business being conducted.
Although results were mixed, with some complaining about the lack of large numbers, others reported they were happy with the results.
There were even some outrageous success stories, such as the Brazilians. According to the press release sent by ABICAB, the Brazilian Chocolate, Cacao, Peanut, Confectionery and Derivatives Association, the 27 companies that exhibited at the show were expecting revenues of $60 million based on the contracts closed during the fair.
If you’ve ever watched a Brazilian soccer match, you’ll understand the inherent exuberance of anything Brazilian. Obviously it made an impact on buyers.
Then there was the ProSweets show, which was held concurrently with ISM for the first time, a move many had anticipated and lobbied for. Although that alignment made it easier for suppliers, it proved a bit tricky for this editor in covering both shows simultaneously.
Still, I did manage to squeeze in a few visits to Hall 10.1 to see our loyal supporters and ask them how this year’s ProSweets show was progressing. Most were very satisfied at the turnout, some even professing pleasant surprise at the amount of leads they encountered.
Those brief discussions were reiterated at Candy Industry’s European Suppliers Roundtable, which was held just a few weeks ago at the Radisson Edwardian Heathrow, just a stone’s throw from the airport.
Not only are many equipment suppliers still working off of 2008 orders, which many concur was the best year for them in a while, but they also are still receiving inquiries. As next month’s article on those discussions will relate, unlike years past during a downturn where all activity stopped, there are still people calling and asking.
Don’t get me wrong, the suppliers attending the Roundtable expressed concerns about 2009, particularly with the banking situation, which is affecting financing for projects and payments. But as with ProSweets, there are parts of the world – call them emerging markets – where growth continues.
Moreover, often times it’s coming from midsized companies that have found a niche and are carefully expanding their expertise in that segment, be it through automation and technology, improved ingredient sourcing or good old-fashioned innovation.
Many equipment and ingredient suppliers are using this business slowdown as an opportunity to switch resources toward research and development and/or tackling particularly difficult projects as a means of improving their own operations.
This was particularly encouraging to hear, despite recognizing that consolidation and rationalization – read: companies in fiscal trouble disappearing – are continuing within the industry.
It’s this manufacturer/supplier partnership that will continue to help both parties come through this challenging period stronger. You see evidence of that in this issue, such as the understanding reached between Natra and Barry Callebaut as well as Halloren’s investment in automation and emerging technology.
Look here for more examples in the coming months. This industry may not be entirely recession-proof, but it’s definitely panic-proof.