The French market: what are the opportunities for Quebec exporters?
As part of the ZENiTH program, the Group Export is taking an in-depth view at several markets. Let's lean in closer towards the French market, which was profiled by Altios, a partner in the ZENiTH France cohort.
Beyond its linguistic and cultural proximity, France is an interesting market for Quebec exporters. With a population of more than 67 million, the French allocate approximately 20% of household spending on food. It should also be noted that the country imports 20% of its agri-food products, i.e.: 1 fruit out of 2, 25% of its pork consumption and 34% of its poultry.
Moreover, Canada has privileged access to the European market through the Comprehensive Economic and Trade Agreement (CETA), which entered into force in 2017. In this context, the value of Canada's agri-food exports to France amounted to US$280.2 million in 2018; Quebec being responsible for US$27.1 million.
MARKET ORGANIZATION
While in 2018 SMEs accounted for an average of only 22% of the sales of French retailers, they contributed to 51% of the growth of large and medium-sized retailers and 88% of the growth of hypermarkets and supermarkets. The appeal of small and medium-sized companies is growing significantly, while the large agri-food groups are seeking to maintain their position by increasing their promotions. Thus, the situation is beneficial for SMEs wishing to access the French market.
Although it can be difficult for new entrants to obtain a referral with major retailers, consumers are eager to discover innovative products, whether in terms of taste, ingredients, packaging, etc. In addition, the French are looking for so-called transparent products, i.e. products whose origin and composition are disclosed, and which respect the environment. The organic market grew by 46.2% between 2015 and 2019 and generated sales of US$13.9 million in the latter year. We note that 90% of consumers aged 35 and under consume organic products and that 30% of these organic foods are imported.
DISTRIBUTION CHANNELS
In 2018, 65% of food products were marketed through large general grocery stores. Since 2010, however, their market share has been declining in favor of online sales. In 2020, online food sales increased by 14%. The COVID-19 pandemic also benefited more the online sales sites of retailers whose omnichannel strategy was already well advanced. In regards to home delivery, drive-through or Click and Collect, traditional retailers such as Carrefour, Cora, Super U, Casino, E.Leclerc, Intermarché, Auchan, etc. have captured 81% of the market share.
Online retailers such as Amazon, Cdiscount and Houra.fr only have a 1.6% market share for food products. However, there are specialized online stores that are successful in exploiting further the market of niche products. Good examples are the websites Greenweez or MondeBio.com, which specialize in organic products offered online.
By getting to know a market, it becomes easier to find your niche and seize the opportunities. The ZENiTH program offered by the Group Export, in collaboration with the National Bank, FCC and Fonds de solidarité FTQ, is made possible thanks to the financial contribution of the ministère de l'Agriculture, des Pêcheries et de l'Alimentation du Québec and of Agriculture and Agri-Food Canada, under the Canadian Agricultural Partnership.
