How Scotland finally has the taste for good food and drink

ARE Scottish food producers maximising the opportunities on their doorstep? No, or not yet, says Scottish Enterprise (SE), which wants Scotland's food producers to think more about how they can meet the needs of the fastest-growing third of the nation's £7.5 billion-a-year food industry, namely "food service".

By SE's calculations, the sector employs 112,600 people, covering caterers, schools, hospitals and staff canteens as well as bars and restaurants.

It is the part of the market that benefits most from the UK's transformation from a spam fritters nation, where food was mere fuel, to one that has been taught by fashionable books and TV programmes to value taste, freshness and provenance.

According to Maggie McGinlay, who heads SE's food & drink team, Scottish SMEs (which she defines as companies of up to 100 million turnover) are unlikely to make great headway in the high-volume, cost-driven retail sector. But there is, she says, much more they can do to improve both their sales and the gastronomic reputation of Scotland, by tapping into the hunger for premium foods in the "fine dining" sector. Growth at this end of the market is leading food service's rapid-catch up with food retail.

"Retail and grocery is more or less static," says McGinlay. "All the growth has been in food service, though there are signs that this is beginning to plateau, to 1.5 per cent annual growth last year from a high of about 4 per cent a few years previously.

"Food is such a huge and fragmented market, with such great potential, which is why it is one of Scottish Enterprise's key industry clusters. Our job as an enterprise agency is to help identify how that breaks down."

McGinlay's mission is to connect the different parts of the supply chain, to make sure that suppliers provide exactly what the market requires.

The statistics demonstrate the stakes involved in boosting Scotland's food sector. Gross value added (GVA) from food and drink manufacturing is 2.7bn. Food manufacturing employs 50,000 people, or 21 per cent of all manufacturing employment. In addition there are 68,000 who are employed in agriculture and about 6,700 in fishing. All would be boosted by better connectivity within the sector. Says McGinlay: "We are seeing an increasing polarisation in Scottish food habits. You have the 28 per cent of the population whom you could classify as 'foodies', a sector that is increasing all the time. At the same time, you have many whose food-buying decisions are driven by price."

SE's point is that, as people become more concerned - or pernickety in the parlance of earlier decades - about where their food actually comes from, the quality of Scotland's larder - as trumpeted in our tourism literature - is to the Scots themselves.

The potential domestic market for top-quality produce in seafood, red meat, fruit and veg and cereals is stronger than ever, and producers should realise this.

Next month SE is hosting the first ever Scottish Food & Drink Conference at Hopetoun House in South Queensferry, which aims to make food producers more aware out of how better routes from their gates to the expensive restaurant plate will advance the cause of Scottish tourism as well as their bottom line.

"This is the first conference to focus on premium and fine dining sectors of the market that we think have the most growth potential for suppliers. The conference is about where the opportunities are and what we need to do about them," says McGinlay.

Shirley Spear, of the celebrated Three Chimneys restaurant on Skye, the star speaker at the conference - whose determination to use local produce in the restaurant long pre-dated, and greatly influenced, the fashion for using local ingredients - said: "We couldn't have achieved all that we have without the advantage of all the wonderful seafood from the waters around Skye and all the produce that is grown on the island - the whole range of vegetables, and mushrooms. We are a small example of how connecting a restaurant and the local producers shows how well they can work together."

"Scottish producers have been very slow off the mark and there is a lot to catching up to do.

"Producers need to spend more time making contact with the retailing side of the industry, including restaurateurs and hoteliers, rather than waiting for us to find out about them and how we can source their produce."

Should a critical mass of the Scottish food industry get the message, the rewards will be huge.

McGinlay believes that Scotland is well placed to surf the wave of the prevailing global food trend, where "eat local" is a global mantra.

To take full advantage, suppliers and outlets need to collaborate more closely on the supply chain if the industry is to remain profitable for future generations.