#14bis Destination Germany (English version)
At Vegg2food, we decided to take you on a trip to a new destination each month. This week we offer you the opportunity to take a closer look at the German vegan market!
Our newsletter will therefore focus on Germany, considered one of the most vegan countries in Europe.
In 2015, the American magazine Saveur named Berlin the vegetarian capital of the year! Even the university restaurants in the capital serve mostly vegan meals (see one of our previous newsletters).
Heavy meat dishes probably come to mind when you think of German cuisine. Indeed, Germany is traditionally a meat-consuming country and a major exporter of livestock products. More specifically, Germany is one of the three largest European meat producers involving France and Spain. This high level of production combined with consumers' ethical and environmental concerns partly explains the importance of the vegan movement in the country. The vegan offer is abundant compared to other countries (even if one should not touch too much the currywurst of Volkswagen: see attached).
📜 On the menu this week :
Veganism in Germany
A mature market
A brief look at the German meat substitute sector
Focus on Veganz strategy change
Conclusion
The image of the week
🌱 Veganism in Germany
According to ProVeg Deutschland, there are almost 8 million vegetarians (around 10% of Germans) and 1.33 million vegans (1.6% of the population) in Germany1. These numbers are constantly rising, especially since the COVID crisis. People who identify themselves as omnivores are becoming a minority in Germany (see diagram below). More than 30% of Germans declare themselves to be flexitarians, i.e., about 256 million consumers2.
👉🏻 A mature market
Germans' changing dietary preferences had consequences for the German economy. Vegan products are no longer considered niche products for a small minority. They are readily available in supermarkets and discounters and can be consumed by a wide range of people.
Flexitarian consumers are driving the demand for more and different products. Many innovative products are launched in Germany, a country known for its highest percentage of global vegan food and drink launches per year ahead of the United Kingdom and the United States. Besides, the trend of naturalness is crucial in the food choices of German consumers who prioritize unprocessed and healthy products.
The number of vegan restaurants has also increased considerably in the last few years. According to Happy Cow, there are over 900 vegetarian and 300 vegan restaurants in Germany3. Leading the Vegan revolution, Berlin boasts an impressive amount of restaurants with vegetarian and vegan options.
👀 A brief look at the German meat substitute sector
In Germany, companies have developed an offer that meets the Germans' changing dietary preferences. It is easier for people who have been used to consuming animal products to follow a vegan diet than a few years ago. Thus the sector of plant-based meat alternatives is divided between local and traditional suppliers, independent companies, international FMCG companies, and retailer brands.
Local and traditional suppliers usually make their products from wheat or tofu, as these companies have often been producing plant-based foods for decades. Taifun has been selling soy products since the mid-1980s. That is also the case for the company, Wheaty, which has been producing a range of wheat protein products since 1993. Some other companies come from a background in the meat industry. For example, the family-owned company Rügenwalder Mühle, founded in the 19th century, has thoroughly expanded its range of vegetarian and vegan products in recent years.
Pure players and Independent companies majorly focus on a product line or single product. They are abroad-based, or in Germany, like the Terra Vegane brand.
For International FMCG companies, we can mention Nestlé (Garden Gourmet), Unilever (The Vegetarian Butcher) or Nomad Foods (Iglo Green cuisine).
Demonstrating the popularity of plant-based alternatives, retailer brands have developed their products and brands such as Mein Veggi Tag (Aldi), My Best Veggie (Lidl), K-take it veggie (Kaufland), or No Meat. Just Vegan (Edeka).
🛒 Focus on Veganz strategy change
Since 2011, Veganz has been one of the few companies worldwide that offer a full range of vegan and vegetarian products. These products are available in 269 countries in more than 15,000 outlets4. The company is gearing up to go public on the Frankfurt Stock Exchange (FWB) in the coming months.
Founded in Berlin as the first vegan supermarket chain in Europe, the company decided to open nine stores in Germany and abroad (in Vienna and Prague). The goal was to reach 60 stores5, including the USA. However, the supermarket branch never became profitable and was declared bankrupt in December 2016.
Operating a change in strategy, Veganz started to turn into a wholesaler and began its production in 2015. The chain supplies, among others, Edeka, Kaufland, Metro, Albert Heijn and Lidl.
What happened? We should not forget that majority of Veganz's customers are neither vegan nor vegetarian, but flexitarian! This type of consumer only wants to reduce their consumption of meat and dairy products and is, therefore, quite reluctant to go to a specialized supermarket. The products offered in mass distribution are majorly sufficient to meet their needs.
🤝 Conclusion
Food markets in Germany are notoriously difficult to penetrate as many are saturated. Moreover, it is vital to keep in mind that hard discounters own more than 40% of the grocery market in the country. Compared to France, prices are very competitive, especially for vegan products. Price competitiveness is significant to be successful in Germany. Nevertheless, the German market can be very profitable if a foreign company succeeds in entering it.
Marine Berthier, Consultant at Vegg2food
📸 The image of the week
The Conversation, Vogue du vegan en Allemagne : adieu la « currywurst » ?, 2018.
Future Grocery Shopping, Mapping the plant-based revolution in Germany, 2020.
Future Grocery Shopping, Mapping the plant-based revolution in Germany, 2020.
Retail Detail, Insecure future for vegan supermarket, 2017.