10 tips for doing business with European buyers of spices and herbs
European buyers of spices and herbs expect excellent quality, food safety and a competitive price. In addition, some buyers are looking for guarantees as to the sustainability of the production process.
Contents of this page
- Meet the required quality standards
- Comply with food safety requirements
- Provide clear product information
- Develop a brand
- Set reasonable prices
- Choose your segment and channel carefully
- Meet your buyers in person
- Provide correct packaging and transport
- Be aware of differences in business culture
- Deliver what you promise
Below, you will find ten tips for doing business with European spices and herbs buyers.
The European market is very demanding when it comes to food quality. Many buyers will have quality managers who are responsible for monitoring the quality of the food and ingredients that they buy. These people have the power to make or break a deal. Make sure that you know what their requirements are, and ensure that you and your products can comply with them.
An important part of a good quality system is proper documentation. This factor will strengthen your position if you are facing problems later on, such as rejected shipments or complaints about quality.
- Read our study of buyer requirements for more information on quality and food safety requirements.
- Find out the minimal quality and food safety requirements for dried herbs and spices from the European Spice Association. These documents are important references for most of the leading market players in the European spices sector.
Food safety is a key issue in European food safety legislation. The General Food Law Regulation stipulates strict legal requirements with which you will need to comply.
You will also need to implement Good Manufacturing Practices, while a food safety system such as HACCP is strongly recommended. External certification of your food management system is a big plus, since it increases your credibility.
The European Commission has a portal dedicated to food safety alerts: Rapid Alert System for Food and Feed. The alerts (recent or historic) on the notifications list will show you the common problems faced by suppliers during border controls and how they are handled.
Be aware that buyers may also have their own set of private requirements with which they will expect you to comply. In the ethnic segments and the lower end of the market, private requirements may be more limited. However, targeting these segments is a risky strategy, since requirements here are likely to increase as well.
- If you do not have a quality and safety certification, you can try looking for countries that do not ask for these additional standards (buyers in eastern and southern Europe, for example).
- Read our study of buyer requirements for more information on quality and food safety requirements.
- Read more about HACCP on the European Commission’s Export Helpdesk.
- Find out more information on Good Agricultural Practices for Spices from the International Organisation of Spice Trade Associations (IOSTA).
- For more information on the different food safety management systems, check the International Trade Centre’s Standards Map.
- Find out the minimal quality and food safety requirements for dried herbs and spices from the European Spice Association.
You will need to send clear product information to potential buyers. Your product specification is essential information to have at hand when order requests come in and when you wish to issue a quotation.
Product specifications define the characteristics of your products and may become part of your contract. They typically include a description of your product, the grade, purity, specific processes applied such as steam sterilisation and the applicable levels of contaminants. If your product has been in touch with any allergens, these substances should be declared as well.
You might find that a buyer in Europe expects further processing of spices and herbs, such as crushing, grinding and blending. This requirement is a growing trend, where produce is processed at the source before being exported to Europe. If you have these capabilities, make sure that you include them in your product information and on your website.
Other information such as laboratory analysis or quality and safety certificates will support your sales process.
- Ask buyers for their product specifications and compare them with you own. Identify the gaps and discuss them before making a deal.
- Read our study of Trends on the European market for spices and herbs for more information about the further processing of spices.
While you will be dealing with businesses rather than consumers, it is still a good idea to develop a trade brand. This process involves consistent communication on all media platforms including your website, social media, your emails, newsletters, quotations, letters and business cards.
How you present yourself as a representative of your company is also very important.
Create one clear message in a consistent style. Explain what your company does, what your products are, how your processes work, what certification you have and what your company’s mission is.
Target this information at your potential buyers. Choose words that they will understand, and relate to words and images that will attract them.
Remember to be honest. Do not advertise products or services that you cannot deliver.
- Identify and promote your Unique Selling Points (USPs). These aspects could be your Corporate Social Responsibility (CSR) qualifications, Good Manufacturing Practices (GMPs), food standards such as HACCP (Hazard Analysis and Critical Control Point), and so on.
- Read our study of Competition on the European market for spices and herbs to help you identify your USPs.
- Sustainability is an important selling point. See our fact sheet for more information on Sustainable spices and herbs in Europe.
Keep up to date on price fluctuations and market trends, so you know what prices to set and whether your buyers are offering market-acceptable prices.
When selling to Europe, you will initially have to depend on prices offered to you by traders. Once you are more familiar with market trends and better able to anticipate them, you may find it easier to set your own prices. Remember, however, that the prices of herbs and spices are dictated by the international market, and that the space for setting your own prices is very limited.
Diversifying your customer portfolio is one way to find a wider selection of buyers, who hopefully include buyers that pay slightly better. This process will take time and you must be careful not to compete on price with your own customers.
The scarcity of produce in the spice sector has created concern among spice traders and has led to increasing prices. While this is good news for farmers and exporters, it makes the sourcing of spices and herbs more difficult. Increasing quality requirements also make it difficult to source products of the correct quality. All these developments affect the price.
- For up-to-date prices of spices and herbs, see Commodity Online and Spices Board India.
- See the websites of the International Pepper Community and the Vietnamese Pepper Association for prices specifically for pepper.
- For an analysis of prices, see the market reports and crop reports published by Nedspice or public sources such as Business Standard and ITC’s Market Insider on spices.
When you start looking for buyers, stop to think about the profile of buyers with whom you would like to work. Not every buyer is equally interesting. For this analysis, think about the market segments that you want to target. Afterwards, think about the channels serving these market segments.
For example, if you are selling spices in bulk, your market segment is the industrial market of spice packers and food manufacturers using spices. You can address them either directly or through importers and agents.
If you are selling retail-packed spices, your market segment is either the consumer or the catering market. You should now look for distributors and agents who target this specific market.
If you are exporting organic spices and herbs, you will be targeting the market niche of organic food products. This segment is served by entirely different importers than the general spice market.
- See our study of Channels and segments on the European market for spices and herbs.
- Read our study of European buyer requirements for spices and herbs for more information on buyer requirements for niche markets.
- Prepare an export marketing plan, so your decisions on target markets and channels will be based on a systematic approach.
Within the spices and herbs sector, personal contact is very important, especially if you want to build long-term business relationships. Try to meet your customers face-to-face at an early stage of the relationship. This approach will lay down the foundations for making agreements and solving problems later on.
If you cannot meet your buyers in person, try to arrange phone or Skype meetings.
- When contacting buyers or prospects, make sure that you address them personally. Avoid general mailings.
- Use sector events such as trade fairs and conferences to meet your business contacts. For more information, see our Tips for finding buyers of spices and herbs in Europe.
Make sure that your products are well protected during transport. Heat, humidity and motion can damage your shipment. Your spices must be dried, packaged and stacked properly for the journey.
The terms under which bulk spices and herbs are generally shipped are:
Free on Board (FOB) – named origin. You will deliver products across the railing of the ship; sea freight is paid for by your buyer;
Cost and Freight (CFR) – named destination. This option means that you will deliver products to your export port or to the port of destination;
Cost Insurance Freight (CIF) – named destination. It is the same as the above, but with insurance added.
Insurance is always strongly recommended. Most buyers hire a forwarding agent to arrange further transport.
Lead times and delivery times are very important factors when managing your exports, as is timeliness. Make sure that you are punctual and do not make agreements which you cannot keep.
- Learn about the major stages, relationships and terminology used in international logistics and supply chain management. Check the website of the International Chamber of Commerce for more information on Incoterms rules.
- Have a look at the Transport Information Service website for more information on packaging, cargo securing and transport risk factors, and so on.
Business culture and communication differs considerably from one country to another. As a result, the way that you are used to do business may be quite different from the way that buyers do business in Europe.
To feel at ease dealing with European buyers, it is important to have a basic understanding of who they are. It is also important to adapt your business style to suit theirs.
Spices traders are not different from other European traders: most of them are professional, pragmatic and to the point. As with most people, they appreciate a personal touch in your contacts, but the professional aspects of the business come first.
If you are lucky enough to visit potential clients in their home countries, do your research on their culture before you go. If you do, your interaction with clients will be fun as well as fruitful.
- Visit the Passport to Trade 2.0 website for more information on international business culture and business etiquette across Europe.
- The Kwintessential Etiquette Guide gives you a country-by-country guide to languages, cultures, etiquettes and taboos throughout Europe.
The number 1 mistake to make with European buyers is to make promises that you cannot keep. You need to be realistic and honest about what you can offer; otherwise, your business relationship will soon turn bad.
Crucial issues here are making sure that you deliver your products according to the specifications which you have agreed with your buyer, agreed delivery times and packaging requirements.
If you are aware of any shortcomings in your product (unable to match the sample quality, for example), you must discuss this fact with your buyer straight away. Make sure that you inform buyers about problems quickly and make yourself part of the solution.
Since trading products all over the world is a lengthy process involving many different companies, things can go wrong. As the exporter, you will often be expected to take a leading role in solving these problems. Try to be proactive in this regard.
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