C.A. Fortune Newsletter- October 2016

Newsletter October 2016 Volume 4 - Issue 6

C.A. Fortune Company Announcements Vol. 4 - Issue 6 Inside This Issue

Distributor News 4-6 Industry News 7-8 Consumer Trends 8-13 Retailer News 13-20 Shows & Events 21

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Please join us in welcoming the following new members to C.A. Fortune: •Lisa TenBruin, Lead Client Service Specialist, Deduction Management - Lisa TenBruin joins C.A. Fortune after working for 4 years with the Carlin Group. Her first day with C.A. Fortune was May 30th when we moved into our new corporate office. While with the Carlin Group, Lisa was in both the Client Services and Deductions departments responsible for servicing several major clients. She joins the C.A. Fortune team as the Lead Client Service Specialist/Deduction Management. Lisa reports to Ben Adelphia, Client Service Manager.

•Kelli Mincemeyer, Bakery Technician - Central Region – Located in the Pacific Northwest, comes to us with 24 years of bakery and cake decorating experience. She has worked with Thriftway, then moved on to Fred Meyer where she had been since 1999. Kelli has brought her many talents to us and is working with our bakery team in the Northwest. Kelli started at C.A. Fortune in June and reports to Eric Syvertsen, Director of Bakery in the Central Region.

•Kassie Smith, Bakery Technician - Central Region - Kassie has been decorating cakes over 20 years and loves to look at decorating as the perfect platform to show off her artistic abilities. Kassie has a long list of achievements from all the different courses she has taken to the many awards she has won in different cake decorating events. Kassie has worked as a Wilton instructor, a bakery owner, decorator at Safeway, and most recently, a manager at WellSpring bakery in Colorado. Kassie, who started in June, is a part of our bakery team working the greater Colorado market and will report to Eric Syvertsen, Director of Bakery in the Central Region.

•Mark Kleitch, Account Manager - Central Region - Mark Kleitch – On July 11th, Mark joined our Central Region sales team as an Account Manager based in the Michigan Market, calling on independents and working closely with Kim Rogers. Mark has a Bachelor’s Degree in Business Administration from Northwood University and comes to us after a 17+ year career with KeHE Distributors where he was a merchandiser, sales rep, lead merchandiser and account manager. He brings a wealth of experience and knowledge to the Michigan Market and is a great addition to C.A. Fortune. Mark will report to our V.P. of Sales in the Central Region, Brian Taylor.

•Siobhan Furia, Regional Sales Manager - East Region - Siobhan joined the C.A. Fortune team on August 8th and will be working closely with our East Region Director of Bakery, Rich Luzzi. Siobhan has a bachelor’s degree from the University of Miami and spent 13 years in the agency industry. She will utilize the relationships she built and knowledge she gained during that time to drive sales with retailers in the northeast. continues next page...

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C.A. Fortune Company Announcements Please join us in welcoming the following new members to C.A. Fortune: •Bre Bergin, Director of Business Development - Central Region – Bre began at C.A. Fortune on August 17th as our new Director of Business Development. She graduated from Western Illinois University and has over 10 years experience in the CPG industry. She spent the last 4 years at KeHE as a Senior Business Development Manager, which included on-boarding national retailers and drove vertical growth in the Solutions Division across the e-commerce, niche retailers, & big box retails for the alternate channel. Bre will be reporting to Becky Morrow, VP of the Central Region.

•Angela Trischitta, Bakery Technician - East Region - Angie became part of the C.A. Fortune team on August 22nd. Her background in baking and decorating was cultivated during 7 years as cake decorator and bakery manager for Shoprite. She then expanded her repertoire to include training other employees in baking, mixing, and decorating when she began working for a New Jersey bakery agency in 2005. Angie has over 10 years experience and knowledge as a bakery technician and will be a valuable asset to our East Region Team. She reports to Rich Luzzi, Director of Bakery in the East Region.

•Ashley Conner, Regional Sales Manager - Central Region – On September 6th, Ashley Conner joined our Central Region Sales team. Ashley has a Bachelor’s degree from the University of North Florida and prior to joining C.A. Fortune, Ashley spent the last 3 years working for KeHE Distributors. She started as a merchandiser in the Midwest Region before moving on to a Retail Sales Position managing the Mariano’s account. Her latest position was working as an Account Manager within the KeHE Solutions team and was responsible for numerous alternative channel accounts. She will be working in the Chicago Market, reporting to our V.P. of Sales in the Central Region, Brian Taylor.

•Jennifer Conway, Marketing Coordinator – Jennifer started at C.A. Fortune on September 19th as our new Marketing Coordinator to replace Liz Snyders, who decided to stay home with her newborn. She has a Bachelor’s degree and is currently enrolled in the MBA marketing program at Elmhurst College. She worked at Follett Higher Education Group as a Creative Services Coordinator from 2014-2016. She will be reporting to Becky Morrow, VP of the Central Region.

•Christine Alba, Accounts Receivable Specialist - Christine’s start date was September 27th. She comes to us from Vita Foods where she has worked for the past 8 years as a credit and collections specialist. She has worked in the food industry for 15+ years doing multiple tasks and has great knowledge of the food industry.

We are beyond thrilled to have her join our accounts receivable team here at C.A. Fortune. Christine will be reporting to Lisa Hussar, Accounts Receivable Manager.

•Jennifer Hamlin, Regional Sales Manager – East Region – We are excited to introduce Jennifer Hamlin as our newest Regional Sales Manager in the East region. Jennifer brings valuable Natural experience to the C.A. Fortune East Team. In her latest role, Jennifer spent four years as an Associate Grocery Coordinator for the Whole Foods South Region where she supported the category, promotional, and merchandising execution for their 36 stores. Prior to Whole Foods, she served five years as an Outside Sales Representative for Acosta/NS Sales. She will be responsible to lead Key Account sales in the Carolinas replacing Miki Wolf, who retired from C.A. Fortune earlier this month. Jennifer will report to our VP of Sales in the East Region, Marty Walsh, and her start date was October 3rd.

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C.A. Fortune Company Announcements Please join us in welcoming the following new members to C.A. Fortune: •Pete Stenstrom, Regional Sales Manager – Central Region – We welcome Pete Stenstrom to his new role as Regional Sales Manager, reporting to VP of Sales in the Central Region, Brian Taylor. He will be our 3rd RSM calling on the Chicago market along with Ashley Conner and Allison Pilcher. Pete started with us October 3rd after working in grocery retail and in various capacities with Natural & Specialty distributors. The past 3 years were spent with KeHE Distributors as an Account Manager Sales Representative calling on independent accounts in Chicago. Pete has BA Degree Business from Wheaton College. Please join us in welcoming Pete to the C.A. Fortune family.

•John Bertovich, Regional Sales Manager – East Region – John brings 30 years National Accounts experience to CA Fortune from ConAgra Foods. In his last role, John was responsible for driving brand sales across multiple categories calling on Publix and Southeastern Grocers. John will be responsible for Publix, Southeastern Grocers, Whole Foods Florida, Associated Grocers, and the Independent business in Florida. His start date was October 17th; welcome to the team John!

We strongly believe every person added to our team will make an immensely positive impact on your business and are so excited to have them.

Distributor News Stock Upsurging Over Past Month at United Natural Foods, Inc. Shares of United Natural Foods, Inc. (NASDAQ:UNFI) have climbed in the previous month. During that time period, shares are up 6.57% which has provided some nice profits for investors who may be looking to take advantage of the recent gains. Focusing in on the past five trading days, shares have changed 4.98%. Year-to-date, the stock has performed 7.11%.

Street analysts have given views on company stock . According to data from First Call, United Natural Foods, Inc. (NASDAQ:UNFI) has a consensus recommendation of 2.90. This recommendation falls on a scale from 1 to 5 where a 1 or 2 indicates a Buy recommendation, 3 a Hold and 4-5 a Sell.

Tracking some technical levels, shares are trading -3.61% away from the 50 day simple moving average and 4.15% off of the 200 day simple moving average. Recently, the stock has been noted -24.30% away from it’s 52- week high and 41.71% separated from its 52 week low. After the recent increase in the stock price, investors might also be looking to see if the stock has entered overbought territory and possibly be primed for a pullback. Traditionally, a stock is thought to be overbought when the Relative Strength Index moves above 70.

As of this writing, United Natural Foods, Inc.’s RSI stands at 56.31 . In looking at volatility levels, the shares saw weekly volatility of 2.33% and 2.24% over the past month.

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Distributor News Lipari Foods Deploys Symphony Gold Next-Generation Category Management Solutions Symphony GOLD, provider of the GOLD unified software platform for omni-channel retail, today announced that Midwest food distributor Lipari Foods has deployed the next-generation GOLD Category Management solutions to facilitate collaboration with its retail customers and ensure the correct product assortments and shelf allocation for each and every store. Lipari Foods had previously relied on the legacy GOLD space planning solution to develop localized planograms for its retail customers.

The GOLD Category Management solutions, which help power the Symphony Retail Cloud Category Manager’s suite, combine local assortment management, store clusters, shelf and retail space planning with data and metrics, enabling Lipari Foods to work together with its retail customers to create truly localized, store-level assortments. By leveraging information on local retail trends, marketing information and new product launches, retailers can optimize assortment choice and availability in order to increase sales, minimize costs, and increase profits.

With the Cloud platform Lipari can push planning processes out to its field reps, giving them access to planograms on their mobile devices and work with retailers to localize their product assortments based on consumer demand. GOLD also gives them space planning capabilities so that they can collaborate with retailers to optimize every inch of available shelf space.

“The real value of Symphony GOLD’s next generation category management solutions is in allowing Lipari Foods to help our customers understand their market, pricing, and right assortment mix,” said Michael C. Hegarty, Director ERP – CRM Corporate Strategy at Lipari Foods LLC. “By providing relevant planogram and category recommendations, Lipari can partner with our customers to help them drive better margins.”

“With its recent upgrade to our next-generation, cloud-based category management solutions, Lipari Foods has implemented a truly modern and collaborative system. This will help Lipari Foods work with its retail customers to achieve higher revenue and margins by optimizing their merchandising and category management processes,” said Gregg Monastiero, president, United States, Symphony GOLD.

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SpartanNash Foundation, Store Guests Raise Money to Help End Hunger The SpartanNash Foundation’s scan campaign to end hunger was its most successful companywide retail fundraising effort to date – raising nearly $300,000 on behalf of more than 100 local food pantries and food banks in the communities it serves. continues next page...

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Distributor News SpartanNash Foundation, Store Guests Raise Money to Help End Hunger cont...

Between Aug. 31 and Sept. 11, the SpartanNash Foundation hosted the companywide scan in each of SpartanNash’s 160 corporate-owned stores in nine states. Store guests and company associates who visited the stores during the 12-day retail scan campaign had the opportunity to donate $1, $5 or $10, with 100 percent of dollars raised going to support community food pantries and food banks.

Each store personally selected the local community food partner its campaign would support, ensuring the scan to end hunger would have a significant local impact.

“The generosity of our store guests during this retail scan campaign was incredible. We are most grateful to all who joined forces with the SpartanNash Foundation and our associates to support our efforts to end hunger in the communities where we live and work,” says Meredith Gremel, vice president of corporate affairs and communications and executive director of the SpartanNash Foundation. “Together, we have made a tremendous difference, and it is clear that the local aspect of this fundraising effort was important to our store guests, as 100 percent of the dollars raised were directed back to the donors’ local communities.”

More than 100 local food pantries will receive monetary support thanks to the scan to end hunger, with some SpartanNash stores – such as the six Dan’s Supermarkets in Bismarck, N.D. – teaming up to support the same food bank in their area.

In total, the Dan’s Supermarkets raised $18,500, all of which will be donated to the Salvation Army. Other top fundraising efforts included: ·Six stores in Grand Rapids, Mich. – including the Family Fare Supermarket and Quick Stop on Leonard St., the D&W Fresh Market and Quick Stop on 28th St. and Forest Hills Foods and Fuel on Cascade Road – raised $11,250 on behalf of God’s Kitchen. · Four Family Fare Supermarkets in Fargo, Moorhead and West Fargo, N.D. raised $9,200 on behalf of the Great Plains Food Bank. · Six Family Fare Supermarkets in Omaha, Neb. and the No Frills stores in Plattsmouth, Neb. and Glenwood, Iowa raised $8,500 on behalf of Together, Inc. In 2015, SpartanNash donated 2.5 million pounds of distressed product to more than 130 food pantries through its corporate retail locations, distribution centers and MDV, the company’s military division based in Norfolk, Va. SpartanNash underwrites the cost of the fundraising campaign, and associates and the SpartanNash Foundation – the company’s charitable giving arm – contribute financially as well.

In 2016, nearly $825,000 was raised through the SpartanNash Foundation’s companywide scan campaigns, benefitting local Habitat for Humanity, Special Olympics, patriotic and food pantry partners.

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Industry News Cocoa Compound Linked to some Cardiovascular Biomarker Improvements To the tantalizing delight of chocolate lovers everywhere, a number of recent studies employing various methods have suggested that compounds in cocoa called flavanols could benefit cardiovascular health.

Now a systematic review and meta-analysis in the Journal of Nutrition, of 19 randomized controlled trials (RCTs) of cocoa consumption reveals some further pieces of supporting evidence. In all, 1,139 volunteers were involved in these trials.

“Our meta-analysis of RCTs characterizes how cocoa flavanols affect cardiometabolic biomarkers, providing guidance in designing large, definitive prevention trials against diabetes and cardiovascular disease in future work,” said corresponding author Dr. Simin Liu, professor and director of the Center for Global Cardiometabolic Health at Brown University who worked with epidemiology graduate student and lead author Xiaochen Lin. “We found that cocoa flavanol intake may reduce dyslipidemia (elevated triglycerides), insulin resistance and systemic inflammation, which are all major subclinical risk factors for cardiometabolic diseases.”

Liu noted some limitations in the trials. All studies were small and of short duration, not all of the biomarkers tracked in these studies changed for the better, and none of the studies were designed to test directly whether cocoa flavanol consumption leads to reduced cases of heart attacks or type 2 diabetes.

But taking into account some of these heterogeneities across studies, the team’s meta-analysis summarizing data from 19 trials found potential beneficial effects of flavanol-rich cocoa on cardiometabolic health. There were small-to-modest but statistically significant improvements among those who ate flavanol-rich cocoa product vs. those who did not.

The greatest effects were seen among trial volunteers who ate between 200 and 600 milligrams of flavanols a day (based on their cocoa consumption). They saw significant declines in blood glucose and insulin, as well as another indicator of insulin resistance called HOMA-IR. They also saw an increase in HDL, or “good,” cholesterol. Those consuming higher doses saw some of the insulin resistance benefits and a drop in triglycerides, but not a significant increase in HDL. Those with lower doses of flavanols only saw a significant HDL benefit.

In general, Lin said, where there were benefits they were evident for both women and men and didn’t depend on what physical form the flavanol-rich cocoa product was consumed in -- dark chocolate vs. a beverage, for example.

“The treatment groups of the trials included in our meta-analysis are primarily dark chocolate -- a few were using cocoa powder-based beverages,” Lin said. “Therefore, the findings from the current study apparently shouldn’t be generalized to different sorts of chocolate candies or white chocolates, of which the content of sugar/food additives could be substantially higher than that of the dark chocolate.”

The authors therefore concluded, “Our study highlights the urgent need for large, long-term RCTs that improve our understanding of how the short-term benefits of cocoa flavanol intake on cardiometabolic biomarkers may be translated into clinical outcomes.”

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Industry News Test Improves Detection of Proteins in Starch; Aids in ‘Gluten-Free’ Labeling For people with celiac disease, wheat allergies or gluten sensitivity, the options for gluten-free foods are growing. But knowing for sure whether products marketed as such are truly safe to eat can be more complicated than just reading a label. Now scientists, reporting in ACS’ Journal of Agricultural and Food Chemistry, have developed a more reliable way for manufacturers to detect gluten in purified wheat starch, a common ingredient in foods labeled gluten-free.

Gluten is a mixture of proteins in the starch of wheat, rye and barley grains that can be broken down into two subgroups: prolamins (wheat gliadins) and glutelins (wheat glutenins). When people with celiac disease, wheat allergies or gluten sensitivity consume these proteins, they can experience a range of symptoms from diarrhea and vomiting to fatigue and migraines. Current testing for gluten in foods involves running an enzyme-linked immunosorbent assay, or ELISA. Although the method determines gliadin levels accurately, its measurements of glutenins are less reliable. Katharina Anne Scherf and colleagues wanted to find a more comprehensive approach.

The researchers combined gel-permeation high-performance liquid chromatography with fluorescence detection to develop a sensitive technique that can detect both gliadins and glutenins in purified wheat starch. The new method identified higher amounts of gluten in 19 out of 26 starch samples than the ELISA analyses did.

And, according to the new test, 12 samples that had been labeled gluten-free contained between 25.6 and 69 milligrams of gluten per kilogram of starch. The U.S. Food and Drug Administration and the United Nations’ Food and Agriculture Organization have set the maximum limit for gluten in products labeled gluten-free at 20 mg/kg.

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Consumer Trends The Next Hot Trends in Food

The next ingredient: Something consumers understand Food companies have long struggled to keep up with changing government guidelines and regulations by reformulating their products to remove unhealthy ingredients such as trans fatty acids, sugar and salt. In some cases, though, shoppers are even more suspicious of the stuff companies put in, such as artificial sweeteners.

Now the goal is “clean labels”—lists of ingredients consumers can understand and pronounce. So, food makers are experimenting with adding natural ingredients to mask bad flavors or enhance good ones

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Consumer Trends The Next Hot Trends in Food cont... without swapping one bad ingredient for another.

“It’s a shift in thinking for food and ingredients companies,” says Dave Donnan, a partner at consulting firm A.T. Kearney, where he leads the global food and beverage practice. “They’re not just looking for a replacement for sugar, but how to change the taste profile” of products so that they don’t need as much sweetener in the first place.

For instance, one biotech company is using mushrooms to remove the bitterness in cocoa beans so that chocolate can be made with less sugar. Other companies are moving to soy protein and natural flavor enhancers to reduce sodium levels in food.

The next healthy beverage: Plant waters The coconut-water fad appears to have unleashed a new category in the drink aisle: plant waters. From aloe water and maple water to artichoke water and cactus water, they are replacing more sugary sports drinks and artificially flavored waters that don’t appeal to consumers’ desire for nutritious and natural beverages.

While U.S. soda sales fell for the 11th year in a row last year, coconut water sales rose 27%, according to market research firm Technavio.

Some drinks are more likely to make it from health-food stores to convenience stores than others. Maple water and cactus water are more appealing than, say, artichoke water, since many people know cactuses contain water and view maple syrup as tasty.

Not only do these provide more flavor than plain water, they also tout health benefits beyond hydration. Aloe-vera juices claim to aid digestion and weight loss. Cactus-water makers say their drinks contain electrolytes and antioxidants.

Some of these plant waters are already popping up next to coconut water in mainstream grocery stores such as Kroger. The new plant waters are taking aim at the coconut beverage, advertising that maple water or cactus water contains significantly less sugar. companies are already using spirulina for organic candy, like Black Forest gummy bears.

The next natural food dye: Spirulina The move toward cleaner food labels is pushing out artificial food dyes like Red No. 40 and Yellow 6, which were popularized for making Jell-O dessert bright red and giving Froot Loops cereal its neon glow. Food makers are responding to growing concerns among parents that artificial food colorings may cause hyperactivity and allergic reactions in their children.

While red and yellow are relatively easy to replicate with natural spices like turmeric and paprika, blue and green have given food makers trouble—until now. continues next page...

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Consumer Trends The Next Hot Trends in Food cont...

Blue-green algae called spirulina are often sold as a health supplement at vitamin shops or as an energy shot in smoothies. But now they are being harvested for use as a natural blue-green dye.

In 2013, M&M’s maker Mars Inc. received the green light from U.S. regulators to use spirulina to color candy and gum. That was later expanded to include cereal, ice cream and more—completing the natural color palette for food makers. Mars said in February it would switch M&M’s to all-natural colors by 2021. Other small companies are already using spirulina for organic candy, like Black Forest gummy bears.

The Food Marketing Institute, a grocery trade group, expects the volume of spirulina used for food and beverages to quintuple in 2020 from 2014, and the natural food-coloring industry to grow at an average annual rate of 6.8% in that time frame.

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5 Trends Driving Growth in Natural & Organic As US consumers embrace a healthier lifestyle focused on prevention rather than treatment, they increasingly are turning to the natural and organic channel for products that are clean, natural and have added health benefits.

As a result, sales in the organic and natural channel are booming. According to recent Packaged Facts’ research, the natural channel will reach a record $69 billion by the end of this year, which is a 12% increase over the prior year. At the same time, it reports, the conventional channel is holding steady at best.

A subsection of this segment is Organic, sales of which the Organic Trade Association just announced reached a new high of $43.3 billion in 2015. This is up a robust 11% from last year’s also record level – allowing the segment to capture 5% of the overall US market food share.

But beyond a general perception that natural and organic foods are healthier than conventional food, what is driving consumer interest in this space and more importantly what will drive product innovation in 2017?

In this episode of FoodNavigator­USA’s Soup­To­Nuts Podcast, Jim Emme, CEO of NOW Health Group, outlines five major trends that he says are the backbone of innovation in the natural and organic channel and will continue to drive sales through next year.

These include: Truth in labeling – Transparency is the foundation of building consumer trust – and sales – in the natural channel. Emme argues that transparency means clearly labeling what is in the product, including GMOs if they are present. He acknowledges that views on GMOs vary, but says providing consumers that added layer of information empowers them to decide what products are right for them. Being transparent also includes adequately testing products to ensure that the ingredients are the highest standard and that consumers receive what they believe they are buying. continues next page...

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Consumer Trends 5 Trends Driving Growth in Natural & Organic cont...

Probiotics – Consumers now understand the importance of gut health in building immunity and ensuring that their bodies are in top condition. As such, Emme says they will continue to demand more probiotics in different formats that deliver specific values, such as for immunity, skin benefits or digestive wellness. Consumers also are demanding higher quality probiotics, and to ensure that NOW provides the correct strains, Emme said the company uses Dupont’s RiboPrinter System to “fingerprint” and better identify the different strains and other microorganisms in products and ensure their purity.

Stress­relievers – Citing data from the American Psychological Association, Emme notes that in 2015 24% of adults said they were highly stressed – up from 18% the prior year. As a result, consumers increasingly are looking for foods and ingredients that can help them relax, including popular adaptogens such as Maca, Rhodiola, Ashwagandha, Panax Ginseng and Eleuthero.

Ashwagandha, in particular, is a breakout star with SPINS data noting product with the ingredient launched in year ending in October 2015 were up 57.3%, Emme said.

Plant­based and vegan options – Consumers increasingly associated being vegan with being healthy – prompting many to reach for more plant­based, vegetarian and vegan alternatives to animal products, Emme said. This trend already is in full swing, but likely will continue to grow – particular in the sports nutrition and general fitness categories. This creates opportunities for different plant­protein products, including NOW Sports’ Plant Protein Complex, which offers a blend of pea, brown rice, hemp and quinoa protein sources, Emme said. An added benefit of plant­based proteins is they are recognizable to many consumers, and therefore perceived as clean options.

Easy options – Consumers clearly want healthier options, but many also don’t want – or are unable to change their lifestyle to accommodate better­for­you products, Emme said. That is why, he notes, it is important that manufacturers offer these products in formats that are convenient, portable and fit into shoppers evolving habits of reaching for smaller snacks throughout the day, rather than the traditional three square meals.

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Pretzel Demand Breeds Creativity The lure of late summer and early fall is not only reliant on seasonal change, but also what that change brings with it, namely a shift in food tastes.

Over the course of the past few years, pretzels have taken off as a reliable source of business for bakeries looking to capitalize on an emerging trend. This is apparent in items such as pretzel buns and breads, continues next page...

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Consumer Trends Pretzel Demand Breeds Creativity Cont... which was spurred by national food chains such as Wendy’s adopting them in their menus and taking them mainstream.

The pretzel boom started with bakeries in Europe and eventually made its way to America. The novelty of the items took hold first, but the taste is what has allowed them to thrive in American bakeries. According to Food Business News, mentions of pretzel breads on menus have gone up 97 percent between 2012 and 2015. It adds a level of excitement, especially when implemented during the fall.

As the taste for pretzel continues to grow, bakeries must adapt in order to satisfy consumer demand. This means creating new and interesting takes on a classic flavor.

Cretzel We’ve all heard of pretzel buns, but the pretzel flavor is expanding to other breads, such as the croissant.

While first developed in the 90s, the cretzel has exploded onto the scene recently as the taste of pretzel has encouraged its placement on menus. The cretzel has sprung from the need for innovation in places such as New York. Zaro’s Family Bakery developed its Bronx Cretzel by fusing its signature Zaro croissant with the pretzel recipe of the Bronx Baking Co. “The Bronx Cretzel is designed to offer the novelty of a traditional pretzel on the exterior and the sophisticated satisfaction of croissant on the interior,” Zaro’s said.

Zaro’s has successfully enhanced its product lineup with new pretzel offerings, and in doing so has made it much more appealing to consumers who are looking for a standout.

Merging Salty and Sweet The average consumer’s palette is inclined to enjoy a combination of the salty and sweet tastes. Salted caramel has been a popular treat in America for a long time, and foods like bacon are seeing a popularity boom in part because of their inclusion in desserts such as donuts and cupcakes.

Naturally, pretzels provide the perfect canvas to add a sweet flavor. Continuing with the theme of witty name fusions, we next look at the prezookie: stuffed pretzel cookie.

Stuffed pretzel cookies almost sound too good to be true, but they are very real and quite spectacular. Sprinkling chocolate chips, brown sugar, and cinnamon into the pretzel dough before baking can turn the average pretzel into a sweet and chewy surprise. By merging a satisfying pretzel with a delicious cookie flavor, you’ve created a new menu item that combines the best of both worlds.

Better for you Healthy food options have become a priority in recent years. Consumers are looking for foods that fill that role in their snacking. Pretzels have long been considered healthier than many conventional snacks. While their sodium content can be high, they also contain iron, vitamins, and other essential nutrients, which can aid digestion and boost metabolism. Depending on the type of flour used, those levels can sway even further.

One segment of the population that is often underserved on menus would be those with gluten intolerance. continues next page...

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Consumer Trends Pretzel Demand Breeds Creativity cont...

Last year, a study published in the journal Digestion claimed that an estimated 1 percent of the population has celiac disease, and must completely avoid gluten. Additionally, those with gluten sensitivity, an estimated 18 million (or 6 percent of the population), are encouraged to avoid gluten as well.

That doesn’t even cover those Americans who avoid gluten regardless of their tolerance to it. A Gallup poll published last year stated that 1 in 5 people say they try to include gluten-free foods in their diet.

Bakeries across the country have undergone the process of adjusting to the growing percentage of Americans who rely on gluten-free foods in their diets.

Pretzels are no different. For those who love their taste but can’t handle the normal gluten content, you can provide a gluten-free option that is true to the flavors and textures of standard pretzels.

By examining these pretzel trends and including them in your bakery’s menu, you can ensure that you are keeping pace with a consumer demand that constantly evolves. They are one of the hottest bakery items in recent years, and their popularity will allow them to continue expanding in our food culture.

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Retailer News Fresh Thyme Farmers Market as Meijer skunkworks?

Public filings show common ownership; Experts say brand separation likely a marketing tactic

With increasing demand for fresh, specialty groceries, Walker-based Meijer Inc. has started to look outside the big box retail format it’s known for, even if the retailer doesn’t like to admit it.

The West Michigan retailer speaks publicly about being a passive investor with a financial interest in Downers Grove, Ill.-based Fresh Thyme Farmers Market, a growing regional specialty grocery chain positioned to tap into the niche of consumers focused on healthy, fresh foods. However, the notoriously buttoned-up Meijer corporate office has long denied that the relationship was deeper than a financial investment.

But through a review of public documents from multiple states where Fresh Thyme operates stores, MiBiz has learned that Meijer — along with a veteran specialty grocery executive — created the 48-store chain, which it owns through a subsidiary. continues next page...

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Retailer News Fresh Thyme Farmers Market as Meijer skunkworks? Cont...

Moreover, the specialty chain appears to serve as a skunkworks division apart from the larger Meijer organization, according to multiple sources familiar with corporate law, liquor license regulations and Meijer’s own operations.

By giving autonomy to the well-capitalized Fresh Thyme brand, which plans to have 60 stores and employ 5,000 people by 2019, Meijer likely hopes to learn how to attract customers in the growing specialty segment without going through the struggle of implementing it within its own legacy retail operation, according to one local expert.

“When you say ‘Meijer,’ you get a certain image,” said Bonnie Knutson, interim director in the School of Hospitality Business at Michigan State University. “But when you look at today’s trends, that image doesn’t fit with a certain niche. Fresh Thyme has a brilliant name. Like Whole Foods, it says something. If they said ‘Fresh Thyme by Meijer,’ you’d get a different image, so it stands to reason that they’d want to separate those brands.”

Local attorneys say Meijer could be capitalizing on some esoteric tax advantages with its relationship to Fresh Thyme, but the overarching reason for the business structure — and the Meijer-Fresh Thyme brand separation — was primarily as a marketing strategy.

The reasons for creating the perception of a passive investor relationship are many, sources said. For one, Meijer has long been known for having a bureaucratic corporate culture that struggles to implement innovation, according to multiple executives who have consulted with Meijer in the past and who spoke on the condition of anonymity.

Fresh Thyme, which operates a store at 2470 Burton St. SE in Grand Rapids, offers a range of fresh meats and seafood, bulk foods, and minerals and vitamins, as well as organic, gluten-free and dairy-free options. The company’s stores are also a fraction of the size of a 200,000-square-foot Meijer superstore, with most clocking in around 30,000 square feet.

Meijer, which Forbes reported generates more than $16 billion in annual revenues, has good reason to diversify its offerings into the lucrative U.S. specialty grocery market, which the Specialty Food Association Inc. estimated at more than $120 billion last year.

While grocery industry experts insist that Meijer’s name brand continues to grow and expand to new geographic markets like Wisconsin and Minnesota, there’s a certain segment of shoppers immediately turned off by aspects of the company’s business.

“Perhaps the group of shoppers you’re trying to target with a company that is more focused on local and fresh food are people that inherently have a dislike or are not as hot at going to shop at a humongous box store because they feel that is not the type of shopping experience they want,” Dr. Marcel Zondag, an continues next page...

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Retailer News Fresh Thyme Farmers Market as Meijer skunkworks? Cont... assistant professor of marketing at Western Michigan University, said in an interview with MiBiz. “At that point, you plaster a different name on it. … There’s a reason Shock Top (beer) is called Shock Top and not Budweiser.”

Zondag’s research focuses on consumer trends within the food industry. As such, Zondag said he’s done considerable research on behalf of Meijer but doesn’t speak for the organization.

KEEPING QUIET For its part, Meijer largely declined to discuss specifics regarding its relationship with the Fresh Thyme brand.

Frank Guglielmi, Meijer’s senior director of communications, repeated the statement that Meijer maintains an undisclosed financial interest in the specialty brand, but later clarified the company’s ownership of Fresh Thyme.

“We own a majority of Fresh Thyme, but not 100 percent, which is why we call it an investment interest,” Guglielmi wrote in an email. “We’re privately held and don’t discuss financial business, and our ownership stake in Fresh Thyme is just that.”

But according to a string of state filings, Meijer and the company that does business as Fresh Thyme Farmers Market (Lakes Venture LLC) share a common parent company: Meijer Companies Ltd. In applying for retail liquor licenses, companies need to disclose their ownership with the state. In Michigan, Fresh Thyme Farmers Market stores and Meijer Inc. branded stores list their sole stockholder as Meijer Companies Ltd., according to licenses MiBiz researched for this report.

The same holds true in other states where Fresh Thyme is expanding. Meijer Companies Ltd. is listed as the “sole member (and 100% owner) of Lakes Venture LLC,” according to the liquor license for a Fresh Thyme store in West Des Moines, Iowa.

Additionally, Meijer co-chairman and CEO Hank Meijer is listed as the vice president and secretary of Meijer Companies Ltd., according to regulatory filings with the city of Lincoln, Neb., where Fresh Thyme opened a store earlier in 2016.

FINDING SYNERGIES, OR NOT? Fresh Thyme Farmers Market began its life as a Delaware corporation headquartered in Arizona in 2012, according to its articles of incorporation. In 2015, the company reportedly moved its headquarters to suburban Chicago. Despite their headquarters being separated by about 195 miles, the connections between Meijer and the specialty retailer run deep.

Officers of Lakes Venture LLC include the entity Meijer Companies Ltd., plus three top Meijer executives: coCEO Mark Murray, senior vice president of finance and CFO Daniel Webb and Meijer General Counsel Janet Kelley.

Another officer is Christopher Sherrell, a veteran executive of other specialty grocery chains, and the current CEO of Fresh Thyme. Sherrell did not respond to requests to comment for this report. continues next page...

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Retailer News Fresh Thyme Farmers Market as Meijer skunkworks? Cont...

By all indicators, the Meijer and Fresh Thyme organizations share ownership, but operate autonomously, which is the point of forming the skunkworks organization.

“We are completely separate businesses, with completely separate operations,” Hank Meijer told Progressive Grocer, a grocery industry trade publication, in 2015. “We see our role as part of an organic experiment to learn, but not to smother, to gain knowledge, but not to stifle creativity.”

In the phone interview, Guglielmi noted that Meijer and Fresh Thyme stores will compete with each other in some markets. However, grocery industry experts contacted for this report say that the type of consumers attracted to Fresh Thyme don’t mind shopping at multiple stores for their purchases.

Moreover, Meijer and Fresh Thyme share a similar, regional footprint, although the latter has already expanded into markets such as Nebraska, Iowa and Missouri, where Meijer does not operate.

According to reports, Fresh Thyme operates its own distribution centers around its 10-state footprint, including a 320,000-square-foot facility in Bolingbrook, Ill. But with ambitious expansion plans for the Fresh Thyme brand, it’s unclear whether that autonomy will last. Fresh Thyme plans about a dozen new stores this year alone, according to a Chicago Tribune report in May. However, depending on Meijer’s long-term goals with the Fresh Thyme chain, it may make sense for the parent company to maintain separation between the two brands, according to grocery industry experts.

“You would expect eventually to use some synergy,” WMU’s Zondag said. “But to be honest, the moment you commit to that … you’re losing a lot of the flexibility that you have.”

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Ahold Delhaize Announces Resignation of James McCann & Appointment of Kevin Holt at Ahold USA James McCann, COO of Ahold USA and architect of the “Project Thunder” initiative to revive its Stop & Shop and Giant brands, has resigned from the company and its executive management board effective immediately, Ahold Delhaize said Wednesday. Kevin Holt, who held the same title at Delhaize America, has been appointed in his place.

McCann’s resignation comes months after the Dutch retailer completed a merger with Delhaize Group, parent of the Hannaford and Food Lion chains that Holt oversaw as Delhaize America COO. Those divisions will report to Ahold Delhaize deputy CEO Frans Muller on an interim basis, the company said.

Ahold said McCann resigned “in order to move out of full-time executive work and into a portfolio of continues next page...

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Retailer News Ahold Delhaize Announces Resignation of James McCann & Appointment of Kevin Holt at Ahold USA cont... non-executive and advisory roles,” and would remain available to the company to assist the transition through April 30 of next year.

The move would appear to appease some observers in Europe who had criticized the company for proposing to employ two U.S. COOs as part of the combined group.

McCann joined Ahold in September 2011 as chief commercial officer, and assumed responsibilities for Ahold USA in 2013, succeeding Carl Schlicker. At Ahold USA McCann was outspoken in his determination to make the chain “one of the great U.S. retailers,” and led a comprehensive transformation plan involving expense reductions to fund price and service investments in stores known internally as “Project Thunder.”

That initiative has resulted in modest gains in volume and same-store sales at the group through the company’s last reported quarter, although McCann often framed his ambitions over a longer term, telling SN in 2014 he was eyeing greatness by the end of the decade. Challenges however have persisted at some of Ahold’s U.S. banners including Giant-Landover, which has faced a rash of competitive openings around its Metro Washington, D.C. market areas. More recently, Ahold acknowledged that price actions from Wal-Mart Stores were necessitating a competitive response from its Pennsylvania-based Giant-Carlisle division.

In Metro New York, McCann beefed up its Stop & Shop banner through the acquisition of 25 former A&P stores a year ago, although it was not alone in benefiting from the A&P selloff as Albertsons Co.’s Acme Markets division and Wakefern Food Corp.’s ShopRite banner were also significant acquirers in the market.

Holt was named Delhaize America COO in 2014, where the Food Lion and Hannaford banners have each grown sales and share in recent years, although in the case of Food Lion, the sales revival came at a cost to the bottom line. Holt formerly held executive leadership positions at Supervalu, Sears and Meijer.

“We thank James for his significant contributions both driving our e-commerce strategy whilst based in Europe and for the last three-and-a-half years driving the transformation at Ahold USA, supporting the Stop & Shop New York, Stop & Shop New England, Giant Landover, Giant Carlisle, Martin’s and Peapod brands,” Ahold Delhaize CEO Dick Boer said in a statement. “We wish James and his wife Tania all the best for the future.

“As the new leader of Ahold USA, Kevin brings a wealth of US retail experience and he is recognized for his leadership skills,” Boer added.

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Retailer News Rouses Markets increases presence in Baton Rouge area, acquires LeBlanc’s stores Rouses Markets is acquiring the nine locations of LeBlanc’s Food Stores, a move that will increase the company’s presence in Baton Rouge.

The deal will give Thibodaux-based Rouses 54 locations, including 10 in metro Baton Rouge. Financial details were not disclosed.

Donny Rouse, managing partner of Rouses, said his family and the LeBlancs have similar values and a dedication to buying local and supporting local fishermen and farmers. “This really is a perfect fit,” he said.

The deal had been in the works since the summer. While Rouses has grown since 2007 though acquisitions of Sav-A-Center, Choice Supermarkets and Belle Foods, the deal with LeBlanc’s is a little different.

“This is not a turnaround,” Rouse said. “None of the stores are in poor condition. The LeBlancs have done a great job operating them and they hired great team members. That makes it a little easier to go forward.”

The LeBlanc’s stores will undergo some changes. Plans call for some remodeling, expanding the perishable and seafood departments and adding rooms to boil seafood.

All of the current LeBlanc’s employees will have the option to remain with Rouses. Rouse said he doesn’t know yet if there will be any additional hiring to staff the expanded departments.

“We won’t know until we get into the stores,” he said. “They were kind of our competitors so we weren’t able to get into the stores and study them.”

Rouse said the LeBlanc’s stores will be rebranded as Rouses by the end of October.

The LeBlanc family has been in the grocery business for more than 100 years. L.C. LeBlanc started the chain in 1961 in Gonzales.

LeBlanc’s has two stores in Gonzales, and one each in Baton Rouge, Prairieville, Zachary, Donaldsonville, Plaquemine, Plattenville and Hammond.

In 2013, the company started rebranding some of its stores with the Frais Marché concept, emphasizing organic produce, prepared foods and specialty Cajun meat dishes. There are now five Frais Marche stores.

In a prepared statement announcing the sale, owners Marcy and Randy LeBlanc thanked their customers and employees for their years of service and dedication. “The continued success of the supermarket operations we built are now with an established company well positioned to compete in a competitive retail environment,” the family said.

Marcy LeBlanc will stay on for several months to help with the transition and make sure that Rouses doesn’t miss out on any important community partnerships or items that customers want, Rouse said. continues next page...

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Retailer News Rouses Markets increases presence in Baton Rouge area, acquires LeBlanc’s stores Rouses was founded 66 years ago by Anthony J. Rouse Sr., Donny Rouse’s grandfather. The company now has stores across South Louisiana, the Mississippi Gulf Coast and South Alabama.

Rouses currently has stores on Airline Highway in Baton Rouge and Juban Crossing in Denham Springs. The Juban Crossing store is temporarily closed because of flooding. Rouse said a third Baton Rouge area location is in the works. “We should be able to announce something in a couple of weeks,” he said.

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Sprouts Farmers Market Announces 8 New Stores; Entering Florida and North Carolina in 2017

Growth is on the menu for Sprouts Farmers Market, which has now confirmed entry into the Florida and North Carolina markets amongst eight new stores announced.

The locations are slated for 2017, amongst a total of 36 new stores for the year. These latest locations, slated for the first quarter of next year, include: Carrollwood, FL, Decatur, GA, Falls of Neuse, NC, Folsom, CA, LaVerne, CA, Marietta, GA, Prescott, AZ and Wichita, KA The retailer stated that each store will bring more than 100 career opportunities to the areas in which they are located, with hiring and grand opening details to be shared at a later date.

Sprouts Farmers Market refers to itself as “the healthy grocery store,” featuring fresh produce, bulk foods, dairy, meat and seafood, bakery, deli, vitamins, and more.

In addition to offering an abundant selection of fresh fruits and vegetables, as well as barrels of wholesome grains, nuts, and sweets, the grocer touts an open environment in the store that showcases thousands of natural, organic, and gluten-free groceries, fresh-baked goods, eclectic beer, and wine.

What will be the next move for the retailer that looks to be one of the fastest-growing retailers in the country?

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Retailer News Industry Speculates Kroger Eyes Whole Foods Acquisition

The industry mill stirred with speculation late last week as whispers spread of a possibility that Kroger and Whole Food are in talks of an acquisition.

Kroger and Whole Foods both officials declined to discuss what news source Cincinnati.com called “rumors and speculation” regarding a potential buyout, but follow-up reports have seen analysts doubting that such a deal will be struck.

The rumors were still enough, however, to register a notable reaction on both sides’ stocks, which saw upkicks by closing time Thursday, Oct. 7.

Whole Foods’ shares jumped 4.9 percent to close at $29.33 Thursday, while Kroger’s own numbers saw a 1.8 percent boost, closing at $29.37.

While this could be listed on the plus side, Jim Hagerty, a Principal and Investment Adviser at Cincinnati-based firm Bartlett & Co., told the Cincinnati Business Courier, “I would think there would be a strong reaction if the market thought a deal was likely.”

Whole Foods has been associated with helping to grow and pioneer organic and natural foods, and despite some bumps has reported positive feedback on the newly-launched 365 chain.

Cincinnati.com reported that, if the deal has merit, the price tag for Whole Foods could be about $9.7 billion based off Kroger’s having paid about seven times the cash flow of previous chains.

Kroger has made a few sweeping purchases in the last couple of years, namely Roundy’s and Harris Teeter, as well as Market6 and DunnhumbyUSA, and has been on the list of interested buyers for both The Fresh Market and SuperValu. The retailer has also moved more actively to enhance its organic and natural foods offerings, which the report noted as a possible reason for its potential interest in Whole Foods.

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