Progressive Grocer - May 2018

Page 1

PLANT FORWARD Soups & Sides that contain flavorful ingredientss which include, vegetables, grains and beans. Blount has over 50 varieties of soups & sides that meet our definition of Plant Forward Learn more by contacting Blount at 800-274-2526 or visit

KNOW NO BOUNDARIES Take advantage of our culinary innovation, inspired recipes, simple, authentic ingredients and premium quality. It’s little wonder that Blount’s expanding line of premium soups is redefining the deli section of hot-to-go soup and its popularity and performance in this must-win category. Our convenient and ready-to-heat bags reduce labor and increase profit – and our commitment to you is unsurpassed. Learn more by contacting Blount at 800-274-2526 or visit

The Leader in Hot-To-Go Soups at Retail

Store of the Month: Bristol farms food hall store creates community Grill Masters Summer is the time for barbecuing fresh fruits and veggies Better PrePared Deli grows through whole-store merchandising to their health How retailers can capture the wellness-oriented shopper


YEaR of DiSRUPTion May 2018 • Volume 97, Number 5 $10 •


Wet Cat is Where It’s At The 27 million households that buy wet cat food are valuable shoppers with intense connections to their pets here are a number of reasons why the 94 million cats in U.S. households are finding more wet food in their dish these days.


The most basic reason is preference. Sixty-nine percent of pet parents feed wet food simply because it’s very well-liked by their cats, according to Cat Food Regimen, 2015. Others choose to feed wet food because they know that the moisture helps keep their cats well hydrated. Offering variety is another purchase driver. In the wild, cats source a wide range of prey, so pet parents are feeding those natural cravings by offering a range of textures and tastes found in wet cat food. In fact, according to the 2015 Cat Food Regimen report, 71 percent of pet parents report buying wet cat food because of the variety. Ultimately, buying wet cat food helps pet parents meet the needs of their cats, which can lead to stronger bonds with their finicky companions. The same Cat Food Regimen report found that 52 percent feed their cats wet food because it makes them feel like a good pet parent. So why should retailers care? Because wet cat shoppers are a valuable segment. The 27.2 million U.S. households that purchase wet cat food also make more shopping trips and spend more per household than other cat shoppers. According to Nielsen Homescan Panel Data (52 wks ending 12/30/17), wet cat households make 12.6 trips per year and spend, on average, $105 on wet cat food over the course of the year. That’s compared to 6.5 trips and $82 per year for dry cat shoppers, 5.9 trips and $69 per year for litter buyers, and 5.4 trips and $28 per year for cat treat purchasers. However, much like the animals they care for, wet cat buyers often have distinct preferences. While variety is their top consideration when choosing a

retailer, different shoppers define “variety” differently. According to the Cat Food Regimen study, some look for a range in pricing or packaging (for example, bigger cans to feed multiple cats), while others look for variety in flavors, protein and product forms. Getting the product mix right for these shoppers isn’t just important, it’s critical because wet cat shoppers will simply leave if you don’t satisfy their needs. One in five wet cat buyers will delay their purchase rather than settle for a substitute when they come across an out of stock, according to Walk Rates Research, 2018. That’s the highest walk rate among all cat shoppers. The good news is that the trends favor growth in wet cat food. There’s potential, for instance, to expand consumption among existing category users. In fact, 46 percent of current wet cat food shoppers say they wish they could feed their cat wet food more often, according to the Cat Food Regimen 2015 study. Demographic trends are in the segment’s favor, too. Millennials (who are now the largest pet-owning generation) are choosing cats more than other generations. According to research by Mintel, 51 percent of Millennials have a cat, compared with just 35 percent of the overall population. They’re also showing a proclivity for owning multiples. According to Pet Attitude Tracker (Q1, 2016), 35 percent of Millennials said they intended to acquire another pet within the next 12 months. Both of these factors are good signs for continued growth in the wet cat food segment, which is why, when it comes to the pet category, wet cat is where it’s at. n

Contents 05.18

Volume 97 Issue 5

44 features



STore of THe MoNTH

ProgreSSive groCer ’S SuPer 50

making food the star

Year of disruption

Bristol farms’ newest store creates a community for shoppers.

A newcomer to our annual ranking is shaking the industry to its very core.


14 CoNsumEr iNsights

20 all’s wEllNEss

The Deal With Dairy

Health in the Dairy Case

Business is Personal

16 NiElsEN’s shElf stoppErs/spotlight

104 Editors’ piCks for iNNovativE produCts

12 iN-storE EvENts CalENdar

Packaged Meat

8 Editor’s NotE

July 2018

18 miNtEl global NEw produCts

Hairstyling Products

106 tECh talk

Say ‘No’ to Tech for Tech’s Sake Progressive grocer May 2018


Contents 05.18

Volume 97 Issue 5

60 Center Store

8550 W. Bryn Mawr Ave. Ste. 200, Chicago, IL 60631 Phone: 800-422-2681 Fax: 978-671-0460

60 SvP, Brand director Katie Brennan 201-855-7609 • Mobile: 917-859-3619

Drink in Summer

editorial Managing Director of content Strategy Joan driggs 224-632-8211

Grocers and suppliers prepare to sell seasonal quaffs that help consumers beat the heat.

eDitorial Director James dudlicek 224-632-8238 Managing eDitor Bridget goldschmidt 201-855-7603 Digital & technology eDitor randy hofbauer 224-632-8240

66 Frozen & reFrigerated FoodS

Senior eDitor Kat Martin 224-632-8172

Milk it for All it’s Worth

contributing eDitorS Eric Richard, D. Gail Fleenor, Molly Hembree, Bob Ingram, Jenny McTaggart, Lynn Petrak and Barbara Sax

Retailers can leverage June Dairy Month to bolster sales across refrigerated, frozen departments.

advertiSing SaleS & BuSineSS SoutheaSt account executive larry Cornick 224.632.8248 MiDweSt Marketing Manager angela Flatland (ar, co, il, in, ia, kS, ky, Mi, Mo, ne, nD, ok, SD, tn, wi) 224-229-0547 • Mobile: 608-320-4421

71 FreSh Food

Get ’em to the Grill

Senior Marketing Manager Judy hayes 925-785-9665

Summer provides an opportunity for retailers to promote fresh fruits and veggies as prime barbecue fare.

Senior Marketing Manager theresa Kossack 214-226-6468 weStern regional Marketing Manager rick neigher (ca, or, wa) 818-597-9029

76 ProgreSSive groCer’S retail deli review


The Halo Effect

Grocers continue to grow deli sales by merchandising across the store.

northeaSt Marketing Manager Mike Shaw 201-855-7631 • Mobile: 201-281-9100 account executive/claSSifieD aDvertiSing terry Kanganis 201-855-7615 • Fax: 201-855-7373 claSSifieD ProDuction Manager Mary Beth Medley 856-809-0050 eventS SvP, eventS & conferenceS Maureen Macke 773-992-4413

83 ProgreSSive groCer’S FoCuS on the healthy ShoPPer

MarKeting Marketing Manager Carly Kilgore 201-855-7601

Best Health Inside

audienCe engageMent Director of auDience engageMent gail reboletti

Retail dietitians are a key part of grocers’ vision for whole-store wellness.

auDience engageMent Manager Shelly Patton 215-301-0593 liSt rental Meritdirect elizabeth Jackson 847-492-1350, ext. 318


SubScriber ServiceS/Single-coPy PurchaSeS 978-671-0449 or email at ProJeCt ManageMent/ProduCtion/art vice PreSiDent of ProDuction Kathryn homenick creative Director Colette Magliaro

95 teChnology

cuStoM Project ManagerS Kathy Colwell Judi lam

Doubling Down on Data Grocers’ ability to gather, analyze quality data is critical in developing the most effective store layout possible.

aDvertiSing/ProDuction Manager Jackie Batson 224-632-8183 art Director Bill antkowiak rePrintS, PerMiSSionS and liCenSing Wright’s Media 877-652-5295

100 equiPMent & deSign

The Big Green Chill

Suppliers and consulting firms respond to retailers’ desires for more sustainable and energyefficient refrigeration solutions.

CorPorate oFFiCerS executive chairMan alan glass chief executive officer david Shanker


chief oPerating officer & chief financial officer richard rivera chief branD officer Korry Stagnito PreSiDent, enterPriSe SolutionS terese herbig chief Digital officer Joel hughes chief huMan reSourceS officer Jennifer turner


Senior vice PreSiDent, innovation tanner van dusen

Editor’s NotE By Jim Dudlicek

Business is Personal It’s not personal, Sonny. It’s strictly business.” — Michael Corleone, “The Godfather”

hat’s an iconic line from one of my favorite films. But as we’ve come to learn, business these days is increasingly personal — retailers and brands need to make a personal connection with consumers, to appeal to the deeper motivations behind their shopping habits. Or, as Kevin Turner, vice chairman and senior advisor of Albertsons Cos., and former COO of Microsoft, told an audience at the recent IRI Growth Summit, in Las Vegas, “It’s not about thinking about the customer — it’s thinking like a customer.” The idea of personalization has become a common theme across retailing and certainly dominated speakers’ presentations at the annual IRI gathering. Retailers must relentlessly pursue shopper insights in their quest to stay relevant and better compete against the growing onslaught of competitors in the battle for share of wallet. Technology is table stakes now — “Every business is a digital business,” Turner asserted — so it’s not really brick and mortar versus ecommerce anymore; it’s about anyone who can successfully deliver a compelling, seamless shopping experience under the terms set by the shopper. Yet it’s the e-players that are setting the tone and the pace. The companies that best exemplify this, according to IRI President and CEO Andrew Appel, are Amazon, Facebook and Google. With a combined market capitalization of $2 trillion, these three companies are “highly customer-centric,” Appel told a summit audience. “They provide new and significant value to consumers.” Their solutions are simple. “The complexity is behind the scenes,” Appel remarked. “They move extremely fast, and they make big bets.” Moving quickly and realizing that most decisions are reversible, they’ve shrugged off their fear of failure, and they take on strategic collaboration partners — examples 8

that traditional retailers need to follow. Disruption is occuring in real time, so “the future belongs to the fast,” Turner pointed out. “Yesterday’s data is not as important as tomorrow’s data.” That data will demonstrate how consumers respond to brands, which, according to Clorox CMO Eric Reynolds, must be human-centered, purposedriven and technology-enabled. “We’re going to win by bringing more humanity,” Reynolds said about his company’s brand, which aims to “create a stage for life’s best experiences.” And you achieve that through personalization, or rather, “moving from a personalized approach to being truly personal,” contended Stuart Aitken, Kroger group VP, and CEO of the retailer’s shopper data arm, 84.51. “We have to inspire and connect with customers, and make them feel cared for,” Aitken added. “We have to do what’s right for customers. … We need to listen.” The ones that listen most effectively will ensure their future and their position on PG’s annual Super 50 ranking of grocery retailers, by providing new and significant value to consumers. See how you stack up, starting on page 22.

oh, Wellness This month, we launch the first in a series of supplements focusing on the healthy shopper, featuring guidance on how to turn the entire store into a nexus of wellness. Read more about that, and our upcoming Retail Dietitian’s Healthy Shopper Summit, starting on page 83.

Jim Dudlicek Editorial Director Twitter @jimdudlicek

VISIT US AT THE IDDBA • June 10-12 BOOTH # 5201 • New Orleans

KNOW NO BOUNDARIES T ake advantage of our culinary innovation, inspired recipes, simple, authentic ingredients and premium quality. It’s little wonder that Blount’s expanding line of premium soups is redefining the deli section of hot-to-go soup and its popularity and performance in this must-win category. Our convenient and ready-to-heat bags reduce labor and increase profit – and our commitment to you is unsurpassed. Learn more by contacting Blount at 800-274-2526. The Leader in Hot-To-Go Soups in Retail

in-store events

Calendar S


Creative Ice Cream Flavors Day. Set up a display of scoops, dishes, cones, and ice cream mixes and toppings near your ice cream freezer.




National Baked Bean Month National Culinary Arts Month National Hot Dog Month National Ice Cream Month



Make sure all Fourth of National Chocolate July displays are fully Wafer Day stocked.



Independence Day National Barbecue Day

National Anisette Day

National Picnic Month National Pickle Month National Independent Retailer Month



National Apple Turnover Day. Run a special in your in-store bakery for the sweet treats, or place apples on promotion in the produce department.



National Fried Chicken Day. Prepare a display of fried chicken and popular sides to also celebrate National Picnic Month.



National Strawberry Sundae Day National Macaroni Day

National Gingersnap Day


National Chocolate with Almonds Day. Run a contest on social media for the best recipes combining these two favorites.


Offer free ice cream cones for National Ice Cream Day.


National Sugar Cookie Day. Host a children’s sugar cookie decorating contest in the bakery.


National Corn Fritters Day

National Gummy Worm Day


National Piña Colada Day ‘Pick Blueberries’ Day


Keep the ice cream fun going by celebrating National Peach Ice Cream Day.









National Lollipop Day

National Junk Food Day. Entice customers with several displays of product that will satisfy those “guilty pleasures.”

National Blueberry Muffin Day

National Pecan Pie Day. Run an informal survey to National Mojito Day determine whether it’s pronounced “pee-can” or “pah-con.”

Ask for recipe suggestions for National Baked Bean Month.

National Daiquiri Day

Celebrate National French Fry Day in your prepared food department.

National Ice Cream Sundae Day

Fortune Cookie Day


Celebrate National Pickle Month by showcasing pickling supplies.


National Vanilla Ice Cream Day Set up a display for National Hot Dog Day, or run specials on America’s famous processed meat.



National Tequila National Hot Fudge Day. Promote the Sundae Day ingredients for making margaritas.


National Bagelfest

National Coffee Milkshake Day


National Lasagna Day


National Cheesecake Day

National Chicken Wing Day



National Raspberry Cake Day National Cotton Candy Day


Bastille Day. Run promotions on all things French.

National Creme Brûlée Day


PMA Foodservice National Milk Conference & Expo, Chocolate Day in Monterey, Calif., runs through the 29th. Put patties and buns on special for National Hamburger Day. National Chili Dog Day

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Consumer InsIghts

Market Research

The Deal With Dairy What t ypes of dairy products are consumers choosing? Dairy can be either be a staple or a no-go food for consumers, but when Progressive Grocer’s sister company EIQ Research Solutions interviewed 500 consumers responsible for household grocery shopping, it found that 89 percent had made some sort of conventional dairy purchase in the past year, with more than one-third purchasing organic or plant-based alternatives. Unsurprisingly, mature/silents were least likely to purchase organics and plant-based alternatives (only 15 percent and 14 percent, respectively), while Millennials were the most likely, at 50 percent, to purchase plant-based alternatives.

In the past 12 months, have you made any of the following purchases at the grocery store? Gender






Generation X

Baby Boomers

Mature/ Silents

Conventional dairy products








Organic dairy products








Plant-based dairy replacement products








Base: All respondents

But what products are consumers purchasing frequently? PG has defined frequently as at least once per week. Alternative milks, especially organic milk, trend higher among Millennials than older generations, and soy milk and vegan cheese also trend higher among men than women who are making plant-based dairy purchases. While nut milks are popular among Millenials, plant-based yogurt and cheese also are standouts.

Percentage of respondents purchasing the following once per week or more Gender Total


of consumers who buy conventional dairy products are purchasing conventional milk weekly.





Generation X

Baby Boomers


Conventional milk







Organic milk







Nut milk







Soy milk







(e.g., almond, cashew, etc.)


Conventional yogurt







Organic yogurt Plant-based yogurt













39% 29%

43% 29%

35% 28%

41% 37%

44% 26%

35% 24%







Conventional butter







Organic butter







(e.g., soy, coconut, etc.)


Younger generations are more likely to purchase vegan cheese. Men also are more likely to purchase vegan cheese than women.

Conventional cheese Organic cheese Vegan cheese (e.g. soy, yeast, tofu, etc.)

Butter (excluding margarine)

Base: Respondents who indicated they had purchased conventional, organic or plant-based product in past year Survey respondents were sourced via ProdegeMR, reinventing the market research process by taking a respondent-first approach. Visit for more information.


Source: Progressive Grocer market research, 2018

Fight the good food fight

Eat the food you want to see in the world.

©2018 Chobani, LLC

Front End

Shelf Stoppers

Shelf Stoppers

Frozen Vegetables TOTAL FROZEN VEGETABLE SALES REACHED $2.97 BILLION IN THE PAST YEAR (52 weeks ending April 2, 2016)

Packaged Meat

TOP 5 CATEGORIES IN $ GROWTH Consumers chose Consumer frozen broccoli over Insights alternatives for



a variety of reasons:

Consumers associate meat with health 12% becauseIn it’s fact: benefits.



quick and easy




because it tastes great

0 52 Wks - W/E 03/31/18

52 Wks - W/E 04/01/17

52 Wks - W/E 04/02/16

Spotlight on Frozen Broccoli

47% 9%

52 Wks - W/E 04/04/15


Breakfast Meat as an ingredient Meat-Fresh Hotoften Dogsused in a side Broccoli is most commonlySausage-Fresh Frozen broccoli is most consumed at dinner, followed by lunch. dish, followed by as a main entrée. 3% 9%

—Jordan Rost, VP consumer insights, Nielsen LUNCH





Spotlight on Charcoal Logs, Accessories Comparison Products

Desserts, Gelatins and Syrups Packaged Meats-Deli Baking Mixes Detergents Laundry Supplies Prepared Food-Dry Mixes Sugar and Sweeteners Vegetables-Canned Bread and Baked Goods Breakfast Food Source: Nielsen


Percent Penetration

77.7% 95.5 77.2 92.8 84.9 90.4 79.3 91.6 98.6 77.4


because it’s low in calories, fat and sugar

Americans’ growing focus on transparency indicates significant growth opportunities for products with healthy attributes. This is particularly true OCCASION MEAL ITEM among packaged meats. Within the lunchmeat category, for example, 29% TYPE CLASS 61% products that are antibiotic- and hormone-free, as62% well as those with no35% artificial preservatives, are driving significant volume.”


of surveyed Americans because it’s agree thatand unprocessed healthy nutritious meat is good for your health.

34% of surveyed Americans believe that those who avoid animal protein are deficient in certain nutrients.


111 111 110 110 110 110 110 110 109 109

30% of surveyed Americans agree that animal protein is associated with positive health effects. Source: Nielsen, U.S. Homescan Panel Protein Survey, April 2017

Mintel Category insights

Global New Products Database

Hairstyling Products Market overview


Key issues

Sales growth for the next five years is forecast to be flat in both the United States and Canada, in line with the more discretionary status of hairstyling products and a continued preference for natural-looking hair.

Reflecting both a preference for simple routines and concerns over damage and harsh ingredients, two in five U.S. consumers who use hair care products say that they try to use as few products as possible on their hair.

The top five claims on hairstyling product launches in North America in the 12 months leading to October 2017 included botanical/herbal, brightening, ethical-animal, paraben-free and longlasting.

Natural looks are trending, with 31 percent of U.S. consumers who use hair care products preferring to wear their hair in its natural texture. Brands can emphasize portability and ease of use when out of the home – for example, on a moving train or at the gym — as just 2 percent of global hairstyling product launches in the 12 months leading to October 2017 featured an on-the-go claim.

What Does It Mean? Multifunctional products that offer more than just styling benefits, and also include treatmentstyle attributes such as conditioning, can appeal to consumers who are concerned about hair damage, and those who seek a more streamlined product. Brands that emphasize convenience can also target consumers who seek a simpler hair care routine. Plant and fruit water/sap formulations can expand into the hairstyling market to add value and evoke a sense of the more natural, healthy and sustainable. While coconut water has been on-trend across the food, drink, and beauty and personal care markets, there’s opportunity for other waters to emerge, such as birch water/sap, rose water, cucumber water and melon water.


Revitalize your category with the #1 Hand & Body Lotion manufacturer in the U.S.*

Driving Topline Sales

Delivering Category Growth

Redefining Innovation

Want to learn more on how to grow? email us: ¨ *Nielsen, xAOC, Beiersdorf $ Volume, 52 weeks through 9/9/2017. Hand & Body Lotion Category, Dollar Share

All’s Wellness By Diane Quagliani

Health in the Dairy Case

Retail Dietitians: Your Dairy and Health Resource If you’re planning a health-related dairy promotion, call on your retail dietitians. The ideas below just skim the surface of what they can do:


Offer dairy-related nutrition and health messaging for themes such as National Osteoporosis Month (May), National Blood Pressure Education Month (May) and National Dairy Month (June).

airy foods have long been associated with helping to build and maintain strong bones, but your shoppers might be surprised by dairy’s potential to provide benefits beyond healthy bones.

Teach shoppers label-reading skills to identify relevant dairy food ingredients like added sugars, protein, and live and active cultures.

Bones, Blood Pressure and More Dairy foods — most commonly milk, cheese and yogurt — are known as rich sources of the calcium that we need for strong bones, but dairy offers several other nutrients that work with calcium to promote bone health. These nutrients include vitamin D (in fortified products), protein, phosphorus, vitamin A, and B vitamins. Dairy foods as part of a healthful diet may help prevent certain health conditions. For instance, dairy products are a key component of the much-lauded DASH diet, which helps reduce high blood pressure and LDL (“bad”) blood cholesterol. The DASH eating plan recommends two to three servings of low-fat or fat-free dairy products daily. In addition, a growing body of research suggests that consuming higher amounts of dairy is associated with reduced risk for type 2 diabetes. More research is needed to confirm the link between dairy and diabetes. The 2015-2020 Dietary Guidelines for Americans recommend that children age 9 and older and all adults consume three cups (servings) of fat-free or low-fat dairy daily (younger kids need a bit less because they don’t eat as much). Further, there’s a glimmer of good news for those who love higher-fat dairy foods: Emerging research suggests that the type of fat in dairy foods may have a neutral or even beneficial effect on cardiovascular disease. Stay tuned as researchers continue to seek answers.

Billions and Billions of Bacteria Recent interest has focused on fermented dairy foods, which contain probiotics — literally billions of “good” bacteria that may positively affect digestive health and immunity. Yogurt


Counsel shoppers on how to incorporate dairy foods into a DASH eating plan. Help shoppers understand the latest health-related dairy research, and identify myths and facts about dairy foods. Plan tastings and develop educational handouts for lessfamiliar fermented products such as kefir and farmer cheese.

3 Cups

The recommended daily serving of fat-free or lowfat dairy for children age 9 and older and all adults. source: 2015-2020 Dietary Guidelines

that contains live and active cultures is the most familiar and popular source of probiotics; the mind-boggling array of yogurt types, forms and flavors means that there’s something for everyone. Kefir, a thick and tangy fermented milk-based drink that’s been around for centuries in Eastern Europe, is now gaining traction in the United States. Kefir is an especially potent source of probiotics in terms of both the amount of bacteria and the number of bacteria strains it contains. Some brands of cottage cheese and farmer cheese also contain probiotics. Diane Quagliani, MBA, RDN, LDN, specializes in nutrition communications for consumer and health professional audiences. She has assisted national retailers and CPGs with nutrition strategy, web content development, trade show exhibiting, and the creation and implementation of shelf tag programs.

Satisfy Your Shoppers’ Hunger For A Different Kind Of Snack

Offer Them the Full Line of Delicious GOYA® Plantain Chips

Capitalize on this growth opportunity with distinctive snacks from a leader in alternative snacking – GOYA®! As the #1 plantain chip brand in the U.S.*, GOYA® offers a full range of authentic and exciting flavors guaranteed to be a hit with your shoppers. *Source: Nielsen Strategic Planner, Total U.S. (unit and dollar sales), 52 weeks ending 3/10/18

Contact your GOYA sales representative or email us at

©2018 Goya Foods, Inc.

Millennials, whose love of snacking is well known, are increasingly seeking alternative snacking experiences that deliver unique flavors and textures not found in traditional snacks.



YEAR OF DISRUPTION A newcomer to our annual ra nking is shaking the industry to its ve ry core. Introduction by Jim Dud licek Analysis by Bridget Goldsc hmi dt, Ran dy Hof bau er and Kat Mar tin

t’s easy to think that the word “disruption” has been overused in descript ions of the transformation that’s taking place in the food retailing industry. But we’d better get used to it, because things are just getting started. There it is, at No. 8 in the cha rt on page 32: Amazon. Mind you, for the moment, it’s just as the new owner of record of Whole Foods Market — up from ninth a year ago — and doe sn’t reflect other grocery sales, mostly nonp erishables, that Amazon has been growing in recent years. But it’s certainly a sign of ho w things are going to continue to change. Shortly before this issue went to press, it was widely reported that Amazon’s U.S. grocery sales in the first quarter of 2018 ros e nearly 50 percent, up to an estimated $650 millio n, led by coffee, beverages and snacks, accord ing to ecommerce data analyst One Click Retail. Yet while Amazon is the most-shopped online grocer ove rall, consumers are more often shopping Walmart (the Super 50’s No. 1) online for daily trips, includ ing fresh categories, according to a Coresight Resea rch study reported on Continued on page 27



The Power of Working Together GROWTH Our retail relationships are built on our desire to work collaboratively and effectively to meet the diverse needs of our customers and their shoppers.

SOLUTIONS Our collaborative approach means customizing our efforts to the needs of our customers and providing differentiation.

Š2018 CSC Brands LP.

Campbell’s value to Our Customers is centered around REAL and comes to life through a commitment to our customers and our consumers. We are committed to building better partnerships because real success comes as we all work together. TOGETHER, WE WILL DELIVER REAL, SUSTAINABLE, PROFITABLE GROWTH.

FOOD We are transforming our food, beverages, and snacks, making them affordable and accessible to all.

INSIGHTS We know what both today’s and tomorrow’s shoppers want and how they want it. These real, actionable insights enable us to drive loyalty, increase trips, and maximize basket size.



As we observed in our 85th Annual Report of the Grocery Industry in April 2018, Amazon’s rise up the grocery ranks doesn’t sound the death knell for traditional retailers — only for traditional retailing. To be sure, progressive grocers had been hard at work changing the way they do business prior to the marriage of Amazon and Whole Foods. Online ordering, click-and-collect, delivery services, scan-and-go platforms, enhanced fresh offerings and compelling in-store experiences are among the many ways that players up and down the Super 50 are making themselves more competitive and relevant to new generations of shoppers. For some, it has worked. For others, well … Our analysis a year ago singled out four operators we observed as struggling. Two of them — Indiana’s Marsh Supermarkets and Illinois-based wholesaler-retailer Central Grocers — have since filed for bankruptcy, had their assets sold off and have vanished from the Super 50. The third, New York’s Price Chopper (Golub Corp.) was at the time ranked 24th and seeking an acquisition partner. Since then, the company has continued its transformation into the

contemporary Market 32 banner, established tech partnerships with companies like Aptaris and Instacart, and teamed up with Daymon to enhance its sampling programs as part of an elevated shopping experience. The largely employeeowned grocery chain is holding steady in this year’s ranking. As for the fourth — it was Whole Foods, at the time beset by activist investors looking to change course as the company lost ground to larger players with the scale to deliver nowmainstream natural and organic products at lower prices than “Whole Paycheck” could offer. We all know what happened next — but the story is far from “happily ever after,” as a management and operations culture clash has threatened to undermine Amazon’s fast-paced changes.

Fighting Back In 2017, 21 companies filed for bankruptcy, a new high, noted Andrew Appel, president and CEO of IRI, at the Chicago-based analytics company’s recent annual summit in Las Vegas. Joining the list in 2018 were two regional grocery retailers, upstate New York’s Tops Markets and Southeastern Grocers (SEG), based in Jacksonville, Fla. And while the wedding of Amazon and Whole Foods certainly “set off a bomb in our industry,” as Appel remarked, it wasn’t the sole or even the leading cause of these grocers’ financial challenges: Tops faced a burdensome debt structure, and SEG was continuing to reinvent itself after filing twice previously for bankruptcy since 2005 as it has struggled in a highly competitive and overstored Southeast. For its part, SEG has been quite busy during its latest reorganization, thinning its store count with sell-offs to other regional players while remodeling many locations and investing in the expansion of its Hispanic banner Fresco y Más in central Florida, plus rolling out a new loyalty program. SEG’s reorganization plan reduced the grocer’s debt by more than $500 million, and after closing 94 stores, the company will continue to operate 580 stores under the Winn-Dixie, Bi-Lo, Harveys and Fresco y Más banProgressive grocer May 2018




At Ferrero, we have a relentless focus on driving category growth. And with exciting new innovations like Tic Tac Gum and Kinder Joy, we continue to delight shoppers and deliver double digit growth to our retail partners.

Source: IRI POS Sales dollars +33.5% latest 12 weeks ending 3-25-18

© Ferrero. All rights reserved.



Online ordering, click-and-collect, delivery services, scan-and-go platforms, enhanced fresh offerings and compelling in-store experiences are among the many ways that players up and down the Super 50 are making themselves more competitive and relevant to new generations of shoppers.

based subsidiary of Mexican company Grupo Comercial Chedraui S.A.B. DE C.V. As PG reported in March, the deal will create one of the largest Hispanic-focused supermarket companies in the United States, with 122 stores in California, Arizona, Nevada, New Mexico and Texas, a region where more than half of the fast-growing U.S. Hispanic population lives. Our drill-down into the Super 50 continues — read on ...

ners in seven southern states. Merger and acquisition activity is expected to continue as companies pursue partners that can not only help them more efficiently serve consumers, but also possess competencies in areas that they seek to enhance to be more competitive (like Kroger did in acquiring Harris Teeter, for its click-andcollect prowess, and Roundy’s, to get fresh-savant Mariano’s). “We predict that legacy consumer and retail companies will fight back in 2018 and seek out adjacent and convergent businesses,” says Bahige El-Rayes, principal at A.T. Kearney and co-author of the Chicago-based global management consulting firm’s “2018 Consumer and Retail M&A Report.” “Winners will be those that understand what consumers prefer and the channels they use, take a holistic view of their industry, and fearlessly pursue innovative, out-of-the-box opportunities.” One change to next year’s ranking we already know: Houston-based Fiesta Mart (44th) was acquired earlier this year by Bodega Latina Corp. (48th), the CaliforniaProgressive grocer May 2018




Methodology Information for Progressive Grocer ’s annual Super 50 is compiled from direct guidance from retailers and/or data sourced from public records, including 10Ks, annual reports and corporate websites. For privately held companies, results are based on information from Nielsen TDLinx, which collects and maintains store information across all channels selling consumer packaged goods. The four categories within the Super 50 report include annual sales from the most recently concluded fiscal year, store count, top banners, and employee counts, either total or full-time equivalents. Full-time equivalent employees are the sum of regular workers, plus one-half the number of part-time employees. Nielsen TDLinx uses Food Marketing Institute’s definition of a supermarket: a grocery store with a minimum of $2 million in annual sales; its data omit sales from convenience, drug and other retail channels that may be part of total revenue for some companies. Wholesale membership clubs such as Sam’s Club, Costco and BJ’s Wholesale Club are also not included. Supercenters are included, but only for their grocery-equivalent


merchandise. Not included are soft goods; clothing; general merchandise such as hardware, appliances, computers and auto service; and other items not common to supermarkets. Sales estimates from Nielsen TDLinx are presented in terms of all-commodity volume (ACV), which is defined as an annualized range of the estimated retail sales volume of all items sold at a retail site that pass through the retailer’s cash registers. Nielsen TDLinx’s ACV is an estimate based on best available data — a directional measure to be used as an indicator of store and account size, not an actual retail sales report. All data are collected by Nielsen TDLinx from a wide range of independent sources, and then enhanced with computer modeling. Information shown is from the March 2018 database.

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THE SUPER 50 2018 2017 Rank Rank


Fiscal Year-end Sales (000)

No. of Supermarkets

Top Banners




Walmart Inc. Bentonville, Ark.



Walmart Supercenter Walmart Neighborhood Market




The Kroger Co. Cincinnati



Kroger Harris Teeter Ralphs




Albertsons Cos. Inc. Boise, Idaho



Safeway Albertsons Vons




Ahold Delhaize USA Quincy, Mass.



Food Lion Stop & Shop Hannaford




Publix Super Markets Inc. Lakeland, Fla.



Publix Publix Sabor Publix GreenWise




H.E. Butt Grocery Co. San Antonio



H-E-B H-E-B Plus H-E-B Central Market




Wakefern Food Corp. *Aggregate of ShopRite, Price Rite and The Fresh Grocer banners Keasbey, N.J.



ShopRite Price Rite Marketplace The Fresh Grocer




Amazon (as Whole Foods Market) Seattle



Whole Foods Market 365 By Whole Foods Market




Aldi Inc. Batavia, Ill.



Aldi Food Store




Trader Joe’s Co. Monrovia, Calif.



Trader Joe’s




Southeastern Grocers LLC Jacksonville, Fla.



Winn-Dixie Bi-Lo Harveys




Meijer Inc. Grand Rapids, Mich.







Target Corp. Minneapolis







Wegmans Food Markets Inc. Rochester, N.Y.







Hy-Vee Inc. West Des Moines, Iowa







Giant Eagle Inc. Pittsburgh



Giant Eagle Giant Eagle Market District




WinCo Foods Inc. Boise, Idaho







Supervalu Inc. Eden Prairie, Minn.



Shop ‘n Save Cub Foods Shoppers Food Warehouse




Defense Commissary Agency (DeCA) Arlington, Va.



DeCA Commissary




Sprouts Farmers Market Phoenix



Sprouts Farmers Market




Smart & Final Inc. Los Angeles



Smart & Final Extra Smart & Final Cash & Carry/Smart & Final




Stater Bros. Markets San Bernardino, Calif.



Stater Bros.




Save Mart Supermarkets Inc. Modesto, Calif.



Save Mart Lucky Store Food Maxx




Golub Corp. Schenectady, N.Y.



Price Chopper Market Bistro by Price Chopper Market 32




Demoulas/Market Basket Tewksbury, Mass.



Market Basket


Source: Nielsen TDLinx, March 2018; Progressive Grocer Market Research, 2018


Employees (Total or Full-time Equivalents)

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Storewide Merchandising Solutions

50 OV E R



American Manufacturing

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Air baffles maintain product temperature & extend shelf life. Durable cooler-capable steel construction ensures long life.

Trays lift out for rear restocking & proper rotation. Versatile spring tension is gentle on delicate produce.

Showcase More Products Exciting Dual Lane merchandising cross sells

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Asymmetrical lanes sell different-width products. Each lane adjusts to fit products as small as 13/4" wide. Unique design features a separate paddle to push each item forward individually in its own lane.

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Expandable Wire Tray for refrigerated retail

Quick drop-in, one-piece installation. Accommodates any style or size package adjusting from 33/8" to 171/2" lane width. Various built-in mounting capabilities available based on shelf component.

■ ■

Molded pusher paddle available, both locking and non-locking styles with wire- or metal-sided trays. Auto feed any product. Clear or Imprinted Front Product Stops. Vends oversize items like pizza.

Display & Scan Hooks Hooks for every purpose

Right Angle Label Holder Hook

A simple, inexpensive design. Use with Quick Back® to maximize product density, provide easy mounting and relocation of stocked hooks in tight places, under shelves or in fully loaded displays, and speed re-merchandising and display changeover.

Economical All Wire Hook

Slatwall Hooks

Safer, rounded Ball-End Tips are available on all hooks at no extra charge and no minimum order. Use the Peg Hook Overlay to quickly convert All Wire Hooks to Scan Hooks.

Protect Your Merchandise Anti-theft security hooks

Scan Lock® Hooks ■ Easy-to-use, inexpensive key-lock system. ■ Prevent the removal of any stock or display 1 or 2 items unlocked to prevent sweeping. Anti-Sweep™ Hooks ■ Camel-back profile prevents sweeping while providing direct access to customers. ■ Flip Scan® Label Holder swings up and out of the way. ■ Use of plain-paper labels can save up to 65% on labels and up to 75% on labor.

Pouch Hook Merchandising ™

A new venue of product promotion

Standard and Gravity-Feed options keep items forwarded and automatically faced. Tool-free installation on most common gondola and cooler uprights. Stocked in 4 lengths compatible with all standard shelf sizes allowing mixed use in display.

Flip-front Label Holder swings up for easy access and product removal.



Adjustable Merchandising Tray For dairy, freezer and center store

■ ■

Molded in openings improve refrigeration air circulation. Top-tier sidewall available for support and containment of tall or multi-tier products.

Adjustable width trays, designed for yogurts, ice cream, and other difficult to organize products. Trays lift out with easy-grip handles to allow quick restocking or cleaning.

Clear Scan Label Holders ®

The complete shelf edge labeling system

Easy-to-use design flexes open at a touch for fast, drop-in plain paper labeling, then automatically springs shut to secure the label in place. Unsurpassed range of sizes, styles & lengths. Labels shielded from dirt, spills, moisture & wear so they last longer, read easier & scan more accurately. Long lasting PVC construction retains “memory” and shape, resists yellowing, darkening & aging.

Choice of magnetic, adhesive or clip-on mounting systems.

Being Seen Means Being Sold


50 OV E R



American Manufacturing

©2018 Trion Industries, Inc. 297 Laird St., Wilkes-Barre, PA 18702 Ph 570-824-1000 | Fx 570-823-4080 Toll-Free in the U.S.A. 800-444-4665


THE SUPER 50 2018 2017 Rank Rank


Fiscal Year-end Sales (000)

No. of Supermarkets

Top Banners

Employees (Total or Full-time Equivalents)




Raley’s Supermarkets West Sacramento, Calif.



Raley’s Bel Air Market Nob Hill




Weis Markets Inc. Sunbury, Pa.







Tops Markets LLC Williamsville, N.Y.



Tops Friendly Markets




Save-A-Lot/Onex Corp. Earth City, Mo.







Ingles Markets Inc. Asheville, N.C.



Ingles Sav-Mor Foods




Schnuck Markets Inc. St. Louis



Schnucks Culinaria A Schnuck Market




Brookshire Grocery Co. Tyler, Texas



Brookshire’s Food & Pharmacy Super 1 Foods Spring Market




K-VA-T Food Stores Inc. Abingdon, Va.



Food City Super Dollar Discount Foods




Grocery Outlet Inc. Emeryville, Calif.



Grocery Outlet




SpartanNash Co. Grand Rapids, Mich.



Family Fare Supermarket D&W Fresh Markets VG’s Food Center




Houchens Industries Inc. Bowling Green, Ky.



Save-A-Lot IGA Food Giant




Big Y Foods Inc. Springfield, Mass.



Big Y




Bashas’ Markets Inc. Chandler, Ariz.



Bashas’ Food City AJ’s Fine Foods




Saker ShopRites Inc. (As Foodarama Supermarkets Inc.) Freehold, N.J.







Inserra Supermarkets Inc. Mahwah, N.J.







The Fresh Market Inc. Greensboro, N.C.



The Fresh Market




Village Super Market Inc. Springfield, N.J.







Woodman’s Food Markets Inc. Janesville, Wis.







Fiesta Mart Inc. Houston



Fiesta Mart




Lowe’s Pay-N-Save Food Stores Inc. Littlefield, Texas



Lowe’s Grocery Food King Lowe’s Big 8




Marc Glassman Inc. Cleveland, Ohio







Fareway Stores Inc. Boone, Iowa







Bodega Latina Corp. Paramount, Calif.



El Super




Alex Lee Inc. Hickory, N.C.



Lowes Food Store Just Save




Coborn’s Inc. St. Cloud, Minn.



Coborn’s Cash Wise Marketplace Foods/Coborns


Source: Nielsen TDLinx, March 2018; Progressive Grocer Market Research, 2018 PROGRESSIVE GROCER May 2018




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By Randy Hofbauer ook through this year’s Super 50 list, and from the start, you’ll see the same familiar names in the same places: Walmart, Kroger, Albertsons Cos., Ahold Delhaize USA, Publix, H-E-B — and Amazon? Sure, it made its way onto the list — and landed such a prime spot — by purchasing Austin, Texas-based natural and organic grocer Whole Foods Market. But one of grocers’ greatest fears in recent years is now officially a reality: Amazon is among the toughest competition in today’s market. And it’s only going to grow tougher: While its climb up the list from No. 10 in 2016 (as Whole Foods) and ninth in 2017 (also as Whole Foods) to No. 8 this year isn’t due to its own sales, which haven’t changed much in the past year, its first-year preparation to seriously disrupt the grocery market means that we can expect even higher rankings in the coming years. Just look at some of the things that Amazon — on its own or via Whole Foods — has introduced in the past year to catch headlines in food retail: lower prices, special deals on select products at Whole Foods for Amazon Prime members, free grocery delivery to Amazon Prime members via Whole Foods stores, Amazon Lockers in Whole Foods stores, the public debut of the checkout-free Amazon Go convenience-store concept, shoppable recipes through several media brands, the possible replacement of Whole Foods’ rewards program with Amazon Prime, and more. Top-three grocers Walmart, Kroger and Albertsons all have been some of the most proactive in keeping their places or rising higher on the list. To defend themselves and even fight back, they’re doing things like dramatically expanding same-day grocery delivery; launching more personalized, shopper-friendly ecommerce platforms; introducing scanas-you-go technology to bypass checkout; launching meal kits or working with/purchas-

ing established meal-kit services; and, to stay relevant, fundamentally changing their in-store and digital setups to create the omnichannel experience that grocers today require. Even Walmart last fall announced direct-to-fridge delivery, one month before Amazon launched its own direct-to-home or -trunk delivery service. And it’s not just the big three that are preparing for battle. H-E-B (No. 6), for instance, piloted a self-checkout app in San Antonio while also acquiring delivery service Favor; Meijer (No. 12) launched a scan-as-you-shop app for skipping checkout; Target (No. 13), among many other initiatives, purchased two services — Shipt and Grand Junction — to boost its delivery capabilities; and even hard-discounter Aldi (No. 9), often seen as immune to most market threats, launched and is expanding grocery delivery via Instacart. Food retailers have made tremendous strides in their omnichannel programs since news of Amazon’s Whole Foods buy hit last June. Comparing Progressive Grocer’s 2018 Annual Report, which was published last month, with its 2017 Annual Report, more than double the number of grocers polled (28 percent versus 12.2 percent) have a fully integrated omnichannel strategy in place, while the number of those with no omnichannel services at all declined from 46.5 percent to 32.7 percent. This corresponds with the fact that “keeping up with advancements in technology” shot up to No. 3 from No. 9 in the list of issues that respondents said keep them up at night. Amazon now has a prominent spot on the Super 50 list — one that could become even more so in the next year. Clearly, however, its competitors are doing — and will continue to do — everything they can to keep the Seattle-based online retailer at bay. PROGRESSIVE GROCER May 2018


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By Bridget Goldschmidt

lthough Walmart, once more in first place on the Super 50 leaderboard, has long been seen as the low-price leader in any given market in which it operates, causing competing grocers to try attracting customers by any number of differentiation strategies, there’s another format that those already embattled retailers — and maybe even the Bentonville Behemoth itself — will need to reckon with: the deep discounter. As embodied by Aldi — now at No. 9 in PG’s ranking, up from the tenth slot last year and 13th place in 2016 — Aldi Nord banner Trader Joe’s, currently

in 10th position; and newcomer to the U.S. market Lidl, not yet in the ranking, the deep-disount business model, honed over time in Europe, relies on an assortment largely made up of premium private-brand products sold at often rock-bottom prices. Indeed, a price comparison test conducted in 2017 by Kantar Retail of 15 private label items delivered a ring that was 23 percent cheaper at Lidl than at Walmart, with the former enjoying a double-digit percentage price advantage over the latter on 11 of the products. “With limited-assortment retailers like Lidl and Aldi already driving growth in private label, particularly among consumers who are both penny-wise and brand agnostic, expect more pressure across all retailers to ramp up their exclusive offerings,” wrote PG Editorial Director Jim Dudlicek after a visit last summer to the very same Greenville, S.C., Lidl store where Kantar’s price comparison took place. “Traditional retailers like Kroger already have been enhancing their private label offerings as well as investing in price reduction to better compete against disruptors like Lidl and Amazon.”



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Further, a study released earlier this year from the University of North Carolina (UNC) Kenan-Flagler Business School found that retailers near U.S. Lidl stores set their prices for key staple products up to 55 percent lower than in markets where Lidl isn’t present — a competitive price-cutting effect more than three times stronger than that of Walmart’s entry into a new market. The independent study, commissioned by Lidl US, encompassed 48 grocery products. “The level of competitive pressure Lidl is exerting on leading retailers to drop their prices in these markets is unprecedented,” affirmed UNC Kenan-Flagler Associate Professor of Marketing Katrijn Gielens, who led the study. While that means great savings all around for shoppers in those markets, it further squeezes grocers’ already razorthin margins as they strive to offer comparable pricing. Despite these wins, the format isn’t a guaranteed slam-dunk, especially in the United States, where Lidl is still finding its feet. The CEO of the chain’s parent company recently admitted to several “failures,” among them poor site selection, locations too large and too expensive to operate, and a lack of insight into Americans’ product preferences. Still, the company is determined to right its wrongs, and with old-pro Aldi set to expand its quietly successful formula to 2,500 stores nationwide by the end of 2022, grocers going head to head with either of these players — or Trader Joe’s, for that matter — need to develop their own deep-discounting chops to better compete.

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Freedom to Grow


INDEPENDENTS FIND OPPORTUNITIES IN SUPER 50 MOVES. By Kat Martin ndependent grocers, by nature of usually being family-owned, aren’t often considered to be large supermarket operators. Taken collectively, however, they do account for 25 percent of retail grocery sales, according the National Grocery Association (NGA), with the 21,000 stores bringing in $131 billion in annual sales, making them the biggest “grocer” when it comes to store locations. They can’t be ranked collectively, though, as they don’t operate as one unit. Taking a broad definition of an independent supermarket, several made this year’s list of Super 50 grocers: Wakefern (a collective of independently owned stores), at No. 7; Wegmans Food Markets (family-owned), at No. 14; Hy-Vee (employee-owned and not publicly traded), at No. 15; Demoulas/Market Basket, at No. 25; Schnuck Markets, at No. 31; Saker ShopRites and Inserra Supermarkets (both part of the Wakefern group), at Nos. 39 and 40, respectively; Woodman’s Food Market, at No. 43; Lowe’s Pay-N-Save (operating in the southwestern United States), at No. 45; Marc Glassman Inc., at No. 46; Alex Lee Inc. (family-owned and operates Lowes in the Southeast), at No.49; and Coborn’s (employee-owned), new this year to the ranking, at No. 50. Looking at the Super 50 rankings, not much has changed from last year at the top of the list, but the ranking doesn’t reflect the biggest news to hit the industry in the past year: Amazon’s purchase of Whole Foods Market, and the subsequent changes implemented at the natural/organic grocer. While the fallout is certainly not over, the result hasn’t been the death knell for the industry that many feared. In fact, for independent


supermarkets, it may even be looked at as a boon a few years down the road. Amazon made several changes in the management of stores and product selection that have opened up opportunity for independents. The move away from regional purchasing and the implementation of “slotting fees” left many smaller local manufacturers in the lurch, without a place to sell their wares. Enter independents. Often already a trusted source of locally sourced products, they offer an ideal solution for small manufacturers that have lost their customary retail outlets. The third annual National Grocery Shoppers Survey, conducted by Nielsen on behalf of NGA, found that those consumers who frequently shop an independent do so because they find better-quality locally grown or produced food. It’s no secret that stores, especially independents, need to be innovative to survive. Several large chains have made strides in omnichannel services, and independents can’t be complacent. Many indies were quick to adopt ecommerce and are adopting more technology within their stores. Several stores, including Macey’s in Utah and some ShopRites in the northeastern United States, are adopting scan-and-go technology that helps reduce the time customers spend in the checkout line, a known pain point. “There’s no doubt that the supermarket industry is rapidly changing, either because of the growth of ecommerce or the explosion of new formats, along with shifting consumer trends,” says Peter Larkin, president and CEO of Arlington, Va.-based NGA. “However, independent grocers are nimble enough to quickly overcome obstacles, and with strong ties to their communities, they know what consumers want and need.”

25% Independent grocers’ share of overall retail grocery sales Source: National Grocery Association

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Store of the Month


Bristol Farms

Woodland Hills, calif.

Making Food the Star Bristol Farms’ newest store creates a community for shoppers. By Jim Dudlicek Photography by Von McKinney

d Bristol Farms’ Woodland Hills, Calif., store offers a bounty of fresh prepared foods. “This is how we compete with fast-food restaurants: with better variety and better quality,” says Store Director Ali Dungarwalla.

elivering a “theater of food” experience is the goal of Southern California grocery chain Bristol Farms, and its new food hall concept, recently launched in suburban Los Angeles, takes that to a whole new level. The Carson, Calif.-based retailer’s 14th location, on Mulholland Drive in the Woodland Hills area, northwest of downtown L.A., features several epicurean market stations and innovative experiences that include fresh produce; a fully staffed natural vitamin, supplement and body care department; an artisan bakery; a premium wine and spirits cave; The Daily, an espresso and coffee concept; freshly made gelato; a smoothie and juice bar; a butcher shop; more than 300 cheeses; a new grab-and-go experience featuring various ready-to-eat Asian hot bowls; expanded sushi and poké offerings; an organic salad bar; and a cascading floral wall with exotic bouquets and greenery. “Bristol Farms wanted to uphold the standard of one-stop shopping for the best-tasting, freshest foods, in a more accessible format which highlights our strengths as a retailer,” says Adam Caldecott, Bristol Farms president. “Working with Kacie Davis, our designer [and daughter of Bristol Farms Chairman and CEO Kevin Davis], one of our goals was to open up the format to create a European-style farmers’-market experience that is Progressive grocer May 2018


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Among the fresh selections at Bristol Farms’ food hall store are hearty sandwiches like the one Kitchen Manager Gabriela Interiano offers to Store Director Ali Dungarwalla.

reminiscent of some of Europe’s great food halls. “The vision was to make our food the star of the market,” Caldecott continues. “Our concept store focuses on creating a community for shoppers and vendors, a local home for families, foodies and everyday customers, where entering the store always feels familiar and welcoming.” In a space formerly owned by Haggen, Bristol Farms aims to offer an elevated shopping experience that’s also accessible by families for their weekly shop, in an area that’s culturally and economically diverse. “When shoppers enter the store, they can expect hundreds of local vendors, with many products sourced from people that live in the Woodland Hills community we serve. The addition of hyper-local, vocal vendors is a priority for our brand, and especially this store,” Caldecott says. “Being a one-stop shop meant we needed to ensure that we have the day-to-day traditional grocery products and supplies to meet the needs of our shoppers as well.”

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The vision was to make our food the star of the market. Our concept store focuses on creating a community for shoppers and vendors, a local home for families, foodies and everyday customers, where entering the store always feels familiar and welcoming.”

Time slots are limited.

—Adam Caldecott, Bristol Farms president

Visit our Website at

Store of the Month

Bristol Farms

It’s more than a grocery store — it’s a place for people to come, hang out and have fun.” —Carina McLaughlin, marketing director

The Woodland Hills store team includes (from left) Luis Vasquez, manager of merchandising; Kristina Tessel, manager of service; Ali Dungarwalla, store director; Carina McLaughlin, marketing manager; and Jack Clayton, manager of perishables.

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Bristol Farms continues to focus heavily on emerging natural and organic foods, carrying thousands of new and mainstay items in all categories. “Our company is made up of real foodies, making it hard to not focus on European foods, many of which are air-freighted directly to our stores,” Caldecott says. What sets Bristol Farms apart from other grocers, he explains, is its connection to the community, and the human connection to good food. “We program monthly lifestyle activities for adults and kids, including food education classes, seasonal DIY programs and community involvement through charity programs, as well as live vendor demos and exclusive promotions and sales ranging

Store oF tHe MontH

Bristol Farms

Grand opening date:

Nov. 11, 2017

Store hours: 7 a.m.— 10 p.m.

30,000 Total square footage:

Designer: KMDesign Co., Sacramento, Calif.

from 20 to 50 percent off,” Caldecott says. “Through the store’s local involvement and interaction between customers and employees, the Mulholland location is a culinary destination for the community, and a place where shoppers genuinely feel at home to do their everyday shopping.” Or, as Carina McLaughlin, the store’s marketing director, notes, “It’s more than a grocery store — it’s a place for people to come, hang out and have fun.”

Hit of Freshness “You walk in, and all you’re hit with is fresh,” says Store Director Ali Dungarwalla, leading Progressive Grocer’s earlyMarch visit to the Woodland Hills store. As with many supermarkets, the entrance opens into the produce department, and Bristol Farms’ rendition is particularly colorful, aromatic and creatively merchandised. But it’s the food hall area just beyond that catches the eye and the olfactories. Along the perimeter, a carving station prepares fresh entrées and sandwiches from various roasted and smoked meats, including the store’s best seller, a tri-tip sandwich featuring that particular cut of beef popular for years in California and starting to gain attention The Woodland Hills food hall store offers (clockwise from upper left) a diverse hot bar, including vegan selections; deluxe sandwiches; decadent baked goods, among them Bristol Farms’ signature cookie; highquality meats; and fresh seafood.


Progressive grocer May 2018


Store of the Month

Bristol Farms

Produce at the Woodland Hills store is merchandised in layers to show it off to its best advantage. The store’s selection also includes items found in few other supermarkets, such as whole jicama and raw roots. Colorful chalked signs call out items throughout the store.

in the rest of the country. There are Asian entrées made to order and a bakery counter replete with colorful cakes, pastries and “The Cookie,” Bristol Farms’ signature face-sized, nut-studded chocolate chip cookie, a vehicle for the retailer in community fundraising efforts. Facing the perimeter are hot and cold bars featuring traditional, Mexican and Asian entrées, as well as soups and salads, and a vegan food bar, “which has proven to be pretty popular,” Dungarwalla says, noting that the store’s prepared food offerings run about 60/40 protein to veggie. But even with all of the unique and creative items available, he acknowledges, “Our biggest hot-bar seller is still orange chicken and fried rice.” Most of the store’s fresh offerings are fully prepared on-site, with some created by the Bristol Farms commissary, either in full or partially for finishing in-store, he explains. “We have a pretty busy lunch crowd. When school is in session, we get a lot of high schoolers,” Dungarwalla says, noting Calabasas High School is right up the street from the store.

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Store of the Month

Bristol Farms

The store features a café seating area with a dedicated checkstand. The café offers a cozy spot for in-store diners and hosts frequent events such as the wellness talk going on during PG’s pre-visit market pop-in, as well as lifestyle programs, and cooking and food education classes. “I try to bring in all the departments and highlight something different every month, always tied back to what you can find in our store and the expertise on our staff,” McLaughlin says.

Better Variety, Better Quality

A staffed counter offers cheeses from around the world. Selections include house-made cheese spreads and popular pepperoni cheese balls for snacks and special-occasion eating.

The “theater of food” concept extends into the produce department, dominated by local and organic selections, and merchandised to highlight color and freshness. For example, the wet racks are vertical and produce is layered to display it to its best advantage. Broccoli and cauliflower are displayed on ace rather than in racks to augment the perception of freshness. Colorful, hand-chalked signs call out selections here and throughout the store; in fact, the store employs a full-time chalk artist






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Store of the Month

Bristol Farms

The Woodland Hills store offers one of the area’s largest selections of local and craft beers. Decorative over-case signage clearly explains the differences between the various beer varieties.

just for this task, Dungarwalla says. The store’s selection includes items found in few other supermarkets, such as whole jicama and raw roots. “There are things you can’t go to a regular market and get,â€? Dungarwalla boasts. The store also has a “chop shopâ€? program, featuring a produce butcher cutting vegetables to size for various uses in recipes or snacking, enhancing convenience and reducing waste. This started as a way to sell blemished produce “and has become its own subdepartment,â€? the store director notes. Nearby, a staffed U-shaped counter offers a bounty of cheese from around the world. “We carry many items other stores don’t carry or cut because they won’t invest in it,â€? Dungarwalla says, pointing out house-made cheese spreads and popular pepperoni cheese balls for snacks and special-occasion eating. “A pack of this and some crackers, and you have a party platter.â€? A heat-and-eat case offers entrĂŠe, side and meal options to take home. “This is how we compete with fast-food restaurants: with better variety and better quality,â€? Dungarwalla asserts.



The butcher shop features Prime and Choice USDA meats, and offers shoppers services like free seasoning and knife sharpening. The meat case features both kosher and halal selections, reflecting the store’s diverse religious community. There’s a full kosher set, with prominent callouts on certified-halal items. Integrated into the meat case are plant-based burgers, sharing space with marinated ready-to-cook chicken breasts, bone broth and Wagyu corned beef. The store’s dairy department is a prototype set for Bristol Farms’ other stores, Dungarwalla explains, with closed doors and an extensive offering of plant-based milk alternatives. Meanwhile, cage-free eggs take center stage, and the store allows shoppers to build their own dozens and half-dozens from individual eggs, at 49 cents each or a dozen for $4.79. “Some customers want to pick their own eggs,” Dungarwalla says. “It’s pretty like getting it right from the farm — and customers will pay for it.” Woodland Hills is Bristol Farms’ first store to have a 4-foot refrigerated vegan set that “has been received very well by the community,” Dungarwalla notes.

Taking it to the Next Level This store offers one of the area’s largest selections of local and craft beers, with three products made “from almost walking distance” among 12 local California brews accounting for some 50 SKUs, Dungarwalla says. Decorative over-case signage clearly explains the differences between the various beer varieties. “We’ve taken craft beer to the next level,” he notes. Another level is volume, and it’s considerably lower in center store by design, to enhance the shopping experience, Dungarwalla explains. “You enter an aisle, the music drops, The Woodland Hills store’s dairy department is a prototype set for Bristol Farms’ other stores, with energy-saving closed doors and an extensive offering of plant-based milk alternatives.

About Bristol Farms Bristol Farms opened its first store in 1982, in Rolling Hills, Calif., followed four years later by a larger store in South Pasadena. The Manhattan Beach Bristol Farms opened in 1991 with a catering facility and a cooking school. The retailer entered Orange County in 1998 with a store in Newport Beach, then, a year later, acquired Chalet Gourmet, a landmark store in Hollywood, followed by a store in Westwood. In November 2000, Bristol Farms opened a store at the site of the former Chasen’s restaurant, serving Beverly Hills and West Los Angeles, and incorporating many of the design elements of the historic celebrity destination. Westchester, La Jolla and Palm Desert stores opened in 2006, followed by Santa Monica in 2013. In 2004, Albertsons acquired Bristol Farms, which, a year later, bought Santa Barbara, Calif.based Lazy Acres, a natural/organic chain established in 1991 that has since grown to four stores. Bristol Farms became part of Supervalu Inc. in 2006, when the Minneapolis-based wholesalerretailer acquired Albertsons. Then, in 2010, Supervalu sold Bristol Farms to a partnership of private equity and the chain’s management team. Owned by Endeavour Capital, Bristol Farms currently operates 13 stores in Southern California and one in San Francisco, and has its headquarters in Carson, Calif.

the sound muffles, it’s just you and the aisle,” he says, pointing out underlit shelves helping shoppers to read labels clearly and without distractions. “People have told me they appreciate the quiet and the ability to read the labels. It’s a library effect.” Meanwhile, he adds, “We got rid of the sidestacks and any intrusions that would hinder the shopping experience.” Center store is also home to the Natural Living department, featuring vitamins, supplements, and beauty and wellness products, which McLaughlin calls the “heart of the store — a really fun couple of aisles.” At Woodland Hills, this department is staffed, setting it apart from other locations, McLaughlin notes: “Shoppers can get an education from our staff. That’s not something you can find when you’re shopping Amazon.” There are plenty of local products in center Progressive grocer May 2018


Store of the Month

Bristol Farms

Center store is home to the Natural Living department, featuring vitamins, supplements, and beauty and wellness products. At Woodland Hills, this department is staffed, setting it apart from other Bristol Farms locations.

store as well. “We have about 10 seriously local companies here in our backyard. We’re working on more — we’re not afraid to have them in our stores,” Dungarwalla says. Bristol Farms scopes out many of the local selections at area farmers’ markets, he adds. The community around the store is home to the well-heeled as well as many celebrities (there was a Kardashian sighting here the night before PG’s visit), but in fact the neighborhood is “actually very diverse,” Dungarwalla says. While towns like Calabasas and West Hills feature homes valued at $1 million and up, the store also serves Canoga Park, which he describes as a more traditional middle-class community. “We don’t want to be the store that you can’t afford to shop at,” Dungarwalla stresses. “We want people to be able to buy their regular groceries here.” To that end, Bristol Farms has an aggressive direct mail and e-coupon program with special deals tied to end cap displays, including BOGOs and “amazing deals with crazy redemption rates — a great way to get people into the store,” McLaughlin says. “Every week, it’s a new item, and it’s a great way to get new customers who wouldn’t necessarily try us otherwise.” A point of pride is one particular end cap that sticks out amid the others offering local and specialty food items: It’s stacked with Tide laundry detergent. “We’re proud of the fact that we price Tide the same as Ralphs or Target,” McLaughlin asserts. “At this location, it’s priced really competitively.” 58

Premier Destination All of Bristol Farms’ offerings and programs are specially curated, with a particular focus on taste, Caldecott observes. “Since 1982, Bristol Farms has combined the service and food quality of a corner grocer, butcher and baker, with the same sense of theater as famed Harrods food halls [in London] to create an unmatched grocer experience,” he says. “With the new concept store at Mulholland, we are taking those same values and offerings to an elevated level. Our new format has shaped expectations for future store locations, continuing to position Bristol Farms as the premier ‘theater in food’ destination, offering the best-curated food selection at competitive pricing.” The most rewarding part of opening this store, according to Caldecott, has been the reception of customers and the community. “The concept has resonated with them, and its ease of shop has helped to make the store a part of their daily and weekly food shop,” he says. “Another byproduct of the opening was new energy around emerging products and developing better processes to onboard new vendors more quickly.” The format focuses on food being the star, Caldecott stresses, “giving vendors a unique opportunity to have their products highlighted for a consumer that loves new and exciting products. Our in-store marketing team is continuously creating new food events and looking for local products to sample to our customers.”

Center Store

Beverage Alcohol

Drink in Summer Grocers and suppliers prepare to sell seasonal quaffs that help consumers beat the heat. By Bridget Goldschmidt

s summer raises outdoor temperatures — and makes consumers thirsty for cool alcoholic beverages — grocers are seeing a chance to make the category their own. “On a national scale, off-premise alcohol sales are outperforming on-premise sales in beer, wine and spirits — which is an opportunity for SpartanNash retail stores and our independent customers,” notes Joe McQuesten, VP, center store merchandising at the Grand Rapids, Mich.-based wholesaler/retailer. “We continue to see a demand for session and flavored beers in 2018, as well as growing demand for imported beer and craft beers. In wine, it is all about rosé, red blends, red blends with adjuncts, sauvignon blancs and cabernets. Vodka and bourbon are still the most popular in spirits, and we have seen rapid growth in tequila and whiskey as well.” According to McQuesten, SpartanNash is able to cater to all of these consumer needs at retail. “With primary banners that include Family Fare Supermarkets, D&W Fresh Market, VG’s Grocery, and Family Fresh Market — serving store guests in eight states — we are able to meet all of these demands and personalize them based


Key Takeaways The fact that off-premise alcohol sales are outperforming onpremise sales in beer, wine and spirits is an opportunity for grocers during the summer selling season and beyond. Large thematic displays capture impulse sales and boost sales per customer; also successful are out-of-department displays and in-store tastings. While beer remains big, flavored malt beverages are proving to be an especially creative segment, with particular appeal to younger consumers, who tend to purchase across beverage alcohol types. Manufacturers are finding inspiration for products in other varieties of beverage alcohol, as well as meeting consumer desire for healthier products.

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Center Store

Beverage Alcohol

on the consumers that shop each store,” he asserts. “For example, our Family Fare Supermarkets customers prefer craft and domestic beers, whereas our D&W Fresh Market customers tend to do a lot of entertaining, so we see strong wine sales at those stores.” Diane Couchman, center store director at Giant Food of Landover, Md., sees similar movements in beverage alcohol. “For beer, customers are going back to the basics,” observes Couchman. “Trends are shifting from hip esoteric brands to more established and imported beer. The microbrew shopper is leaning more towards local. Wine shoppers are still hoping from brand to brand but are shifting to rosés and light flavor profiles that mix well for summer drinking.” When it comes to merchandising and promoting product during the season, McQuesten points out: “Retail price drives top-line growth in the beer, wine and spirits categories, and front-cover, aggressive beer retails continue to drive traffic. Large thematic displays capture that impulse sale and increase sales per customer. We have increased the number of out-of-department displays, where we can also have an increased focus on in-store tastings.”

He adds: “Pairing beers with food is also a growing trend. Similar to how red wines go with red meat, or white wines with cheeses, more consumers are pairing their foods with beers that complement the flavors and enhance the overall experience. On many of our websites — and, for example — our category managers have a regularly occurring blog, where they pair … timely product recommendations. This gives our customers the chance to learn more about what flavors go together, while also driving sales of on-trend beers and wines.” “Curating distinctive assortment as well as display plans will be critical to the summer selling season,” says Couchman. “Having the right item in the right store for our shoppers is our direction. We anticipate selling more beer and wine once our customers understand that we are meeting their needs.”


Beer’s Still Here

New this summer from the Boston Beer Co. is the lighter Sam ’76.

When the weather turns hot, Americans still overwhelmingly turn to cold beer — but it may well be a south-of-the-border brand. “Mexican imports like Modelo, Corona and Dos Equis will continue to drive momentum for beer, primarily because of their sessionability — Mexican imports continue to drive double-digit growth,” notes Vikas Satyal, senior director, commercial marketing at White Plains, N.Y.-based Heineken USA, where “we’re also leveraging our [Major League Soccer] sponsorship for Heineken and the College Football Playoff, which will be more localized and amplified this year, on the back end of summer for Dos Equis.” As always, the company is ready for the season. “From a product standpoint, we’ve focused on the Heineken aluminum bottle and Cooler Pack packages, which drive portability and emphasize the convenience shoppers are seeking,” says Satyal. “From a merchandising standpoint, we’ve developed displays that highlight multiple import brands in our portfolio — again, because imports are driving growth for beer, whereas the domestics are driving all of the declines. Relatedly, we also continue to partner with our retailers to help validate shelf sets and assortment recommendations that in the past were too focused on declining domestic brands; our space-planning value proposition guides the retailer through an unbiased approach to leveraging syndicated, customer and ROM data to create a balanced assortment.” “Lighter styles are always a go-to in the summer, and craft beer drinkers are looking for easy-drinking styles that still have great flavor,” notes George Ward, national director-off-premise at the Boston Beer Co., which offers famed Samuel Adams beer and other well-known beverage alcohol brands. “New Sam ’76 is a great option

Center Store

Beverage Alcohol

for drinkers looking for something that tastes great, won’t weigh them down and comes in cans for summer drinking occasions.” Some point out, however, that regardless of the time of year, beer can’t continue to dominate the category — despite volume declines, along with incursions from wine and spirits, in recent years, it still enjoys a 79 percent share of total U.S. beverage alcohol, according to the London-based data and analysis provider IWSR — without some adjustment to shifting consumer preferences. “The beer category must offer more diversity such that it reflects the emerging cross-category purchase behavior or decision hierarchy” of consumers age 21 to 34, many of whom “consume more variety, drinking a mix of beer, wine and cocktails, depending on daypart or usage occasion,” contends Scott Varner, VP of national accounts at Reno, Nev.-based Ennoble Beverages, which has introduced ready-to-drink malt-based cocktails Tipsy Tomato Bloody Mary and Frank’s RedHot Bloody Mary. “This growing cocktail-purchase occasion can be represented in the beer aisle. Ennoble Beverages was created solely to fill this growing opportunity. The Ennoble portfolio brings the cocktail-purchase occasion to the beer aisle.” It’s not just upstart brands like Ennoble that are getting creative in the flavored malt beverage segment, though. Ward points out that Boston Beer’s Twisted Tea brand “continues to see double-digit growth as more and more drinkers try this refreshing hard iced tea made with real brewed tea. It’s delicious, refreshing, and perfect for outdoor drinking occasions, especially tailgating.”

La Vie en rosé, and More Given the aforementioned popularity of rosé wine, beverage alcohol suppliers are hastening to leverage the trend in their offerings for summer and beyond. “Our new Angry Orchard Rosé hard cider, which uses rosé wine as an inspiration, has really taken off this year and could be the overall No. 1 new item in the malt beverage category for 2018,” says Ward. “Made with a delicious blend of apples, including rare red-flesh apples from France, Angry Orchard Rosé delivers the crisp and refreshing qualities of cider, with a rosy color and floral aroma. Angry Orchard Rosé pairs well with lighter foods and is great in a cocktail anytime.” Adding that since its debut earlier this year, consumers “have really embraced it,” Ward asserts, “Angry Orchard’s new Rosé Cider is a great example of how beverage trends in one category can inspire innovation in other spaces.” Over at Heineken USA, meanwhile, “we’re launching Strongbow Rosé Cider to capitalize on the female and gluten-free consumers that are seeking healthier options,” notes Satyal, adding that flavored malt beverages “such as Mike’s Hard Lemonade and its remaining portfolio continue


Hard sparkling water brand Truly, from the Boston Beer Co., offers consumers a healthier option.

to grow as well, reflecting ... consumer interest in lighter, fruitier flavors.” Ward is likewise aware of this “increased focus on wellness,” observing: “Drinkers are looking for hard beverages that taste great and fit into their active lifestyle without having to sacrifice their social life. Hard sparkling waters like Truly Spiked & Sparkling satisfy the desire for a refreshing drink without the added sugar, calories or artificial sweeteners. Truly comes in slim cans, has only 100 calories, 2 grams of carbs and 1 gram of sugars, and is the perfect choice for session drinking or a post-workout summer happy hour.” The product is available as a citrus mix-pack or, new this year, a berry mixpack, one of whose flavors is the recently released Truly Spiked & Sparkling Wild Berry, which Ward describes as featuring “a refreshing mix of California strawberries, raspberries and Marion blackberries.” To make the most of their summer beverage alcohol sales, Ward advises “retailers to leverage all their appropriate brand assets on the floor. … Our recommendations include a Samuel Adams Summer Ale/Sam ’76 display to announce summer is here and to embrace drinker excitement for warmer weather. And, as the days get hotter, Truly Spiked & Sparkling mix 12-packs are a great option to display to showcase a light, refreshing option. In summer 2017, our Truly Spiked & Sparkling 12-pack slim-can mix-pack was the fastest-selling SKU in the hard sparkling water category, and really flew off shelves. We anticipate that much drinker enthusiasm and more as we head into summer 2018.” What’s for certain is that the beverage alcohol category will keep innovating, not just in summer, but all year round. As SpartanNash’s McQuesten notes, “Like other beverage categories — where we’re seeing new flavors and blends — alcohol options continue to expand as our consumers’ palates change.”

Legal Notice


SUMMARY NOTICE OF PENDENCY OF CLASS ACTION, PROPOSED PARTIAL SETTLEMENT AND HEARING REGARDING SETTLEMENT TO: All persons and entities in the non-Western United States who purchased FRESH AGARICUS MUSHROOMS directly from an Eastern Mushroom Marketing Cooperative (EMMC) member or one of its co-conspirators or its owned or controlled affiliates, agents, or subsidiaries at any time between February 4, 2001 and August 8, 2005, YOUR RIGHTS COULD BE AFFECTED BY A CLASS ACTION LAWSUIT. Direct Purchasers of fresh agaricus mushrooms have filed a lawsuit against the Eastern Mushroom Marketing Cooperative (EMMC); Robert A. Ferranto trading as Bella Mushroom Farms1; Brownstone Mushroom Farms; To-Jo Fresh Mushrooms, Inc.; Cardile Mushrooms, Inc.; Cardile Brothers Mushroom Packaging, Inc.; Country Fresh Mushroom Co.; Forest Mushroom Inc.; Franklin Farms, Inc.; Gino Gaspari & Sons, Inc.; Giorgi Mushroom Company; Giorgio Foods, Inc.; Kaolin Mushroom Farms, Inc.; South Mill Mushroom Sales, Inc.; Leone Pizzini and Son, Inc.; LRP-M Mushrooms LLC2; Modern Mushroom Farms; Sher-Rockee Mushroom Farm; C& C Carriage Mushroom Co.; Oakshire Mushroom Farm, Inc.; Phillips Mushroom Farms, Inc.; Harvest Fresh Farms, Inc.; Louis M. Marson, Jr. Inc.; Mario Cutone Mushroom Co., Inc.; M.D. Basciani & Sons, Inc.3; Monterey Mushrooms, Inc.; Masha & Toto, Inc., trading as M & T Mushrooms4; W & P Mushroom, Inc.; Mushroom Alliance, Inc.; Creekside Mushrooms Ltd.; Kitchen Pride Mushroom Farms, Inc.; J-M Farms, Inc.; United Mushroom Farms Cooperative, Inc.; and John Pia (collectively, the “Defendants”),5 alleging that they violated the antitrust laws by fixing the prices, and restricting the supply, of fresh agaricus mushrooms. The lawsuit has been certified as a class action by Judge Thomas N. O’Neill of the United States District Court for the Eastern District of Pennsylvania and is known as In re Mushroom Direct Purchaser Antitrust Litigation, No. 06-620. Defendants deny that they were subject to and violated the antitrust laws. Defendants also deny that the Class was impacted or suffered any compensable losses as a result of the EMMC’s policies at issue in this case. The Court has not decided whether Defendants did anything wrong. These issues will ultimately be resolved in this case. The Class certified is: All persons or entities in the non-Western United States who purchased fresh agaricus mushrooms directly from an Eastern Mushroom Marketing Cooperative (EMMC) member or one of its co-conspirators or its owned or controlled affiliates, agents, or subsidiaries at any time between February 4, 2001 and August 8, 2005 (the “Class Period”). For group buying organizations and their members, direct purchasers are either: (1) members who have a significant ownership interest in or functional control over their organizations; or (2) if no member has such interest or control, the organizations themselves. The Class excludes the EMMC, its members and their parents, subsidiaries and affiliates. The nonWestern United States refers to the following states which were in the six regions of the country which plaintiffs claim were subject to the EMMC’s pricing policies: Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, Connecticut, New York, Pennsylvania, New Jersey, Delaware, Maryland, Virginia, North Carolina, South Carolina, Georgia, Florida, Tennessee, Alabama, Mississippi, Arkansas, Louisiana, Wisconsin, Minnesota, Iowa, Kanas, Nebraska, Colorado, Oklahoma, Texas, Ohio, Missouri, Michigan, Indiana, Kentucky, West Virginia, Illinois, and the District of Columbia.6 If you do not meet these requirements or are not a member of the Giorgi Settlement Class, this Notice does not apply to you. Common Class Wide Claims and Issues identified by the Court include: whether there has been a violation of the antitrust laws; whether Class members suffered an injury from the claimed antitrust violations; and aggregate damages suffered by the Class as a result of Defendants’ conduct. Proposed Partial Settlement. Plaintiffs have reached settlements with the following Defendants: Giorgi Mushroom Company and Giorgi Foods, Inc. (collectively “Giorgi”), Creekside Mushroom Ltd. (“Creekside”) and Kitchen Pride Mushroom Farms, Inc. (“Kitchen Pride”). The settlements are contingent upon the Court’s preliminary and final approval of class certification under Rule 23 of the Federal Rules of Civil Procedure. Subject to the terms and conditions of the settlement agreement with Giorgi, dated April 27, 2011 which is on file with the Court as Exhibit 1 to Class Plaintiffs’ January 29, 2018 Motion for Preliminary Approval, a copy of which is also available at www.garwingerstein. com, Giorgi has paid $11.5 million in cash into an escrow account for the benefit of Class. The settlement with Giorgi includes a “most favored nation” provision whereby (subject to specified exceptions) future settlements with certain other defendants that have not yet settled might lead to a reduction in the settlement amount paid by Giorgi. The proposed settlement with Giorgi is a compromise of disputed claims and does not mean that it or any other defendant in this action has been found liable for the claims made by the Class Plaintiffs. Giorgi does not admit any wrongdoing or liability on its part. Subject to the terms and conditions of the settlement agreement with Kitchen Pride, dated June 26, 2015 which is on file with the Court as Exhibit 2 to Class Plaintiffs’ 1

Buona Foods, Inc., not a defendant in this litigation, is its affiliated distributor.


Manfredini Enterprises, Inc., not a defendant in this litigation, is its affiliated distributor.


Basciani Foods, Inc., not a defendant in this litigation, is its affiliated distributor.


Robert Masha Sales, Inc., not a defendant in this litigation, is its affiliated distributor.


Defendants dispute that purchases made from the identified non-defendant affiliated distributors (Buona Foods, Inc., Manfredini Enterprises, Inc., Basciani Foods, Inc., Robert Masha Sales, Inc.,) as well as other mushroom distributors who are also not defendants in this case may be included in this case. That issue will ultimately be resolved in this case. 6

The Giorgi settlement referenced below is on behalf of a class that is defined as follows: All persons or entities who purchased Agaricus mushrooms directly from an EMMC member or one of its co-conspirators or its owned or controlled affiliates, agents or subsidiaries at any times during the period January 1, 2001 through December 31, 2008. The term “Agaricus mushrooms” shall mean all varieties and strains of the species Agaricus bisporus, including, among others, both brown and white varieties. The Direct Purchaser Class excludes the EMMC, its members and their parents, subsidiaries and affiliates. The Class also excludes Giant Eagle and Publix Super Markets, Inc. and their parents, subsidiaries and affiliates (the “Giorgi Settlement Class”).

January 29, 2018 Motion for Preliminary Approval, a copy of which is also available at, Kitchen Pride has agreed to pay $125,000 in cash for the benefit of the Class upon final Court approval of the settlement. Kitchen Pride has also agreed to cooperate with the Class in its continuing litigation against the non-settling defendants, to the extent that such cooperation does not conflict with attorney-client or work product privilege. Kitchen Pride does not admit any wrongdoing or liability on its part. Subject to the terms and conditions of the settlement agreement with Creekside, dated April 19, 2017 which is on file with the Court as Exhibit 3 to Class Plaintiffs’ January 29, 2018 Motion for Preliminary Approval, a copy of which is also available at www.garwingerstein. com, Creekside has paid $250,000 in cash into an escrow account for the benefit of the Class. Creekside has also agreed to cooperate with the Class in its continuing litigation against the non-settling defendants, to the extent that such cooperation does not conflict with attorney-client or work product privilege or disclose any information learned exclusively through efforts or communications subject to the joint defense or common interest privilege. Creekside does not admit any wrongdoing or liability on its part. If the Settlements are approved by the Court, Giorgi, Kitchen Pride and Creekside, and their respective present and former parents, subsidiaries, divisions, affiliates, stockholders, officers, directors, employees, agents and any of their legal representatives (and the predecessors, heirs, executors, administrators, successors and assigns of each of the foregoing) (the “Released Parties”) shall be released and forever discharged from liability for all claims that were or could have been brought by Class Plaintiffs and members of the Class in this case (the “Released Claims”). Notwithstanding the Class Definition certified by the Court and referenced above, Giorgi shall be released and forever discharged from liability for all claims that were or could have been brought against Giorgi as defined in the settlement agreement with Giorgi, dated April 27, 2011. Each member of the Class who does not opt-out covenants and agrees that it shall not seek to establish liability against any Released Party based, in whole or in part, upon any of the Released Claims. Any disputes arising under or relating to the Settlement Agreements, including, but not limited to, the releases in the Settlement Agreements, will be resolved in the U.S. District Court for the Eastern District of Pennsylvania. Mailed Notice. If you believe you are a member of the Class but have not yet received the more detailed Notice of Pendency of Class Action (“Mailed Notice”), you may obtain a copy of the Mailed Notice (that includes additional information regarding objections to the settlements or the certification of the Class as well as deadlines for asserting those objections if any), by contacting the Notice Administrator at: Mushrooms Direct Notice Administrator c/o Rust Consulting, Inc. - 6057 P.O. Box 44 Minneapolis, MN 55440-0044 Excluding Yourself From The Class. To exclude yourself from the Class (“opt out”), you must send a letter to the Notice Administrator at the above address by U.S. First Class Mail, postmarked on or before July 28, 2018, requesting exclusion and following the detailed instructions in the Mailed Notice. You cannot exclude yourself by telephone or e-mail. If you exclude yourself, you will not be bound by any judgment that may be made in the case, and you will not share in recovery from the Giorgi, Kitchen Pride or Creekside settlements, or any recovery that may be obtained as the result of a trial or other, future settlements. You will keep any right to sue Defendants on your own about the legal issues in this case. The Court will exclude from the Class any member who requests exclusion. Staying in the Lawsuit But Objecting to the Settlements. If you object to all or any part of the proposed settlements, write to the Court about why you do not like the proposed settlements. Any Notice of Intention to Appear and Summary Statement of Objections to the proposed Giorgi, Kitchen Pride and/or Creekside settlements filed by a Class member must be postmarked no later than Saturday, August 25, 2018, 30 days prior to the Fairness Hearing, which will be held on Monday, September 24, 2018 at 9:30 a.m., before The Honorable Berle M. Schiller, United States District Judge of the U.S. District Court of the Eastern District of Pennsylvania, in Courtroom 13B at United States Courthouse, 601 Market Street, Philadelphia, PA 19106. If You Do Nothing. If you do nothing, you remain in the Class. You will be bound by any judgment reached in this case. You will share in recovery from the Giorgi, Kitchen Pride or Creekside settlements and, to the extent there is any further recovery through trial or settlement, you will keep your right to share in it. Although not required, you may also hire your own attorney at your own expense and enter an appearance in the case through your own lawyer, if you so desire. Getting More Information. If you have questions, need additional information, or want to receive the Mailed Notice, please contact the Notice Administrator Rust Consulting, Inc. as set forth above. You may also get additional information by visiting PLEASE DO NOT WRITE OR CALL THE COURT OR THE CLERK’S OFFICE FOR INFORMATION. DATE: March 22, 2018, BY THE COURT Honorable Berle M. Schiller, United States District Judge

For Information:

Frozen & reFrigerated Foods


Milk It For All It’s Worth Re taileRs can le veR age June DaiRy Month to bolsteR sales acRoss RefRigeR ateD, fRozen DepaRtMents. By Lynn Petrak

ike an ice cream cone on a warm summer night on one of the longest days of the year, June Dairy Month is an anticipated and celebrated tradition. But similar to the ways that ice cream has changed over the years — vanilla may still be a standby, but creamy, cold dairy desserts are savored in all kinds of formats, flavors and formulas — June Dairy Month promotions and programs have evolved with the times. Back in the day, National Dairy Month began as a way to sell more milk during surpluses in the Depression-era 1930s. In the ensuing years, farmers, grocers and restaurants promoted the month-long occasion to move more product and champion wholesome foods and beverages that were often commodities or sold as familiar products by reliable, loyalty-inducing brands and stores. In the current ever-splintering, competitive marketplace, and with a plethora of dairy and dairy-like products spanning plant-based milks and rice-based ice creams, among others, retailers can get as creative with their June Dairy Month programs and promotions as they are with their product assortment and category management efforts. If it’s not a


Key Takeaways Many programs and promotions for June Dairy Month 2018 reflect changing consumption habits and industry innovations. The nutritional benefits of dairy remain a strong focal point of the promotion’s communications, as well as the appeal of locally sourced fresh product. Additionally, NFRA is emphasizing the versatility of diary items in the refrigerated and frozen sections. To execute successful promotions, retailers should team up with manufacturers and association partners to generate excitement and sales in their stores’ respective dairy sections.

Frozen & reFrigerated Foods


vanilla-cone world anymore, it’s not your parents or grandparents’ Dairy Month, either. “The dairy aisle has really evolved over the years. Today, it’s where consumers can find so much more than traditional fridge staples,” affirms Julie Henderson, spokeswoman for the National Frozen and Refrigerated Foods Association (NFRA), based in Harrisburg, Pa. “While families are still purchasing milk, eggs and butter, the evolution of yogurts and cheeses have expanded and boomed in popularity.” “Innovation has been happening across the dairy category,” agrees Lucas Lentsch, CEO of the St. Paul, Minn.-based Midwest Dairy Association. “If the competition is any indication of how great this category is, imitation is the sincerest form of flattery.” Henderson also notes the advent and expansion of milk alternatives and other items in the department, which can impact and sometimes complement programs for Dairy Month or, for that matter, any season or time of the year. “Additionally, milk alternatives are available in a variety of options and creating buzz for meeting consumers’ dietary needs,” she points out, “and there is diversity and versatility in other dairy-aisle products like potatoes, dips, breads, sour cream, cottage cheese, juices and more. Shoppers are eagerly exploring this aisle for inventive flavors and emerging trends — more so now than ever before.” Accordingly, many programs and promotions for 2018 reflect changing consumption habits and industry innovations. According to Henderson,

her organization’s June Dairy Month initiatives are broader, both in messaging and in the ways in which they are delivered to retailers and consumers. “NFRA’s June Dairy Month promotion focuses on the entire dairy aisle and all its diverse products,” she remarks. Ultimately, the goal of the effort is to garner more interest in the category and boost sales. “Dairy represents 3 percent of store space and 20 percent of store profit,” observes Lentsch. “That tells a tremendous story for retailers about the importance of a strong dairy aisle.”

to Your Health The health-and-wellness benefits of consuming products in the dairy category continue to be a strong focal point of June Dairy Month communications, some of which begin with World Milk Day on June 1. In the past, messages have

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concentrated on the nutrients in milk and its from-the-farm wholesomeness; today, those Shoppers are messages have expanded eagerly exploring this aisle to include a variety of other attributes offered by traditional for inventive flavors and dairy products, as well as emerging trends — more so those of emerging items in the now than ever before.” department. —Julie Henderson, NFRA “Messaging around health and wellness fits many promotion periods and eating occasions,” says Henderson, adding that health-related angles work well for June Dairy Month in the summer as much as they do for healthy eating around New Year’s, and betterfor-you choices during the back-to-school season. NFRA, for its part, engages dietitians to help share messages about the health aspects of consuming items in the dairy section. The Midwest Dairy Association incorporates several dairy nutrition messages as part of its toolkit for June Dairy Month. These materials, which include customizable press releases, weekly ad circulars, and sample social media posts and calendars, highlight the role that dairy foods play in a healthy diet. Midwest’s Dairy’s 3 for Me initiative is designed to encourage people to consume three servings of dairy foods daily. The 3 for Me badge, as well as general June Dairy Month logos, are available as graphics for retailers and others to use in advance of and during June.

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Frozen & reFrigerated Foods


Tied into health and wellness is the appeal of locally sourced products that originate on what’s often a family farm. “Most milk is produced within 200 miles of where you live and available in the store within 48 hours after production. It’s an awesome aspect to dairy, because dairy is incredibly local, fresh and available when and how you like it,” says Lentsch, adding, “One thing we love about dairy is that when you pick up your gallon of milk or innovative smoothie or package of cheese, there is a story of real people behind those products.”

dairy Products as Versatile solutions In addition to the health message, NFRA is hinging its 2018 programs on the versatility of items found in the refrigerated and frozen sections, something underscored by the theme of this year’s programs, Discover the Cool Possibilities. In its outreach and toolkit for June initiatives, NFRA encourages manufacturers of dairy foods and items sold in dairy aisles to share recipes and meal suggestions offered on NFRA’s website, Indicative of the many channels in which consumers receive information, industry organizations, retailers and manufacturers can leverage a variety of platforms to reach consumers with June Dairy Month messages. In addition to traditional point-of-sale materials, social media and digital advertising and promotion are increasingly important components of integrated campaigns. NFRA, for its part, is deploying digital coupons on the website Coupons. com, on which sponsoring brands can run various coupon offers designed to draw shoppers to the store. The trade organization is also entering into an integrated media partnership with New York-based mass-media company Westwood One to share June Dairy Month information via web and social media platforms. “In particular, the Westwood One program reaches consumers where they are throughout the day with traditional radio, email blasts, online streaming and social media,” explains Henderson. In other social media efforts, the trade association’s June Dairy Month Twitter party has been set for June 5, looping in brands, registered dietitians and consumers to tweet about dairy-aisle products and recipes. On a more personal and targeted digital level, NFRA has assembled a panel of chefs, dietitians and food writers to blog and share recipes featuring dairy aisle products during June. Meanwhile, the Innovation Center for U.S. Dairy, part of Rosemont, Ill.-based Dairy Management Inc., is continuing its multiyear, multiplatform Undeniably Dairy campaign, which rolled out last year to educate consumers about milk, dairy foods and dairy farms. The campaign includes message points and information on the nutrition of dairy foods compared with nondairy and plant-based alternatives. This information can be used to tout dairy-specific items during June Dairy Month.

the Power of Partnerships In its idea book for successful June Dairy Month programs, NRFA offers 12 Steps for a Successful Retail Program. At the top of the list: cultivating beneficial partnerships by working with manufacturers and association partners to generate excitement and sales in stores’ respective dairy sections. For grocers, then, gearing up for June Dairy Month often means bringing others along for the ride. To that point, partnerships abound, from in-store events with retailers and nearby dairy farmers to the Great American Milk Drive’s key engagement period in June, led by the Washington, D.C.-based Milk Proces-


When you pick up your gallon of milk or innovative smoothie or package of cheese, there is a story of real people behind those products.” —Lucas Lentsch, Midwest Dairy Association

sor Education Program (MilkPEP). NFRA, for example, works with a variety of manufacturers and brands on coupons and advertising. “Retailers can take advantage of the increased media by promoting these brands in-store,” notes Henderson. “Retailers can also utilize NFRA’s digital toolkit for June Dairy Month, using those assets in everything from social media to e-blasts to in-store displays.” On a regional, state and local basis, collaborations among industry organizations, retailers and brands can be the rising tide that lifts all sales. “We’re creating a lot of activity on the local level by celebrating dairy within the state,” says Lizzie Duffey, public relations specialist for Dairy Farmers of Wisconsin (formerly the Wisconsin Milk Marketing Board), based in Madison. “This year’s theme is ‘Hooray Wisconsin Dairy!’ From the retail end, we’re doing local activities.” The Frozen and Refrigerated Foods Council of Northern California likewise works with several partners for June Dairy Month, including grocers. Among other efforts, the Tres Pinos-based group supports retailers with end cap and bunker displays that can be set out for the four weeks of Dairy Month, and also offers website postings, in-store fliers, coupon booklets and other promotional materials. Like items in the dairy case, regional and grass-roots collaborations evolve, too. Midwest Dairy, for instance, recently unveiled a new logo, vision and mission after a year-long strategic planning process to develop stronger relationships with consumers and work closely with farmers, manufacturers, coop partners and retailers.

Fresh Food


Get ’Em to the Grill summer Provides an oPPortunit y for re tailers to Promote fresh fruits and veggies as Prime barbecue fare. By D. Gail Fleenor

he smell of fragrant smoke and juice dripping on skewers isn’t always from steak or chicken. Grilling fruits and vegetables to accompany meat, top a salad, create dessert — or even as the main course — is good for summer produce sales. Almost any kind of fruit or vegetable can be grilled and enjoyed. As consumers continue to search for healthy options, produce departments can offer the answer and, in the summer, that can mean grilling, along with items like freshly made salsa.

Grill for a Thrill Grilling continues to be a hot trend with customers as a time for family and friends to gather. “Grilling fruits and vegetables, including some surprises like grilled romaine, should continue to be popular [this summer] — why heat up the kitchen if you already have the grill going?” says Kathy Means, VP of demand creation and consumer affairs for the Newark, Del.-based Produce Marketing Association. “Also, as consumers look at

Key Takeaways Post signage in the produce and meat departments with information about grilling fruits and vegetables. Display on an end cap some of the fruits and vegetables that can be grilled, along with educational signage. Plan a summer calendar of grilling, featuring a different fruit or vegetable, other than the most commonly grilled, with recipes available. Grill outside in conjunction with the meat department, including vegetables like artichokes and beets, plus fruits like peaches and watermelon, to educate customers. Demonstrate how to grill fruit for dessert on a hibachi in the produce department, with samples and recipe cards.

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Fresh Food


plant-based diets, mushrooms as a meat substitute or blend are growing in popularity. So we can expect to see more mushroom burgers or mushroom-blend burgers on the barbecue.” Biting into a ripe peach with the juice running down your chin may sound like the ultimate way of enjoying the beloved fuzzy fruit, but there are other options. Advise shoppers that grilling peaches is an easy task, and they can be used in everything from salad to dessert. The fruit caramelizes when grilled, bringing out more of its sweetness. Remind shoppers that when choosing a peach for grilling, to make sure it’s soft but not too soft, with a slight give to the flesh, and they should smell it for freshness. Supermarket promotions for grilling naturally link meat and produce together. “We tie in with the meat department when they have a grilling sale,” notes Jay Schneider, produce director for Malvern, Pa.based Acme Markets, a division of Albertsons. “Maybe asparagus tied in next to a steak display with tray pack corn on the cob nearby.” “Almost every vegetable is up for grilling,” asserts José Padilla, produce and floral operations coordinator for grocery wholesaler Krasdale Foods, based in New York. “We will be pushing tons of local vegetables. Whether it’s squash, eggplant, cauliflower, tomatoes, pepper, corn — all can be barbecued!” Padilla says that he sees more people slicing cauliflower and eating the vegetable like a hamburger. Meanwhile, fruit such as pineapples,


stone fruit (peaches, nectarines, plums, pluots), and even melons are fit to be grilled, he points out. The grilled fruit can be glazed with brown sugar and topped with a scoop of ice cream, or combined with other ingredients such as prosciutto. “From a marketing perspective, we will be calling out produce items that are good for barbecuing with a

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Fresh Food


flamed-charcoal logo,” Padilla notes. Lowes Foods, based in Winston-Salem, N.C., actively markets produce for grilling. “People are looking for more healthy options, and grilling is a great way to unleash a new flavor from an old favorite,” says Chris Van Parys, Lowes’ VP, fresh merchandising. “In our Pick & Prep area, we sell combinations already on the skewer and ready for the grill, such as sweet onions, brown and portabella mushrooms, squash, and bell peppers. Fruit items that can be grilled include grape and Roma tomatoes, pineapple, peaches, plums, nectarines and even avocados.” Van Parys recommends a touch of olive oil with vegetables, and a balsamic glaze with fruit. Grilling halves of Brussels

sprouts dipped in olive oil, coarse ground sea salt and crushed pecans is delicious, he adds. One produce item many consumers have already been grilling for years is onions. A particular favorite is Vidalia onions. John Williams, sales manager for L.G. Herndon Jr. Farms, in Lyons, Ga., has 600 acres of Vidalia onions out of 3,500 total acres, where corn is also grown. Williams recommends grilling Vidalias on skewers with bell peppers and mushrooms. Onions can also be placed in grill baskets or trays, or tented in aluminum foil. According to the 2017 consumer survey for the Arlington, Va.-based Hearth, Patio & Barbecue Association, nearly one-third of consumers (29 percent) planned to use their grill or smoker more often. Summer holiday weekends bring the highest usage, with 73 percent of consumers grilling on July 4, 60 percent on Memorial Day, 58 percent on Labor Day, and 45 percent on Father’s Day. Mother’s Day and Easter are also popular grilling occasions. Many consumers grill year-round, however. Parties (49 percent), camping (24 percent), a vacation home party (21 percent), and tailgating at sporting events (11 percent) aren’t just opportunities for the meat department. Planning promotions and demos around holidays can show consumers the tastes that fruits and vegetables can bring to grilling.

What Else is on the Plate This Summer? Predictions for summer 2018 are that traditional produce menu items will remain strong, according to Kathy Means, VP of demand creation and consumer affairs for the Newark, Del.-based Produce Marketing Association (PMA). Summer will bring berries and melons, salad greens and toppings, fresh and cooling citrus as a fruit and as an ingredient, and favorites like potato salad and cole slaw to tempt the palate. Means is seeing greater creativity in produce combinations such as salads with both fruits and vegetables, dishes full of color and flavor, and mixing any kind of fruit or vegetable to get a new flavor profile. As far as other specific fruits and vegetables, cauliflower in many forms is still popular, she observes, and the jackfruit trend is continuing. For those unfamiliar with jackfruit, it’s sometimes used as a replacement for pulled pork in vegan recipes. Not only is it the world’s biggest tree fruit, often described as having a taste somewhere between a banana and a pineapple, but the seeds are edible as well. Meanwhile, cherries are Jay Schneider’s most popular summer display. The produce director for Malvern, Pa.-based Acme Markets, a division of Albertsons, notes, “Cherries really kick off the summer as we head into Memorial Day, and signify the summer selling season.” Further, when consumers think of summer, especially on


a sweltering day, watermelon comes to mind, he observes: “Pre-cut watermelon bowl sales in various sizes continue to increase in sales every year.” Consumers are moving toward convenience, now more than ever, he points out, and precut fruit is a perfect fit for time-starved customers. “Nothing says summer like peaches, so you want to promote peaches all summer long,” asserts Will McGehee, sales manager at The Genuine Georgia Group LLC and marketing director for the Georgia Peach Council. His family has worked the Pearson Farm, 90 miles south of Atlanta, since 1888, and McGehee himself is a fifth-generation Pearson.

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Grilling’s Healthy Benefits grilling fruits and vegetables can be a healthy meal addition or great stand-alone. There are other healthy pluses to consider, according to the Fruits & veggies — More Matters Health initiative from the Brentwood, Mo.-based Produce for Better Health Foundation: grilled fruit can be a great low-fat summer dessert. grilling brings out the sweetness in many fruits such as pineapples, peaches, nectarines and plums. grilled apples can increase the soluble fiber and intake of natural phytochemicals that may reduce risk for heart disease and some cancers, and may improve brain function. grilled mushrooms are a great meat replacement. By promoting the grilling of fresh fruits and vegetables this summer, produce departments can become a destination for customers looking for healthy options in a different way. some customers may need instruction in grilling. if you provide it, you’ll reap their sales and loyalty.

Summer is a great time for creating new combinations of fruits and vegetables for salsas. While traditional salsa is made with tomatoes, onions and hot peppers, there are many recipes for fruit and vegetable salsas which can be used as a condiment, garnish or topping for a variety of foods such as fish, baked potatoes or rice. Almost any fruit or vegetable can be added or combined for freshly made salsa, with or without hot peppers. Vegetable salsas can crown or stuff an omelet or a pita sandwich, while fruit salsas can top yogurt or serve as a dip for fresh fruit. Both vegetables and fruit can accompany cottage cheese, grilled chicken, fish, pork or beef, according to Fruits & Veggies — More Matters, an initiative of the Brentwood, Mo.based Produce for Better Health Foundation. However they’re prepared, salsas are a low-fat, lowcalorie way to enjoy summer produce that grocers should encourage consumers to try.

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2018 Retail Deli Review

he traditional supermarket deli has gone through an evolution in recent years, as retailers complement their traditional deli counters with experiments involving instore restaurant concepts, globally inspired hot and cold food bars, crafted soups, and signature sandwiches. Add the newest craze of meal kits to the mix, and you have a deli department that looks decidedly different from a few decades ago. With more consumers feeling time-starved and looking for daily meal inspiration, it looks as if grocers will continue to find new ways to reach their shoppers in an effort to boost sales — and they’re going all over the store to do it. Progressive Grocer’s 2018 Retail Deli Review, our exclusive annual survey of grocery retail executives, store managers

and deli department leaders, finds that three-fourths of respondents are now cross-merchandising the deli to drive sales throughout their stores. From the more common tie-ins — fresh bread from the bakery, salads in produce and specialty cheeses — to more outof-the-box ideas (one respondent says that his store promotes dried meats with melons, while another places prepared salads in the meat department), retailers are getting more creative in how they engage their shoppers. As one savvy store manager notes, “All areas of our store are cross-merchandised with deli.” Their efforts seem to be paying off, as

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Fresh Food

2018 Retail Deli Review

Deli Department Sales Performance Increased


Stayed the same

Ye ar ago

Current 14.9%


12 . 8%


Net change

Projected for Total 2018 Increased


Stayed the same

Ye ar ago

Current 2 0.0%







Net change

Net change

Prepared Foods Program Performance Increased


Stayed the same

unit volume

Doll ar SaleS 13.5%


10. 8%

Profit Uptick When it comes to profits, retailers are also seeing dollar signs — which is good news, considering the competitive retail climate they’re operating in and the persistent challenge of two hard-to-ignore

6 9.6%



Net change

deli sales have continued to grow over the past year. Seventy-two percent of respondents say that their overall deli sales, including prepared foods, grew in 2017 — that’s 2 percent more than those who cited sales growth in 2016. Larger operators (those with more than 10 stores) have fared particularly well, with 81 percent reporting an increase in sales. Of those retailers who reported an increase, the average sales gain was 8.2 percent. In total, deli department sales now account for almost 15 percent of all supermarket sales, according to the survey, with independent operators (those with 10 or fewer stores) seeing their average total sales closer to 10 percent. Looking ahead, three-fourths of respondents expect sales to increase next year, while about 20 percent think that sales will stay roughly the same. Which factors have been most influential in securing strong everyday deli sales? Retailers cite engaged associates (65.5 percent), signature items (48.3 percent), advertising/promotions (41.4 percent), and active sampling/events (just under 40 percent) as the primary contributors. Other factors a little further down the list include product samples, merchandising/ experience, in-store specials and social media special offers.


72 .3%

Source: Progressive Grocer market research, 2018

13.5% 8.1%


70.3% Yes Net

Have you dedicated more selling space to fresh prepared foods in your average store in the past year?

Is your deli area separated from your fresh prepared foods selling area?

40.5% Yes

59.5% No

Comparing deli department profits from this year vs. last year, did they:

Stayed the same



Yes, significantly

Yes, modestly

No, kept same amount of space

Do your stores have a dedicated dining area for shoppers to eat fresh prepared offerings?

10. 8% 21.6%

Are you cross-merchandising your deli to drive sales throughout the store?

75.7% Yes

24.3% No Source: Progressive Grocer market research, 2018

64.9% Yes

35.1% No

What three factors do you consider to be most influential to securing strong everyday deli department sales?





Engaged Associates Signature Items Advertising/Promotions Active Sampling/Events Product Samples Merchandising/Experience In-Store Specials Social Media Special Offers Extended Hours of Operation Premium Brands Cross-Promotions POS Coupons/Discounts Executive Chef Incentive-Based Discounts Increased On-Ad Specials Source: Progressive Grocer market research, 2018


Year Ago

65.5% 48.3 41.4 37.9 27.6 27.6 13.8 10.3 6.9 6.9 6.9 3.4 3.4 0.0 0.0

76.5% 47.1 17.6 35.3 23.5 23.5 29.4 0.0 0.0 23.5 5.9 0.0 0.0 0.0 17.6

Fresh Food

2018 Retail Deli Review Which operational issue do you consider to be the single most challenging with regard to your service deli program? Rank Labor Shrink Training Pricing Other Sourcing Equipment productivity/maintenance profit drainers: labor and shrink. An impressive 67.7 percent of survey respondents say that their profits were up in 2017 (87.5 percent of chain store representatives cite profit increases). In last year’s report, just 58 percent said they’d seen their profits rise. While only about half of independent operators responding to this year’s survey saw an increase, 38 percent say that their profits have largely stayed the same, suggesting that they may

50.0% 25.0 17.9 3.6 3.6 0.0 0.0

Which operational issue do you consider to be the single most challenging for your fresh prepared foods program? Rank



Labor Shrink Product mix Equipment productivity/maintenance Pricing Packaging Product quality levels Inventory management Other Source: Progressive Grocer market research, 2018

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Fresh Food

2018 Retail Deli Review

What areas of your deli/prepared food operations will you concentrate on enhancing during 2018? Current

Year Ago

Meal deals (bundled meals) Rotisserie programs Staff training Hot/cold bars Daily specials Lunch Sandwiches Dinner Catering

48.3% 48.3 44.8 44.4 44.4 44.4 44.4 31.0 31.0

41.2% 47.1 58.8 41.2 41.2 17.6 47.1 11.8 17.6

Side dishes Soup stations Private label Sushi Breakfast Category management Beverage bars Premium brands Concept food stations

27.6 24.1 20.7 17.2 13.8 10.3 6.9 3.4

5.9 11.8 17.6 17.6 11.8 5.9 5.9 5.9

3.4 0.0 0.0

5.9 0.0 5.9

(i.e., Asian kitchens, pasta, carving stations)

Antipasto bars Other Source: Progressive Grocer market research, 2018

be having a harder time keeping up. Retailers’ average deli gross margin was 43.9 percent, with labor accounting for almost 20 percent of sales, and shrink coming in at a more manageable 5.6 percent of sales. Delving deeper into the survey data, prepared foods have remained a shining star among deli categories. Three-fourths of respondents say that their prepared food program increased in dollar sales and unit volume in 2017, while about one-fourth of independent operators say that they saw no change in performance. Seventy percent of respondents say that they dedicated more selling space to fresh prepared foods in 2017. Moreover, half of chain respondents say that they increased space significantly. Retailers still vary in how they arrange their deli departments, however: Some separate their traditional deli sections from fresh prepared foods, and roughly 35 percent don’t have a dedicated dining area. Not surprisingly, salads and healthier fare were mentioned by a large number of respondents, who note that customers are thinking more about wellness than ever before. “Our fresh salads move very fast,”


explains one owner of an independent operation in Virginia. “Sandwiches and wraps go faster when they’re already made up and placed in an open-face refrigerator.” Another respondent goes so far as to list “vegan” as a growing category.

Planning for 2018 In planning for 2018, retailers are especially enthusiastic about meal deals (48.3 percent of respondents plan to concentrate on enhancing this area), and they remain focused on rotisserie programs, as they did in last year’s survey. Just over 40 percent of respondents say that their companies plan to concentrate more on hot/cold bars, daily specials, lunch and sandwiches, while 31 percent will pay more attention to dinner and catering. Side dishes seem to be another hot area, with 27.6 percent of respondents planning to focus on them, compared with only 6 percent who were focused on this area in last year’s survey. Also, while staff training remains a planned area of focus (44.8 percent of respondents say that they’ll concentrate on training in 2018), retailers’ interest has waned somewhat compared with last year’s survey, when almost 60 percent said that they’d be emphasizing this area. Either way, the single most challenging operational issue for the service deli is still labor for half of the respondents, followed by shrink (25 percent) and training (17.9 percent). Further, when asked to rate the “most serious issues” facing the deli (using a scale of one to 10, with 10 being most serious), recruiting effective employees ranks as the top concern, followed by labor costs, shrink/waste, attracting more shoppers to the deli, employee training and food safety. To be sure, deli operators will continue to face a number of challenges in the year ahead. But if they can stay creative in supplementing traditional fare with more modern, healthier options, while also thinking outside the counter when it comes to merchandising, deli’s halo effect should continue to boost sales for independent and chain operators alike.

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pharmacists educating on medication use and disease prevention, to merchandisers elevating design and display, to category managers maximizing product impact, these key players can shake up the food landscape. The shared motivation of these influencers is determining where to expend extra effort to stimulate consumer excitement.

Wellness Across the Store

Best Health Inside Re tail die titians aRe a ke y paRt of gRoceRs’ vision foR whole-stoRe wellness. By Molly Hembree s suggested by the saying “No one can whistle a symphony; it takes an orchestra to play it,” there is demand for cohesion amid grocery stores’ departments to deliver results. if we take a look at FMi’s “2017 Food retailing industry speaks report,” a top worry of senior retail leaders is competition — namely among nontraditional channels and e-tailers — while health and wellness is regarded as a major positive impact in the marketplace. supermarkets, from small-chain to mixed-retail to big-box retailers, have the opportunity to amplify key health messages through decisions that span the whole store. The common goal of all retail stakeholders to improve profit begins with the basic understanding that more consumer purchases need to be made inside the grocery store than from outside food establishments. on trend with increased interest in health and wellness, FMi’s “2017 U.s. grocery shopper Trends report” found that 77 percent to 94 percent of respondents agreed that food eaten at home is healthier than food eaten away from home. in fact, Nielsen research suggests that 88 percent of consumers are willing to spend more for healthier food. More options that acknowledge the varying needs of shoppers, from convenience to cooking literacy, dietary restrictions, budget and flavor, will increase the chances of keeping customers on the retail floor. The quadruple threat of dietitians, pharmacists, merchandisers and category managers serves as a powerful team. From dietitians coaching balanced nutrition and how to make “all foods fit,” to

A whole-store approach that’s relevant and earns trust with customers is a focus on wellness. A retailer that delivers consistent healthand-wellness messaging throughout the store experience, from the aisles to circulars, social media and advertising, is a winner in the game of grocery. A chain that understands food trends, knows the population it serves, demonstrates a flair for fare and uses desirable ingredients from all corners of the store strikes a chord with shoppers. opportunities to synchronize efforts with other departments of the store include leveraging vendors, events and cross-merchandising tactics. Fine-tune your work with private- and national-brand suppliers in a 360-degree approach to create recipes used in self-serve areas, delicatessens and bistros, with products that can be bought right off the shelf. As part of a whole-store diabetes awareness event, perhaps showcase the pharmacist’s expertise with blood glucose monitoring using general merchandise and over-the-counter products paired with the dietitian’s guidance on carbohydrate counting using items from dairy and produce. Help shift common consumer perceptions of foods to ones that support wellness, such as highlighting potential heart-healthy compounds in alcohol, homing in on the nutrient density of frozen foods, and broadcasting portion-controlled snacks in the cookie and cake aisle. smart food means better food. supporting our customers’ desires for finding their best health inside the grocery store can inform an action plan in the better-for-you food movement. Boost interdepartmental communication to raise not only sales and reputation, but also customers’ basket size and health numbers. Molly Hembree, RD, LD, is a registered dietitian coordinator for The Little Clinic and Kroger.

Progressive grocer May 2018


Focus on the

Grocerant Goodness Fresh departments are ke y to at tr acting and re taining wellness shoppers. By Eric Richard

he changing dynamics of today’s food scene are certainly influencing the role that supermarkets play in providing meal options for today’s consumers. Eating is no longer just a necessary routine in one’s daily life; rather, it’s a thought-out and calculated component of one’s lifestyle, especially among health-and-wellness shoppers. Fortunately, supermarkets are in a prime position to offer these consumers exactly what they’re searching for in food. It takes more than just having an appealing and relevant inventory, however; engagement is crucial to help attract and retain today’s consumers who are looking for wellness solutions. Shine a spotlight on product attributes. Transparency is quickly becoming a necessity in the retail food industry. Shoppers want to know where the food they consume was grown or produced, what it contains (and what it doesn’t contain), and how it can support their healthy lifestyle. Don’t leave it up to chance and risk a missed sales opportunity. This is where clean labeling comes in. Given that many of the products sold in in-store bakeries and delis contain a minimal amount of ingredients (compared with many center-aisle dry goods), the fresh perimeter is in the perfect position to connect with wellness shoppers. Besides the short list of product ingredients, also focus on other perceived health attributes that shoppers may be looking for, such as protein-rich, gluten-free, organic, non-GMO, no preservatives, no artificial flavors or locally sourced. Above all, however, emphasize the “fresh” factor. Nothing conveys the idea of healthy eating like fresh food. Make sure that this message resonates in all of your store’s marketing, promotions, displays, cases and merchandising concepts. Today’s consumers no longer look to their local supermarket as simply a destination for grocery stock-up trips; they view it as a place to experience new products and learn about their food. In fact, the storytelling component is vital in today’s retail food marketplace. Whether it’s through in-store messaging, social media or traditional advertising, telling the narrative behind your fresh food offerings will resonate with shoppers. Provide ideas on meal solutions. Deciding what to eat, prepare or purchase for their families is a real dilemma for many shoppers, with some scrambling for ideas right up to


the time of the dining occasion. In-store delis and prepared food departments are the perfect solutions. Provide shoppers with a selection of meal solutions, sides and ways they can personalize their orders, such as selecting the type of fresh-baked bread they’d like for their sandwiches, or their favorite pizza toppings. Personalization and customization can set your store apart from restaurant competitors, which may not be able to provide these to the same degree that a supermarket can. Make the most of your store’s in-store production through cross-departmental use of products and services. For example, leverage your store’s fresh bread program by providing traditional, artisan and new varieties of bread to your store’s sandwich program or prepared food department. Sales of fresh perimeter products are growing at a faster rate than those of center store. By focusing on the appeal, variety and freshness factor of in-store delis, bakeries and prepared food departments, stores can boost their image as a true destination for today’s wellness shopper.

Eric Richard is education coordinator at the Madison, Wis.-based International Dairy Deli Bakery Association.

Healthy Bites Re taileRs help consumeRs find the Right snack foR theiR wellness needs. By Lynn Petrak hile most grocers still have a center store aisle lined with traditional salty snacks and cookies, consumers are demanding more out of their snacks, looking for things like protein and whole grains. Frequent snacking has replaced traditional mealtimes for many, and folks want more food value in their grazing. “consumers are snacking on an average of 2.5 snacks per day in the U.s., and the snacking universe is far-reaching, encompassing many categories throughout the store,” concurs sally Lyons Wyatt, evP and practice leader for chicago-based iri. “consumers are driving this by either snacking on nontraditional categories, such as hard-boiled eggs, and/or the expansion within traditional categories.” According to chicago-based Mintel, 55 percent of people now say that they snack two to three times a day, compared with 50 percent of respondents in 2015. And Nielsen data pegs the individual-snacking category at $33 billion in the United states.

free of the “big eight” allergens. The health attributes of such snacks are a major driver, according to some industry experts. “Probiotic-enhanced salty snacks are a huge trend at present, as consumers continue to indulge in self-care, with a 360-degree approach that also impacts on their attitudes to snacking,” says Nicole Prefer, director of strategy for vault49, a New York-based brand design agency that has worked in the snack sector. “snack brands are stepping in to provide solutions with probiotic-enhanced nuts, chips and pretzels that help aid in digestion.” she cites the example of richmond, calif.-based Living intentions, which offers an activated Thai curry superfood nut blend with live probiotics. Typically merchandised in center store and impulse areas, nutrition bars have become a quintessential snack for busy consumers, for health, flavor and portability reasons. The bar segment remains a focus of r&D activity, too, with new products launched almost weekly, including hybrid bars. case in point: a savory snack bar made with real cheese, recently unveiled by sonoma

Core Value “For core snacking, it has received an even greater boost in sales — up 1.9 percent in dollar sales — from the diversification of benefits across the categories,” observes Wyatt. “This may be from added benefits, such as protein or fiber, and the absence or less of other ingredients, like non-gMo.” Hummus chips, lentil chips and other types of plant-based salty snacks are now commanding attention and room on the shelf. examples include the recently introduced line of Peatos, from Los Angeles-based snack it Forward, crunchy puffed snacks high in protein and fiber, and cassava root chips, from Needham, Mass.-based Plant snacks, made from root vegetables and Progressive grocer May 2018


Focus on the

Creamery, in Sonoma, Calif. Meanwhile, given the popularity of protein-rich diets, the meat snack segment has been hot in recent years, and innovations keep coming. “The meat snacks sector is evolving, too, with better-for-you ranges proving popular,” notes Vault49’s Prefer. “Among the reasons for meat snacks’ success is that they offer a quick and easy snack with portion control which [is] high in protein and satiates hunger.” Beyond traditional jerky and meat sticks, the category is also spawning hybrid products, such as PowerBar’s new Jerky & Nut Bar, and Epic’s bars that combine animal proteins with nuts and seeds. Prefer points to other interesting types of meat snacks, such as Boulder, Colo.-based Wilde Brands LLC’s chicken chips, exhibited at the recent Natural Products Expo West trade show, which claim to be the first-to-market salty snack that has the taste and texture of a potato-based chip, but with clean ingredients and protein instead of carbohydrates. The changed-up form of meat snacks is likewise showcased in the new Beef Thins line from The New Primal, based in North Charleston, S.C. The thinly sliced cuts of grass-fed and -finished beef jerky are touted as easier to bite and chew than traditional jerky and fit into high-protein regimes like the Whole30 diet and the Paleo eating plan. “Our goal with the Beef Thins is to bring a new type of meat snack to market that not only caters to the particularities of Whole30, but also appeals to consumers who are put off by the toughness of traditional jerky,” says founder Jason Burke.

A Nosh Above A host of new healthy snack products were rolled out and sampled at this year’s Natural Products Expo West, including the following: Crunchmaster Vegetable Cheese Crisps, from TH Foods New flavors of Angie’s BoomChickaPop ready-to-eat popcorn, from Conagra Brands Lantana Strawberry Hummus Grain-free coconut-based granolas, from GrandyOats Imagine Yogurt Crisps and Off the Eaten Path sweet potato and veggie crisps, both from Frito-Lay

72 88


Total-Store Snacking While their snack aisles encompass more and different SKUs, grocers are delivering solutions for shoppers’ cravings across most, if not all, departments. In the refrigerated case, snacking cheese and combination snack packs offer consumers a host of snacking options. “Snacks packs combining meat, cheese, crackers and/or dessert were a hit in 2017, with an increase in dollar sales of 45 percent,” notes Wyatt. “These not only deliver on variety, but convenience and satiety.” Yogurt has long been a snack as much as a breakfast food, and there are an array of yogurt and other cultured and probioticrich refrigerated products that appeal to on -the-go, snack-seeking consumers. Here, too, the variety show continues: the maker of Alove yogurt, Torrance, Calif.-based Morinaga Nutritional Foods, recently added a drinkable low-fat Japanese-style yogurt with aloe-vera gel pieces; the product is

sold in a 7-ounce bottle and comes in three varieties. Elsewhere in the store, fresh fruits and vegetables are snackable on their own, yet many grocers have added packaged snacks to their produce department. “Some consumers are still opting for other fruit forms versus fresh, with an increase in other dried fruit of 2.3 percent,” points out Wyatt. Grocers can cross-merchandise packaged fruits and vegetable products, carrying them in the traditional snack aisle as well as the produce area. Packaged kale chips, for example, can be displayed near fresh kale or next to other packaged salty snacks, while single-serve packaged strawberries can be sold in a refrigerated case or display not far from larger, traditional fresh strawberry packages. A 2017 Consumer Insights report from Nielsen confirms shoppers’ gravitation toward packaged produce snacks. According to the research, the on-thego snacking category within the produce department has grown more than 10 percent every year between 2012 and 2015, with more than 900 new snacking items introduced in that time frame. This article is edited from a longer version published in the April 2018 issue of Progressive Grocer.

Focus on the

In the Mainstream Tr adiTional grocers aim To own The growing naTur al /organic segmenT. By Barbara Sax atural is a trend that’s here to stay. What’s shifting is where consumers are purchasing these products. Conventional supermarkets are not only adding more natural foods to their shelves, they’re also layering in more natural health, beauty and wellness, and over-the-counter pharmacy products that were once found exclusively at natural food stores. By pricing the products aggressively and advertising them extensively, they’re muscling in on natural food markets’ share of natural and organic. The Food Marketing Institute’s (FMI) “U.S. Food Retailing Industry Speaks 2017” study shows significant dollar growth in products with health-and-wellness-related claims, as well as organic, over the past three years. “Wellness has become a differentiation strategy for food retailers,” says Heather Garlich, VP, media and public relations at Arlington, Va.-based FMI. “Retailers expect SKU allocation to organic, local sourcing, and health and wellness to increase significantly.” Similarly, Jim Hertel, SVP at Barrington, Ill.-based consultancy Willard Bishop, acknowledges:, “Mainstream grocers may have taken share from Whole Foods and natural food stores, but consumer commitment to natural and organic is still growing significantly. While we’re seeing a share shift, there’s still tremendous upside for all outlets.” Customers have come to expect a wide array of natural products at their conventional supermarkets. “Coborn’s launched our first natural foods department 22 years ago, so we were ahead of the trend,” asserts Rhonda Siltman, category manager for natural organic and specialty at the St. Cloud, Minn.-based grocer. “We have a full offering of foods and HBC, and have seen sales growth every year.” The chain is also adding more natural items to its smaller, more rural stores. According to Siltman, with stores in four states, Coborn’s competes against “everyone from Fresh Thyme to local co-ops and Whole Foods. We focus on being first to market with new items and offering

Mainstream grocers may have taken share from Whole Foods and natural food stores, but consumer commitment to natural and organic is still growing significantly. While we’re seeing a share shift, there’s still tremendous upside for all outlets.” —Jim Hertel, Willard Bishop


superior guest service, so we’re more of a leader than a follower in most markets.” “Our customers’ appetite for better-foryou products continues to grow year over year,” says Kristal Howard, head of corporate communications and media relations at The Kroger Co., in Cincinnati. “The natural foods category has become mainstream — it is no longer a niche market. We reached $16.7 billion in natural and organic food sales in 2017.”

Natural Selection As supermarket retailers add more natural products to their shelves, there’s been a shift in how they merchandise these products. “We’re moving out of the phase where all products are located in one natural section,” notes Hertel. “That was an important strategy when retailers were trying to communicate that they had a critical mass of natural products, but now that their position is clear and we’re beyond the boutique phase, it’s time for natural products to be integrated into regular sets in the center of the store.” coborn’s uses both a segregated department and an integrated approach to merchandising natural products. “We recently started removing segregated

departments in stores getting remodels and adding those items to traditional sets,” says siltman. “it’s too early to gauge, but we are seeing good increases so far and positive guest feedback.” some of the remodels feature lighted shelving for natural and organic sets. “We also have a new system of bib tags that call out certain attributes, like local or gluten-free,” she adds. retailers still need to differentiate natuProgressive grocer May 2018


Focus on the

ral versus conventional items for consumers, however, and they’re doing that in creative ways throughout the store. For instance, Kroger uses a Live Naturally leaf icon to identify natural items. “Whenever a customer sees the leaf, they’ll find items that are free from over 100 artificial ingredients, flavors and preservatives,” observes Howard. “We also have additional Live Naturally signage to help customers [navigate] the aisles.” “Lunds & Byerlys uses shelf blades to call out natural and organic products in the center of the store,” says Hertel. “Other retailers, such as Mariano’s, are using bump-outs that extend several inches into the aisle to visually interrupt the aisle and call attention to natural products.” Some retailers are sticking to their original merchandising plan and keeping natural products in one location. “The vast majority of our Bashas’ stores have a separate section dedicated to natural and organic items,” notes Paul Howland, Natural Choice category manager at Chandler, Ariz.-based Bashas’ Family of Stores. “Our natural and organic section is next to our produce, so there is great symmetry there and opportunities for cross-merchandising at times. “At store level, we are constantly identifying ways to better communicate new options to our customers [through] aisle or shelf signage,” continues Howland. “Natural and organic items are already included in our weekly ads, which are available at store level, through regular mail and through our digital platforms.” Conventional supermarkets have been aggressive in their pricing on natural foods as they move into the territory. “We have had to get more price savvy with Fresh Thyme entering our markets,” admits Siltman. For its part, Kroger has been a leader, Howard asserts, in making the natural food category more mainstream, affordable and accessible.

natural Private Labels Store brands are one way to keep prices low. Rochester, N.Y.based Wegmans Food Markets recently highlighted its natural food position in value pricing in a mailer advertising “Clean Ingredients at the Best Value.” The grocery chain used the mailer to tell consumers that more than 90 percent of its private label products carry either a Wegmans Food You Feel Good About label, signifying that they are free of artificial colors, flavors and preservatives, or Wegman’s Organic label, meaning that the product meets USDA Organic standards. Kroger’s Simple Truth has become the secondlargest brand sold in its stores, growing to reach $2 billion in annual sales in 2017. The retailer actively focuses on developing new partnerships at micro and macro levels to expand the natural category. “Innovation is key in this space, and this is one of the reasons we have attended [Natural Products] Expo West since 2002 and recently started our Natural Foods Innovation Summit series,” explains Howard. Expanding selection has led to big gains across categories. According to Howland, Bashas’ has seen an increase in natural


foods, with the largest uptick coming from natural frozen items, snacks and nutrition bars. “The frozen aisle is definitely an area that should be on conventional supermarkets’ radar,” affirms Kimberly Kawa, an analyst at Chicago-based SPINS, a retail intelligence provider in the health-and-wellness space. “Natural frozen desserts and frozen entrées are showing some of the highest growth among conventional outlets.” Kawa notes that refrigerated kombucha and shelfstable functional drinks, such as mushroom beverages and yerba mate, are growing in conventional channels. “There’s a lot of innovation happening in that segment,” she says, adding that conventional channels have been much quicker to jump into these segments.

natural health While natural foods have been a big focus for conventional grocery stores, the channel is also beginning to pay more attention to natural health and beauty care and over-the-counter products. “Conventional retailers are absolutely picking up more natural cough, cold and flu products,” observes Kawa. “The conventional food class of trade is certainly catching up and gaining an increasing share of betterfor-you HBC categories, but when it comes to the OTC segment, the overall food class of trade still underindexes the total market,” points out Annette Domnik, chief marketing officer for Draper, Utahbased OTC products maker Zarbee’s Naturals. Domnik notes that food retailers are expanding better-for-you OTC product selections across baby, kids and adult consumers. “Specifically in adult, we are seeing a real tipping point in terms of consumer awareness and interest,” she observes. “Educating shoppers that these better-for-you solutions exist across a broad range of segments in OTC is critical and drives incremental category growth. Our experience in partnering with several leading food retailers in executing shelf signage has helped these retailers become a destination for better-for-you solutions among Millennial families.” According to Domnik, Zarbee’s data indicate that shoppers are actively looking for better-for-you solutions and will switch retailers if those solutions aren’t readily presented at their go-to supermarket. “The right selection and making sure consumers are aware that retailers offer these items [are] key,” she says, “even more important than price.”

RD to Rx With PG Progressive grocer highlights total wellness solutions at re tail Die titian’s he althy shoPPer summit.

Schedule at a Glance

Tuesday, June 26 7-8 a.m.


8-8:30 a.m.


By Kat Martin

8:30-9 a.m.

Keynote: Why is Health and Wellness the Thing of the Moment? Dan stanek, evP, WD Partners

Hosted by Progressive grocer, retail Dietitian’s Healthy shopper summit will offer retail dietitians, pharmacists, merchandisers and category managers at retail, as well as cPg dietitians and brand managers, a whole-store philosophy: a 360-degree view of wellness in the store, including how the categories work together to improve the health and wellness of shoppers. The summit will be held June 26-27 in chicago, in conjunction with the United Fresh Produce Association’s 2018 show. Health and wellness is an increasingly essential yet complex driver in consumers’ buying decisions, and retailers must embrace their role as both an advocate for, and supporter of, shoppers’ desire to make better choices, and offer those solutions. Healthy shopper summit takes into consideration health-conscious and aspirational shoppers, prohibitive shoppers who make decisions based on a medical or health condition, and ethical/social shoppers who spend based on personal values. The session agenda is designed to be “Ahead of what’s next,” in keeping with Pg’s promissory tagline. As part of the summit, Pg also will recognize three retailers with the most innovative programs that retail dietitians have developed, executed or supported. From store tours and sampling, to website messaging and community outreach, retail dietitians work to create value for their customers, their retail associates, and the banners that they proudly serve. The summit will be co-located with smartFood expo, the only B2B event solely focused on fresh, healthy and better-for-you food and beverage products across all categories. Powered by United Fresh Produce Association, ensembleiQ and Pg, the expo

9-9:30 a.m.

The Health-Minded consumer and the evolution of Food for Wellness, Katherine Allmandinger, Manager, strategic insights, H&W, Nielsen

9:30 a.m.-12:30 p.m. one-on-one Meetings, retailers and sponsors 12:30-1:30 p.m.


1:30-2:30 p.m.

retailer Panel: Health Across the store

2:30-3 p.m.

retailers committed to Health and Wellness case study

3-3:30 p.m.


3:30-4 p.m.

What’s Motivating Today’s Healthy shopper, Jennifer Aranas, senior Project Manager/chef, Datassential

4-4:30 p.m.

Pg research: Have retailers Put the Health-and-Wellness cart Before the Horse?

4:30-5 p.m.

The impact of registered Dietitians in Nutrition Marketing through Multiple communication channels, Kerry clifford, corporate registered Dietitian, and Meghan sedivy, rD, LDN, Fresh Thyme Farmers Market

5:30-7:30 p.m.


Wednesday, June 27 7-8 a.m.


8-9 a.m.

innovations from Tech to Taste: explore the Developments in Helping shoppers choose Healthy options, susan Borra, chief Health and Wellness officer, executive Director, FMi Foundation, and Melanie Hall, senior Nutrition Marketing Business Partner/Manager of National Wic Partnerships, Kellogg co.

9-9:45 a.m.

rD Talks: real Dialogue for retail Dietitians

9:45-10 a.m.


10-10:30 a.m.

rD Talks: real Deal strategies shared

10:30 a.m.-12:30 p.m. one-on-one Meetings, retailers and sponsors 12:30-2 p.m.

Tour of Trade show Floor (retailers only)

2-4 p.m.

Free Time to explore Trade show Floor

will feature two new partners with show floor pavilions focused on up-and-coming food product categories: The rapidly growing Plant Based Foods Association and its member companies will feature a wide array of new plant-based foods, while the chicagoland Food incubation Hub, hosted by the chicagoland Food & Beverage Network, will enable locally based startups to gain exposure to a national audience. Progressive grocer May 2018



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Space Optimization

Key Takeaways It’s critical for grocers to use shopper insights to better organize their stores, displays, assortments and more.

Correlating different types of data and heeding behavior indicating product or store performance can lead to learnings on such issues as simplifying store layout.

Doubling Down on Data Grocers’ abilit y to Gather, analy ze qualit y data is critical in de velopinG the most effective store l ayout possible. By Randy Hofbauer

Make sure to tap into real-time feeds on the state of in-store displays, inventory and merchandising, as well as sales, demographics and other metrics.

Co-creation-enabling concepts like online gamification, popup retail spaces and virtual innovation labs are likely to roll out in the near future.

n today’s world of grocery, retailers are no longer the ones calling the shots — consumers are. And more than ever before, they want a closer relationship with the stores they shop. This reality is especially true in the grocery business. According to the “2018 Private Brand intelligence report,” from stamford, conn.-based branding and consulting firm Daymon, seven in 10 engaged U.s. shoppers want to give feedback to grocers to help improve the shopping experience. “consumers have moved from passive buyers to active cocreators who want to articulate their opinions and help retailers and brand owners solve for their unique needs,” says ryan Dee, creative director at san Diego-based experiential retail marketing firm interactions, a division of Daymon. “We at Daymon see co-creation as a white-space data stream to fuel store optimization.” Progressive grocer May 2018



Space Optimization

But it’s hard to argue that because three in 10 don’t want to give feedback, they also don’t want stores to be better suited to their shopping needs. This is why it’s critical for grocers to use any insights that can be obtained from shoppers to better organize their stores, displays, assortments and more to best cater to the customers they serve.

A new Reality Years ago, grocers faced challenges accessing software to integrate store-specific space-planning data — on both macro and micro levels — with item-level performance data, for the purpose of optimizing space allocated to every category inside a store. This reality has changed. Today, most are able to obtain and use the majority of data necessary to effectively optimize every category within stores. They also have what they need to align the products they sell to the demographics they serve and each one’s shopping preferences, according to Mike Letchford, SVP of category management solutions with Symphony RetailAI, a Dallas-based global provider of artificial intelligence (AI)-enabled decision platforms, solutions and customer-centric insights. Grocers and brands can both tap into data on inventory, foot traffic, POS and more, as well as information from devices such as beacons and the like, notes Gina Ashe, CEO of ThirdChannel, a

Consumers have moved from passive buyers to active co-creators who want to articulate their opinions and help retailers and brand owners solve for their unique needs.” —Ryan Dee, Interactions Cambridge, Mass.-based cloud-based retail intelligence platform. Take this even further to include CCTV data, and even MAC addresses from mobile phones or car keys, adds Guy Yehiav, CEO and chairman of Profitect, a cloud-based prescriptive analytics company in Waltham, Mass. “Tying these together and correlating with traditional data sets such as sales, pricing, queue time, basket analysis, shelf capacity, replenishment order


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Space Optimization

quantities, etc.,” and then analyzing the relationship between these data sets, will tell a grocer the full story on how it can best optimize layouts, drive traffic and increase sales, he says. From his perspective, Yehiav sees three major ways that grocers can use the data science at their disposal today to optimize a store’s layout:

with multiple entrances can realize improved sales when its owner adds a value-focused aisle near the front of the store. Another spot where prescriptive analytics can help optimize layout involves using Internet of Things (IoT) cooler data to help reduce energy consumption while maximizing product placement. “The ability to identify optimal product placement by using IoT and/or mobile phone data to see where store customers linger the longest has been a long-term goal for grocery,” Yehiav asserts. Correlating all of the different types of data and looking for behavior that indicates how a product or store is performing can lead to many remarkable discoveries, he observes. These can include such learnings as whether the store’s layout is confusing or too complicated. “The key thing to remember is data can be found everywhere in retail,” Yehiav says. “It is the ability to act on that data in a meaningful way that makes a difference in a retail organization’s bottom line.” And it’s always important to note, Symphony Re-

Clustering analysis: By clustering data, its value is improved, Yehiav explains, as it can then identify stores, products, associates and more that act similarly. Machine learning: Using artificial intelligence, systems can leverage the clusters to detect a number of opportunities; one example he gives is that increased shelf space of specific product categories could drive sales. Prescriptive analytics: While descriptive analytics try to discover what has happened and predictive analytics try to forecast what could happen, prescriptive analytics help determine the best solution among options that a grocer can take. The process brings both clustering analysis and machine learning together in a way that can be easily understood and acted upon. For instance, Yehiav notes, a store



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tailAi’s Letchford points out, that the effectiveness of an initiative is tied to the quality of the data. “The more accurate the information about store layout and space allocation is, the more accurately new initiatives can be planned and executed in-store with high levels of compliance — giving the retailer more control over driving store performance,” he says.

The Role of Displays As discussed earlier, data can be gathered from many, many sources. But for her part, Thirdchannel’s Ashe stresses the importance of tapping into real-time feeds on the state of in-store displays, inventory and merchandising, as well as sales, demographics and more. solutions that leverage data science can make intelligent recommendations to grocers and brands about where the most potential for category and brand growth lies. “Data on displays and merchandising is crucial in order to help grocers understand whether or not products are being displayed correctly in stores, and beyond that, whether or not the store layout or display is actually driving optimal sales,” she notes. Ashe adds that in the longer term, grocers can compare data from store locations across an entire physical footprint to determine which layouts, displays and merchandising strategies are performing best — and optimize other stores accordingly. But what’s perhaps more important than anything else is first knowing exactly what happens on a store’s ground, she says. At a basic level, the product needs to be on the floor, in the location where customers are looking for it, with the right price and signage, supported by knowledgeable store

The more accurate the information about store layout and space allocation is, the more accurately new initiatives can be planned and executed in-store with high levels of compliance — giving the retailer more control over driving store performance.” —Mike Letchford, Symphony RetailAI

associates. Then grocers and brands can identify any potential path-to-purchase roadblocks. “Perhaps a brand’s product isn’t being restocked often enough, or there aren’t enough associates available to answer specific questions, or maybe a new product was introduced, but the supporting elements of the launch haven’t been executed upon by the retailer,” she offers as examples. “it is essential for grocery brands to identify these issues using retail execution and monitoring systems to carry out corrective actions in real time.”

Overcoming Transparency Issues But one of the issues that could grow to be a major barrier to gathering necessary data in the near future is transparency. As consumers grow more concerned about the security of their information, it’s important for grocers and brands to be open with them and find ways to more directly interact with shoppers to secure the levels of insight necessary to optimize their stores. As a result, interactions’ Dee says that he’s seeing growth in crowdsourcing technologies that allow shoppers to directly participate in innovation efforts. Using an example from the beauty channel, he points to sephora, whose latest format concept, Beauty TiP (Teach, inspire, Play), stems from its innovation Lab. The workshop-concept store, he notes, is a digitally integrated format that encourages the shopper to linger, discover and learn. At the same time, sephora can gather shopper insights to fuel its “innovation roadmap,” Dee observes. “expect to see other co-creation-enabling concepts like online gamification, pop-up retail spaces and virtual innovation labs surface in 2018 and beyond to inform retail innovation initiatives,” he predicts. Progressive grocer May 2018


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The Big Green Chill SupplierS and conSulting firmS reSpond to re tailerS’ deSireS for more SuStainable and energy-efficient refriger ation SolutionS. By Bob Ingram

rocery stores use three times more energy per square foot than nonfood retailers, and 50 percent to 70 percent of that energy comes from refrigeration alone. With such high energy use the case, grocery facility managers understandably must pay close attention to the impact and capabilities of new equipment. “For the most progressive grocers, equipment monitoring can provide real-time insights to alert facilities of equipment problems, yet there are still many insights that can be found within the utility bills themselves,” notes Caitlin Helterline, senior manager, product marketing, at Engie Insight, a Spokane, Wash.-based sustainability and energy management company that works with top grocers and has insights drawn from 200 million resource consumption data points across energy bills and store equipment each year. Engie recommends accounting for variable factors like weather, local energy unit costs and variances in store footprint and equipment and, after stripping out these variables, comparing energy intensity per square foot across the portfolio to find outliers. “Further narrow down these sites by those with the greatest energy cost, and now you have a prioritized list for equipment upgrades,” Helterline advises. Identifying efficient refrigeration improvements should be top supermarket priorities, she suggests, and by installing anti-sweat heater controls, LED lighting and occupancy sensors, on-demand frost controls, and refrigeration leakdetection systems, grocers can significantly minimize energy use. “These predictive tools also decrease the possibility of equipment failures and minimize the risk of food loss,” Helterline notes. “The data leveraged from these systems can also reveal insights to optimize preventive maintenance scheduling and inform repair or replacement decisions.”

Precise temperature and pressure control … allows for a true steady state of operation, better enabling the benefits of lowering condensing temperatures to improve the efficiency of the entire system when combined with an electronic expansion valve.” —Andre Patenaude, Emerson


A greater investment upfront in alternative refrigerants, she adds, can provide long-term returns, as they’re designed to mitigate environmental impacts and global warming. Further, she observes: “Larger stores, such as Whole Foods, have been testing retrofit open-display cases, which seal the cold air into the refrigeration to optimize energy usage. While higher-costing, these new technologies will significantly decrease the monthly cost of refrigeration and drive sustainability.” While new equipment can gain significant efficiencies, simple changes to operations can also reduce consumption within existing equipment, Helterline points out. An overstocked unit can block air flow and increase consumption by as much as 3 percent, and gaps in air curtains and wornout door seals also add to consumption. What’s more, she recommends, “Verify that you have the correct refrigeration temperatures by food type, selecting the highest possible temperature for each product.”

Just the Amount needed At The Fresh Market, based in Greensboro, N.C., Facility Systems Manager Pete Cuneo says that the upscale grocer’s retro commissioning involves implementing programming logic to force the refrigeration controller to recognize changing case load and ambient conditions to run only the minimum amount of compressors needed to sustain perishable product, which has been ongoing since 2012. “Deli hood controls were constantly bypassed by store personnel,” Cuneo notes, “so the exhaust fan ran 24/7. We installed temperature sensor controls to only run the exhaust fan when cooking. Makeup air fans were abandoned, with makeup air now fed through existing A/C units. The combination of these lowered humidity, which allows for less load on the cases and less refrigeration compressor runtime. We also added infrared leak detection to reduce refrigerant use.” According to Cuneo, these steps have resulted in a 17 percent kilowatt-hour reduction. Among suppliers, Andre Patenaude, director of food retail business development at St. Louis-based Emerson, asserts that the company places “significant ... emphasis on helping our customers be ready for refrigerant and energy advancements.” Emerson offers Copeland Scroll digital

Key Takeaways Identifying efficient refrigeration improvements should be top supermarket priorities, and by installing anti-sweat heater controls, LED lighting and occupancy sensors, on-demand frost controls, and refrigeration leak-detection systems, grocers can significantly minimize energy use. Simple changes to operations can also reduce consumption within existing equipment, such as verifying that you have the correct refrigeration temperatures by food type. Challenging their previous decisions in these areas, retailers considering energy-efficient improvements are simultaneously evaluating the use of natural refrigerants, implementing refrigeration-leak detection, deploying advanced demandreduction methods, exploring new energy storage potential and weighing how to incorporate natural refrigerants. Working with regulatory agencies and suppliers, as well as constantly evaluating product development, helps a company maintain its sustainability initiatives.

Emerson’s Copeland Scroll digital compressor adjusts the output to precisely match the load.

compressors with digital modulation capability that allows for infinite capacity adjustments within specific modulation ranges, which means that instead of having to cycle on and off to match capacity, the compressors are capable of adjusting their output to precisely match the load. “retailers rely on store controls to connect and manage their major refrigeration, lighting and HvAc systems,” Patenaude explains. “emerson has recently launched a new family of supervisory controls that allows retailers to expand powerful energyefficient temperature and conditions management capabilities through a simplified dashboard-style interface that puts critical information at the users’ fingertips.” emerson works closely with supermarket customers to build more environmentally friendly refrigeration systems, and has developed products that enable the use of natural refrigerants

while designing refrigeration architectures that reduce the environmental impacts of refrigerants to near zero. “We’ve focused on precise temperature control via digital modulation, which allows temperatures to be controlled within plus or minus 0.5 degrees Fahrenheit,” Patenaude says. “in today’s increasingly competitive foodservice, supermarket and transport industries, this provides the assurance that operators are maintaining the highest quality of perishable food items. Precise temperature and pressure control also allows for a true steady state of operation, better enabling the benefits of lowering condensing temperatures to improve the efficiency of the entire system when combined with an electronic expansion valve.” Patenaude believes that the growing adoption of newer control technologies and upgrading older refrigeration systems will continue into the future as two primary means of Progressive grocer May 2018


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achieving sustainability and energy efficiency. The combination of new systems with enhanced digital controls will serve as a way of further realizing energy efficiencies and additional cost savings. “As retailers are considering energy-efficient improvements,” Patenaude says, “they are also simultaneously evaluating the use of natural refrigerants, implementing refrigeration-leak detection, deploying advanced demand-

Technology is changing — there are capacity improvements, smaller system demands, energy usage reductions and continuous development of safe refrigerant options in the works.” —John A. Stocks, Everidge CrownTonka reduction methods, exploring new energy storage potential and considering how to incorporate natural refrigerants. We see more retailers challenging their previous decisions in these areas, and learning about entirely new architectures in store controls, refrigeration systems and HVAC units that are capable of meeting these overall sustainability challenges.”

Bright sustainable Future

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Everidge CrownTonka, a Plymouth, Minn.based manufacturer of cold-storage rooms, including coolers, freezers, prep rooms, ambient staging and cold-storage warehousing and distribution, led the implementation of Enviro-Foam, an insulation method with a low environmental impact, and continues to provide maximum-energy R-Factor (resistance factor) insulation for products in its market segment. According to John A. Stocks, Everidge’s VP of sales, marketing, and construction services, partnering with regulatory agencies, working with competent suppliers and constantly evaluating product development helps maintain the company’s sustainability initiatives. “The future is bright for sustainable solutions in refrigeration and cold storage,” Stocks asserts. “Technology is changing — there are capacity improvements, smaller system demands, energy usage reductions and continuous development of safe refrigerant options in the works.” He adds: “There are great ideas and capable development happening around the world. Looking for the best practices, without bias tied to tradition, will elevate the industry over the next several years.”

RENEWING THE COLD. UPGRADE COLD STORAGE FACILITIES WITH THERMAL ENERGY STORAGE TO REDUCE ENERGY COSTS AND MAXIMIZE REFRIGERATION SYSTEM EFFICIENCIES. Intelligent energy storage means you decide when to buy and use your energy. Viking Cold gives your existing facility new flexibility to avoid peaks and shift demand.


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Editors’ Picks

Food, Beverage & Nonfood Products

Light but Luxurious Who says indulgent can’t also be light? That’s what makes Dove sorbet bars unique: They combine light and refreshing mango sorbet with silky dark chocolate. Created by Mars Wrigley Confectionery, the frozen summertime treat takes a cue from the growing interest in fruit-andchocolate snacking combinations to satisfy a sweet tooth without the guilt. The 2-ounce bars retail in boxes of six with an SRP of $4.99 each.

craft something cool The meal-kit trend shows that many people want to prepare a gourmet dinner even if they have little cooking know-how. The Cocktail Artist brand takes a similar approach to cocktail hour, offering the ingredients and mixes necessary to make craft cocktails at home, only with one key difference from other ingredients and mixes: Each is developed by an award-winning U.S. mixologist. The lineup consists of two ingredients and five mixes: Triple Sec Syrup, Blue Curacao Syrup, Margarita Mix, Piña Colada Mix, Bloody Mary Mix, Strawberry Daiquiri-Margarita Mix, and Sweet & Sour Mix. Each contains no artificial flavors and colors or high-fructose corn syrup. The premium ingredients retail for a suggested $2.87 per 375-milliliter bottle, while the cocktail mixes retail for $3.98 per 750-milliliter bottle.

No-Fry Nuts Responding to many health-conscious consumers’ concern over snack nuts often being roasted in oil, John B. Sanfilippo & Son Inc. has launched a line of better-for-you nuts: Fisher Oven Roasted Never Fried, which is made with two simple ingredients — nuts and sea salt — and contains no added oils. The Non-GMO Project Verified line comes in six varieties: Deluxe Mixed Nuts (SRP: $7.99 for 8.75 ounces); Mixed Nuts with Peanuts ($4.64 for 10 ounces); Peanuts ($2.99 for 12 ounces); Almond & Cashew Blend ($6.50 for 8.75 ounces); Almonds ($5.99 for 10.5 ounces); and Cashews ($7.99 for 8.75 ounces). Each variety comes in a clear PETE container for full visibility of its contents.

sensible sausages Grilling season is closing in, and just in time, Beyond Meat has introduced what it calls the world’s first plant-based sausage for retail. Said to sizzle and snap like pork-based sausages while also providing the same taste, texture and juiciness, Beyond Meat’s latest offering also delivers 16 grams of plant-based protein, 43 percent less total fat, 38 percent less saturated fat, 27 percent fewer calories and 26 percent less sodium. It’s also naturally cholesterol-free, with no hormones, nitrites, nitrates, GMOs, soy or gluten. Available in three varieties — Original Bratwurst, Hot Italian and Sweet Italian — the sausages retail in four-link packages with an SRP of $8.99 each.


Advertiser index

United states Markets • Convenience • Grocery/Drug/Mass Store Brands • Specialty Gourmet Technology • Hospitality • Apparel canadian Markets • Convenience • Pharmacy • Foodservice



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Progressive grocer (issN 0033-0787, UsPs 920-600) is published monthly by ensembleiQ, 8550 W. Bryn Mawr Ave. ste. 200, chicago, iL 60631. single copy price $10, except selected special issues. subscription: $135 a year; canada $164 (canada Post Publications Mail Agreement No. 40031729. Foreign $270 (call for air mail rates). Periodicals postage paid at chicago, iL 60631 and additional mailing offices. Printed in UsA. PosTMAsTer: send all address changes to Progressive grocer, P.o. Box 1842 Lowell, MA 01853. copyright ©2018 ensembleiQ All rights reserved, including the rights to reproduce in whole or in part. All letters to the editors of this magazine will be treated as having been submitted for publication. The magazine reserves the right to edit and abridge them. The publication is available in microform from University Microfilms international, 300 North Zeeb road, Ann Arbor, Mi 48106. The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

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Tech Talk By Randy Hofbauer

Say ‘No’ to Tech for Tech’s Sake Re actionaRy innovation can cause gRoceRs to foRge t what mat teRs most in theiR business: the customeR.

o me, the most noteworthy takeaway from this year’s Annual Report, which ran in Progressive Grocer’s April 2018 issue, is technology’s rise from No. 9 last year to No. 3 on the list of biggest concerns for grocers today, trailing only human capital and competition, which always will be top of mind for grocers, and were so last year. Moreover, this isn’t likely to change soon, as three in four respondents plan to grow tech spend this year. But while the wake-up call has been heard, and it’s a relief to see such a response as Amazon continues developing and refining its grocery strategy, seeing such a fast, big ramp-up also can be concerning. All too often, businesses stumble in being reactionary to a threat, making moves simply to outdo a competitor, but not seeing why the competitor truly made its move in the first place. Grocers run this risk more than ever as they race to make their next investments with every step that Amazon takes — and many will trip over their own shoelaces implementing technology for no reason other than to “out-Amazon Amazon.” That’s not a strategy. Whether it’s an augmented-reality experience in-store or ordering online from the comfort of one’s own home, technology can’t be done merely for technology’s sake — it has to serve the customer. Developing and implementing such innovations is no easy feat, however.

Discovering True Value This reminds me of a presentation that I attended at Shoptalk, which took place March 18-21 in Las Vegas. During the day-one keynote, two Amazon VPs, Gianna Puerini and Dilip Kumar, shared learnings from developing and fixing one of the most controversial — yet most-watched — new concepts in the market, Amazon Go, which has had many grocers concerned about everything from the elimination of the cashier role in stores to their own existence altogether. As many already know, the checkout-free convenience store from the Seattle-based ecommerce giant opened to the public only a few months ago, but did so after a 10-month delay. The store, which uses computer vision similar to that in self-driving cars to detect what customers take and to charge them for it upon leaving, had problems detecting who was taking what when too many people were inside at once. It wasn’t easy to develop and then fix the technology made to eliminate one of shoppers’ least-liked parts of grocery shopping. According to Kumar, the technology required complex algorithms for computer vision and machine learn106

ing, which work to solve the problem of who took which products. Moreover, a robust software and hardware infrastructure had to be developed and refined to support everything. Even more important and critical, however, were the questions asked before developing the solution in the first place, which all came down to the shopper. Puerini said that if grocers wish to implement such technology to help their shoppers, before taking even the first step, they must ask themselves: “Who is my customer?” “What can I do to add value to their life?” “What am I uniquely positioned to offer them?” “If I’m not offering something unique, am I willing to build, buy or go another route to offer it?” Amazon is known for developing the press release for a product before it’s even created, making sure the idea is planned with true value in mind for its intended user in the first place. Amazon Go was no exception, Puerini assured listeners. In the end, Amin Maredia, CEO of Phoenix-based Sprouts Farmers Market, made a point in a presentation that summed up the issue well: Unlike how many grocers today view it, technology isn’t ultimately a sales tool. Instead, he told attendees, it’s a solution that simplifies the customer experience. Going forward, as they marry the physical and the digital, grocers need to understand this truth. Otherwise, they risk continually stumbling as they try to stay relevant and customer-centric in an everevolving, increasingly competitive market.









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