g s nc v b n s, nn v v p uc s n c s s lu ns.
Instead, just turn the page.
brands to beef up your meat case
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shaking up the status quo in new and exciting ways by facilitating food retailers’ omnichannel operations.
44 RETAILER DEEP DIVE Unstoppable ALDI
The fastest-growing U.S. grocer offers a value proposition shoppers can’t resist.
These strategies will boost beef sales to meet consumer demands in a changing marketplace.
KUBRA Retail Cash Payments Network Grows
Rite Aid has become the latest member.
TECHNOLOGY The Next Grocery Tech Frontier
Many food retailers are reaping the benefits of using advanced technology to drive pricing decisions.
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Navigating the ‘Never Normal’
HERE ARE SIX BUSINESS IMPERATIVES FOR GROCERS IN 2023.
ow much can you cram into your brain after attending three of the retail industry’s biggest trade events in 12 days?
Quite a lot, it turns out, especially if you drink pints of coffee, walk 10 miles a day and talk to as many food retail leaders as possible.
Instead of feeling sleepy from travel, though, my time at CES in Las Vegas, NRF’s Big Show in New York City, and FMI’s Midwinter Executive Conference in Orlando, Fla., over a span of 12 days felt like an awakening. We’ve all been a little asleep since 2020, muddling through, waiting to get back to normal. Well, in-person events are decidedly back to normal, and for the grocery industry, it’s back to the “never normal,” a theme that technologist and MIT professor Peter Hinssen so eloquently introduced during his keynote at FMI Midwinter.
FMI’s chief collaboration and commercial officer, Mark Baum, moderated a panel discussion at Midwinter with H-E-B President Craig Boyan, UNFI CEO Sandy Douglas, Unilever Global Chief Customer Officer/ Personal Care Terry Thomas, and Hunter Williams, partner in Oliver Wyman’s retail and consumer goods practices. The speakers outlined six business imperatives that will shape grocers’ and manufacturers’ priorities in 2023: workforce challenges, technology transformation, changing macro-economic conditions, evolving consumer behaviors, rising ESG expectations and supply chain disruption. Douglas stressed the importance of finding alternative ways to solve the labor crisis in grocery.
“I think there’s a public-policy opportunity for all of us to work on, which is basically workforce supply,” Douglas said. “How do we try to de-politicize the issue of immigration so that we widen the labor pool?”
Boyan expressed concerns about the American consumer “running out of fuel,” trying to absorb sticker shock at the grocery store. He mentioned that savings rates are at a 17-year low, and that credit card and household debt are growing at the fastest rate in 15 years. What happens when the consumer runs out of money?
“We know that high inflation, while it helps our sales and helps
some part of this industry, is basically a tax on households — and especially on low-income households,” he noted. “And so, when we think about the state of the U.S. household, the high inflation and spending that has drained their savings, the impact on the average household is going to be severe. We have to assume that growth and consumer spending in 2023 and beyond is going to slow. And I think it’s [incumbent] on everybody in this room, in this industry, to find ways to help the average household that’s under massive economic pressure, especially low-income” households.
Yet despite the doom and gloom about inflation, labor shortages and slowing growth, grocery leaders have much to look forward to. Food-at-home consumption keeps rising. The supermarket channel has become agile, innovative and more efficient. And opportunity abounds when it comes to automation, loyalty, private label, foodservice, retail media, data analytics, social commerce and new tech platforms.
“There are retailers positioned very effectively all over the marketplace,” Douglas concluded. “So if we pivot into this year of uncertainty, we have an opportunity to collaborate and tackle problems in a much more boundary-less way, so that the richness of the customer base continues to be strong and grows.”Gina Acosta Editor-In-Chief firstname.lastname@example.org
Despite the doom and gloom about inflation, labor shortages and slowing growth, grocery leaders have much to look forward to.
Want to fuel growth in your dairy category?
YOU’RE GONNA NEED MILK FOR THAT.
MILK IS FUELING TODAY’S CUSTOMERS AND DAIRY CATEGORY SALES!
It’s a Destination Category:
55% of consumers say it is a main reason for the trip.1
It’s a Trafﬁc Driver: 92% of households buy ﬂuid dairy milk at grocery stores.2
It’s a Basket Builder: Nearly 50% of stock-up trips contain milk.1
SCAN TO LEARN MORE:
African American Women’s Fitness Month Alcohol Awareness Month Fresh Florida Tomato Month
National Arab American Heritage Month
National Fresh Celery Month National Pecan Month
1 National Greeting Card Day
6 National Açai Bowl Day. Provide instructions for how to make the healthiest version of this yummy dish.
7 Good Friday. Encourage associates who observe this holy day to mark it in the way that’s most meaningful to them.
16 Day of the Mushroom. Ask customers for their favorite recipes starring these versatile fungi.
10 National Cinnamon Crescent Day
11 National Barbershop Quartet Day. Hire a group to entertain your customers as they shop the store.
17 Go Fly a Kite Day 18 Piñata Day. Suggest that customers break one open at their next fiesta.
12 Deskfast Day. Offer ideas to make breakfast at one’s office or home desk more nutritious and delicious.
19 National North Dakota Day. This is the time to showcase the food traditions of the Peace Garden State.
23 Army Reserves Birthday. Pay tribute to all of the reservists in your area by offering a discount for those who serve.
30 National Raisin Day. This classic lunchbox snack is packed with sweetness and nutrients.
24 National Bucket List Day
25 National Drug Take Back Day. Hold an event to encourage community members to dispose of prescription medications that they no longer need.
26 International Guide Dog Day. Profile your customers and associates who use these trained animals to generate greater awareness and understanding.
13 Passover ends. National Make Lunch Count Day
8 National Catch and Release Day. Inform fishermen who abide by this practice that there’s plenty of premium seafood awaiting them at the nearest grocery store. 9 National Baked Ham with Pineapple Day Easter
14 National Pecan Day. Yes, we know they’re popularly used in pies, but there are a range of other tasty baked goods that also feature these sweet, buttery nuts.
15 World Art Day. Put up inspiring images from local artists that your shoppers can enjoy and even purchase.
20 International Pizza Cake Day. Be honest – who doesn’t want to make a cake out of pizza?
27 National Prime Rib Day. Run a special in the meat department on this great family meal option.
21 National Tea Day. Black, green, white, red or herbal, this perennial beverage, which can be enjoyed hot or iced, never goes out of style.
Occupational Safety & Health Day. Check with your associates that your business is complying with all regulations in this area.
22 Eid al-Fitr Earth Day
29 National Supply Chain Day. Pay tribute to your partners that keep the products — both essential and fun — coming.
Premium Brands Still a Powerhouse for the Pet AisleBy Joe Toscano, Vice President, Trade & Industry Development at Purina
It can be easy to get caught up in trends and just focus on what’s new. Trendy and new feels fresh and can o ff e r an e xci ti ng wo rl d o f p o ssibili tie s. In the pet category, this can mean that r et ail e rs s ometime s o ve rl oo k o n e o f the largest categories in pet – premium pet food – which includes trusted, ic o nic bran d s like D o g Ch ow®, Ca t Ch ow®, Friski e s® an d Be n e ful®. In fact, Cat Chow is the number one dry cat brand in the U.S. based on dollar sales1 an d D o g Ch ow has t h e nu m b e r one SKU in the dry dog category2 These brands are true pet food powerhouses.
Th e p et ca te go ry is b ooming. Ove r t h e las t t hr ee years, th e p et p o pula tio n in t h e U.S. has als o gr own by a littl e mo r e than four percent and has added 7.5 million mouths to feed, which brings the total number of dogs and cats in the U.S. to 185 million. Consequently, t h e p et car e ca te go ry c o n ti nu e s to grow at near record highs. As of October 8, 2022 3 , the pet care category has seen a 16 percent increase in sales ve rsus t h e pr e vi o us year. This s t r o ng growth is also seen in the premium pet food category with many of Purina’s premium pet food brands showing double-digit growth with most actually e xc eed ing t h e tot al ca te go ry gr ow t h.
B u t wha t doe s t ha t mean f o r r et ail e rs?
In the dog category, premium dry dog food has the second highest number of households, and the highest pound buying ra te. On ave rage, t h e pr emiu m dog food household purchases 139 pounds of dog food each year, which is 38 p o un d s mo r e t han t ha t o f t h e valu e dog buying household. That is a lot of dog food! The premium dry cat food category has the highest household
count with roughly 19.7 million households buying premium cat food in 20214 . On ave rage, th e pr emiu m d ry ca t h o us e h o l d s buy an ave rage o f 62 pounds of dry cat food a year, which is 63 percent more than super premium buyers.
Wh e n we l oo k a t gr o c e ry an d mass s to r e s, we als o kn ow t ha t t h e maj o ri t y o f puppy an d kitt e n own e rs s t ar t t h e ir p et s o ff wi t h pr emiu m d ry f ood nu t ri tio n. Puppy Ch ow® an d Kitt e n Ch ow® ar e t h e h o us e h o l d l ea de rs in puppy an d kitt e n nu t ri tio n, an d t h e s e brands are specially formulated to meet t h e uniqu e nu t ri tio n n eed s puppi e s an d kitt e ns have d uring t h e ir firs t year o f life to support their rapid growth and de ve l o p me nt . Wi t h such a large buying power, it is no wonder the premium segment has such a large impact on the total pet food category.
As we l oo k ah ea d to t h e i m pac t o f o ngo ing infla tio n, we kn ow t ha t t h e
premium pet food category will be ke y f o r c o nsu me rs an d r et ail e rs. Th e core consumers within the premium segment are the most loyal to their brand of any segment. This high degree o f l o yal t y an d c o nfi de nc e in t h e s e iconic brands means that premium pet f ood sh o pp e rs ar e n ot like ly to swi t ch.
I t is i m p o r t ant t ha t r et ail e rs o ff e r a vari et y o f t h e pr emiu m f o r mulas these consumers prefer and in the sizes they want. Retailers carrying the premium dog and cat food products their consumers desire are able to turn shoppers into loyal consumers who kn ow t h e y do n’t have to l oo k b e yo n d yo ur s to r e to fin d wha t t h e ir p et s n eed .
Ar e yo u all o ca ti ng th e right spac e in yo ur s to r e to valu e, pr emiu m, an d sup e r pr emiu m p et pr od uc t s? To l earn more, reach out to your Purina sales associate.
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Natural and Organic Foods
According to the Organic Trade Association, organic sales surpassed $63 billion in 2021, including $1.4 billion in growth from 2020. The vast majority (90%) of these sales were from food, which experienced about 2% growth.
Food and beverage accessibility complications related to inflation and supply chain perils had consumers re-evaluating necessary versus discretionary spending and challenging preferred product purchases, although consumers who can afford to do so will likely continue budgeting for natural and organic purchases.
More than half of consumers engage with natural products, and more than a third engage with organic in some capacity, indicating that natural and organic brands have their foot in the door with a significant portion of the general population — and have room to grow.
Half of consumers agree that natural and organic foods don’t stay fresh as long as conventional foods, compounding the financial stress that comes with natural and organic premiumization, and consequently increasing hesitation to fully engage with natural and organic.
Production methods may be what sets organic apart, but perceived personal health benefits are what move the needle: Half of consumers who engage with organic do so because they perceive it to be healthy, while about a third do so to avoid adulterants (artificial ingredients, 38%, and pesticides, 35%). Environmental friendliness resonates less, at 24%, and animal welfare lower still, at 13%.
Consumers’ blended product-type repertoires — i.e., conventional, natural, organic — according to food and beverage category indicate that their expectations and needs vary by category, and that their depth of engagement is subject to change. Natural and organic brands may have consumers’ attention in one or two categories, but not others, indicating that differentiating factors for each product need to be communicated to persuade even those already on board with natural and/or organic.
What Consumers Want, and Why
Organic sales surpassed $63 billion in 2021, including $1.4 billion in growth from 2020.
Source: Organic Trade Association
By helping consumers get creative and make the most of what they have through thoughtful leftover use, storage methods that maximize lifespan, and more, brands can align themselves with consumers’ best interests in a way that is costeffective for all parties and may alleviate some financial strain (and hesitation) on consumers’ end.
Getting more consumers on board with environmental impacts — and therefore advancing the scale and potential influence of organic — will come from marrying human health with environmental impact under one umbrella that’s “better for us.”
Brands that don’t take the time to clearly communicate their products’ benefits run the risk of being overlooked or considered not worth the price; this is especially true for organic brands, whose penetration is lower relative to natural and conventional, and whose engagement has a steeper financial barrier.By Karen Buch, RDN, LDN
The Food as Medicine Trend at Retail
reach, and use data-driven metrics to communicate return on investment.
lthough there’s no evidence that the Greek physician ever uttered this fa mous quote, the notion highlights the longstanding importance of nutritious foods in the prevention and management of disease.
Over the past 25 years, supermarket-based retail programs — designed specifically to support the health and wellness of customers, associates and surrounding communities — have been established, shaped and spearheaded by innovative registered dietitian (RD) pioneers.
Retail RDs pair science-based knowledge of how food, nutrition and lifestyle can either contribute to disease development or help maintain and restore health with educational selling strategies and tactics to measurably impact consumer choice at the point of purchase. As retail RDs started to expand into full-time, consumer-facing positions, they also used multimedia communications to reach very broad audiences with food and nutrition guidance via broadcast and in-store television, broadcast and in-store radio, custom magazines, in-store point-of-purchase communications, ad messaging, live events, and retailer websites.
Momentum picked up in the early 2000s as more and more retailers recognized health and wellness as a purchase driver and sought to establish points of differentiation in the well-being space. Tactics such as in-person classes, children’s education tours, blogging and video communication gained traction in step with burgeoning social media.
Although the retail health-and-wellness landscape has expanded and contracted in pockets of the grocery industry, commonalities remain consistent, including digital and in-store path-to-purchase marketing efforts, customer engagement and personalized food and nutrition education, and use of incentives or prescriptions to purchase better-for-you foods and medically tailored meals. Historically, layered approaches tend to have the highest degree of impact.
Defining and Measuring Food as Medicine at Retail
As retail RD leadership in Food as Medicine initiatives has grown, so have the efforts to define, enhance and measure the value and effectiveness of collective Food as Medicine programming. Beginning in 2013, select retail dietitians from noncompeting retailers worked together to co-author the first edition of the Supermarket Business and Industry Skills to Thrive in Retail Dietetics Certificate of Training; it launched in 2015 as a tool for the next generation of retail RDs, covering how to navigate the retail landscape, define roles and responsibilities, expand
In 2021, the Academy of Nutrition and Dietetics approved a definition of Food as Medicine: “A philosophy where food and nutrition aids individuals through interventions that support health and wellness.” In 2022, a new Certificate of Training program was launched, Excelling in the Retail Food Industry. In conjunction, Food as Medicine in the Retail Setting was developed as a resource guide. In addition, a new Nutrition in Food Retail curriculum was established for dietetic students and interns.
Food as Medicine: The Retail Opportunity
Food as Medicine bridges the gap between traditional medicine and established foodbased prevention and treatment. Health care systems, health insurers and a growing body of researchers are increasingly engaging in Food as Medicine. It is critical for food retailers to improve and expand current health-and-wellness offerings. More than 48 million households include someone whose diagnosis can be managed in whole or in part by diet and other lifestyle choices. These households represent $268 million in annual grocery sales. Food retailers have a massive opportunity to provide solutions, from prevention to management through personalized medical nutrition therapy and individually tailored meals, help at the pharmacy counter, expert guidance when navigating the food aisles, and so much more.
GROCERS HAVE A MASSIVE OPPORTUNITY TO PROVIDE SOLUTIONS IN THIS AREA.
More than 48 million households include someone whose diagnosis can be managed in whole or in part by diet and other lifestyle choices. These households represent $268 million in annual grocery sales.
“Let food be thy medicine and medicine be thy food.”
– Hippocrates, circa 400 ADKaren Buch RDN,
LDN, is a registered dietitian/nutritionist who specializes in retail dietetics and food and culinary nutrition communications. One of the first supermarket dietitians, she is now founder and principal consultant at Nutrition Connections LLC, providing consulting services nationwide. You can connect with her on twitter @karenbuch and at NutritionConnectionsLLC.com.
Red Hot Seafood Sales
Wild Alaska Sockeye Salmon
Wild Alaska Sockeye Salmon
Wild Alaska Sockeye Salmon
It’s often the way of things that the big guys in the industry hog much of the media attention — think of those two grocery behemoths whose impending merger set off a veritable feeding frenzy among members of the press — but independents also deserve their time in the spotlight. While they may not be able to compete with larger chains in terms of scale, many have perfected the fine art of making themselves beloved and indispensable members of their respective communities, and this approach often helps to boost their bottom lines.
As an example of this, look no further than Byron’s and Cambridge Village Markets, in upstate New York, which, when faced with supply chain woes that bedeviled even the big-box stores, found unconventional sources to keep their shelves stocked, such as restaurant suppliers that would to “a staff focused on taking care of customers from the moment they walk through the door.”
have otherwise been unable to move product during the height of the pandemic. The stores, operated by Byron Peregrim, also kept customers in the loop daily via social media on stock availability. According to Peregrim, this in itself lifted sales more than 35% over the prior year, and two years on, they’re still up 20%-25% over previous years. He proudly adds that throughout it all, the stores never raised their margins, instead growing profits via “hard work and added sales.” These added profits subsequently enabled the stores to give back even more to their local communities, completing the circle of trust between the stores and their shoppers.
In another case, when a Wegmans Food Market opened a few miles away from Harvest Market, in Hockessin, Del., in spite of predictions from a consultant of plunging sales, the single-store grocer closed out the year up 11%. The indie attributes this win
Independents’ gains aren’t just monetary, however. Gwen Christon’s store, Isom IGA, in Isom, Ky., may have been destroyed by a devastating flood, but in the aftermath, she and her business were inundated with donations and offers of help to rebuild the supermarket, which had long been a welcoming community hub and will be again.
That’s the true differentiating factor of independent grocers — their ability to bring people together through food in unique ways that reflect their local areas. Despite their many differences, that quality is one shared by each of Progressive Grocer’s 25 2023 Outstanding Independents. Read on to find out more.
This year’s 25 honorees continue to prove that small(er) is not only beautiful, but also, in many cases, profitable. By PG Staff
2023 Outstanding Independents
Headquarters: San Diego
Number of Stores: 9
Local family-owned independent grocer Barons Market has always thought of its employees as part of its extended family, so in a year when labor shortages were plaguing the grocery and other industries, the food retailer put employees at the forefront of its operations.
Barons’ LEAD program not only focuses on teaching employees the ins and outs of grocery management, but also helps them find the passion in what they do. In 2022, the expansion of the program, which now has more associates participating than ever, resulted in the creation of 10 new assistant manager positions across Barons’ nine stores.
“This all stems from our core value that our employees are our No. 1 asset,” notes Barons in its Outstanding Independents submission. “The key is our culture. We’re so proud that we’ve built a company culture that encourages creativity, passion and engagement among our team. We’ve created a work
Bi-Rite Family of Businesses
Headquarters: San Francisco
Number of Stores: 2
Amid marking its 25th year under the leadership of second-generation owner Sam Mogannam and looking to open its third market in San Francisco, Bi-Rite Family of Businesses is touting its central role as an incubator. From being an early collaborator with technology partners such as Instacart and an AI-based inventory management startup, to helping local restaurants launch and scale their CPG products, the indie has offered its neighborhood stores, staff and data as resources in service to its mission of Creating Community Through Food. Through such efforts, Bi-Rite believes that it can help other independent retailers, local entrepreneurs and consumers have a better experience as part of its responsibility to create a better food system.
environment where employees feel excited to come to work every day. We want our employees to truly love what they do, and if they don’t, we beg them to find another job.”
The company points out that while it’s always had such employee benefits as health insurance, an employee discount, bonuses and matching 401(k) contributions, this past year it introduced dental insurance for all full-time
employees, increased the employee discount from 10% to 15%, and added vacation time for all employees, no matter their position.
“Barons Market will always be an employee-focused company,” the grocer asserts in its submission. “We believe that when our employees are happy, our customers are happy, and this will have a ripple effect among the communities that we are in.”
2023 Outstanding Independents
Bi-Rite’s most important incubator activities, however, are the ones that happen behind the scenes in collaboration with its community partners. An example of this is nonprofit cooking school 18 Reasons’ Nourishing Pregnancy Program.
In early 2021, Bi-Rite wanted to develop a small food-box program to increase food security for local families. At the same time, 18 Reasons was designing its Nourishing Pregnancy program, working within the BIPOC community to boost food access, health and well-being. The program is a free four-month pregnancy and postpartum cohort series featuring online cooking classes, weekly grocery deliveries, and support classes taught through a cultural lens by Black- and Latinx-identifying facilitators.
Bi-Rite and 18 Reasons serendipitously joined forces to launch the first cohort in June 2021, with 22 participants. The grocer’s role in the program included offering recipe consultation and grocery guidance to the Nourishing Pregnancy program director, food sourcing and procurement, providing space for dry good storage and weekly food-box packing, and identifying a delivery/logistics partner to ensure that food boxes were delivered directly to participants, thereby helping to eliminate common barriers to accessing healthy food. Bi-Rite also held a point-of-sale fundraiser for the program.
Last year, Nourishing Pregnancy hosted three cohorts and served 96 participants. Despite inflation and supply chain issues that challenged the entire industry, Bi-Rite’s team continued to source ingredients for the weekly food boxes and evolve operations to increase efficiency.
The company’s work in the past year has helped create capacity within the program for 18 Reasons to further expand it in 2023. As the program grows to accommodate four cohorts of 60 participants each, the physical space needed for the weekly grocery boxes has exceeded Bi-Rite’s footprint, so Nourishing Pregnancy will team with a new wholesale grocery partner to handle most of the weekly grocery-box sourcing and packing. This move also allows the Nourishing Pregnancy staff to allocate more time to programming, further enhancing the program’s impact.
Rather than expressing sadness at losing a trusted collaborator, Bi-Rite notes that “there’s no greater reward for its incubator efforts than having a community partner outgrow them and be able to serve even more people within the community.”
BriarPatch Food Co-op
Headquarters: Grass Valley, Calif.
Number of Stores: 1
Things have been busy at BriarPatch Food Co-op. Long considered by its Northern California community as a trusted source for high-quality, fairly produced natural and organic local products and food information, the cooperative has striven to keep its quarterly magazine, The Vine, relevant by providing food education and tips on how to prepare and access healthy food, along with stories about the people and places tied to the origins of sustainable food.
The magazine, featuring all original content, is produced entirely in-house by a group within the store’s marketing team, despite the fact that creating a “scratch” magazine requires significant resources for an independent grocery store. In 2021, faced with the dramatic increase in the cost of paper and the store’s commitment to improve its carbon footprint, BriarPatch opted out all 5,000 of its print subscribers and invited them to opt back in via email. Now only 250 people receive The Vine via mail, and costs have halved. This gave the team the opportunity to improve the magazine’s digital version: QR codes link print readers to additional content, and the digital version is entirely reformatted on a platform that caters to mobile and tablet users.
Additionally, since BriarPatch’s volunteer program, PatchWorks, launched in 2020, it has more than doubled the number of volunteer hours donated in the local community, making a tangible difference to nonprofits struggling in the pandemic’s wake.
Currently, 16 Nonprofit Neighbor organizations benefit from the program, among them local food banks, environmental organizations, a farmers’ market, a homeless shelter, and an organization dedicated to diversity, equity and inclusion. Those who volunteer at approved nonprofits receive shopping discounts in return for their good deeds, while groups enrolled in the program submit volunteer hours to BriarPatch and pledge to promote PatchWorks through their marketing channels. This cross-networking gets the word out and connects people in the community like never before.
Collectively, volunteers have worked more than 20,000 hours since 2020 — with their labor valued at $600,000-plus — and earned more than $40,000 in shopping discounts. What’s more, at least three volunteers have been hired by the nonprofits for which they volunteered.
2023 Outstanding Independents
Byron’s and Cambridge Village Markets
Headquarters: Schuylerville, N.Y.
Number of Stores: 2
During the height of COVID, which exacerbated lingering supply chain issues, Byron’s and Cambridge Village Markets were able to increase their business dramatically by striving to find sources to restock their shelves at a time “when the big-box stores struggled,” in the words of President Byron Peregrim.
“For instance,” explains Peregrim in his Outstanding Independents submission, “we would order any type of bathroom tissue available, and if it was in 6-packs or higher, we would open the packages and make up 4-packs that we would sell to our customers, with a limit of one per day, so all had bathroom tissue. We were fortunate to only be out of stock a day here and there until our next truck came in.” He adds that his stores were also able to get many deals from restaurant suppliers that needed to move out product, enabling the independent “to pass along a lot of great deals to our customers.”
Every day, shoppers were kept informed via social media of the status of the stores’ shelf stock. According to Peregrim, “This in itself helped increase our stores’ [sales] 35%-plus over last year, and two years later, they’re still up 20%-25% over previous years. I have no doubt that our increase is due to finding product availability, no matter who the manufacturer might be; our staff, for working through unknown times, when they could have easily opted out; and gaining trust and respect from our everyday regular customers and the hundreds, or maybe even thousands, of new customers we gained because of our honesty.”
Not once did the stores increase their margins, instead opting to grow their profits “through hard work and added sales.” Through these added profits, they were able to give back even more to their local communities and raise employee wages various times, instead of just during their reviews. They were also able to complete several capital projects, which gave back money to their local community job force.
“COVID, obviously not being a good thing, really changed our business model and gained our customers’ trust and appreciation,” notes Peregrim, adding that his stores continue to find sources for products that are still hard to find, giving their customers the best choice possible.
indie follows some unique practices that differentiate it from every other competitor around, regardless of size.
In the area of community support, for instance, during every holiday when the stores are closed – Thanksgiving, Christmas and Easter – the grocer provides free food in front of its locations. “We set up about 20 key items outside of our stores for customers to take as needed,” explains Charley in his Outstanding Independents submission. “We understand that people forget an item or two [and] not being open can be tough [for them], so we set that up outside. There is no requirement to pay a penny for anything you take. We have a sign next to the free product that describes what nonprofit we are supporting, with a QR code customers can scan to donate directly to nonprofits we think are great assets for our region.”
Another unique thing that Charley Family Shop ’N Save does is communicate regularly with its community through its social media accounts in a way “that would be impossible for a large company to match,” asserts Charley. The company discusses the professional accomplishments of individuals, posts pictures, and bonds with the community over various momentous life events. As well as sharing the good, however, the company doesn’t shy away from discuss challenging situations directly with the community. “We’ve had Facebook Live videos talking about specific challenges in the supply chain, categories we are having a hard time stocking and what the future looks like for those items,” says Charley, who adds that the social media channels also feature giveaways and product-sampling videos.
What’s more, all of these videos come from Charley himself. “These aren’t produced by a marketing firm; they are very grass-roots, and it shows,” he notes. “There is no filter between [my] mouth and what is going on in the industry. It fosters trust between our company and the community.”
This consistent activity on social media is reinforced by the daily presence of Charley and his brother Mike in the stores, where they regularly interact with customers.
DeCicco & Sons
Headquarters: Pelham, N.Y.
Nunber of Stores: 10
What started nearly 50 years ago as a family-run storefront in the New York City borough of The Bronx has transformed into a multigenerational food retail destination in New York’s Westchester County. DeCicco & Sons now has 10 locations and prides itself on exemplary customer service, world-class food selections ranging from specialty goods to freshly prepared meals, and a commitment to the communities it serves.
Customers praise the retailer for its vast selection of fresh produce, its well-appointed cheese and deli counters, and imported Italian goods, as well as for its friendly associates and owners who frequently take the time to walk the aisles and speak with customers. The grocer has won accolades for its Italian bakery, beer selection and catering division, but today it’s focused on much more than just the
Dom’s Kitchen & Market
Number of Stores: 2
After making its Windy City debut in the summer of 2021, Dom’s Kitchen & Market has made a splash as an omnichannel food emporium that focuses on food and community. The grocer has
food and beverages that it stocks. As the company expands, renovates existing sites and opens new locations, it has consistently been at the forefront of innovative, environmentally friendly building solutions. Energy and water efficiency are top priorities for the company, and during the construction process, DeCicco & Sons uses post-consumer glass, as well as reclaimed brick and wood, along with employing other means to minimize water usage and
and an app, and also opening a much larger second location in November of last year. The new store, in Chicago’s Old Town neighborhood, features updated grocery technology like digital menu boards, electronic shelf labels, self-checkout and self-order kiosks.
Dom’s is spearheaded by Chicago grocery veterans Don Fitzgerald, Bob Mariano and Jay Owen, whose team is committed to highlighting local
offset its carbon footprint. Additionally, the company is one of the first in the country to test and use geothermal wells combined with natural refrigerant to reduce electricity use and cut emissions.
DeCicco & Sons also has three large solar panel arrays at select locations, with two more in the pipeline. The grocer is proud to extend its commitment to quality beyond its food and services, and into the realm of renewable and sustainable energy.
products and entrepreneurs. The customer-favorite bakery stocks baked goods from some of the most popular bakeries in Chicago, and the stores’ category managers seek out emerging local brands to help curate a uniquely local and global experience for shoppers.
Dom’s executive chef creates a menu of freshly prepared, globally inspired foods, including Roman-style pizza, sushi and poké bowls, as well as Italian main courses that complement the retailer’s signature sandwiches, salads and burgers. The company also partners with chefs across Chicago to bring unique experiences to its customers, and incorporates local ingredients into its menu items.
In addition to its commitment to great food and supporting local purveyors, Dom’s gives back to the communities it serves by regularly donating to and volunteering at the Greater Chicago Food Depository and Nourishing Hope. As it aims to open 15 new stores by 2025, the grocer also plans to create thousands of new jobs – in addition to the 250 jobs it created last year.
2023 Outstanding Independents
Dorothy Lane Market
Headquarters: Dayton, Ohio
Number of Stores: 3
As the Southwest Ohio specialty grocer enters its 75th year in business, Dorothy Lane Market (DLM) remains focused on its endless quest to innovate, according to CEO Norman Mayne. The executive believes that DLM’s successes wouldn’t be possible without the people who have been part of the journey, including his entire family, the stores’ associates, its vendors and especially its community of customers.
“Together, we’ve not only served up great food traditions, but we’ve had a lot of fun doing it along the way,” Mayne says. “We’ve always tried to create faster than the competition can steal. As a result, we try things that others won’t, and that leads to not only unique promotions and business practices, but items like the Killer Brownie and
Fareway Stores Inc.
Headquarters: Boone, Iowa
Number of Stores: 133
From South Dakota to Illinois and in five other states in between, Fareway Stores is on a mission to provide the highest-quality products while treating customers like family and valuing its dedicated employees. The family-owned grocer is known for its
our killer strategy to develop signature favorites in every aisle and department.”
Mayne took over day-to-day operations at DLM at just 23 years of age, and he’s been focused on selling great food ever since. The retailer credits its rich history as the core of everything it does, counting multiple generations of associ-
experts who cut, prepare and package product to customers’ specifications, as well as its farm-fresh produce and topnotch customer service.
Fareway had a busy 2022 that included the opening of three Meat Market locations throughout its footprint; these feature the grocer’s signature high-quality meat and a full-service butcher counter. The year also brought Fareway a high school registered-apprenticeship program for meat cutting in Indepen-
ates among its ranks. These elements have helped make DLM a Dayton mainstay, with loyal customers stopping in to take a cooking class, pick up a prepared meal for dinner, order a gourmet cup of coffee, or even stroll the grocery aisles with a glass of wine or beer in hand.
Introduced in recent years, the DLM Good Neighbor Program is one of the main ways that the grocer supports its local community. Loyalty program members can choose a nonprofit organization from a list provided by the grocer to have their purchases credited toward that group. Hundreds of thousands of dollars have been donated to date.
dence, Iowa, and the acquisition of the 20,000-square-foot Brick Street Market and Café near Des Moines.
After adding an e-commerce platform in 2020, the indie retailer made further tech moves last year with the addition of Venmo and PayPal as in-store payment options. Fareway has also worked with energy partners to install electric vehicle-charging stations and solar panels in key store locations, in addition to installing a 1-megawatt solar facility adjacent to its corporate campus.
Additionally, Fareway has rescued and donated more than 1.1 million pounds of food and recycled more than 400 tons of plastic shrink wrap, 12.5 tons of cardboard and 4.5 million plastic sacks. The grocer has also become a steward for smaller communities in Iowa through a partnership with the State of Iowa Economic Development Authority that allows the company to build smaller store models in communities of around 5,000 people. Further, Fareway makes monetary donations to Variety-the Children’s Charity, the Muscular Dystrophy Association, the U.S. Marine Corps Toys for Tots program and other local community initiatives.
February 26-28, 2023
February 26-28, 2023
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2023 Outstanding Independents
Headquarters: New York
Number of Stores: 30
The names Gristedes and D’Agostino’s are synonymous with the New York City grocery landscape, and the 132-year-old combined supermarket chain prides itself on offering a wide selection of local foods and goods that support the community it serves. At the helm of Gristedes/D’Agostino’s is Joe Parisi, a seasoned food and grocery retail professional with more than 40 years of experience in the industry.
Parisi and his team have worked hard to maintain the success of the business despite recent hurdles, and they’re adamant about the safety and security of all stores, even doubling the number of security guards in the past year.
Despite its age, the grocer is highly technically savvy and innovative, having recently refreshed its enterprise point-of-sale system in an effort to drive greater efficiencies from a speed and reporting standpoint. The company has also made significant investments in its e-commerce strategy, offering a variety of channels and methods to enable New York met-
Headquarters: Hockessin, Del.
Number of Stores: 1
The first thing that shoppers notice about Harvest Market is a big sign at the front of the store that reads: Your Community Grocer. This 27-year-old indie operator specializing in local, organic and specialty foods squeezes more than $9 million in annual sales out of a 6,000-square-foot storefront. The company knows that it can’t match the size, selection and buying power of the chains, but it strives for excellence in everything it does — successfully. In recognition of its efforts, Harvest Market has earned two consecutive top workplace awards from the Wilmington News Journal and Energage.
When a Wegmans Food Market opened a few miles away last October, Harvest Market worried that customers might defect. They did not. Despite predictions from a consultant that it might see as much as a 15% drop, the grocer closed out the year up 11%. According to Harvest Market, this is because it has “a staff focused on taking care of customers from the moment they walk through the door.”
Harvest Market quickly delivers on customer requests for new products and special orders. It developed a popular safety protocol during the peak of the pandemic. Harvest Market staff develops “how are the kids?” relationships with many customers, and they reward the retailer with a $55 average basket size.
Another key to the grocer’s success is its prepared food kitchen, which produces restaurant-quality offerings across categories such as soups, salads, sandwiches, sides and
ro-area residents to shop with Gristedes/D’Agostino’s, such as Freshop, Uber/Cornershop and Instacart.
On the corporate responsibility side, the company and its parent, Red Apple Group, have raised millions of dollars for Tunnel to Towers, a group that helps provide mortgage-free homes to Gold Star and fallen first-responder families with young children, and that builds custom-designed smart homes for catastrophically injured veterans and first responders.
baked goods. The kitchen is 3-Star Green Restaurant Association (GRA) Certified, and one of only seven kitchens ranked by the GRA that has earned more than 90 points for ingredient quality and sourcing.
Harvest Market was founded in 1995 as a high-quality community grocer, a mission it’s still fulfilling to this day.
Headquarters: South Burlington, Vt.
Number of Stores: 3
Founded by Katy Lesser in the 1980s and now co-owned by her two adult children, Healthy Living has always been — and remains — ahead of its time. The grocer, with locations in South Burlington and Williston, Vt., and Saratoga Springs, N.Y., was a pioneer early on by investing in ordering and inventory management technology. Lesser started the business without formal training, going up against conventional supermarkets before natural foods were mainstream.
The company’s three stores run on 100% renewable energy sources, and its cafés offer from-scratch prepared foods crafted by a renowned chef. The grocer offers a Core Shopper loyalty program that aims to teach customers that healthy food is accessible, affordable and “the right way to go.” E-mails, blog posts and more written by Healthy Living leadership further the company’s educational work, providing tasty recipes and facts about various grocery and wellness items. The retailer also has strict product standards, prohibiting foods that have added hormones, antibiotics, artificial and trans fats, high-fructose corn syrup, artificial sweeteners, bleached or bromated flour, or artificial colors, flavors and preservatives.
Last year, the retailer’s Together We Can Help philanthropy program resulted in donations totaling $91,146.56 — given directly to nonprofits helping neighbors in need. During the COVID-19 pandemic, Healthy Living showed tenacity, drive and innovation by managing to open a third location, in Williston, despite operational challenges.
Healthy Living employs 300 workers across Vermont and New York, consistently adding talent to its roster and furthering its mission of exemplary customer service and hospitality for an exceptional shopping experience. The company is also focused on nurturing a positive work culture by offering competitive pay, benefits and other opportunities for staff. In short, Healthy Living is a great place to work, shop, learn and engage with the community.
Headquarters: Isom, Ky.
Number of Stores: 1
More than six months ago, Gwen Christon’s life changed forever. Her IGA supermarket, in Isom, Ky., was destroyed by storms, which sent more than 6 feet of floodwater into her store. Christon, who has worked in the store since 1973 and owned it since 1998, runs the only full-service supermarket in a 12-mile radius of that part of Appalachia, and she employs more than 20 people. As such, she is one of the largest employers in the town, part of an economically challenged region.
Before the flood, Christon had been continually investing in her store and her customers by installing self-checkout and energy-efficient cases, lights and solar power. Christon’s store was the heart of Isom, a community within a community, providing a place where people form connections and friendships, gather in good times and bad, and always feel welcomed.
So it comes as no surprise that immediately after the flood, the Isom community rallied behind her. Donations and volunteers came flooding in. The store’s parking lot became a hub for the Isom community. Christon’s team worked with World Central Kitchen and Mercy Chef Kitchen to feed hot food to 10,000 neighbors forced from their homes. People lined up for family meals every day for a month. Working with local groups, Gwen’s team also ensured that everyone would have their food needs met for Thanksgiving.
Christon’s inspiring story was featured in Progressive Grocer, on “Good Morning America” and NPR, and in other national media. Today, Christon’s new store is under construction, and she recently told NPR that she’s well on her way to planning her store’s reopening celebration on April 1.
“This is my family, and the people of Isom are my people,” Christon said in the NPR interview. “We work hard to make everyone’s life easier and more convenient for them. It’s what we do.”
Headquarters: Troy, Kan.
Number of Stores: 1
John’s Market, in Troy, Kan., is the textbook definition of a hometown, family-run, rural grocery store. Troy is located about 70 miles north of Kansas City and has a population of approximately 7,500, with a median household income of $54,792. Without John’s Market, a lot of people in this community wouldn’t have access to quality groceries or quality customer service.
John’s Market is famous for helping neighbors in need. From offering special hours after a local game to provide food to athletes, to delivering necessities to a customer whose house burned down on Thanksgiving, the retailer serves its community without hesitation.
Recently, one customer received a breast cancer diagnosis. Her family tradition for Thanksgiving was making oyster salad, but she was too sick to travel, so John’s Market brought the oysters to her. The grocer also helps
Headquarters: Westport, Ontario
Number of Stores: 1
Kudrinko’s owners Neil and Martha Kudrinko have always been progressive grocers: The store received recognition for its sustainability practices as
churches, schools and community organizations, which all depend on John’s Market for successful events. Without them, each organization would have to travel more than 20 miles one way to shop for groceries.
During the pandemic, John’s Market was the community’s “security blanket.” The retailer adjusted its business model and began offering contactless delivery, accepting phone orders and
one of Progressive Grocer’s Outstanding Independents in 2014.
Given the owners’ approach to business, it’s no surprise that when second-generation owner and president Neil Kudrinko decided to come out publicly as pansexual/ queer in 2021, he felt a responsibility to create a safer and more inclusive space in his community. Kudrinko’s has made diversity, equity and inclusion (DEI) efforts not just a matter of policy, but also a matter of action. The store joined the Welcoming Project and was successful in getting local affirming businesses to post All Are Welcome decals on their doors as well.
When it comes to human resources programs, the small company of 30 employees added gender affirmation coverage to the health benefits offered. While health care in Canada is covered
providing special shopping times for the most vulnerable, as well as adding online pizza ordering, pre-made sub sandwiches and much more.
John’s Market is also one of the few businesses in the area that hires teens and young adults. Over the years, hundreds of local teens have worked for John’s Market because the owners understand that school is a priority. A common comment from young employees is that John’s Market is flexible and understanding. The grocer will tailor schedules around band, athletics, studying and other school activities. Working at the grocery store also teaches these kids many valuable life skills — respect, friendliness, a strong work ethic and accountability, to name just a few.
by a public single-payer system, some surgeries are considered elective and are left to the individual to pay out of pocket. Kudrinko’s recognized that gender dysphoria is experienced differently by every trans individual, so a one-size-fitsall approach wasn’t going to provide the care needed for many people.
Yet beyond its DEI efforts, Kudrinko’s support for the trans community is deeply personal. Neil Kudrinko sees it as a matter of professional development, personal growth and leadership, especially during a time when members of the queer community are threatened by harassment and legislatures that would seek to use identity as a matter of political division. Kudrinko’s doesn’t only believe that diversity, equity and inclusion are a matter of ethical business practices, it’s also committed to celebrating all people regardless of their backgrounds. Addressing inequality in government policies, working toward a more sustainable planet and building a strong community are Kudrinko’s stock in trade.
2023 Outstanding Independents
Little Red Box Grocery
Number of Stores: 1
Little Red Box Grocery is doing big things. Founded by H-E-B veteran and nonprofit leader Samuel Newman, the independent small-format grocer in Houston’s Second Ward aims to improve accessibility to affordable foods while engaging and empowering the community, which had been considered a food desert.
The store’s assortment includes a range of fresh food and everyday staples that meet customers’ many needs. LRB, as it calls itself, also partnered with a group called Cooking Matters to create meal kits that are quick and easy to serve for families.
The arrival of LRB in 2022 was much appreciated by community members. “Oftentimes, our customers are just coming in for one or two essential
items — a loaf of bread, milk or some vegetables, and if we weren’t here, they tell us they’d either need to take two buses to get to a store or they’d just go without,” the grocer notes.
Behind the scenes, this indie is
incorporating technology into its grass-roots food retailing. Last year, the business delved into the omnichannel realm through a partnership with Grocerist and launched several digital marketing initiatives. This
We are honored to be selected as one of the TOP INDEPENDENTS IN GROCERY
year, LRB and Grocerist, along with tech partner Forage, will roll out online SNAP EBT, something that they believe will be a game-changer for the many customers who would prefer to go online to use their benefits instead of doing so in person.
Further, LRB is widening its reach beyond its store doors as part of its overarching mission. The grocer works with local organizations to provide food relief, including partnerships with the Urban Harvest Group, El Centro de Corazon and Arena Foundation. Through these collaborations, local residents can get benefits such as half-off SNAP EBT purchases, medically tailored offerings, expanded food access, and more.
Ultimately, it’s about connections in many forms at LRB, which asserts, “Our approach is to treat each customer like you would a friend of a friend walking into your living room.”
The Mildred Store
Headquarters: Mildred, Kan.
Number of Stores: 1
It’s been said that walking into the Mildred Store is like stepping into a Norman Rockwell painting. It’s
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partly the fact that the general store in rural Mildred, Kan., opened 107 years ago, and the store’s current assortment includes nostalgic items like retro candies and regionally made Amish canned goods. It has also remained a hub of the community,
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as team members regularly assemble locally famous deli sandwiches for customers who hail from Mildred and other parts of Southeast Kansas.
History is part and parcel of this indie grocer, which was founded by Lucille and Charlie Brown and was known as Charlie Brown’s for more than nine decades before the store was bought by the new proprietors, Regena and Loren Lance. The Lances, who changed the store name to simply the Mildred Store, report that they have continued many traditions, but are also forging new ones to meet
Oryana Community Cooperative
Number of Stores:
Starting with its founding as a buying club 50 years ago, this cooperative and natural and organic retailer in Traverse City, Mich., has striven to follow a socially driven business model. Beyond supporting local food systems and working with nonprofit groups to boost food security and access, Oryana Community Coopera tive has transformed its area in other important ways.
the needs of today’s shoppers.
For example, stemming from Loren Lance’s interest in music, the Mildred Store now hosts a monthly music night in one of its spacious back rooms. The free event draws crowds of up to 200 and drives revenue as well as community engagement.
In addition to these events, the grocers frequently open up the site for local festivals, family gatherings, fundraisers and even car shows. They offer a variety of made-to-order party trays for these and other occasions, including platters with meats, cheeses, vegeta-
bles, cookies and candies. Recently, the Lances opened an RV park next door as another way to generate income for the business and interest in the store.
The grocers have also worked creatively on the supply side, especially during the pandemic. At a time when restaurants in the area were largely closed, they turned to foodservice suppliers to provide them with bulk items that could be repackaged and sold to shoppers who still felt comfortable shopping at their hometown grocer. Further, in the e-commerce era, the Mildred Store has added delivery services at no charge.
Case in point: The consum er-owned co-op was able to maintain its own business and essentially save another one during the recent trying times of the pandemic. CEO and General Manager Jim Nance led efforts to acquire a struggling competing business in the Grand Traverse area, which eventually led to the opening of Oryana West. The co-op helped preserve 62 jobs at the acquired business and, along the way, more than doubled its sales revenue from 2019 to 2022. What some might have seen as a risk turned out to be a choice that spurred growth and positively affected the area.
Today, the two-store co-op governed by Nance and an elected nine-member board has a base of more than 10,600 member-owners and is a $32 million operation. Oryana Community Cooperative received the 2022 Cooperative Excellence award from the local chamber of commerce for its achievements and local economic and community contributions.
Adhering to the values that have served it well since it was formed by volunteers in 1973 is what sets this co-op apart, according to its leader.
“We truly believe that all people have a right to high-quality food, and all are welcome in the co-op,” says Nance. “Recognition lets us know that the efforts of our forebears, staff and boards — both past and present — and the support of our owners and community have made a difference, and it motivates us to keep working hard, to be truly inclusive [and to] care for future generations of people and families in our community.”
Headquarters: Andover, Minn.
Number of Stores: 20
As with many independent grocers, it’s a family affair at Rademacher Cos., launched in 1976 and based in Andover, Minn. The Rademacher family manages around 20 family-owned stores in the central part of the state.
After running successful superette convenience stores and G-Will liquor stores (short for Gee Willickers) for decades, the Rademachers went into the full-scale grocery business in 2022. They quickly got to work upon acquiring a former Food Price location in the town of Becker, Minn., updating the parking lot, sprucing up the store exterior and entrance of the building, and installing new lighting. They also invested in technology, adding self-checkout areas and an in-store pointof-sale system, and staffed up the store with new hires.
Working with distribution partner SpartanNash, of Grand Rapids, Mich., the owners completed a full store reset with an expanded assortment of grocery items, deli offerings and fresh produce, among other products. They also added a beverage bar and a rotating series of weekly specials.
Rademacher Cos. expanded further into the Becker community by opening a new Bill’s Superette c-store at the site of
Redner’s Markets Inc.
Headquarters: Reading, Pa.
Number of Stores: 64
Sensing and seizing opportunities, the family that operates Redner’s Markets Inc. didn’t wait for the volatile times of the COVID-19 crisis, supply chain snafus and high inflation to settle. Instead, the grocers took all kinds of actions to grow their independent business and bring it into the next merchandising era.
“If the global pandemic brought anything to light, it was that for any business to survive and show continued growth and success, sticking to one’s core values is a must,” the company’s nominator asserts.
The leaders didn’t think small, either. This employee-owned indie expanded its new concept, Redner’s Fresh Market, focusing on full-service deli, bakery, meat, seafood and chef-prepared meal solutions. Having unveiled the first Fresh Market store, in Wyomissing, Pa., in 2019, the company recently opened its fourth Redner’s Fresh Market, in Lewes, Del. Unveiled in November 2022, the 49,000-square-
a former Deli Plus/Shell station.
The new Bill’s Family Foods and the latest Bill’s Superette continue the company’s focus on serving customers promptly in a personal and sincere way, something that they perfected in their other retail enterprises that include car washes and fuel and propane sales. As the grocer’s Outstanding Independents submission puts it, “The main key to operating a successful store is simply stated in the company’s motto: ‘Cleanliness and Friendliness!’”
While the company has widened its retail presence, Rademacher Cos. has evolved as well. The next generation of the family business started by Karen and Bill Rademacher has taken a new leadership role, with their son, Grant Rademacher, now president.
foot store also makes its own fresh popcorn and pressed juice, and offers convenient self-checkout along with curbside pickup and delivery options via DoorDash and Shipt.
The Reading, Pa.-based retailer also rebranded its convenience store division, dubbing it Redner’s Quick Stops. From an operations standpoint, Redner’s invested in a front- and backend point-of-sale solution to bring the stores into the future.
Now in its third generation of leadership under Ryan, Gary M. and Richard Redner, and with 64 locations, the company begun in 1970 by Mary and Earl Redner continues its focus on valuing its 5,000-plus associates. Among other measures, Redner’s has increased wages,
recognizing the commitment of its workers during the pandemic. Community support remains a priority, too, as the grocer partners with nonprofit groups and provides charitable donations. At the end of 2022, Redner’s revealed that it’s providing more than 200,000 meals to area food banks through a partnership with such brands as Minute Rice and the Original Louisiana Hot Sauce.
2023 Outstanding Independents
River Market Community Co-op
Headquarters: Stillwater, Minn.
Number of Stores: 1
Not only is River Market Community Coop owned by local residents, it’s also active, integral and vital to its surrounding area.
In 2022, River Market created its very own grant fund to support and strengthen the local foodshed: the Growers, Grazers, Makers and Bakers Grant Program. This grant program weaves together local food and community, two essential ingredients of the fabric of the co-op since it was founded 45 years ago by a small group of volunteers. Local farmers, food producers and processors are eligible to apply for a grant through the program. Funds may be used for the purchase of machinery, construction or other resources necessary for increasing productivity, scaling offerings, improving efficiency or growing the applicant’s business. Contributions to the fund come primarily from shoppers rounding up their purchases to the nearest whole dollar. This
program generates more than $38,000 each year, entirely from the generosity of the small grocer’s shoppers. In an example of a unique event in its community, the World Snow Sculpting Championship takes place in
January, just steps from River Market. Sculptors come from around the world and spend three days chiseling, shoveling and sculpting giant blocks of snow. The independent store is a proud sponsor of this event, with its deli providing lunches for each team of sculptors. What’s more, General Manager Sara Morrison is a member of the steering committee, helping plan and promote the event as well as working on logistics.
The rich symbiosis between the co-op and the surrounding community doesn’t stop there. The grocery store also educates its community by offering virtual classes. Topics include “Everything
You Need to Know
About Recycling,” “How to Grow Microgreens” and “The Art of Beekeeping.” Overall, River Market is an inspiring example of an entity owned by and serving the needs of those who live, work and play in the area.
Headquarters: Spokane, Wash.
Number of Stores: 23
What sets Rosauers Supermarkets apart from competitors is how it strives to serve its customers, communities and employees. When customers shop
its stores, they encounter a neighborhood market feel with a full-service bakery, a deli, and produce, floral and meat departments, alongside offerings of natural, organic, conventional and local products. They also discover employees who are available not only to tell them where a product is, but also to walk them to the item or direct them to an associate to place a special order — services they won’t find at many competitors.
It’s things like Rosauers’ 30-year relationship with the local crisis nursery, its 20-plus-year affiliation with the local food bank distributor, its 20-plus-year association with the local United Way, its work with the American Heart Association and its support of hundreds of local nonprofits across
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2023 Outstanding Independents
the four states in which it operates that show customers the heart of the company. When customers shop Rosauers’ stores, they know that they support the local community while receiving exceptional service.
Rosauers is also known for being at the forefront of innovation. As a founding Rosie e-commerce retailer, Rosauers paved the way for other independent grocers in its area to see Rosie’s potential in improving online offerings. Rosauers was also the first
Schnuck Markets Inc.
Headquarters: St. Louis
Number of Stores: 114
Schnucks is a third- and fourth-generation family-owned grocery retailer committed to nourishing people’s lives. It’s known for partnering with nonprofit organizations aligned with the company’s community pillars of fighting hunger and food insecurity.
Its most robust community partnership is with Operation Food Search (OFS). Since the inception of the OFS partnership, Schnucks has donated more than $180 million worth of
independent retailer in its region to partner with Upside and Instacart.
During the pandemic, Rosauers didn’t just use its relationship with Rosie to expand the number of online orders at its six established stores — within three weeks’ time, it had added 13 additional store locations to serve customers during COVID’s twists and turns. When Rosauers saw that its local food bank distributor was struggling to meet the increased demand of so many people being out of work, the grocer
took further steps to collect donations from customers, adding a percentage matched by the company, and used gift cards to ensure that those in need had access to food.
Additionally, for the first time ever, Rosauers started hiring temporary employees to help those out of work provide for their families, and it increased its employee discount. These actions further demonstrate the grocer’s drive to serve the community and keep everyone safe, fed and employed.
food to those in need. By teaming with OFS and its 330-member nonprofit agencies, Schnucks enables an average of 200,000 people per month to receive food assistance.
Then there’s Schnucks’ decades-long tradition of hosting an annual teammate United Way campaign. Through teammate pledges, community fundraisers and company donations, the 2022 campaign raised $2.239 million to support United Way and its mission to help those most in need.
Meanwhile, in 2021, Schnucks launched a $1 million partnership with the Urban League of Metro -
politan St. Louis (ULSTL). Schnucks customers can Round Up at the Register to support the nonprofit’s Save Our Sons initiative. The relationship includes Schnucks’ continuing support of ULSTL’s annual St. Louis Urban Expo and donations of food and other products for the organization’s annual holiday meal campaign. It also includes the grocer’s sponsorship of various drive-thru emergency relief distributions, both through product donation and Schnucks volunteers, as well as ULSTL’s use of Schnucks’ warehouse facility for the food distribution events.
The grocer is also focused on community health. Recognizing the disparity in breast cancer survival rates between white and African-American women, Schnucks, in partnership with the Pink Ribbon Girls and ULSTL, created Treasure Your Chest to incentivize residents of 21 underserved ZIP codes in the St. Louis area to get mammograms. Participants received a $50 Schnucks gift card along with other resources to promote healthy living and eating choices.
There’s also Schnucks’ nearly 40-year-partnership with The Salvation Army (TSA). Each holiday season, Schnucks customers can Round Up at the Register to support the TSA Tree of Lights campaign or give to the TSA bell ringers in front of Schnucks stores. TSA of Greater St. Louis recently recognized Schnucks with the Doing the Most Good award, highlighting the grocer’s commitment to serving the community and to supporting TSA.
Headquarters: Hialeah, Fla.
Number of Stores: 33
Sedano’s Supermarket began as a neighborhood grocery store founded Cuban exile Armando Guerra in 1962. Guerra brought in Manuel Herrán, and together they grew the banner into the largest Hispanic-owned grocery retailer in the United States. Today, Sedano’s is still operated by the second and third generations of the Guerra and Herrán families.
With 33 stores across South Florida and Orlando, Sedano’s has always been a cultural hub for its local community. It is committed to serving immigrants and providing products that connect customers to their home countries. Besides its diverse variety of products, Sedano’s offers authentic Hispanic prepared dishes and bakery items ideal for the grab-and-go crowd.
“Customers feel more at home in
the environment we provide at the stores,” says Produce Supervisor Ricardo Carbonell, “whether it be the cafecito and the pastelito de guayaba in the cafeteria, to the arroz con frijoles at the hot bar they can have for lunch.”
Sedano’s has also been a huge supporter of its community since its inception by sponsoring local causes. It provides relief to thousands of families each year, especially during its Season of Giving campaign during the holidays. For instance, the grocer has been part of the Camacol Annual Holiday basket drive for 20-plus years.
“Prioritizing community involvement is what makes Sedano’s special,” says Supervisor Pedro Mesa. “We celebrate with the community in good times and [we’re] there to support them during challenging times.”
Sprankle’s Neighborhood Market
Headquarters: Leechburg, Pa.
Number of Stores: 3
Sprankle’s has elevated itself past selling groceries — the grocer has become a community hub and a popular destination. Since its opening in July 2022, Sprankle’s Saxonburg, Pa., store has continued the indie’s commitment to offering consistent standards, fair pricing and an environment where something fun is always happening.
For example, one surprising store feature is a full Lego section, popular with young and old customers alike. Owner Doug Sprankle creates in-store events using the colorful plastic building blocks, including full Lego races in the grocery aisles, which has brought more young families to shop at the store.
Another popular event that drives traffic is the Pre-Mingle celebration that supports Saxonburg’s monthly Mingle-onMain events, giving local craft vendors a chance to sell their wares and offering competitions for kids.
Then there’s Sprankle’s reputation for quality meat, freshly cut on the premises. A dry-aged steak vault enables customers to watch their products age, a high-end experience found only at Sprankle’s. Customers can also enjoy the Saxonburg store’s brewery bar or dine outside on the patio.
During the pandemic, Sprankle’s started to incorporate local food businesses, including a bakery, a burrito shop and sushi, to help struggling businesses compensate for lost volume when they couldn’t open. Sprankle actively promotes them as part of his marketing strategy.
Meanwhile, as part of its Sedano’s Retail Media Network, the Hispanic independent grocer released the first issue of its bilingual Nuestra Sazón (Our Flavors) magazine in November 2021. Each issue of the print and online publication celebrates the richness of Latin cuisine and culture through entertaining stories and comida criolla recipes that customers can make at home using ingredients from featured brands.
“When our customers are missing their home country or just simply Grandma’s cooking, we want them to think of us as the place where they can go to find everything they need for that meal that will transport them back,” adds Mesa.
Creating a culture at Sprankle’s that is broadly community-based and woven into everything it does sets this store apart. Employees, known as crew members, are the difference-makers, giving the store an edge that translates to a more positive customer experience. Sprankle pays well and provides a quality health insurance program, bonuses and other benefits. “Focusing your efforts on your community starts with taking care of your crew and treating them with the same respect you do your community,” he says.
Additionally, Sprankle participates in MDI’s NextGen program, which empowers future leaders in the grocery industry by teaching business fundamentals and cutting-edge trends. Focusing on his development, he ensures that Sprankle’s will remain a fixture in the community well into the future.
Out of the BoxBy Mike Duff
igitally based delivery has changed the grocery sector, with players in a constant frenzy to be the next biggest disruptor in the market, but the combination of demand, technology and experience, along with the recognition that a huge opportunity exists for whoever can drive the next phase of development, has service providers innovating intensely to put online ordering and at-home fulfillment on a par with in-store shopping.
Whether a company has evolved in the delivery sector or, like San Francisco-based Uber, has converted a compatible operation to take a unique approach to domestic drop-off, ongoing investment and technological advances promise rapid evolution.
Shipt, of course, has been among the more recognized delivery companies, not only for its early appearance on the delivery scene, but also for its operational development and rapid growth. However, its acquisition by Minneapolis-based Target lifted Shipt’s profile even further, which has not only changed the course of its development, but also that of the big-box retailer, which has quickly made pickup and delivery much more central business functions.
In essence, disruption is in Shipt’s DNA, according to the company’s chief business officer, Rina Hurst.
“Shipt originated as a disruptor in the retail technology space,” says Hurst. “It goes all the way back to our roots: founded in 2014 in Birmingham, Ala., with
Technology is the centerpiece, but building relationships between consumers and the people delivering their food is the element that humanizes and elevates the digital shopand-drop experience.
a goal of helping individuals with little or no time for grocery shopping. As Shipt has grown, we’ve leveraged our technology to empower consumers and retailers alike. For retailers, Shipt offers an easy solution to bring both the convenience of reliable delivery to their current customers and an opportunity to meet new customers for incremental sales.”
She adds: “Third-party delivery services leverage scale across a market to keep costs for partners low and can flex their business models to prepare for peaks in retail demand. Companies like Shipt can offer grocers support that would be extremely capital- and labor-intensive for an individual grocer to buy or build and maintain.”
Shipt maintains a commitment to developing first-to-market delivery operations that prioritize the changing needs of an extremely diverse group of customers, notes Hurst.
Meanwhile, DoorDash is coming up to its 10th anniversary in business and continues to look at the flexibility built into its delivery capacity as an original basis for disruption,
Ongoing investment and technological advances promise rapid evolution in the grocery delivery space.
Grocery delivery services are helping to bring about a world where the store visit is only one of several options that consumers will pick, depending on their needs at the moment.
Flexibility and personalized relationships with customers, grocers and CPG companies are key to success in this sector.
GROCERY DELIVERY SERVICES ARE SHAKING UP THE STATUS QUO IN NEW AND EXCITING WAYS BY FACILITATING FOOD RETAILERS’ OMNICHANNEL OPERATIONS.
and the foundation of its ability to be a disruptor in the future, as well as the basis for future disruption in reaching customers.
“DoorDash’s goal since day one is to empower and grow local economies,” asserts Fuad Hannon, VP new verticals for the San Francisco-based company. “We’re focused on helping businesses compete in the digital economy.”
DoorDash’s beginnings in the restaurant sector, with high-volume, relatively low-value deliveries made with speed, precision and an understanding that affordability is a central issue, set a foundation for its emergence into the grocery sector, where the business is lower volume and higher value. As such, before venturing into grocery stores, where there may be 50,000 SKUs compared with a few hundred items on the most expansive restaurant menu, DoorDash had already faced and addressed critical challenges in the delivery sector and made its service work. And it did so, it’s worth noting, despite the fast expansion of pickup windows and takeout parking spaces added by restaurants even before the COVID-19 pandemic.
Indeed, confronting and systematically addressing such increasingly complex retail sectors as grocery are consuming the company’s time and investments these days, but DoorDash already has come to understand that the ability to be flexible is critical to the future of delivery in the grocery sector.
The company already services grocery store shoppers through its own app and through the proprietary apps of its customers. As such, it can support the agenda of its partners, which can include driving digital orders through their own apps and gaining the data that they provide. A retailer’s use of the DoorDash app can also bring new customers to that business, and a partner can choose to operate through both apps as well. DoorDash also works with different methods of fulfillment, given that its Dasher associates can shop orders themselves or accept completed orders when store personnel do the picking.
As DoorDash has gravitated beyond restaurant delivery to grocery and other retail, the company has established a standard to follow as it proceeds to the next iteration of delivery, one where consumers begin to more thoroughly integrate store and online grocery shopping into their everyday habits. As such, the company is looking at how the online and delivery experience can compare with the best retail environments.
“Then what has to happen is to make this as seamless and delightful as shopping in the store,” observes Hannon.
He emphasizes that grocery delivery is still in its earliest stages, but that DoorDash, with the flexibility of its platform, which can integrate other systems and function through retailer apps, is working on how to make digital food shopping just as comfortable, and, as soon as possible, as familiar an experience as shopping for food on a sales floor.
The Next Phase
Over the years in which the company developed its grocery delivery model, San Francisco-based Instacart has been able to develop technology and experience that have helped it gain traction based on a deepening understanding of the food retailing industry and its complexities, according to Chris Rogers, the company’s chief business officer.
“This knowledge has allowed us to build the technologies to power online grocery for retailers of all sizes, helping our partners
effectively compete as customer preferences continue to evolve rapidly,” notes Rogers. “Together with our grocery partners, we aim [to create] the most seamless, affordable and personalized experiences possible to serve customers. Since our founding, we’ve focused on bringing grocery shopping online and have since expanded our role to be a foundational retail enablement partner, dedicated to helping retailers compete against digital-first competitors and win. We believe technology will continue to play a significant role in up-leveling and seamlessly integrating the online and in-store experiences for consumers, improving operational efficiency and inspiring greater retailer profitability.”
Instacart has helped lay the foundation for the next phase in the grocery sector’s development, contends Rogers, one where the store visit is only one of several options that consumers will pick, depending on their needs at the moment.
“We believe grocers can and should offer customers the latest in e-commerce, fulfillment, in-store innovation, advertising and personalization — everything they need to build the store of the future,” he says. “Through the Instacart Platform, we offer retailers solutions to provide a more personalized grocery shopping experience, both online and in-store. We also work closely with our CPG brand partners to develop new ad offerings that help them connect with and inspire their consumers, and measurement capabilities that help them more deeply understand the impact their ads are driving on Instacart. Our goal is to continue to create innovative technologies and solutions that help both CPG brands and retailers connect with their customers in a new way.”
Perishables represent the toughest product challenge for pick-and-deliver systems, and so require communication and diligence to ensure satisfactory results.
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Uber Eats offers a fresh take on grocery delivery
More consumers want to seamlessly and conveniently order and receive groceries in their own chosen time frame. Uber Eats is dedicated to helping grocers fill that need. Progressive Grocer talked with Therese Lim about how Uber Eats is helping reshape the grocery industry.
Progressive Grocer: How is Uber innovating in the grocery industry?
Therese Lim: At Uber, we thrive on finding ways to constantly improve, refine, and expand our technical and logistical expertise to help solve problems, which is what we’ve done by entering the grocery space. After pioneering on-demand rides in 2010 and quickly building an extensive network of drivers that scaled, we now operate in more than 10,000 cities across 71 countries globally.
In 2015, after seeing the growing demand for food delivery, our team launched Uber Eats to make getting your favorite dish delivered to your doorstep as easy as getting a ride with Uber. Then, in 2020, we entered the grocery and retail space and grew from a restaurant delivery platform into an everydayitems delivery platform. Today we partner with more than 870,000 merchants across the globe to help customers order not only dinner, but anything from groceries and baby formula to birthday cards and more—all at the touch of a button.
Uber’s ability to identify growing consumer demands and respond by building products that operate at a global scale has allowed us to redefine how people move around and access their favorite goods around the world.
PG: How are conventional grocery operators responding to your presence in the market?
TL: Our teams put a tremendous amount of effort into ensuring that the retailers using or considering our platform see us as partners who are an extension of their business. Whether partnering with small businesses or large enterprise brands, we do our best to understand and build for their unique set of needs. We’ve learned that there is no one-sizefits-all approach for grocery retailers and that each market brings its own unique expectations and challenges from retailers.
However, grocers have made it clear that they want a seamless experience with a reliable partner. We’ve made those expectations the cornerstone of how we build products so that it comes through in our platform experience and other interactions grocers have with Uber Eats. We’re continuously expanding the features available on our platform to help streamline omnichannel operations for retailers, and we’re constantly looking for other ways to support their business and performance goals. These efforts are positively received by the hundreds of thousands of grocery partners we work with.
PG: Who do you consider your competition, and how are you differentiating yourself?
TL: While industry competition is fierce, Uber Eats is uniquely positioned to help people across the world discover local merchants and order meals, groceries, alcohol, and more at the touch of a button. As one of the most downloaded food delivery apps, we know we can leverage both our global and local expertise (across both our delivery and mobility businesses) to be successful in helping the world get anything.
This opens the door to tremendous growth opportunities for grocers and retailers looking to gain access to new customers through our marketplace. Today, we have more than 124 million active consumers who use our app to do everything from requesting their next ride to ordering ingredients for their next meal. We’re the only delivery app in the world that can provide grocers with this advantage.
We’ve also invested heavily in what we call Uber Direct, which is our white-label delivery-as-a-service option that retailers can plug into their own e-commerce platforms. Uber connects businesses with drivers who handle the logistics of delivery, while the retailer manages marketing, order intake, and the customer relationship. Our hope is to offer grocers a variety of delivery solutions that best fit their business.
PG: What do you think will be the next grocery industry disruptor(s), and why?
TL: As we emerge from the pandemic, grocers are tasked with meeting changing consumer expectations around delivery. Just about everything was forever changed by the pandemic—those expectations are here to stay, and grocers are changing their business models because of it. Whether it’s expanding pickup and delivery options to remove friction, speeding up operations, or leaning into personalization and increasing selection, we know that the next grocery disruptors will be keenly aware of consumers’ evolving demands and will find creative solutions to meet them.
Learn how you can use Uber Eats to grow your grocery business at merchants.ubereats.com/grocery
Of course, technology has driven immense change in how people and things move across the landscape today, and not just in home delivery. However, the flexibility built into modern technological systems has allowed them to multipurpose in interesting ways.
Uber is a case in point. The rideshare provider has taken its basic business model and developed variations such as Uber Eats. As it did so, Uber took the experience and proficiency that it developed, and then repurposed them to create its dedicated food delivery system.
“At Uber, we bring a few unique things to the table for merchant partners: our technology, our global logistics expertise and our strong consumer brand that comes with a built-in user base of more than 100 million consumers around the world,” says Therese Lim, who leads Uber’s Product Team for Grocery. “We’re hearing interest from our grocery partners — both new and those we’re talking about working with in the future — in being omnichannel retailers: They want to meet customers wherever they are and however they’re looking to shop on any given day.”
The 100 million consumers worldwide who are already interacting with the Uber platform are a dynamic audience, Lim notes, “looking to go places and get things delivered; this means we’re an attractive place for retailers and grocery brands to reach new and existing customers. Our delivery network provides retailers with broad coverage to help expand their delivery service areas. Across the country and around the world, we’re uniquely positioned to help them get what they’re looking for from the merchants they love in under an hour, whether they’re cooking and forgot an ingredient, or planning their weekly shop and just don’t want to jump in the car. These are different kinds of shoppers, and we’re looking to satisfy both with an experience they can count on.”
The pandemic-forced rapid development of grocery delivery networks has been a major challenge all around. Consumers are themselves adapting to the new features and functions that the grocery marketplace offers. Companies providing delivery services have had to update their operations quickly and almost constantly as competitors and consumers alike weighed their options. Lessons learned had to be quickly applied.
“One of the things we learned when we started building for grocery retailers is that there is no one-size-fits-all approach, especially as we work in more than 30 countries around the world,” says Lim, “and each market brings its own unique expectations and challenges from retailers.”
As such, delivery businesses have survived and grown based on their ability to quickly adapt in response to consumer demand, retail need and competitive pressure. Uber is another operation that saw a need to accommodate retailers that want to have their own employees shop for delivery orders, as well as those that want a partner to take care of the picking.
“As a result, we’ve built for both options to give retailers more control,” notes Lim. “Our team designed new features like item replacements and live order tracking to create a more seamless experience for consumers, shoppers and grocers. Grocers have made it clear that they want a seamless experience with a reliable partner. We’ve made those expectations the cornerstone of how we build products so that it comes through in our platform experience and other interactions grocers have with Uber Eats. We’ve also invested heavily in what we call Uber Direct, which is our white-label delivery-as-a-service option for retailers to plug into their own e-commerce platforms. Uber takes care of the delivery and logistics, while the retailer manages marketing, order intake and the customer relationship.”
For DoorDash, the company’s associates who are in stores picking orders for consumers are critical assets that have to be carefully considered.
“There’s a lot done in terms of identifying who are the right Dashers for these kinds of dashes,” affirms Hannon.
Each associate is evaluated specifically for their ability to get orders right, and who might be diligent enough to handle an order of 50 items rather than five or six, as would be the case with a restaurant pickup. For restaurant orders, speed and efficiency are of the utmost importance, but for grocery orders, DoorDash looks for associates who understand that it’s important to take enough
time to ensure that they reach the customer with the correct order. The need to do so is particularly important with perishables such as produce, where selection can be subjective. By interacting with customers, notes Hannon, the same Dashers who have the patience to select other products appropriately can get the best idea of just what the right piece of fruit or best example of a particular veggie is.
The flip side of getting the order right is working with grocers to have a better grasp of what’s in stock so that consumers are provided with the correct choices and issues such as substitutions, which can be pain points for consumers, don’t come up.
“One of the key things we have to nail down with grocers is the problem of understanding what’s in stock,” says Hannon.
A key to how Shipt has helped to reconfigure grocery shopping is a recognition that the hunt for just the right foodstuffs is a personal priority that means more to consumers than just acquiring sustenance.
“Our teams spend a lot of time thinking about ways to make a delivery experience more meaningful at the household and individual levels,” says Hurst. “We take pride in listening to our customers and are conscious of their ever-evolving shopping needs. Personal shoppers are Shipt’s true differentiator. They shop the same way customers would shop for themselves and have proven the power of building relationships within the delivery experience. For example, our first-of-its-kind Preferred Shopper feature has been quickly adopted by both shoppers and customers across the country, showcasing the importance of personalization and relationships to today’s customers.”
The Preferred Shopper initiative allows consumers to pick their favorite Shipt picker. According to Hurst, it’s one example of how Shipt has remained a shopper-centric company and continues to improve its relationships with consumers. In doing so, Shipt is moving toward a new phase of delivery that can draw more customers by better satisfying their preferences.
“Another really great personalization product we launched is Shipt’s dietary preference feature,” she adds. “Customers can go into their profile and save their dietary and wellness preferences, such as keto diet, Paleo, vegetarian, vegan, sugar-free, low-sodium and organic. When customers search for an item in Shipt’s catalog, Shipt will boost and tag the items that match the customer’s saved preferences. When a [Shipt] Shopper claims a customer’s order, a customer’s dietary preferences are available to them and served up during product substitution searches. While Shipt is a technology-based company, we believe that this desire for human connection will continue to have an edge over digital-only solutions.”
In in similar vein, deep relationships with partners are key to advancing Shipt’s delivery services.
“A strong and collaborative approach to partnership is absolutely critical,” emphasizes Hurst. “Shipt takes a personalized approach to each partnership, working hand-in-hand with our retail and CPG partners. Each retail or CPG partner we work with has a dedicated partner success manager who is backed by an entire cross-functional team within Shipt to ensure full support of our partner’s business. Our partner success team is committed to unparalleled service, figuring out what
makes each potential partner unique, understanding the needs of their customers and making sure we are scaled to support their business. Unique to our industry, at Shipt we work collaboratively with our retail and CPG partners to understand data [and] performance, and identify insights to drive our joint business forward, whether it be focused on awareness, trips or baskets.”
Despite challenges ahead, the accomplishments and technological innovation that have driven delivery operators suggest that they will only become more proficient at what they do and more appealing to consumers while providing grocers with more ways to satisfy demanding customers.
For its part, Instacart aims to empower grocers to better serve their shoppers, asserts Rogers.
“We aim to be the backbone of the industry, building the technologies that support our retail partners’ business online and offline,” he says, “and in doing so, we believe we can help our partners effectively compete, and invent the future of grocery together.”
An underlying factor in grocery delivery is the ability to offer consumers alternatives to their typical grocery shopping habits when time is tight and energy is flagging.
“We believe technology will continue to play a significant role in up-leveling and seamlessly integrating the online and in-store experiences for consumers, improving operational efficiency and inspiring greater retailer profitability.”
—Chris Rogers, Instacart
The fastest-growing U.S. grocer offers a value proposition shoppers can’t resist.By Gina Acosta
.S. shoppers are head over heels in love with ALDI — literally.
In November, Michael Hurd and Jessica Bojanowski got married in the produce section of the company’s U.S. flagship location, in Batavia, Ill., after spending many months “dating” by shopping together at ALDI.
“We still have our weekly shopping ‘dates’ at ALDI every Sunday, and every time we walk in that door, we are reminded of our wedding day,” the happy couple told People magazine in January. “Our love for each other and our ALDI obsession has grown tenfold since that beautiful November day.”
Michael and Jessica will soon have to share that obsession with a lot more shoppers.
In October, the German-owned discount grocer, which first put down roots in the United States back in 1976, revealed that more than 1 million new shoppers had lifted same-store sales growth by double digits year over year at the chain, as inflation drives consumers to look for bargains on food. In January, the company with estimated annual sales of $19 billion unveiled its 26th distribution center, which will supercharge the retailer’s expansion in the fast-growing Sun Belt. That same month, dunnhumby named ALDI the No. 1 grocery leader in Price for the sixth year in a row. In an exclusive interview with Progressive Grocer, Scott Patton, ALDI’s VP of national buying, says the ALDI business model was built for these inflationary times.
“Our greatest opportunity is introducing ALDI to new shoppers at a time when consumers need a tangible solution to the inflationary pressures they are feeling from every direction,” Patton notes. “Offering access to fresh foods and essential household products at incredible prices, like we have been doing for decades, is more important now than ever before. We look forward to welcoming even more new customers and earning their loyalty.”
Of course, discount stores tend to perform well during times of economic pain and uncertainty, but ALDI has weathered the pandemic storm particularly well by expanding its assortment of fresh food, ramping up its digital offering, remodeling stores, curating assortments with local products and accelerating sustainability efforts – all while strictly adhering to its EDLP pricing philosophy.
ALDI’s discount business model is made for inflationary times.
It leads the United States in grocery store openings, with a particular focus on the Sun Belt.
ALDI is investing further in its omni operations, as well as fine-tuning its store assortments and increasing its eco-friendly initiatives.
In 2017, ALDI said that it would invest $3.4 billion to accelerate store openings, with a goal of growing from 1,700 locations to a 2,500-store footprint by 2022. But the pandemic put a kink in that plan in 2020, with many of those planned openings taking a backseat to getting product on shelves and expanding contactless fulfillment options for shoppers too scared to enter physical locations.
So where does that evolution stand now?
“It is no secret that the pandemic created shifts in consumer shopping habits, and more specifically, how people shop,” Patton says. “But our efficient business model allows us to react in real time to meet consumer needs and preferences.”
Part of that quick reaction includes leading the United States in new store openings. In early 2022, the discount grocer revealed plans to open 150 new stores by the end of the year. While the retailer was able to open and remodel 139 locations last year, that’s still more new openings than any other grocer in the country, according to a new report from JLL, a Chicago-based professional services firm. ALDI is now the third-largest grocer in the United States by store count, with a current total of 2,270 stores.
ALDI currently has its sights set on establishing a dominant presence in the Sun Belt, a swath of the United States that has attracted scores of new residents since the pandemic. Last month, the retailer opened another regional headquarters and distribution center, in Loxley, Ala., which will ultimately serve as many as 100 stores across the Gulf Coast. Historically, ALDI distribution centers have been designed to service 70 to 75 stores in a 150-to-200-mile radius.
“At a time when inflation is putting pressure on American wallets, we believe our mission to save people money on the food and products they need is more important than ever,” says Heather Moore, ALDI divisional VP for the
2022 Fastest-Growing Grocers
Loxley region. “We are thrilled to see so much customer love for the 20 stores we’ve opened in the Gulf Coast area in the last year alone. Once they see the quality, selection and value ALDI offers, they keep coming back. That’s why we’re committed to providing our customers the lowest possible price and the best possible value — that’s something that will never change.”
The 564,000-square-foot Loxley facility (most ALDI DCs range between 400,000 to 525,000 square feet) is equipped to service stores across Louisiana, Alabama, Mississippi and the Florida Panhandle. In total, the 100 stores that will be supported by the Loxley facility represent an opportunity to reach more than 8 million customers.
As the company's sixth regional headquarters in the southern United States, Loxley aims to support the grocer’s rapid expansion in the region. ALDI is now operating 30 stores in the Gulf Coast, having opened 20 stores in the area in the past year alone. It plans to add another
ALDI fine-tunes its assortment to provide shoppers with what it considers a perfect mix: 90% private label and 10% branded products that are on-trend, local and seasonal, with a little treasure hunt mixed in.
13 stores in 2023, including one in Fairhope, Ala., that is slated to open on March 2. Other stores in development include locations in Tampa and Callaway, Fla.; Flowood and Hattiesburg, Miss.; and in the Baton Rouge, La., area.
Driving all of this growth is a fervent customer base: A new report from Los Altos, Calif.-based Placer.ai shows that ALDI saw some of the greatest gains in foot traffic during the fourth quarter of 2022. Specifically, the grocer saw store traffic increase 6.8% YoY and 30.2% Yo3Y – in large part thanks to the brand’s ongoing U.S. expansion.
“Within grocery, there are two subcategories that generally overperformed in 2022: those that serve as a primary one-stop shop for the bulk of grocery needs, and those with a value orientation,” explains Ethan Chernofsky, VP of marketing for Placer.ai. “The latter segment also benefited from the massive expansions in overall footprint for some of the leaders within that group. Even as the impact of inflation dissipates, there is ample reason to expect both of these groups to continue to show strength.”
The other part of ALDI’s value proposition for shoppers comes from the design of its smaller, easier-to-shop stores.
“At ALDI, we offer a store experience that is fast, efficient and fun,” notes Joan Kavanaugh, VP of national buying at ALDI. “A typical store is approximately 12,000 square feet of retail space, making ALDI stores easier and quicker to navigate. Every ALDI has a similar easy-to-shop layout, so it feels familiar to customers no matter where in the country they’re shopping.”
According to Kavanaugh, the company is working to make the shopping experience “even more convenient by remodeling stores in select markets to include self-checkout lanes.
“So far, the customer reaction has been extremely positive, and shoppers are excited about the added option for quick shopping trips,” she adds.
When the pandemic hit, ALDI was ready for the grocery e-commerce boom.
The retailer had already partnered up with Instacart in 2018 on delivery, so it was well prepared to offer e-commerce options when shoppers drastically cut back on trips to its physical locations.
In 2020, ALDI was the first grocery retailer to work with San Francisco-based Instacart on launching and then expanding shopper access to the Electronic Benefit Transfer and Supplemental Nutrition Assistance Program (EBT SNAP). As part of this program, EBT SNAP participants were able to shop from ALDI via the Instacart online site and mobile app at a critically important time: the peak of the pandemic.
“We pivoted to accelerate our e-commerce operations to give our customers more ways to access fresh groceries and essential household items,” Patton says. “This included investments in services like curbside grocery pickup and grocery delivery. Since the world has opened back up, the shift to e-commerce has not slowed and we are seeing shoppers continue to use these options as a convenient way to shop with.”
Recently, ALDI has moved to invest further in its omni operations. The retailer has been working with Spryker, a German technology company, to develop a new online food and grocery shopping experience for the U.S. market, offering grocery delivery or curbside pickup. The new digital commerce platform is currently being tested with a select group of U.S. shoppers and is planned to be introduced nationally in a phased approach.
ALDI’s new digital commerce platform follows through on the grocer’s pledge made last year to increase access to convenient online shopping options. During that time, ALDI indicated that it would expand its curbside grocery pickup offering from 1,200 to 1,500 stores by the end of the year.
“Our partnership with Spryker will allow our shoppers another way to access the incredible value they expect from ALDI,” Patton says.
Trip Consolidator Destination
One of the many repercussions of inflation and elevated fuel prices during the past year has been trip consolidation: Consumers are shopping fewer stores, trying to get everything they need in one shop. They simply don’t want to burn gas driving to multiple stores, or to stores too far from their homes.
“The impact of inflation and other economic headwinds are likely to continue affecting consumers in the coming months,” Placer.ai’s Chernofsky says. “While a degree of continued ‘trading down’ is to be expected, another important effect has been the lengthening of visit duration driving greater opportunity for those chains that succeed in driving the visits. This understanding is going to be critical for chains to best position themselves for an extended period where the effects of continued economic headwinds are felt.”
Trip consolidation has been a bon for ALDI, which finetunes its assortment to provide a perfect mix of 90% private label and 10% branded products that are on-trend, local and seasonal, with a little treasure hunt mixed in.
“We do things differently at ALDI by design,” Patton asserts. “We’re passionate about offering ALDI shoppers fresh and delicious foods, and on-trend products we know they’ll love, always at great prices. Customers can always shop with confidence because one in three of our ALDI-exclusive products are award-winning, and we back that up with our Twice as Nice Guarantee.”
As sales of natural food products continue to rise as a result of post-pandemic-related health concerns, ALDI is doubling down on better-foryou, organics and non-GMO.
ALDI-exclusive brand Simply Nature offers customers many organic options at affordable prices. All Simply Nature foods are certified organic or Non-GMO Project Verified, and meet USDA National Organic Program Standards. On top of that, nearly 100 Simply Nature foods have earned the Good Housekeeping Nutritionist Approved Emblem.
ALDI is also focused on making sure that assortments reflect local communities.
“What makes shopping at ALDI fast and easy is the consistent experience and product assortment in our stores from coast to coast,” Patton says. “That said, we know preferences vary across the country, which is why about 5%-10% of the products in each store are regional items. Shoppers are likely to find their favorite local brands, craft beers, and various types of breads or cuts of meat that are particularly popular in the area.”
The discounter also offers rotating seasonal
items and flavors, and its treasure-hunt program, ALDI Finds. These limited-time specialty items range from unique foods and home goods to other unexpected items like workout equipment, furniture or décor.
“We make sure to offer our shoppers the items they need during that time of year,” Patton explains. “If you visit ALDI over the summer, you may find grilling essentials, and during the holidays, we will have shelves dedicated to meats and cheeses for charcuterie boards, and kitchen items needed for hosting.”
ALDI has also attributed some of its success to offering more fresh produce over the past two years; in fact, produce now makes up two-thirds of what ALDI customers put into their carts.
Lean and Green
As ALDI continues its rapid expansion across the United States, and as consumers increasingly shop with sustainability concerns in mind, the retailer remains committed to becoming a more eco-friendly company.
For instance, the new DC in Alabama features some of the
most innovative and efficient design components included in any ALDI facility to date, including roof-mounted solar panels, LED lighting, an environmentally friendly refrigeration system and metal panel insulation. These elements work together to create a thermally tight and efficient building.
The retailer has also remodeled more than 1,100 existing stores to be more eco-friendly, and has invested more than $5 billion to support making new and remodeled stores more environmentally friendly.
“Sustainability has always been a driving force at ALDI, and we’re proud that the ALDI model is inherently more sustainable,” Kavanaugh affirms. “Our commitment to reduce greenhouse-gas emissions by 26% in 2025 can be seen throughout many of our new and remodeled stores, which may feature environmentally friendly building supplies, energy-efficient HVAC units, more environmentally friendly refrigerants, and/or solar panels.”
Last year, ALDI released its first-ever “Corporate Responsibility Progress Report,” which outlined progress toward its environmental goals. Also, the grocer is working to reduce its use of plastic and increase the recyclability of its packaging. To date, 62% of ALDI-exclusive packaging is reusable, recyclable or compostable. The company additionally plans to eliminate all plastic shopping bags from stores by the end of 2023 and to reduce operational food waste, all while ensuring that its products are responsibly sourced and remain affordable. It’s a value proposition that’s helping ALDI outperform competitors and grab greater market share as more shoppers seek quality products and relief from inflationary prices.
As Patton notes, “Our business is built on maximizing cost savings that we pass along to our customers — an approach that we have been practicing since we opened our first store, and one that is more important than ever before.”
“Our greatest opportunity is introducing ALDI to new shoppers at a time when consumers need a tangible solution to the inflationary pressures they are feeling from every direction.”
—Scott Patton, VP of National Buying, ALDI
THESE STRATEGIES WILL BOOST BEEF SALES TO MEET CONSUMER DEMANDS IN A CHANGING MARKETPLACE.By Lynn Petrak
stalwart of the meat case, beef remains a king of protein. Per capita consumption of beef came in close to 60 pounds per person (59.4) in 2022, the highest level since 2010.
The kingdom of protein is shaping up to look a little different this year, though, thanks to the ultimate drivers of supply and demand. An ongoing high inflationary market, anticipated tightening in supplies, and an uncertain drought outlook could affect consumers’ steady demand for this red meat.
Bridget Wasser, associate director, customer insights for Chicago-based marketing and research firm Midan Marketing, agrees that cattle supplies might contract in the next several months. “Looking ahead to 2023, analysts expect a 7% decline in total beef production, which may lead to tighter supply, which will likely lead to higher prices for shoppers at the retail meat case,” notes Wasser. As projections play out, recent research shows that consumers are adjusting
During a time of high inflation, tightening in supplies, and an uncertain drought outlook, food retailers can tap into consumers’ continued penchant for cooking and eating beef, with variety pivotal in keeping the red meat in shoppers’ baskets.
Some food retailers are leveraging their store brands to capture a share of the beef dollar, and more grocers are adding products aimed at consumers mindful of their health and the environment.
Beyond building a diverse meat case, retailers can deploy fresh merchandising tactics to ring up beef sales.
to the various headwinds. According to the Centennial, Colo.-based National Cattlemen’s Beef Association (NCBA), retail beef sales hit $20.1 billion for the first 28 weeks of 2022, up 4.6% on a year-over-year basis.
Although there’s price inflation behind these figures — essentially, consumers spent more per pound on beef but bought fewer pounds — the data reveals that beef is still a favorite choice for at-home meals. NCBA found that 91% of those who bought beef roast and ground beef are satisfied with their eating experience, and that 93% of those who purchased beef steak are happy with their choice.
In this good news/bad news environment, retailers can take different approaches to sustain beef purchases.
For example, Wasser notes that food retailers can tap into consumers’ continued penchant for cooking. “Looking forward, we expect shoppers to continue to cook more at home, due to economic pressures and habits formed during the pandemic,” she says. “Beef offers a convenient and flavorful entrée, and it is a great go-to for home cooks.”
Kent Harrison, VP of marketing and premium programs for Tyson Fresh Meats, based Dakota Dunes, S.D., shared that assessment. “Consumers are looking for creative ways to stretch their dining budget by preparing restaurant-quality meals at home,” observes Harrison.
When it comes to assortment, variety will be pivotal in keeping beef in shoppers’ baskets, he adds. “While we are seeing increased demand for alternative cuts and roasts, consumers are still seeking out premium meats, so retailers need to continue offering high-quality options in the meat case,” says Harrison, highlighting the example of Chairman’s Reserve Platinum Angus beef, which provides a quality eating experience at an attractive price point.
Steve Coley, head of marketing for the One World Beef alliance of quality brands, in Solana Beach., Calif, agrees. “One World Beef’s program portfolio supports a range of price points: Our flagship Brandt Beef program offers family-owned, single-source Prime and Choice beef to provide the at-home chef with a no-compromises restaurant-quality experience every time,” explains Coley. “For value-oriented consumers, Brawley Beef still offers a Southern California-raised program that we produce in Choice and Select grades. In addition, we consult with our in-house Michelin-awarded chef talent to explore a variety of alternative, sometimes nontraditional cuts for customers looking for great-performing steaks outside of the typical ribeye and filet.”
Some food retailers are leveraging their store brands to capture a share of the beef dollar. Grand Rapids, Mich.-based Meijer Inc., for ex-
ample, offers several case-ready cuts as part of its Frederik’s by Meijer private label portfolio; those cuts include prime beef ribeye steak, New York strip steak, top sirloin steak and ground chuck. Meanwhile, Batavia, Ill.-based Aldi US offers a Cattlemen’s Ranch line of portioned cuts that includes a corned beef brisket and bacon-wrapped filet, and Cleveland, Ohio-based Heinen’s recently added grass-fed-and-finished organic beef to its line of Heinen’s Organic Beef.
These days, convenience also grabs consumers’ attention at the beef point of sale. “It’s important for meat cases to have options,” notes Harrison. “Portion-cut products, as well as pre-seasoned and marinated proteins, are convenient and deliver consistency in serving size and quality. They also eliminate the prep work for a consumer, which is a huge value.”
As retailers diversify their beef offerings, they’re also adding products aimed at mindful consumers. “Modern consumers are definitely becoming
“While we are seeing increased demand for alternative cuts and roasts, consumers are still seeking out premium meats, so retailers need to continue offering high-quality options in the meat case.”
—Kent Harrison, Tyson Fresh Meats
increasingly invested in knowing more about their beef,” affirms Coley, citing One World Beef’s programs, which also include an all-natural single-source line from Brandt Beef and an organic grass-fed line from Imperial Valley Organics.
Harrison also points to the rise in food-conscious shoppers. “Another consumer to watch is the shopper, who, despite rising costs, is still looking for products with natural and claimsbased messaging,” he says. “In recent years, consumers have been transitioning to meats with ‘no hormones,’ ‘no antibiotics’ and ‘humanely raised’ claims.” One Tyson product line that addresses such preferences, he adds, is the Open Prairie Natural Meats portfolio featuring beef products that are minimally processed, with no artificial ingredients.
Likewise, New Zealand producer Silver Fern Farms has found that the market for grass-fed beef is growing. “It’s gone from commodity to good for you, and now good for the environment,” recounts Matt Luxton, the company’s global strategic sales manager. “Grass-fed was about 5% of the market about six years ago, and now we are talking 10% to 12% of the retail environment. Grass-fed buyers also tend to have a bigger basket than the average consumer buying commodity beef.” Luxton notes that Silver Fern Farms’ products are currently distributed to more than 1,600 U.S. retailers.
Silver Fern Farms recently began selling Net Carbon Zero by Nature branded grass-fed beef New York strip steaks, Angus ribeye steaks and premium ground beef to stores in New York City and Los Angeles, and is planning to expand distribution in the coming months. “Net carbon zero beef is a big step forward ,and we are a bit ahead of the pack on that, with our connection with farmers,” says Luxton.
Grass Fed Foods, a Loveland, Colo.-based platform that brings together grass-fed category leaders Teton Waters Ranch and SunFed Ranch, has also seen interest in grass-fed beef skyrocket. “For many younger consumers, everything they purchase has higher standards,” notes CEO Jeff Tripician. “Whether it is regenerative, pasture-raised, freerange, antibiotic-free, organic, grass-fed, no sugar or Certified Humane — all of these standards and certifications are now part of the purchase lexicon of the young consumer. On the flip side, older consumers are driven more by food as a prescription for what ails them, so brands and foods that speak to their personal health-and-wellness goals translate more than those focused on animal welfare or climate. Claims like no antibiotics, no sugar and gluten-free drive this subset of the beef consumer.”
Beefing Up Merchandising
Beyond building a diverse meat case, retailers can deploy fresh merchandising tactics to ring up beef sales. “Retailers can leverage these changing behaviors by using sales and promotions to draw shoppers to the meat case, then use cross-merchandising and educational materials to help shoppers visualize how they can transform value cuts
“Looking forward, we expect shoppers to continue to cook more at home, due to economic pressures and habits formed during the pandemic. Beef offers a convenient and flavorful entrée, and it is a great go-to for home cooks.”
—Bridget Wasser, Midan Marketing
and roasts into creative meals,” advises Wasser.
At Silver Fern Farms, Luxton underscores the importance of strategic marketing. “At the end of the day, if we only did it in store, it would cannibalize sale from one brand to another,” he says. “So we are also outside the store, communicating to consumers to let them know the retailer has the product, to get them into the store to look for it.”
Other retailers have put a different stake — or should that be steak? — in the ground when it comes to their beef expertise. Boone, Iowa-based Fareway Stores Inc., for example, opened its
Demand is steady for beef with natural and claims-based messaging, such as cuts from Tyson Fresh Meats' Open Prairie Natural Meats brand.
second full-service Fareway Meat Market in its home state in 2022. The 7,800-squarefoot store also carries a limited amount of produce, snacks, cheeses and adult beverages, among other items.
Walmart Inc., for its part, is taking the proverbial bull by the horns. The Bentonville, Ark.-based retail giant revealed last summer that it’s investing in Sustainable Beef, a Nebraska processor that can help the retailer sustain its beef inventory.
On their end, suppliers are working to maximize product availability. One World Beef, for its part, runs a vertically integrated operation with a plant in Brawley, Calif., that processes beef and produces a variety of custom fabrication and value-added services. According to Coley, “The close control we maintain over our process is how we are able to meet our customers’ needs in a collaborative manner.”
retail. The network provides a secure, convenient and accessible way for cash-preference, unbanked and underbanked customers to pay bills.
Customers receive their personalized, reusable barcode on their printed bill, or they can download the barcode to their mobile phone from their biller’s website. Printed barcodes come with a list of retailers in that consumer’s neighborhood where cash payments are accepted. When creating the barcode digitally, customers can use KUBRA’s dynamic map tool to choose their retail location. The unique barcode contains all of the information required to validate a cash payment. Once a cash payment is made at any of the stores in the network, it will be authenticated and authorized in real time. Customers can receive text and email confirmations when their payment is successful.
Defining the Terms
KUBRA Retail Cash Payments Network GrowsBy Bridget Goldschmidt
rug store chain Rite Aid last month became part of KUBRA’s Retail Cash Payments (RCP) Network, giving cash-paying customers thousands of new retail locations where they can pay their bills.
“Our goal is to bring the most convenient and accessible bill payment option to cash-preferred customers that we can,” says Rick Watkin, president and CEO of Tempe, Ariz.-based KUBRA, a provider of customer experience management solutions and an operating subsidiary of the Hearst Corp. “Adding Rite Aid to our payment network brings us another step closer to achieving this goal.”
Philadelphia-based Rite Aid is the 19th retailer to join the RCP Network, adding 2,257 new retail locations in 17 states. This raises the total number of retail locations in the network to more than 72,000. Other retailers in the network include 7-Eleven, Dollar General, Family Dollar, CVS, Walmart and Walgreens.
KUBRA launched the RCP Network as part of its KUBRA EZ-PAY payment solution in 2014, when it began a partnership with Atlanta-based InComm Payments, a payments technology company whose VanillaDirect platform lets consumers fund accounts and make real-time payments with cash at
As the term indicates, “cash-preference” consumers are those who would rather pay in cash for various reasons, including the beliefs that it’s safer than other payment methods in terms of fraud and that it helps to control their spending. While alternative payment methods are making inroads, cash is still popular: A survey conducted last year by international payment solution platform Paysafe found that 31% of in-person transactions are still paid in cash, while 59% of respondents think that cash is the most reliable form of payment, and 70% would be worried if they couldn’t access it anymore.
As for the other terms, according to the Library of Congress, an “unbanked” person is someone who doesn’t have a checking or savings account with an institute insured by the Federal Deposit Insurance Corp. (FDIC), while an “underbanked” household has a checking or savings account with an FDIC-insured institution, but regularly uses alternative financial services such as a check-cashing company or a payday lender.
Cash handling can be a huge time and labor commitment – something grocers don’t have enough of. SafePoint is comprised of cash recycler technology, change order management, armored transportation, and our customer reporting platform, and is designed to make your in-store cash handling quick and easy. Leave it to the pros!
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Everything you need to know to increase efficiency, mitigate risk, and reduce costs associated with in-store cash handling.
Price and Promotion Optimization
The Next Grocery Tech FrontierBy Emily Crowe
ny savvy grocer knows that using technology, data and analytics can be key to setting themselves apart from competitors in today’s challenging economic landscape. Taking these tools to the next level for price, promotion and markdown optimization, however, is still an often-unexplored avenue for food retailers.
While price, promotion and markdown optimization might seem like no-brainers in the grand scheme of grocery operations, the truth is a large majority of food retailers aren’t taking advantage of these powerful tools. That’s about to change, however, accord-
As more grocers move to sharpen pricing and promotions amid the rise of e-commerce and unprecedented industry challenges, their use of price, promotion and markdown optimization solutions is poised to rise.
Powered by artificial intelligence and machine learning, sophisticated solutions understand all of the interrelationships of products and measurable impacts to demand, therefore giving grocers an accurate understanding of how price will influence consumer behavior.
Most food retailers that invest in a price optimization solution drive significant return on investment, breaking even between six months and one year after implementation.
MANY FOOD RETAILERS ARE REAPING THE BENEFITS OF USING ADVANCED TECHNOLOGY TO DRIVE PRICING DECISIONS.
Price and Promotion Optimization
“[T]he best food retailers are adopting leading solutions and best practices to not only price better, but also price faster,” says Pavich, also noting that leveraging optimization can help food retailers find the delicate balance of pricing moves to ensure that consumers in different markets are getting great prices while accounting for cannibalization, halo effects and profitability.
Behind the Solutions
ing to Kevin Sterneckert, chief strategy officer for San Carlos, Calif.-based DemandTec by Acoustic, as more grocers embrace the need to sharpen pricing and promotions amid the rise of e-commerce and unprecedented industry challenges.
“We’ve had inflation, but we didn’t have supply chain disruptions at the same time,” notes Sterneckert. “We didn’t have labor issues at the same time. We didn’t have issues with supply and retail relationships because products were not available. All of these things are happening at once, and it’s compelling retailers to say ‘I need a better way to manage all of these cost changes and all of these things that are happening.’”
While it’s one thing to have the right prices and the predictive analytics to properly forecast the impacts of strategy adjustments or individual pricing moves, it’s also critical to move faster than the competition, explains Matt Pavich, senior director of retail innovation at Alpharetta, Ga.-based Revionics, an Aptos company that provides artificial intelligence (AI)-powered pricing and promotion optimization software to retailers.
DemandTec by Acoustic offers solutions for price, promotion and markdown optimization, all of which are built on algorithms determined by AI and machine-learning technology. According to Sterneckert, these sophisticated solutions understand all of the interrelationships of products and measurable impacts to demand, therefore giving grocers an accurate understanding of how price will influence consumer behavior.
“We take in all of the transactions that happen at a given location, across every location, all of the competitive data, even inclusive of the vendor information, product information, product attributes, and more,” he explains. “We bring in competitive price data and we create an artificial-intelligence and machine-learning algorithm for each individual SKU at every location.”
Sterneckert adds that these insights give retailers information on how to leverage optimization to improve their competitiveness and their appeal to consumers, as well as their ability to handle pricing moves amid inflation, supply chain disruptions, new store builds, and more. As a result, users of DemandTec by Acoustic’s promotion solution can expect a revenue increase of 1%-12% and a gross margin increase of 5%-20%, while markdown solution users can expect a greater than 10% gross margin increase and a revenue increase of greater than 5%.
Revionics’ base price optimization tool helps retailers simplify the complexity of pricing and gain clarity into the impacts of every price change, making it easier to know what pricing moves make the most sense at any given time. Promotion optimization, meanwhile, simulates outcomes and tailors promotional strategies to the most efficient offers for supporting specific business goals and customer engagement. Markdown optimization allows food retailers to reduce waste and minimize costs while generating greater value and maximizing sell-through.
According to Revionics, its customers average a 5%-9% profit lift soon after launch and see eight to 10 times return on investment (ROI) year after year.
“The ROI on a price optimization solution is an opportunity that retailers simply can’t
“Becoming a pricing-fluent retailer is a journey that involves critically investing in your people, your processes, your strategies and your technology.”
—Matt Pavich, Revionics
ignore,” asserts Pavich. “While actual results may vary based on the pricing strategies, priorities and processes enacted, it is safe to say that most food retailers who invest in a price optimization solution drive significant ROI, with a ‘break-even’ often occurring between six months and one year.”
A study from Franklin, Tenn.-based IHL Group shows that prescriptive analytics like those used in pricing and promotion optimization are expected to be rapidly deployed by food retailers in the next year. The research and advisory firm points to inflation-driven changes in consumer behavior and demand that must be met with real-time moves, as well as broad promotions that are often less effective if not personalized, as reasons for the upswell.
While not every grocer can initiate each individual process overnight, Pavich explains that the journey itself is self-funding, with each improvement driving significant benefits that can fund future enhancements. “Becoming a pricing-fluent retailer is a journey that involves critically investing in your people, your processes, your strategies and your technology,” he says.
To get started, DemandTec by Acoustic walks retailers through a carefully orchestrated process, with the recommendation that they choose the one price category that’s their most painful process to begin with — be it promotions, everyday pricing or markdowns. “We can stand these up rather quickly and get the prices on the shelf and the value occurring,” notes Sterneckert. “The value generates increased profit, revenue and volume that you can use to invest in one of the other solutions.”
Regardless of how food retailers get started on their price optimization journey, both Sterneckert and Pavich believe that there’s no time like the present to initiate the processes.
As Pavich points out, “[I]t’s one thing to have the right prices and the predictive analytics to properly forecast the impacts of strategy adjustments or individual pricing moves, but it is also critical to move faster than the competition in an increasingly dynamic and omnichannel retail landscape.”
Food, Beverage & Nonfood Products
Tea With Macadamia Milk
The latest offering from Milkadamia is multiserve Milk Tea, a ready-todrink lightly sweetened beverage featuring black tea and the brand’s smooth dairy-free milk, made from buttery Australian macadamia nuts that are rich in healthy fats, offer antioxidant compounds, and contain vitamin E and soluble fiber. According to the brand, the popularity of milk tea around the world is increasing exponentially, especially among the highly influential Millennial and Gen Z demographics. Milkadamia’s Milk Tea is the first in the United States to come in cartons rather than unsustainable, cost-ineffective single-serve packaging. The richly layered and complex yet refreshing beverage contains only 100 calories per serving and is available at major retailers and clubs, with a suggested retail price of $6.99 per 32-ounce carton. The tea will also be available at foodservice. https://milkadamia.com/
Already known for the gourmet burgers made from 50% ground bacon and 50% ground beef that are sold at its restaurants, Slater’s 50/50 has now come up with a frankfurter that’s poised to redefine the premium hot dog segment. Slater’s 50/50 Beef & Bacon Hotdogs are 50% beef and 50% bacon, which imparts intense flavor to the quarter-pound franks, enabling them to stand alone on the grill or pair effortlessly with consumers’ favorite toppings. A 16-ounce package of four franks has a suggested retail price range of $5.99-$6.99. The Slater’s retail brand is manufactured by Bar-S Foods Co. https://slaters5050.com/; https://www.bar-s.com/
Snack on Salmon
Upcycled Tochi Salmon Chips, made with sustainably sourced salmon skin from the coasts of Norway and England, come in four savory iconic Asian flavors – Salted Egg, Korean BBQ, Sriracha, and Thai Lime & Herb – all boasting healthy nutrients. Salmon skins are a popular snack throughout Southeast Asia, but despite the fact that Asians now make up approximately 6% of the U.S. population, well-known flavors from different parts of Asia are still underrepresented at mass retail – a situation that Tochi Snacks aims to remedy, The brand’s founders aspire to break out of the “ethnic aisle” at traditional food retailers and normalize Asian-inspired flavors by making them more accessible for consumers. A 0.9-ounce bag of any of the snack line’s umami-packed flavors retails for a suggested price range of $3-$4. https://tochisnacks.com/
Nondairy Cream Cheese
Leading cream cheese brand Philadelphia has become the first mainstream player in the segment to introduce a plant-based option. Philadelphia Plant-Based spread is made with a recipe featuring simple, high-quality ingredients with no added flavors or dyes, offering a taste and texture mirroring those of its iconic dairy-based counterpart. With this dairy-, lactose- and gluten-free offering, the Kraft Heinz Co. brand aims to attract the 52% of consumers who want to add more plant-based foods to their diets, according to Philadelphia cream cheese 2021 IRI and Mintel data. Currently available in the original cream cheese flavor that Philadelphia fans already know and love, the plant-based product will roll out additional flavors nationally in the summer of 2023. An 8-ounce container of Philadelphia Plant-Based spread retails for a suggested $6.49. https://www.myfoodandfamily.com/ brands/philadelphia; https://www. kraftheinzcompany.com/
Functional Food on the Go
Frozen plant-based food company Tattooed Chef is expanding its portfolio and making its debut in the refrigerated section with the launch of Oat Butter Bars, which combine grab-and-go convenience with the emerging trend of functional nutrition. In each bar, Tattooed Chef delivers powerful adaptogens – among them ashwagandha, holy basil, reishi and vitamin D3 – to promote vitality, stabilize mood, and improve performance and focus. Each Non-GMO Project Verified Oat Butter Bar contains 12-14 grams of plant-based pea protein, but no added sugars, no soy and no gluten. They come in four flavors: Chocolate Chip, Brownie, Peanut (the first bar to feature peanuts and oat butter) and cinnamon-flavored Graham. Tattooed Chef Oat Butter Bars have a suggested retail price of $2.99 per 2.47-ounce bar. https://tattooedchef.com/
Known for its best-selling chocolate chip cookies on Amazon, HighKey is expanding its product portfolio of low- and no-sugar treats with dunkable Sandwich Cookies. Featuring light and creamy vanilla-flavored filling spread between two crunchy, chocolaty cookies, the clean-label, gluten- and soy-free, keto-friendly item has no artificial colors and flavors and contains 0 grams of sugar, 2 grams net carbs, 7 grams of fiber and 60 calories per two-cookie serving. Each shareable sleeve contains 10 conveniently packaged cookies, making them ideal for work, school or a family road trip. HighKey Sandwich Cookies have a suggested retail price of $4.99 per 4.27-ounce package. Every HighKey product uses naturally derived sugar substitutes and quality ingredients like almond flour. https://highkey.com/
The Creamiest Yet
All-natural Icelandic skyr brand Siggi’s latest product line, Rich & Creamy Skyr, offers a satisfyingly thick whole-milk yogurt packed with 10 grams of protein per serving in three trending flavors: Zesty Lemon, Ripe Cherry and Vanilla Honey. “Yogurt consumers are seeking options that will satisfy their cravings without compromising on important attributes like high protein, simple ingredients and not a lot of sugar,” notes Siggi’s Brand Manager Stephanie Kellogg. “We created Siggi’s Rich & Creamy Skyr to offer a delightfully creamy and flavorful treat that consumers can feel good about craving.” The suggested retail price is $1.89 per 4-ounce cup of any flavor. Rich & Creamy Skyr joins Siggi’s existing family of products, which consists of nonfat, low-fat and whole-milk yogurts and drinkables; plantbased coconut-blend yogurts; and yogurt pouches. https://siggis.com/
Now seafood lovers can get dinner on the table in 20 minutes or less with Phillips Foods’ line of restaurant-inspired seafood flatbreads. Handmade with premium seafood and chef-crafted recipes, the flatbreads can serve as a meal for one or a shareable appetizer for more. The flash-frozen heat-and-serve line currently comes in two varieties: Clam Oreganata Flatbread, an update on the classic Italian appetizer, featuring wild-harvested sea clams in a base of cream cheese and sour cream layered over a flatbread and seasoned with oregano, garlic and parsley, with generous portions of parmesan, cheddar and mozzarella cheeses, and Sriracha Shrimp Flatbread, offering a flavorful blend of sriracha sauce and honey for an ideal balance of savory and sweet, with each flatbread loaded with shrimp in a blend of sour cream and parmesan, Monterey jack and cream cheeses, and seasoned with jalapeño peppers, garlic and sea salt. The suggested retail price range is $9.99-$10.99 for an 8.9-ounce package of the Shrimp Sriracha Flatbread or a 8.4-ounce package of the Clam Oreganata Flatbread. Each has a two-year frozen shelf life from the date of production.
AHEAD OF WHAT’S NEXTBy Bridget Goldschmidt
A GOOGLE EXEC TALKS ABOUT ISSUES AT GROCERY RETAIL THAT CAN BE ADDRESSED BY AI.
he Kroger Co., Google Cloud and Deloitte recently collaborated on two purpose-built applications to enhance associate productivity. One is a task management application that gives Kroger’s night crew managers greater visibility into the volume and type of merchandise arriving on a given day, store staffing information and stocking needs. The other is a store management application that allows store leaders to be less dependent on paper tools. Both apps are now automatically generating tasks and prioritizing meaningful work for Kroger associates chain-wide.
Jose Luis Gomes, managing director, retail and consumer at Mountain View, Calif.-based Google Cloud, tells Progressive Grocer that the decision to team up was a no-brainer: “We are trusted advisors, Deloitte are trusted advisors, and it’s very possible for us to partner in that way. We provided our capabilities and our products and subject-matter expertise.”
Asked about the problems faced by Kroger specifically — and the retail industry in general — that led to the apps’ development, Gomes notes: “It is scarcity of labor, being able to find folks, being able to retain folks and, as a result of that sort of scarcity, ensuring that you are getting the most out of the time that people are in the stores. At the same time, [you need to provide] them a fantastic experience that makes them want to stay.”
how much I’m going to sell of each product, and how much margin I make from them,” or “the most loyalty-driving activity that I could be doing.” Then there are the sudden urgent items that arise, like “a spillage in aisle six … that takes precedence over restocking the popcorn.”
What the agile, real-time solutions developed with Kroger and Deloitte aim to do is “reduce idle time by giving people better information[;] focus [users] on the most important activities, and that’s defined by the retailer”; and enable a change of plan in response to unexpected schedule deviations, observes Gomes, who adds, “Underpinning [these solutions] is a platform that continues to learn, continues to get smarter and continues to make better recommendations as time goes on.”
Identifying a “gap in the market” in relation to task prioritization, Google and its partners were “able to create something that leverages [artificial intelligence (AI)] to continue to learn, so that we’re always helping associates know what the next thing that they should be doing is,” explains Gomes, “and that is contextual and alive, so that if something happens, the prioritization changes.”
Uncovering the Value
In response to a question about the value of these types of solutions to grocers, Gomes notes that they can counter the “tremendous amount of downtime” and “lack of productivity” caused by problems like late trucks or not enough associates showing up for a shift by giving companies the ability to reprioritize tasks. He also points to the ability to figure out the most valuable task, which can be measured in various ways, among them “the highest gross margin activity … based on
Having just been at the NRF Show in New York in January, Gomes notes that Google’s AI technology is seeking to address some of the top issues discussed at the event, such as associate experience, which he deems “front and center,” through solutions that enable hands-free picking and tell workers when items are out of stock, respectively; supply chain visibility from distribution centers to stores, using machine learning along with AI to determine fair allocation; and reducing friction in the customer experience by recommending the best products for customers and enabling them “to find the products that they’re looking for, even when they don’t know exactly the name of that product.”Bridget Goldschmidt Managing Editor email@example.com
“Underpinning [these solutions] is a platform that continues to learn, continues to get smarter and continues to make better recommendations as time goes on.”
—Juan Luis Gomes, GoogleApps that Kroger developed with Google and Deloitte are now prioritizing meaningful work for the grocer’s associates.