Special Report: Private Label Cooking Oils

Special Report

Private Label Cooking Oils

In the grand landscape of cooking oils, private label brands have emerged as viable options for consumers looking for both new taste and cooking experiences as well as affordability and a greater likelihood to be in stock. On a more granular level, however, each retailer and supplier has come away from the last year and a half with a diverse mosaic of insights and data with regards to supply side challenges, consumer taste preferences and more, which collectively inform how the category is generally faring: “winning.”

Peter Wynkoop for La Tourangelle used “winning” in a deeper discussion over consumer trends in the last 18 months. “Prior to the pandemic, the coconut oil category was declining double digits,” he said. “A few retailers started to reduce the amount of shelf space they gave the brands and provide more space to private brands. Then the pandemic hit, which then propped up sales for coconut oil branded items. Now we’re 18 months into the pandemic and the same trends that we saw pre-pandemic are back. Branded coconut oils are struggling, and private label is winning. In response, we are sharing a two-brand strategy with customers. All retailers need for this segment is one premium brand and a selection of private label offerings.”

Catania Oils has likewise seen an uptick in sales in 2021, but Mark Coleman for Catania Oils said this is also compared against the wild consumer behavior that characterized the onset of the pandemic. “Due to retailers stocking up to meet consumer demand in 2020, the first quarter of this year saw a dramatic slowdown in retailers’ needs. However, by mid-summer, we started to see retail heat up again as uncertainty crept in amid signs of supply chain issues across the globe. Retailers and consumers alike have been stocking up at a rapid pace in the hopes of not experiencing what Covid brought in 2020.”

However, the difference between this year and last is what has happened with the labor market, Coleman said. “The lack of the everyday worker has caused most companies across the country to re-evaluate their go-to-market approach in satisfying consumer demand. Labor and supply chain issues are the two main issues driving concern. Factor this in with inflation, now we see ‘shrinkflation’ happening across the retail sector where the national CPG companies are reducing the package size but keeping the price either the same or only taking a slight price increase versus a much larger one.”

These supply challenges make it so communication between retail buyers and suppliers is that much more crucial, Coleman said. “Catania Oils has always set its sights on being a low-cost producer as it thrives in a commodity driven category like vegetable oils and olive oils. One of the company’s core values is ‘customer focused’ and that is a driving force behind the company’s success. Communication plays a large role in this area. Catania has implemented daily meetings between all departments in order to effectively communicate whatever difficulties might pose as a barrier to satisfying the customer,” he said.”

From the end consumer perspective, Paula Yoder-McMahon with Tops Markets shares, “Multiple cost increases are driving consumers to purchase new brands. With long-term out of stocks due to specific brands production interruptions, which is causing out of stocks on the shelf, consumers are shifting to what is simply available.”

When there is some breathing room on the supply side, Wynkoop said product integrity and high standards are still paramount in La Tourangelle’s ability to support its retailers. “Quite frankly, educating customers in this complex category continues to be an opportunity,” he said. “The best effort we can make is to create a great product and deliver on the expectations of the customer. Secondly, educating the customer through our packaging is key (providing smoke points, pointing out if the oil is neutral in flavor etc).”

La Tourangelle makes its mark through its expertise with specialty oils, Wynkoop continued. “Our expertise gives our retailers assurances that we are sourcing the best oils in the world, which also means we bottle authentic oils. There is a lot of adulteration of oils in the market, not only with extra virgin olive oil but avocado oil and other specialty oils. Our testing standards for our private label match that of our brand, which are some of the strictest in the industry. Secondly, we provide insights to our customers on what are the latest trends in the oil category. With this expertise we can help retailers make the best decisions on what selection of specialty oils to carry.”

Private brands in this category have evolved leaps and bounds in the last 15 to 20 years as trust with the consumer base is quite high, said Coleman. “Catania Oils continues to collaborate with its retailer customer base to encourage private brand trial of some of the newer and healthier oils hitting the marketplace. An example of this is avocado oil. One of the healthier oils available, avocado oil is also great for high heat cooking and is readily available for private brand supply.”

Another innovation La Tourangelle is looking toward into the new year is the use of cooking oil sprays that contain no chemicals. “The current brand leader in sprays uses aerosol technology, which mixes oil with butane and other harsh chemicals,” Wynkoop said. “Consumers are becoming savvier when it comes to what they use to cook, and they want to use ingredients in their purest forms. The sprays that we manufacture use a technology that sprays only oil. Some of the biggest retailers in the US have moved their private label sprays to use this type of technology and we anticipate more will be coming on board in the future.”

Before they can turn their attention to innovation again, suppliers have to ensure their supply base is in order. “In normal years, retailers are looking for what is the hottest new item they can get on the shelf in a private brand,” said Coleman. “However, as we head in to 2022, retailers need to know that their supplier base is solely focused on communication and on delivering orders as close to on time as humanly possible. The supply chain disruptions and labor shortages are still at its peak, so it is imperative that daily communication with our retailer base remains top priority.”