Minn Supplier Partner Edition_Oct2010

October 2010

Daymon Worldwide in Minneapolis ~ Greg Mayhugh, Senior Sales Manager Albertsons LLC continues to be an opportunity that we have to regain Private Brand strength. Many changes have recently occurred within the organization. Here is an overview.

Albertsons LLC consists of 222 stores in 8 states. Their Corporate office is located in Boise, Idaho with two operating Divisions – The Southwest Division with 105 stores in 5 states and the Southern Division with 117 stores in 4 states (both Divisions have stores in Texas). The Southwest Division stores are supplied out of the Tolleson, AZ warehouse.

The Southern Division stores are supplied by 3 warehouses: the AWG warehouse in Ft. Worth, TX (80 stores), SUPERVALU‗s Indianola, MS warehouse (17 Louisiana stores) and SUPERVALU‗s Quincy, FL warehouse (20 Florida stores). The Southern Division has also announced the opening of two new stores – in Watauga, TX and Denham Springs, LA. Several management changes have been made due to the recent merger of the DFW and Florida Divisions into the Southern Division. Wayne Denningham has relocated to the DFW area as President while the former President of the DFW division, William Emmons, has assumed the position of

Chairman. Mike Withers is relocating to the DFW area as VP of Merchandising and Marketing and the current VP of Merchandising and Marketing, Frank Yaksitch, has assumed the role of VP of Operations.

Daymon Worldwide has 3 Sales Managers handling the Albertsons LLC account. Mike Hanley lives in the Orlando, Fl area and handles operations out of the Quincy, Fl and Indianola, MS warehouses. John Callison lives in the Ft. Worth area and handles operations out of the AWG warehouse in Ft. Worth and Tolleson warehouse in Arizona. Greg Mayhugh lives in the Boise, Idaho area and handles Corporate Headquarters, Home / Health / Beauty and General Merchandise operations, while managing Mike and John in their Divisional endeavors.

In February Daymon Minneapolis management, in conjunction with Albertsons LLC management, laid the groundwork for Albertsons LLC to reinvigorate their commitment to Private Label. They have hired a Private Label Merchandiser in each division and at Corporate Headquarters. With this new organization, we expect growing private label sales though increasing ad support, broadening of each Division‗s assortment, filling store voids, and continuing to align item retails versus national brands and LLC‘s competitors.

M a r k e t D e v e l o p m e n t U p d a t e ~ Susan Hunsaker, Director The Market Development Team continues to make great strides on behalf of our supplier partners in developing relationships with the major retailers in the Greater Minneapolis market including Target, Menards, Nash Finch, and Holiday. These growing relationships, have allowed us to become the market representation for our suppliers, meaning one contact for the entire region. The ease of this single point of contact provides universal business planning, reporting, and insights.

Team, please feel free to contact Susan Hunsaker, shunsaker@daymon.com. To learn more about our Daymon Minneapolis Team. Click Here

In working with represented suppliers at Target, our MDT analytical team has developed custom reporting similar to that available for SUPERVALU. If you believe that there are opportunities to improve the data that you receive regarding Target, we would love to show you a sample report of what we can provide.

If you would like to learn more about our Market Development

Published by the Daymon Minneapolis Team

October 2010 Letter From Marc Koutoufaris—Vice President This past Monday, October 11th we celebrated Columbus Day. Of course named after Christopher Columbus (c. 31 October 1451 – 20 May 1506) the navigator, colonizer, and explorer from Genoa, Italy, whose voyages across the Atlantic Ocean led to general European awareness of the American continents in the Western Hemisphere.1 If you think about it, Columbus had a clear vision of what he wanted to set out to do and a tenacious spirit to drive him. Additionally, he had to have been one of the world‘s best salesperson at the time in order to have convinced others that his plans were worth the investment and risk.

He made sales calls for seven years to, at the time, the world‘s most powerful kingdoms in search of their support.

In 1485, Columbus presented his plans to John II, King of Portugal. He proposed the king equip three sturdy ships and grant Columbus one year's time to sail out into the Atlantic, search for a western route to the Orient, and return. The king submitted the proposal to his experts, who rejected it.2 In 1488 Columbus appealed to the court of Portugal once again, and once again John invited him to an audience. It also proved unsuccessful.

Columbus travelled from Portugal to both Genoa and Venice, but he received encouragement from neither. Previously he had his brother sound out Henry VII of England, to see if the English monarch might not be more amenable to Columbus's proposal.

He had sought an audience from the monarchs Ferdinand II of Aragon and Isabella I of Castile. On 1 May 1486, permission having been granted, Columbus presented his plans to Queen Isabella, who, in turn, referred it to a committee. After the passing of much time, the savants of Spain, like their counterparts in Portugal, reported back that Columbus had judged the distance to Asia much too short. They pronounced the idea impractical, and advised their Royal Highnesses to pass on the proposed venture.

After continually lobbying at the Spanish court and two years of negotiations, he finally had success in 1492.

This year marks Daymon Worldwide‘s 40th year of operation. From the days of black and white labels and very little consistency with offering or quality, to now with quality Private Brands being crafted and utilized as category growth leaders. Daymon Worldwide has continued on its pioneering journey to reach its stated vision ―To be the global leaders in building brands through business solutions and services with our partners.‖ The Daymon Minneapolis Team is ready to build additional success for you! Over the past number of newsletters we have introduced you to our Associates, new business tools, highlighted our capability to cover SUPERVALU, and more recently introduce our newest sales support of the Market Development Team, led by Susan Hunsaker. We have a strong belief in our abilities to create new opportunities and cross new business divides similar to the drive Columbus displayed. ―He (Columbus) is regarded more accurately as the person who brought the Americas into the forefront of Western attention.

"Columbus's claim to fame isn't that he got there first," explains historian Martin Dugard, "it's that he stayed."‖3 Our Daymon Team has a passion for what we do and are committed. We are well positioned to serve your business needs and help bring the Greater Minneapolis Market into the forefront.

This short article doesn‘t provide anything near the detail of the actual challenges that faced Columbus, his crew or of the inhabitants of the lands he discovered. But what is remarkable was his willingness to go the distance, create new opportunities, and deliver on his promise even following his seven year pursuit of yes. Columbus died at the age of 55, very young compared to today‘s lifetime. He had only started propositioning Kings and Queens about his venture when he was 34 and finally set sale at age 41.

In today‘s business environment we can take a lesson from Columbus‘ experience. Business needs a vision, a plan, time and hard work from many to accomplish a task. There has to be promise of greater benefit for others to take risk or make a change. It is Daymon‘s mission of ―We build brands with our partners,‖ which reminds us as we work together, that our job is never done and our journey has no limits!

1

(Britannica "Christopher Columbus." Encyclopedia Britannica. 2010. Encyclopedia Britannica Online. 8 June 2010)

2

Samuel Eliot Morison, Admiral of the Ocean Sea: The Life of Christopher Columbus, (Boston: Atlantic-Little, Brown, 1942). Reissued by the Morison Press, 2007. ISBN 1406750271 3

Dugard, Martin. The Last Voyage of Columbus. Little, Brown and Company: New York, 2005.)

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October 2010

Distribution Void Blitz ~Tara O’Shea, Senior Account Executive In an effort to aggressively drive incremental volume, the Daymon Field Teams have staged a ―Distribution Void Blitz‖ in the selected categories we represent on behalf of all of our Supplier Partners.

As our field team visits markets within the SUPERVALU Enterprise, they are auditing Daymon-represented items and ensuring these items are effectively in front of the consumer.

While in stores or visiting Home Offices, our Daymon Sales Managers work with SUPERVALU Sales and Merchandising Managers, Category Managers and Store Directors and take every opportunity to sell in product wherever they see an opportunity on shelf.

Through these efforts and only one month into the program, we have gained the commitment to fill in excess of 1,700 distribution voids and have driven an estimated 8,000 incremental cases! While we are putting on a full court press to fill as many voids as we can as fast as we can, our work doesn‘t stop there. We will continue to focus on ensuring that all of these items are properly supported in the market.

To help communicate opportunities, share progress on initiatives such as filling distribution voids, and to measure the value the field team provides, the Minneapolis Team has instituted a new communication process between the Minneapolis office and our field team which we can report to Supplier Partners. Using an interactive web-based tool developed by Senior Analyst, Rolland Petersson, the Account Executives in Minneapolis communicate our Supplier‘s initiatives to the Field Teams.

On a regular basis, the Field Team reports back their progress on these initiatives. In order to measure our successes, the Field Sales Recap Tool requires the field to input quantifiable data that is translated into incremental cases sold.

The reports driven from the tool are shared on a regular basis with our Supplier Partners. We look forward to communicating the results of the Field Sales Recap Tool to you in the coming weeks.

September Field Sales Results: ~Derk Horlacher, Director September was a busy month for our field sales representatives as they made headquarter calls at the SUPERVALU Regions and Banners where new item implementation was followed up on, distribution voids were closed, retail pricing audits were shared and follow up promotional activities were done to help insure success. The field sales also called on Albertsons LLC and the independent stores where they sold in incremental cases, closed store voids and conducted retail pricing audits.

Our featured Field Sales Manager for September is David Warren who works with store groups that pull from the SUPERVALU Eastern Region. For September, here are a few of his accomplishments: 353 — New items cut onto shelves with product 53 — New items cleared for shelf placement waiting for product to ship 28 — Store visits 1176 — Incremental cases sold through additional promotions and displays gained Retailers are accustomed to having us in their stores working their Private Brands and helping grow their sales. In building these store level relationships, all of our Field Sales Managers have seen many opportunities come their way that allows for increased Private Brand sells during the month and they look forward to many more opportunities in the future.

Example of Field Sales Tracking Tool Page 3

October 2010 BUZZ AROUND THE MARKETPLACE Target Corporation will open ten stores on October 10, 2010. The locations are: Sacramento, Simi Valley, Bakersfield, San Jose, and Azusa, CA; Salt Lake City, UT; Little Rock, AR; Christiana, DE; Flushing, NY; and Braintree, MA.

operations center in San Antonio, TX. During the year, the Company remodeled 85 stores, 66% more than the year prior. Kohl‘s now operates three customer service and operations centers nationwide, and 1,089 stores in 49 states.

Target also announced plans to open its first small urban format store in Seattle in 2012. The Company aims to open this smaller format, which will focus on necessities, in 10 other urban markets in the next few years. Earlier this year, Company officials indicated plans to open smaller stores of about 60,000 – 100,000 square feet, compared to its typical stores which are 125,000 – 180,000 square feet.

In preparation for the holiday shopping season, Best Buy will hire 29,000 seasonal employees. The Company also announced plans to open approximately 44 – 50 Best Buy mobile-product stores throughout the U.S. before Thanksgiving in an effort to boost its smart phone business. Additionally, as a result of a number of recent product launches, the Company plans to spend more on promotions this year compared to the year prior.

Last week, Kohl’s opened 21 new stores in 15 states: Alabama, California, Florida, Illinois, Kansas, Kentucky, Louisiana, Maryland, Minnesota, Missouri, Nevada, New Mexico, New York, Ohio, and Pennsylvania. The Company also opened a new, 102,000 square-foot customer service and

Alimentation Couche-Tard Inc. allowed to expire on Sept.

30 its tender offer to acquire shares of Midwest convenience store retailer Casey's General Stores Inc., marking the end of the Canadian company's hostile takeover attempt, which began publicly in April.

HIGHLIGHTS ON MINNEAPOLIS ASSOCIATES Daymon Minneapolis Conquered the Streets of St. Paul ~Emma Bryan, Account Executive is a beautiful fall run and the weather was perfect! It is only a small part of a p a c k e d w e e k e n d o f running events, most widely know is the marathon which is touted as ―the most beautiful urban marathon in the United States‖ and also this year‘s U.S. Marathon Championship.

On Saturday, October 2, 2010, associates from the Daymon Minneapolis team donned their running gear and trounced through the streets of St. Paul to show their team spirit and support during the Twin Cities 5K. The 5K course starts and ends on John Ireland Boulevard, near the State Capitol in St. Paul.

This out-and-back course along Summit Avenue in Saint Paul, finishing at the Medtronic Twin Cities Marathon finish line,

There were 10 participants comprised of both associates and family members (one in a stroller) that were greeted with jammed streets and eager participants.

The participants donned Daymon tshirts and running gear and smiles.

While it was a tough hilly course, everyone had a great time. Mark ―Blazin Fast‖ Fields, Director, finished with a time of 24:45 to be our first male finisher. Jayme ―Flash‖ Kruse-Cordie, came in first for the women with a time of 29:34.

This was a great team building race and we are hoping it becomes an annual event for our team.

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October 2010

~John Croco, Director of Bakery, Daymon Resource Center, Stamford Connecticut

Has so much talk about the intake of high glycemic index foods and complex carbohydrates affected white bread consumption?

Although one iconic brand of white bread takes a strong nutritional position todaythat it has as much fiber as 100% whole wheat bread and that two slices have as much calcium as a glass of milk- a demand shift has already occurred in the bread category. For the first time ever dollar sales of fresh wheat bread have surpassed the sales of fresh white bread in the U.S. supermarkets, wheat bread was the only bread segment of those identified to post any gain at all. Rye, oat, multigrain, pumpernickel and barbecue segments all posted declines over the last twelve months. Wheat with whole grain led the

break away in sales to $1.07 billion in supermarkets in a total fresh bread category that generated $6.49 billion. In three out of the past four years, the growth of ‗wheat with whole grain‘ breads far outpaced that of the ‗wheat without whole grain‘ breads.

When shoppers place bread in their cart, several companion products they buy on the same trip suggest that young families that eat breakfast and dairy products regularly are frequently the purchasers of wheat bread with whole grains.

View from the desk: Consumers want to eat healthier!

The above is a great example of how bread manufacturers and retailers must be able to see the healthier life-style trend movement and react to provide these products to the consumer. Whether branded or made in a retailers commissary for private brands, retailers had better increase the ratio of ‗whole wheat with grain‘ breads SKUs verses the amount of white bread SKUs currently on shelf. During the past 12 months white bread was the largest segment in the Fresh Bread Category to take such a high percentage loss.

Time will tell if the nutritional positioning taken by one major leading white bread brand producer can help to reverse the

A Host of Whole Grain Products Driving Sector’s Growth ~ Mintel GNPD, a leading research company

Chicago (September 17, 2010)—With obesity fears a constant concern, many are striving to eat better, seeking out affordable better-for-you food options. Whole grain products have certainly hit that sweet spot, and shoppers now have many options across food and beverage sectors. According to recent research from Mintel Global New Products Database (GNPD), more than 3,700 products were launched since 2005 with a ―whole grain‖ claim in the US. David Browne, senior analyst at Mintel notes, ―2010 has been particularly strong so far, with 651 whole grain products launched across all food categories in the US. At this rate, 2010 should be the biggest year ever in terms of total whole grain product launches.‖ Since 2005, the whole grain product claim has consistently been in the top 20 among all food and beverage claims according to Mintel. Furthermore, the share of all products with whole grain claims has gone up consistently since that time. In 2005, just 2.3% of all new product launches had a whole grain claim, whereas in 2010, this has grown to 5.6%.

An increasingly familiar logo to consumers comes from the Whole Grains Council. Currently, the Council has its Whole Grain Stamp on over 4,400 products in the US and 20 other countries. ―Our Stamp was designed to be a tool for consumers and we love that it‘s being put to use and to the test,‖ says Kara Berrini, program manager for the Whole Grains Council.

SPINS, an information provider tracking natural, organic and specialty gourmet sales data within natural and conven-

tional retail outlets, also captures sales of products with the Whole Grain Stamp. The company notes that combined channel sales of naturally positioned dry grocery products with the Stamp grew 16% for the 12 week period ending August 7, 2010, versus a year ago. ―In fact, substantial sales growth is due primarily to performance of Whole Grains Council–certified natural bread and baked goods (up 221%); salty/savory snacks (up 133%) and energy bars (up 76%),‖ says Mary Ellen Lynch, director of consumer insights at SPINS. Indeed, the bread market in particular has benefitted from the Whole Grains Council Stamp. SPINS reports that sales of natural bread loaves bearing the Stamp increased 172% (up $7.4 million) in the 12 week period ending August 7, 2010, versus a year ago. And consumers clearly place a great deal of importance on the symbol. According to Mintel‘s 2009 bread report, whole grains are the second most influential factor in a bread purchase after price only.

Looking ahead, David Browne notes, ―While sales of these products are still small, there are a lot of good signs for the whole grain market. Nearly 6% of all food products and 18% of allnatural food products launched in 2010 have the whole grain claim. Innovations in unexpected places, including beverages and dairy products, will also drive sales.‖

INTELLIGENCE REPORT: WHOLE GRAINS

Wheat Bread Sales Surpass White For First Time:

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October 2010

~Jamye Kruse-Cordie, Executive Sales Manager

The Promotional planning process within SUPERVALU can be complex and is under constant change, offering Daymon the opportunity to navigate for our supplier partners. However, when working with the Independent Retailers, a process has been established that enables Daymon to work effectively with the Regional Merchandising teams on behalf of our Supplier partners.

It is important to note, some items that do not have deal allowances will make it on the Ad Planners, hence the reason we actively present recommendations. Because space is limited and is shared with National Brands, allowances or bonus type items greatly influence the Merchandisers decisions.

In working with Wholesale divisions, it is important to understand the planning process and timing that is required to drive a successful promotional program. Below are specific guidelines of Trimester Planning which include Trimester Dates, Submission/Approval Guidelines and Event Planning.

The Trimester Planner is the driver of all event planning.

Items that are relevant to an event will be selected from the appropriate Ad Planner. For example, if there were an item to be promoted during Super Bowl February 2011, it would have to be submitted by 8/5/2010 and approved for the Trimester 1 Ad Planner.

Trimester Dates: There are 3 Trimester ad planning sessions for the SUPERVALU fiscal year. Each Region plans their own Trimesters independently equating to slight timeline differences in each region. However, these differences are only a few weeks, making it easier to work across all Regions consecutively which finalize their plans 5 to 6 months out from execution. This is currently different than the Banner model which is 6 to 8 weeks, but is one that SUPERVALU Regions require of all Suppliers, whether it is Private Brands or National Brands. As the yearly planning windows are finalized, your Account Executive will update you accordingly.

Submissions and Approvals To submit an item for a promotional opportunity, items must have one of the following: incremental funding, lower cost of goods such as in a display, or a bonus type item. Items that meet the criteria are communicated to the Daymon Account Executive along with the date parameters. This is then shared with the Daymon Sales Management team who work directly with the Region Merchandisers to secure approval for an Ad Planning spot.

Once item(s) are approved and timing is appropriate, the Daymon Field Sales team will sell thru to the Key Independent Retail Groups.

Event Planning

If there is a promotion during the Thanksgiving/Holiday 2011 season, items would have to be submitted and approved by April 15th, 2011 for Trimester 3.

Aligning key items with corresponding promotional opportunities is essential to our promotional sales success. Below is a list of major events and the correlating Trimester Plan.

While there are many opportunities and key events that drive business, this should serve as thought-starters around the potential opportunities to best support your assortment portfolio.

The Trimester Plans are but one essential link between your promotional opportunities and the Independent Retailers. To help you understand all your options, we have dedicated individuals that work only with the Regions and Independent Retailers and we would welcome any opportunity to partner with you.

Contact me directly at 952 -967-2924 or at jkrusecordie@daymon.com for any questions on promotional planning, the Field Sales Team or on the SUPERVALU Wholesale division. I look forward to hearing from you.

Major Events in Trimester Planning

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October 2010

Daymon Worldwide in Minneapolis MANAGEMENT TEAM

GROCERY / FROZEN

BAKERY / DELI / MEAT / SEAFOOD

Marc Koutoufaris, Vice President mkoutoufaris@daymon.com 952.967.2990

Tara O‘Shea, Senior Account Executive toshea@daymon.com 952.967.2987

Mike Howell, Senior Account Executive mhowell@daymon.com 952.967.2925

Ramon Santos, Senior Director rsantos@daymon.com 952.346.2827

Nick Kapral, Account Executive nkapral@daymon.com 952.967.2926

Chris Tully, Account Executive ctully@daymon.com 952.346.4391

Mark Fields, Director mfields@daymon.com 952.967.2986

Anna Cooney, Associate Account Executive acooney@daymon.com 952.967.2926

MARKET DEVELOPMENT

GROCERY NON-EDIBLE / BEAUTY / BABY / OTC

Susan Hunsaker, Director shunsaker@daymon.com 952.967.2923 Allison Hopkins, Account Executive ahopkins@daymon.com 952.967.2995

Cord Schrader, Senior Account Executive cschrader@daymon.com 952.967.2921 Emma Bryan, Account Executive ebryan@daymon.com 952.967.2987 Lyndsay Jackson, Account Executive ljackson@daymon.com 952.967.2993

Don’t Forget Sunday, November 7th is Daylight Savings.

FIELD LEADERSHIP TEAM Derk Horlacher, Director of Retail Sales dhorlacher@daymon.com 208.884.5642 Jayme Kruse-Cordie, Executive Sales Manager jkrusecordie@daymon.com 952.967.2924 Greg Mayhugh, Senior Sales Manager Albertson‘s LLC gmayhugh@daymon.com 208.871.7432 MARKETING Lynne Deering, Marketing Manager ldeering@daymon.com 952.967.2996

Clocks ‘Fall’ Backwards

Minneapolis 10333 West 70th Street, Suite 5 Eden Prairie, MN 55344 Phone: 952.942.5033 Fax: 203.276.3553

www.Daymon.com

Published by the Daymon Minneapolis Team