MARCKET REPORTS

detailed periodic analys dedicated to single categories of merchandise video-courses promoted with qualified partners and available on demand

Closer Attention To Raw Materials And Italian Ingredients

Simone Zerbinati, Zerbinati General Manager , claims that the world of private labels plays a major role in his company. «According to 2022 figures, we produced about 65% of our IV range products under PL. The most popular references within large-scale distribution are undoubtedly fresh and ready-to-eat salads, together with ready-to-cook bagged vegetables. After recording a plateau for months during the Covid-19 pandemic, the market is now growing steadily, and brands aim to widen their product assortment both in terms of recipes and formats. Besides the advantage of being ready-to-eat, these products are always produced paying close attention to raw materials and, where possible, using Italian ingredients grown according to Integrated Crop Management systems and 100% recyclable packaging. As for the V range, large-scale distribution is mainly focused on mainstream recipes, such as minestrone soups, vegetable purees and legume or cereal soups, which are recording a significant increase».

Bagged Salads Crossing The Finishing Line

Back to their busy life, spending less time at home compared to the period of the Covid-19 pandemic, consumers seem to prize highly practical and convenient products again, ever more important in private label assortments. «In 2022, the Bontà dell’Orto and L’Arte delle Specialità brands of our IV and V range went up by 15% in value and by 9% in volume. Mixed bagged salads, growing by over 22% in turnover, were the best-performing category. Tender greens (+14%) and soups (8%) performed well too. Nowadays consumers seem to pay closer attention to these products and are more and more interested in recipes with crunchy salad, such as iceberg lettuce, as the main ingredient. In terms of this year's sales, these references recorded exceptionally high sales peaks compared to last year's sales during the same period. We continue focusing on soups, as innovative recipes and new trends are making our fresh produce assortments ever more unique» says Pietro Fiore, Todis Fresh Produce (Department) Manager .

A Wider Range Of Pl Products

Nicolò Padrin, Senior Buyer F&V at Penny, shares the view that the V range is an interesting segment to develop. «We significantly widened the ready-to-eat soup supply, by betting on more regional recipes and differentiating our assortment by geographical area. However, we’re also concentrating on new ingredients for our summer recipes. Moreover, our maxi bagged salads are sold at a discounted price in order to preserve the purchasing power of consumers. Together with spinach, which is already part of our assortment, in January we’re going to introduce new PL ready-to-cook bagged vegetables (e.g. ready-to-cook mixed vegetables, puntarelle, chard). I’d like to also highlight the performance of our pre-cooked unpeeled vegetables that, being practical and convenient, seem to be particularly appreciated by our customers. On the whole, after recording +4.5% in 2021, last year the sales of our IV and V range PL products increased by 5%».

Close Attention To Quality And Freshness

Pier Luigi Lauriola, Fresh produce Manager at Carrefour, estimated a steady value increase of +3% for the brand’s PL category in 2022, with an incidence of about 15% on the fresh produce section. «Single-type or mixed bagged salads account for over 50% of the turnover. However, it’s the V range to record the most significant performance with its soups, cooked vegetables and fruit. Nevertheless, the ready-to-eat section plays a key role in ensuring quality and freshness to our customers.

Expertise and innovation at the service of PLs

Martina Boromello, Marketing and Communication Manager at OrtoRomi, believes that the role of private label supplier has more than one advantage for her company. «On the one hand, through our products and professional skills, it allows us to convey the expertise and innovation skills we’ve acquired over the years. On the other hand, give us the chance to strengthen the relationships with our retailers, some of whom have shared with us an important journey towards constant improvement and growth. We applied the same concept last year too. As a matter of fact, PL products accounted for 58% of our turnover. We were also extremely proud to see our PL Zuppa Pugliese being awarded with the International Salute to Excellence Award 2022 by the Plma. Our goal for the next months is to continue growing as co-packers and large-scale distribution partners, always ensuring our expertise in terms of quality and innovation».

This includes ready-to-eat or ready-to-cook fruit and vegetables prepared by designated operators, specifically trained in dedicated laboratories in some of our stores. In general, in the fresh produce industry, highly practical and convenient products are becoming increasingly important, as consumers are now looking for ready-to-eat products, produced in a way that makes it easy to prepare them at home». l

Experience and technology for a customized supply

According to Andrea Battagliola, Chairman of La Linea Verde , the relationship between brands isn’t merely based on supply, but it’s instead a true partnership. «With our extensive expertise and state-ofthe-art technologies, as co-packers, we’re able to provide the innovative solutions PLs need, but also to help them convey their brand’s identity. We’re indeed very receptive when it comes to consumer inputs, and we’re able to provide a customized supply to each of them, while ensuring those strengths that have always characterized our products, such as authenticity, utmost freshness, a controlled and certified supply chain, up-to-date product range and sustainable packs. Looking at last year’s figures, we can see that some trends recur: fresh soups, also under PLs, drive our growth, whereas salads, which have always represented the major component of our PL supply, win the top spot of the PL podium».

How much does private label advertising in the fruit and vegetable market impact large-scale retail flyers?

QBerg, Leading Italian research institute for pricing intelligence and cross-channel assortment strategies analysis, examined supply chain trends of fresh, IV range and V range fruit and vegetables in 2022 and 2021.

In 2022, the number of advertising campaigns increased by approximately 2% from 2021, with more than 33 thousand campaigns, where branded products featured in 2 out of 3 campaigns. It is worth noting that:

• Advertising campaigns on PL flyers increased for all ranges, especially for vegetables, except, however, for the small segment of prepared fruit (4th range).

• Branded products were more or less stable for fresh fruit and vegetables, as well as V range vegetables , but the number of campaigns for IV range fruits and vegetables have significantly increased.

• The largest increase in the number of advertising campaigns for PLs was for IV range vegetables. It is worth highlighting how this is the market segment that displays the smallest difference in campaign presence between branded and PL products.

As far as unique products are concerned, they have experienced a 10% increase (up to 2,905).

Breakdown:

• For IV range vegetables, the promotional offer indicates an increase of 9% for PL products and an increase of 17% for non-PL products. The latter marked the largest increase in 2022.

• On the other hand, we can observe different strategies from large-scale retail chains for fresh fruit and vegetable products: there is significant growth in PLs for both fruit and vegetables (+13% and +7% respectively), while, on the other hand, these two segments in the range of nonPLs have suffered a stagnation. • The number of unique PL vegetable products has nearly caught up with that of branded products (425 vs. 458).

Although both the number of fruit and vegetable campaigns and products increased in 2022 compared to 2021, the same cannot be said for the visibility space (Qp4 is the indicator constructed by QBerg) in the two assortments, where a decrease of roughly 3-4% in fruits and vegetables can be seen.

The decrease in advertising visibility in large-scale retail flyers was not, however, consistent between private label and non-private label fruit and vegetable products:

• Decrease for fresh fruit (-2%) and vegetables (-5%) for both PL and branded products.

• Increase in shelf visibility of prepared fruit (4th range) for PL products and decrease for non-PL products (-11%).

• On the contrary, there was a decrease for PL in prepared vegetables (-10%) but, at the same time, increases for branded products (-5%).

• The only similarity recorded was the cooked vegetable/ready meal (5th range) segment.

Concentration of Promotions on Flyers of Hypermarkets, Supermarkets and Mini-marts for Fruit and Vegetables (2021 and 2022; No.Campaign and delta % vs Previous Year)

There were clearly many pricing strategies adopted by large-scale retail chains regarding fruit and vegetable flyer advertising in 2022. Breakdown of the average prices charged:

• There was an overall growth of 8% compared to 2021.

• It is evident that non-PL fruit advertising is roughly 3% cheaper than PL advertising

• For fresh vegetables, PL prices are roughly 15% higher than for branded products.

• The highest average promotional prices were charged for prepared fruit and vegetables (4th range), and while promotional prices for prepared fruit (e.g., fruit salads) between PL and non-PL products are essentially equivalent, those for prepared vegetables (mixed salads in bags, for example) sees private label prices significantly lower (about 23% lower) than those of its competitors. l

Average price of promotions on Flyers of Hypermarkets, Supermarkets and Mini-marts for Fruit and Vegetables (2021 and 2022; Average promotional price and delta % vs Previous Year)

Source: In-Store POINT 2023