Progressive Grocer - April 2018 by ensembleiq

ExclusivE! 85 th AnnuAl REpoRt of thE GRocERy industRy MAKING THE CUT Produce butchers can create excitement, differentiation GROCERANT SOluTiONS Concept, design, demographic opportunities abound FUTURE SHOPPING Grocers are helping guide ecommerce into the mainstream

Mark Laryea, district manager (L-R); Sheila Whitiker, store director; Anthony Suggs, VP marketing and merchandising; Tina Browen, director of marketing; Doug Cygan, president.

April 2018 • Volume 97, Number 4

Jewel-Osco’s new flagship sets stage for fresh features

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Contents 04.18

Volume 97 Issue 4

features

STorE of THE MonTH

gold standard

ProGrESSIvE GroCEr ’S 85 TH AnnuAL rEPorT of THE GroCErY InDuSTrY

A new Jewel-osco in downtown Chicago amps up fresh, prepared food and spirits offerings.

Grocers are learning quickly that slow and steady isn’t what wins the race anymore.

departments

16 NiElsEN’s shElf stoppErs/spotlight

8 Editor’s NotE

General Merchandise

Grocery’s Got Talent 12 iN-storE EvENts CalENdar

June 2018

18 miNtEl global NEw produCts

Cheese 20 all’s wEllNEss

14 CoNsumEr iNsights

Snacking Away

Healthy Snacks Go Mainstream

22 NEw horizoNs

What Do Your Job Postings Say About Inclusion? 110 Editors’ piCks for iNNovativE produCts 114 iNdEpENdENt thoughts

Encourage ‘Buy Local’ Shopping at Your Independent Store Progressive grocer April 2018

contents 04.18

Volume 97 Issue 4

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

www.ensembleiq.com

65 SolutionS

The Hunger Game As consumers snack more often and in more places, grocers expand snack offerings throughout the store.

editorial Managing Director of content Strategy Joan driggs 224-632-8211 jdriggs@ensembleiq.com eDitorial Director James dudlicek 224-632-8238 jdudlicek@ensembleiq.com Managing eDitor Bridget Goldschmidt 201-855-7603 bgoldschmidt@ensembleiq.com Digital & technology eDitor randy hofbauer 224-632-8240 rhofbauer@ensembleiq.com

72 FreSh Food

Senior eDitor Kat martin 224-632-8172 kmartin@ensembleiq.com

Cutting a Path to Profit

contributing eDitorS Princess Jones Curtis, D. Gail Fleenor, Kathy Hayden, Bob Ingram, Amelia Levin, Lynn Petrak and Barbara Sax

Produce butchers can create a popular point of differentiation.

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

81 Grocerant SolutionS Menu Boards / In-Store Alliances / Modern Jewish Deli Fare

SVP, Brand director Katie Brennan 201-855-7609 • Mobile: 917-859-3619 kbrennan@ensembleiq.com

Senior Marketing Manager Judy hayes 925-785-9665 jhayes@ensembleiq.com Senior Marketing Manager theresa Kossack 214-226-6468 tkossack@ensembleiq.com

weStern regional Marketing Manager rick neigher (ca, or, wa) rneigher@ensembleiq.com 818-597-9029 northeaSt Marketing Manager mike Shaw 201-855-7631 • Mobile: 201-281-9100 mshaw@ensembleiq.com account executive/claSSifieD aDvertiSing terry Kanganis 201-855-7615 • Fax: 201-855-7373 tkanganis@ensembleiq.com

98 technoloGy

claSSifieD ProDuction Manager mary Beth medley 856-809-0050 marybeth@marybethmedley.com

From Minor to Major League

eVentS SvP, eventS & conferenceS maureen macke 773-992-4413 mmacke@ensembleiq.com

What must grocers do to help usher ecommerce into the mainstream?

cuStom media general Manager, cuStoM MeDia Kathy colwell 224-632-8244 kcolwell@ensembleiq.com marKetinG Marketing Manager carly Kilgore 201-855-7601 ckilgore@ensembleiq.com

103 PG Pet

audience deVeloPment Director of auDience DeveloPMent Gail reboletti greboletti@ensembleiq.com

Good for What Ails Them

Foods and other products that address pets’ evolving health concerns can attract loyal shoppers.

auDience DeveloPMent Manager Shelly Patton 215-301-0593 spatton@ensembleiq.com

103

liSt rental the information refinery 800-529-9020 Brian clotworthy SubScriber ServiceS/Single-coPy PurchaSeS 978-671-0449 or email at EnsembleIQ@e-circ.net art/Production Director of ProDuction Kathryn homenick khomenick@ensembleiq.com aDvertiSing/ProDuction Manager Jackie Batson 224-632-8183 • Fax: 888-316-7987 jbatson@ensembleiq.com

106 equiPment & deSiGn

creative Director colette magliaro cmagliaro@ensembleiq.com

Weight Lifters

art Director Bill antkowiak bantkowiak@ensembleiq.com

Pallets are an indispensable part of the supply chain.

rePrintS, PermiSSionS and licenSinG Wright’s Media ensembleiq@wrightsmedia.com 877-652-5295

corPorate oFFicerS

106 6

progressivegrocer.com

executive chairMan alan Glass chief executive officer david Shanker chief oPerating officer/ chief branD officer richard rivera chief buSineSS DeveloPMent officer Korry Stagnito PreSiDent of enterPriSe SolutionS/ chief revenue officer ned Bardic PreSiDent anD executive Director, Path to PurchaSe inStitute mike mcmahon chief Digital officer Joel hughes chief huMan reSourceS officer Jennifer turner

It’s Tough to Be This Tender The cornerstone of amazing pork is tenderness. That’s why Chairman’s Reserve® Prime Pork stridently upholds standards in pH, color and marbling that make our pork 25% more tender than other leading brands of pork without added solution. Sure, it’s hard work but for us, it’s a labor of love. Visit ThePrimeDifference.com to put the pinnacle of tenderness to work for you.

Editor’s NotE By Jim Dudlicek

Grocery’s Got Talent mid the many disruptions in the grocery industry, from digital to delivery, what’s the one thing that’s keeping most retail executives up at night? People — or specifically, the ability to attract, retain and nurture top-notch talent that will drive innovation and propel businesses to relevance, growth and long-term success. At least that’s what retail executives told Progressive Grocer when they responded to our survey for PG’s 85th Annual Report of the Grocery Industry, which you’ll find in this issue starting on page 26. “Innovation takes calculated risk and commitment. Having knowledgeable and passionate members [employees] on the front lines is a key component to ensuring success with something new, while also supporting traditional needs at store level,” says Edward “Trey” Basha, president and CEO of Chandler, Ariz.-based Bashas’ Family of Stores. “An idea can be great in theory, but the key to success is how smoothly that innovation can be executed in store. We do everything we can to ensure smooth transitions and easy adjustments both for our members and for our customers.” Retailers are increasingly investing resources in making sure that their teams, from top to bottom, are motivated, innovationdriven, diverse and reflective of the demographics of their consumers. Beyond companies’ internal efforts, many institutions of higher learning offer food-industry-specific curricula. Among them is Western Michigan University (WMU), whose recent 53rd annual Food Marketing Conference I was privileged to attend. With broad industry support, including sponsorships by Kroger, Meijer, SpartanNash, and an array of retail and CPG companies, the conference allows WMU students to benefit from an agenda of content-rich educational sessions and to network with prospective employers. As Dr. Frank Gambino, director of the WMU Haworth College of Business’ food and CPG marketing program, noted at the event, proceeds from the conference help pay for, among other things, students’ attendance at industry events such as the NGA and PLMA shows, Network of Executive Women conferences, and the Sweets & Snacks Expo. WMU grads go on to internships and full-time employment with major grocery retailers and food manufacturers, creating a pool of talent that will take on the industry’s future challenges. Speaking of which, what are other issues that keep retailers tossing and turning? “I spend a lot of time thinking about trends and looking for feedback on how we can meet customers’ diverse needs while maintaining quality in everything we do,” re8

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Executing innovation requires knowledgeable and passionate associates on the front lines as well as in the c-suite.” veals Randy Edeker, chairman, CEO and president of West Des Moines, Iowa-based Hy-Vee Inc. “In order to stay relevant, grocery retailers must continue to vie for business from the customer who shops at multiple stores each week to find their favorite products or take advantage of special deals. That’s where offering the convenience of on-the-go meal options, a wide selection of products at great prices, and a robust customer loyalty program will continue to be key.” Adds Judy Spires, CEO of Parsippany, N.J.-based Kings Super Markets: “Organizations must know their strengths and continue to audit customers’ needs to stay relevant. Retailers need to take calculated risks, stay flexible, and implement attractive, experiencedriven solutions quickly.”

More solutions Effective with this issue, we welcome our Grocerant Solutions publication as an integrated section of PG. Supplemented by a monthly e-newsletter, Grocerant Solutions will continue to dive deep into the area of fresh prepared foods and support PG’s annual Grocerant Solutions Summit event, scheduled for Oct. 3-4 at the Minneapolis Convention Center. The summit will feature a robust educational lineup, including our new retail chef challenge. Hope to see you there!

Jim Dudlicek Editorial Director jdudlicek@ensembleIQ.com Twitter @jimdudlicek

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in-store Events

Calendar

06.18

National Candy Month National Dairy Month National Dairy Alternatives Month

National Fresh Fruit and Vegetables Month National Iced Tea Month National Frozen Yogurt Month

S M T W T F S

National Doughnut Day

National Rotisserie Chicken Day

National Say National Rocky Something Nice Day Road Ice Cream Day

National Egg Day

National Cheese Day. Promote all of your specialty cheeses.

National Gingerbread Day

National Corn on the Cob Day

National Jerky Day

National Chocolate Macaroon Day

IDDBA 18 begins and continues through June 12. National Iced Tea Day

National Frozen Yogurt Day

National Ketchup/ Catsup Day

National German National Peanut Chocolate Cake Day Butter Cookie Day

Cupcake Lover’s Day

Flag Day

National Applesauce Cake Day

National Chocolate National Jelly-filled Ice Cream Day. Doughnut Day Promote some favorite chocolate ice cream brands and cones.

National Kitchen National Strawberry Klutzes of America Shortcake Day Day. Promote your prepared meal solutions to keep inept cooks away from culinary disasters.

National Strawberry-Rhubarb Pie Day

National Fudge Day National Lobster Day. Display napkins, nutcrackers and Fresh Veggies Day butter in your seafood department.

Eid al-Fitr

Father’s Day

National Cheesemakers Day

National Apple Strudel Day

International Picnic Day

National Martini Day. Set up a display of gin, vodka and olives.

National Cherry Tart Day

National Pralines Day. Put out a call for customers’ favorite recipes.

National Kouign Amann Day. Schedule a special baking class for this tasty Breton cake.

National Peaches & Cream Day

National Chocolate Eclair Day National Onion Ring Day

National Orange Blossom Day

National Tapioca Day

National Pineapple Day. Have the bakery run a promotion for upside-down cake.

National Public Service Day. Honor your local first responders. National Pecan Sandy Day

National Vanilla Milkshake Day

National Strawberry National Chocolate Parfait Day Pudding Day National Catfish Day

Make sure you’re National Almond adequately stocked Buttercrunch Day for Independence Day promotions next week.

Social Media Day. Tweet, pin, share photos and reach out to customers online. National Mai Tai Day Summer Fancy Food Show begins and continues through July 2.

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PG 012-013 Events bgJIM.indd 12

4/3/18 1:23 PM

INTRODUCING SMITHFIELD

SEASONED BEEF. Smithfield Seasoned is now more than just pork. As the Seasoned Fresh Pork category leader, we are proud to expand our portfolio and bring you two new Seasoned Fresh Beef items made with USDA Choice Beef. With 89% of households purchasing Beef — and Seasoned Beef sales1 up +7% — you can count on Smithfield Seasoned Beef Steaks firing up your shoppers’ grills and your seasoned category sales with our hottest new items this summer grilling season.

Drive Seasoned Category Growth

Grow Total Meat Department Sales

Increase Total Basket Ring

For more information about how Smithfield Seasoned Beef can help boost your bottom line, contact your Smithfield Sales Representative or freshporksales@smithfield.com. 1

52 weeks ending 10/28/17

Consumer InsIghts

Market Research

Snacking Away What’s driving snacking purchases? Snacking has been on the rise for several years, but how often are people snacking, and what are they choosing? Progressive Grocer, along with sister company EIQ Research Solutions, interviewed 500 consumers who have household responsibility for grocery shopping to find out how often they snack and what products are driving their purchases. Fewer than 7 percent of respondents snack once a week or less, but younger Millennials (5.6 percent) and Baby Boomers (6.6 percent) are the most likely to limit snacking to less than once a week. Older Millennials and Gen X are the “snackiest” generations, with 74.4 percent of older Millennials and 72.2 percent of Gen Xers snacking at least once a day. Survey respondents were sourced via ProdegeMR, reinventing the market research process by taking a respondent-first approach. Visit www.prodegemr.com for more information.

Younger Consumers most Likely to replace meals With snacks How often do you replace full meals with snack foods? Younger Millennials Two-thirds of all respondents surveyed indicate that they snack at least once a day, and more than half replace traditional meals with snacks at least sometimes. Among those who do, this is most common at lunch; 76 percent report choosing snack foods for their midday meal. Protein was the top factor in snacking health concerns, with 46 percent of all respondents citing it as a quality that they look for. However, a quarter of respondents noted none of the snacking qualities listed (protein, portion control, organic/natural, non-GMO, glutenfree, allergen-free) as something that they were looking for in snack food.

Baby Boomers

Mature/ Silents

5 .6%

4.7%

3.0%

2.4%

3.6%

14.0%

11.8%

7.1%

Sometimes

51. 9%

48.8%

43.8%

31.0%

42.9%

Rarely

2 0.4%

27.9%

30.8%

38.7%

35.7%

Never

1. 9%

4.7%

10.7%

20.8%

10.7%

Base: All respondents

men, older millennials more Likely to Choose Cookies Which snack foods do you purchase? Male

Female

Younger Millennials

Older Millennials

Generation X

Baby Boomers

Mature/ Silents

Chips

85.2%

77.8%

74.1%

83.7%

84.6%

80.4%

75.0%

Fruit

73.4%

78.5%

72.2%

86.0%

76.9%

72.0%

71.4%

Crackers

70.1%

72.4%

68.5%

70.9%

71.6%

70.8%

78.6%

Nuts

72.5%

67.4%

57.4%

67.4%

73.4%

70.8%

75.0%

73.0%

64.8%

59.3%

79.1%

68.0%

68.5%

60.7%

Cheese

62.3%

74.3%

57.4%

64.0%

67.5%

70.8%

96.4% 57.1%

Popcorn

54.1%

62.1%

42.6%

61.6%

60.9%

58.9%

Nutritional Bars1

57.8%

53.6%

61.1%

67.4%

60.4%

47.0%

32.1%

Candy

50.8%

59.0%

51.9%

55.8%

56.8%

53.6%

57.1%

Vegetables

45.5%

57.9%

48.1%

48.8%

52.1%

52.4%

64.3%

Pretzels

47.5%

49.4%

35.2%

47.7%

55.6%

45.2%

53.6%

Other Salty Snacks

39.3%

43.3%

35.2%

38.4%

45.0%

39.3%

53.6%

Snack Cakes

38.1%

35.6%

29.6%

37.2%

40.2%

36.9%

28.6%

Meat Snacks/Jerky

36.5%

33.3%

35.2%

39.5%

43.8%

25.0%

Other Sweet Goods

22.1%

31.4%

31.5%

27.9%

26.0%

25.0%

32.1%

Other

1.6%

0.8%

0.0%

1.2%

7.1%

(e.g., Protein Bars, Energy Bars, Granola Bars)

Base: All respondents Source: Progressive Grocer market research, 2018

Generation X

2 0.4%

Very often Often

Older Millennials

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Front End

Shelf Stoppers

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

General Merchandise TOP 5 CATEGORIES IN $ GROWTH (MORE THAN $500M IN ANNuAl SAlES) $6,000,000,000

Consumers chose Ethnicity frozen broccoli over Snapshot alternatives for

5,000,000,000

a variety of reasons:

4,000,000,000

Which ethnic group is spending the most per trip 12% it’s onbecause general quick and easy merchandise?

3,000,000,000

2,000,000,000

10%

1,000,000,000

because it tastes great

0 52 Wks - W/E 01/27/18 Candles

52 Wks - W/E 01/28/17

52 Wks - W/E 01/30/16

$18.03

52 Wks - W/E 01/31/15

Batteries logs Spotlight on FrozenCharcoal, Broccoli and Accessories

Hardware

per trip

Asian-Americans because it’s spend healthy nutritious the mostand per trip on general merchandise.

Household Plastics

WHEN ARE CONSUMERS EATING FROZEN BROCCOLI?

Broccoli as an ingredient is most commonly Frozen broccoli is most often used in a side The general consumed merchandise department has struggled this year, contracting at dinner, followed by lunch. dish, followed by as a main entrée.by

more than 3 percent in dollar sales. Though this marks the steepest decline 3% of the last five years, it’s important to focus on the drivers of growth in this 9% broadly about the themes that bolster their area of the store and think performance. Take candles as an example. With more consumers emphasizing relaxation and mindfulness, candles have become heavily integrated within homes across the nation. Now, OCCASION MEAL ITEMare with online replenishment and niche offerings from specialty stores, the scent profiles 29% TYPE CLASS 62% 35% 61% seemingly endless. Staying aligned with consumers’ ever-changing experiential preferences is a way general merchandise categories can regain momentum this year.”

because it’s low in calories, fat and sugar

$15.03 per trip

Hispanic Americans’ spend, on average.

—Jordan Rost, DINNER

LUNCH

OTHER

VP consumer insights, Nielsen SIDE DISH MAIN ENTRÉE OTHER

Spotlight on Charcoal Logs, Accessories Comparison Products

Butter and Margarine laundry Supplies Stationery, School Supplies Salad Dressings, Mayo, Toppings Vegetables-Canned Wrapping Materials and Bags Baking Mixes Bread and Baked Goods Coffee Nuts Source: Nielsen

progressivegrocer.com

Percent Penetration

91.0% 84.9 90.8 86.2 91.6 90.2 77.6 98.6 76.7 80.2

$14.95 per trip

Index

112 112 112 112 112 112 111 111 111 111

Caucasian Americans’ spend, on average.

$14.43 per trip

African-Americans’ spend, on average. Source: Nielsen Homescan, Total u.S., 52 weeks ending Jan. 27, 2018

Introducing our summer wardrobe.

Limited edition summer packaging. Please drink responsibly. Corona ExtraÂŽ Beer and Corona LightÂŽ Beer. Imported by Crown Imports, Chicago, IL.

Mintel Category insights

Global New Products Database

Cheese Market overview Cheese sales in the United States grew 10 percent in the past five years to reach $23.6 billion in 2017, driven primarily by the natural cheese segment. While the United States maintains the largest consumption of cheese per capita in North America, Canada is a standout performer when it comes to average value growth.

Key issues Consistent with the increasing dominance of natural cheese in the U.S. market, nearly all American adults say that they’ve eaten natural cheese, with most consumers indicating that they do so at least a few times a month.

FOR MORE INFORMATION, VISIT WWW.MINTEL.COM OR CALL 800-932-0400

Cheese manufacturers have focused on sustainability in new product development, with “hormone-free” being the most common ethical and environmental claim in the North American cheese category between November 2012 and October 2017. Eight in 10 U.S. cheese buyers say that they eat cheese because they like the taste. To appeal to an even greater number of consumers, cheese innovation is seeing a slight shift toward sweeter flavors. Despite consumer interest in organic food, organic certification on cheese has a marginal impact on natural cheese sales in the United States.

What Does It Mean? Cheese products placing sustainability at the center of their innovation not only appeal to consumers who care about the climate and animal well-being, but also promote higherquality product cues. While cheese’s protein and calcium content help to bolster its image as a healthy food or snack, the category’s most leverageable asset may be great taste. Cheese marketers and retailers can give cheese lovers more ways to use cheese by introducing new varieties and flavors such as strawberry or salted caramel.

progressivegrocer.com

All’s Wellness By Karen Buch

Healthy Snacks Go Mainstream MAke The MOST OF MIlleNNIAlS’ PReFeRReD WAy TO e AT.

onsumer eating trends have shifted away from three set meal times and toward snacking throughout the day, with 94 percent of Americans snacking at least once a day and Millennials, as a generation, choosing to snack as often as four or more times a day. Overall, snacking accounts for half of all eating occasions. With increased frequency of snacking comes growing demand for snacks that couple substantial nutritional value with convenience and a variety of appealing textures and powerhouse flavors that satisfy. While taste is still No. 1 when it comes to choosing a snack, Millennials are also looking for a short list of trusted, real, whole or “clean” ingredients that satisfy hunger and provide idealized quality, which extends to exotic or premium halos and specific attributes regarding how the food was sourced and produced. In particular, they’re thinking about how their purchase may impact personal factors, societal concerns such as the local community or economy, worker and animal welfare, and global sustainability of the environment and the planet. From a personal standpoint, individuals may look to snacks to satisfy a variety of needs, including desire for a particular nutri-

69% Of Millennial moms say that their kids understand that some snacks are healthier than others. Source: Mintel

progressivegrocer.com

Right-sizing portions to appropriate snack sizes is a key part of positioning convenience or on-the-go snack options.” tional attribute, flavor or texture; as a source of energy and appetite satisfaction; for replenishment and recovery after physical activity; as a de-stressor or for emotional comfort, or as a way to relax or indulge. Snack selection may look completely different for a person snacking alone compared with when snacking with children or others.

The Kids are All Right Not surprisingly, children are the biggest influencers when it comes to purchasing snacks, according to Mintel’s 2017 consumer trends research. A majority (69 percent) of Millennial moms say that their kids understand that some snacks are healthier than others. Data also suggest that parents are willing to pay an average of $1.53 more for a better-for-you snack if they know that their child will eat it. This presents an opportunity for retailers to conduct betterfor-you snack-sampling events specifically geared toward customers and their kids. In general, trial of new snacks is highly influenced by recommendations, ratings and

reviews. Research shows that 37 percent of Millennials have tried a snack because of a social media post made by someone else. Retail dietitians, as trusted influencers, can regularly introduce shoppers to specific snack items, trends and recipes using social platforms and other media. Shoppers are looking beyond the packaged snack aisle to functional snack foods found among fresh produce, prepared foods, the dairy case, bars and nutritionals, and center store’s canned poultry and fish. Popular attributes sought include protein, probiotics, natural fiber and omega-3s.

What Makes a snack? The type of food that constitutes a snack is up for debate. For instance, many consumers believe that a smaller portion of a food normally eaten at mealtime counts as a snack. Right-sizing portions to appropriate snack sizes is a key part of positioning convenience or on-the-go snack options. For example, prepared food departments can offer slidersize sandwiches or “snackwiches” featuring a minimum of 20 grams of protein, and snack boxes featuring a hard-boiled egg pop paired with dried fruit, nuts and seeds. All in all, snack foods are moving toward simple, whole-food ingredients that offer innovative flavor and function while delivering all of the craveable indulgence of traditional snack foods.

Karen Buch, RDN, LDN, is a registered dietitian/nutritionist who specializes in retail nutrition marketing and 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.

NEW HORIZONs By Sarah Alter

Do t a h W Your s g n i t s o Job P bout Say A n? o i s u l c In w r It e e s to r e m e co It ’s t Imt w h e n It . Ip g r In c t h e s o r e c r u It t By Sar

a h A lte

our company’s ability to attract the best talent — and create a truly inclusive workplace — starts with a few well-chosen words. The way you write your recruitment ads and job descriptions is the first step in attracting a diverse pool of candidates and recruiting the 21st-century leadership skills that you need today. These skills — empathy, collaboration, a willingness to seek help, and the capacity to nurture others — are often called “feminine” leadership traits, but you don’t have to be a woman to leverage them. In fact, they’re critical for everyone who wants to manage today’s multigenerational, multicultural work teams. Millennial, women and multicultural leaders are far less likely to respond to job posts filled with “bro-speak” written by men and (often unconsciously) for men. Even companies that value diversity and women’s leadership will scare off talented prospects if they consistently emphasize “hardcharging” candidates who will “do whatever it takes,” according to researchers. Seattle-based Textio, which analyzes hiring outcomes of more than 10 million job posts each month, found that companies that write job descriptions with gender-neutral language — such as using “extraordinary” instead of “rock star” — attracted a more diverse group of candidates. They also filled jobs an average of 14 days faster.

progressivegrocer.com

Words used in job postings reflect a company’s cultural norms, which can be at odds with what companies say they value.”

Troublesome Terms Words used in job postings reflect a company’s cultural norms, which can be at odds with what companies say they value, according to Textio CEO Kieran Snyder. “When your PR talks about work/life balance, but your team consistently advertises jobs that are work hard/play hard, your team is the one telling the truth,” Snyder wrote in her company blog. A few months ago, Textio gained attention when it looked at 25,000 job descriptions published by power employers Amazon, Apple, Facebook, Google, Twitter, Uber, Netflix, Salesforce, Slack and Microsoft. The company found that each firm relied frequently on specific phrases. For instance, in job descriptions posted by Amazon, terms that are statistically more likely to attract male applicants were used much more often than by other companies studied. “Wickedly” was used 33 times more often than by the next-closest company; “fast-paced” was used 12 times more frequently. At Uber, the term “whatever it takes” was used 30 times more often than by the next-closest company; “high-performance culture” was used 23 times more. On the flip side, Apple used phrases more likely to attract women and, I believe, people with the leadership skills needed most in today’s workplace. “Comfortably” was used 15 times more frequently than by the next-closest company, and “empathetic” five times more often. Other words and phrases that correlate to a higher proportion of female applicants, Textio says, include “our family,” “building alliances,” “care deeply,” “meaningfully” “passion for learning” and “diverse perspectives.” Men are more likely to respond to “disciplined,” “tackle,” “hungry for,” “weed out” and “bull by the horns.”

Advice From the Experts Mill valley, calif.-based recruiting site glassdoor offers tips for creating job posts free of gender bias. Here are a few that will lead to a broader pool of candidates who have what it takes to build strong, diverse teams.

Sarah Alter is president and CEO of the Network of Executive Women, a learning and leadership community representing nearly 11,000 members, more than 800 companies, 100 corporate partners and 21 regional groups in the United States and Canada. Learn more at newonline.org.

Use gender-neutral titles. Avoid including words in your titles like “superhero,” “guru” and “ninja,” glassdoor advises. Use more descriptive titles instead, like “project manager.” Check pronouns. Use he/she or “you” when describing a job’s responsibilities. Avoid or balance gender-charged words. For example, “analyze” and “determine” are associated with male traits, while “collaborate” is considered female. Limit the number of job requirements. glassdoor recommends identifying the “nice to have” versus “must have” requirements — and removing the “nice to haves” from the job descriptions. Women are much less likely than men to apply for jobs if they don’t meet 100 percent of the requirements; you’ll get many less-than-qualified male applicants and very few female applicants who don’t have the exact experience listed.

A Fresh Alternative

Reconsider college major requirements. You may be limiting your candidate pool by unnecessarily requiring completion of a specific degree. Express your commitment to equality and share your values. Women want to know that they’ll be welcome and have the opportunity to advance their careers. if your company’s vision and values promote diversity, include them in your job descriptions. Make a note of employee business resource groups, mentoring programs and other female-friendly initiatives. List your family-friendly benefits. Parental leave, flextime and child care subsidies benefit women and men. Let candidates know what you offer. As snyder notes, changing the words in your job descriptions won’t change your culture overnight. But being more intentional about language helps teams stay focused on diversity and inclusion, the first step to creating a more gender-balanced workplace and more successful leadership teams.

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Progressive grocer April 2018

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Retailers are learning quickly that slow and steady isn’t what wins the race anymore. By Jim DuDlicek, BriDget golDschmiDt, ranDy hofBauer anD kat martin

onsumer confidence is higher than it’s been since 2000, and it appears to be bolstering the mood of the nation’s grocery retailers. Responses to Progressive Grocer’s 85th Annual Report of the Grocery Industry indicate that grocers are more optimistic about the current retailing climate than they have been since 2011. They started the year emboldened by tax reform that promised to free up cash to invest in their businesses and put more money in consumers’ pockets. Still, this rosy outlook may come as something of a surprise, considering events that have shaken the industry in the past year, including etailing giant Amazon’s emergence as a full-on player in grocery, from soup to nuts, through its acquisition of Whole Foods Market in late 2017; two regional grocery chains — Southeastern Grocers and Tops Markets — filing for bankruptcy; and German hard-discounter Lidl, which was expected to turn markets upside-down, scaling back its U.S. invasion plans after meeting less-than-expected success. And while most of our survey respondents expect their net profits and gross margins to stay consistent with, or rise above, year-ago levels, a clear majority expect to be paying more in wages and benefits. But despite a retail environment that promises to vanquish anyone caught napping, retailers, for the most part, are rising to the challenge. They’ve been forced to reassess their operations from every angle, accelerate the pace at which they innovate, streamline processes to free up resources for customerfocused initiatives, and bend over backwards to engage their shoppers, who crave convenience and excitement. Just look at some of PG’s recent headlines on the news roller coaster leading up to this issue: Walmart Expanding Grocery Delivery Nationwide. Kroger Expands Grocery Delivery Via Instacart. Aldi Expands Delivery. Meal Kits Explode in Brick-and-Mortar Stores. Walmart Introducing Meal Kits. Supermarkets Make Strong Showing in Customer Service Index. Walmart Closing

Progressive grocer April 2018

85th AnnuAl RepoRt of the GRoceRy IndustRy

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Grocery Price Gap With Amazon. Voice-Ordering Products, Including Groceries, to Surge Through 2022. Amazon to Lay Off Hundreds. H-E-B to Acquire Delivery Service Favor. PG’s survey includes the responses of more than 140 retail grocery executives, including presidents. CEOs, c-level officials, store owners and managers, categoof consumers will buy groceries online by 2024, accounting for ry managers and merchandisers, and store $100 billion in sales. operations, sales, advertising and marketing executives. Amid the challenges of Source: Nielsen driving this $680 billion industry, grocery retailers are most worried about labor, competitive threats and keeping up with advancements in technology. To stay relevant in turbulent competitive waters, traditional grocers continue to focus on fresh departments, particularly prepared foods, shoring up their core competencies in the perimeter while etail rivals keep wrestling with this part of the service equation. Tech solutions for merchandising and marketing are a priority, and omnichannel competency is surging. In fact, while store remodels led investment priorities a year ago, tech upgrades and online shopping top the list for 2018 and beyond. That’s fortunate, in light of a Nielsen study, unveiled at the FMI Midwinter Executive Conference earlier this year, indicating that 70 percent of consumers will buy groceries online by 2024, accounting for $100 billion in sales. Consumers in large part hold grocers in high esteem. In the 2018 “Harris Poll Reputation Quotient” study, grocery retailers held four spots among the top 10 companies across all categories with the best reputations among the general public: Wegmans at No. 2, H-E-B at No. 6, Publix at eighth and Aldi at 10th. No. 1? Amazon. Year after year, the phrase “cautiously optimistic” manages to make its way into assessments of retail leaders’ moods. But it has become increasingly clear that being too cautious is going to result in being left behind. Does the Amazon revolution really mean the death of traditional retailing? Yes, but not necessarily the death of traditional retailers, provided they continue to aggressively pursue better ways to connect with and serve consumers — in other words, create a new tradition.

Methodology Progressive Grocer ’s 85 th Annual Report of the Grocery Industry is based primarily on an exclusive survey conducted among executives at supermarket chain and independent operators across the United States. Among this year’s 144 retail executive participants, 38 percent classify themselves as independent retailers, while 62 percent are self-distributing chains. Of the total respondents, 44 percent operate fewer than 50 stores, while 56 percent operate 50 stores or more. Additional store count and sales data are provided by Nielsen TDLinx, which maintains a national database of supermarket and other retail format locations.

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85th AnnuAl RepoRt of the GRoceRy IndustRy Supermarket Sales by Format Number of Stores

Percent of Total

Total Supermarkets ($2 million or more)

38,571

100.0%

Supermarket-Conventional

Sales ($ millions)

Percent of Total

$682,716

100.0%

26,551

68.8

430,494

63.1

Supercenter

4,393

11.4

173,492

25.4

Supermarket-Natural/Gourmet Foods

3,469

9.0

44,491

6.5

Supermarket-Limited Assortment

3,578

9.3

25,221

3.7

Warehouse Grocery

411

1.1

4,418

0.6

Military Commissary

169

0.4

4,601

0.7

154,262

n /a

450,907

n /a

Gas Station/Kiosk

19,921

n /a

n/a

n /a

Superette

12,475

n /a

19,118

n /a

1,387

n /a

156,304

n /a

696

n /a

4,204

n /a

Conventional Drug

28,959

n /a

178,243

n /a

Rx Only and Small Independent

14,210

n /a

13,420

n /a

Other Formats Conventional Convenience

Conventional Club Military Convenience Store

63.1%

Grocery sales accounted for by conventional supermarkets, with the next most popular format, supercenters, accounting for 25.4 percent.

Supermarket Sales by Sales Range Number of Stores

Percent of Total

Supermarkets ($2 million or more)

38,571

100.0%

$682,716

100.0%

Chain (11 or more stores)

31,721

82.2%

646,627

94.7%

$2,000,000 to $4,000,000

2,226

5.8

6,566

1.0

$4,000,000 to $8,000,000

7,174

18.6

42,840

6.3

$8,000,000 to $12,000,000

3,708

9.6

38,734

5.7

$12,000,000 to $20,000,000

4,875

12.6

79,487

11.6

$20,000,000 to $30,000,000

6,249

16.2

155,204

22.7

$30,000,000 to $40,000,000

3,480

9.0

120,917

17.7

$40,000,000 to $50,000,000

2,419

6.3

107,364

15.7

$50,000,000+

1,590

4.1

95,515

14.0

Independent (10 or fewer stores)

6,850

17.8%

$2,000,000 to $4,000,000

2,405

6.2

7,161

$4,000,000 to $8,000,000

$36,089

5.3% 1.0

3,862

10.0

20,927

3.1

$8,000,000 to $12,000,000

340

0.9

3,428

0.5

$12,000,000 to $20,000,000

177

0.5

2,751

0.4

$20,000,000 to $30,000,000

0.13

1,209

0.2

$30,000,000 to $40,000,000

0.03

443

0.1

$40,000,000 to $50,000,000

0.00

0.0

$50,000,000+

0.00

124

0.0

Source: Nielsen TDLinx; Progressive Grocer Market Research, 2018

Sales ($ millions)

progressivegrocer.com

94.7% Sales accounted for by supermarket chains of 11 or more stores, with independents operating 10 or fewer stores making up the rest.

85th AnnuAl RepoRt of the GRoceRy IndustRy

Here Comes the Sun Re taileRs aRe feeling e veR moRe optimistic about the Re tail climate, with some e xceptions. By Kat Martin

he future looks bright, at least according to supermarket operators. Last year marked a return to increased optimism, but this year, retailers looking forward need to wear shades, with 51 percent of respondents to Progressive Grocer’s Annual Report survey saying that they’re more optimistic about the retail climate than they were last year. This number is the highest it’s been since 2011, when the outlook hit a high of 54 percent — the highest in the past decade. Looking forward to the rest of 2018, nearly half (42.3 percent) of retailers predict a good year, ranking the rest of the year as an eight or above on a 10-point scale, with 10 being sensational and one being awful — more than 82 percent foresee the rest of year as a six or higher. Even looking back at 2017, retailers retained their rosy outlook, with a quarter (24.4 percent) ranking 2017 as an eight or higher and nearly three-quarters (71.1 percent) as at least a six. However, for those retailers operating smaller chains of fewer than 50 stores, the optimism is somewhat more muted, with only one-third foreseeing a great 2018 (an eight and above ranking), compared with the 42.3 percent overall), and just 20 percent looking back at 2017 as a great year (again, an eight and above ranking), compared with 24.4 percent overall. While smaller supermarket companies are often credited as being more nimble and able to adjust to change, they also don’t usually have the financial resources to withstand a drawn-out fight for consumer dollars and market share that a larger chain can make use of.

Gauging Confidence Much of the overall optimism could stem from two things: consumers’ own optimism, and the fact that many of the industry’s bogeymen are out in the open. First, consumer confidence is at its highest level since 2000, with The Conference Board Consumer Confidence Index hitting 130.8 in February. “Consumers’ assessment of current conditions was 32

progressivegrocer.com

Overall, what kind of year was 2017 for your company? And how do you view 2018 prospects for your company? Rank

2017

2018

Sensational

10 9 8 7 6 5 4 3 2 1

3.1%

9.2%

17.7%

15.3%

21.5%

26.0%

22.3%

20.6%

17.7%

15.3%

9.2%

6.1%

3.1%

3.8%

3.1%

1.5%

Awful

0.8%

Source: Progressive Grocer Market Research, 2018

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85th AnnuAl RepoRt of the GRoceRy IndustRy

51%

and-go technology to allow customers more favorable this month, with the to skip the bottleneck at checkouts, labor force the main driver,” said Lynn and retailers across the country are Franco, director of economic indicators ramping up delivery and click-and-colat the New York-based board. “Delect programs to better compete. spite the recent stock market volatility, Also, Lidl entered the market to great consumers expressed greater optimism fanfare and much publicity about the toabout short-term prospects for business tal number of stores it planned to open. and labor market conditions, as well as of Annual Report survey The German discount retailer stumbled their financial prospects. Overall, conrespondents say they’re more a bit out of the gate, scaling back its sumers remain quite confident that the optimistic about the retail plan to have 100 stores open within a economy will continue expanding at a climate than they were last year of opening its first in June 2017. It strong pace in the months ahead.” year, the highest percentage currently operates about 50 stores, with Second, while the industry is strugsince 2011. plans to open about 20 more. Aldi, angling with recent store closures — other German price discounter, is also Walmart closed 63 Sam’s Club stores, expanding store locations — it added and Southeastern Grocers filed for 150 in 2017 — and updating store bankruptcy and revealed that it would décor. These moves by value grocers are putting shutter 94 stores, to name just two examples — pressure on traditional retailers to keep prices low other troubling situations have become clearer. despite the easing of food deflation. Whole Foods Market’s dicey financial situation Many retailers complain of their operating arhas been resolved by its acquisition by Amazon, eas being overstored (even as food deserts persist although the “fallout” from that move has yet in the United States), but store growth has reto be fully seen, especially how the company’s mained fairly stagnant, with 38,571 total superecommerce arm will truly affect grocery business. markets open at the end of 2017, compared with Further, both Walmart and Kroger are investing 38,441 the previous year. in technology by expanding or introducing scan-

Retail Climate

More Optimistic

Compared with a ye ar ago, are you more optimistiC or less optimistiC about the re tailing Climate for supermarke ts?

No Change

51.2%

Less Optimistic

49.6%

50%

45.5% 40

39.3%

36.8% 32.9%

23.3%

25.6%

26.2%

30.9%

29.8%

28.3%

32.5% 28.2%

20.6% 20

2018

2017

2016

2015

2014

Source: Progressive Grocer Market Research, 2018 Progressive grocer April 2018

85th AnnuAl RepoRt of the GRoceRy IndustRy

Difference Engines How grocers seek to stand out from tHe compe tition is e volving.

Most Influential Department in Driving Stores’ Overall Brand/ Image/Point of Differentiation

21%

Meat

By Bridget Goldschmidt

ure, supermarket operators always want to differentiate from their rivals in any given geo21% graphical area — particularly in notoriously overstored regions like the Southeast — but the ways that they’re doing so are changing in tandem with shifting consumer needs. 15% For instance, when Annual Report survey respondents were asked about the most influential department in driving their stores’ overall brand, image or point of differentiation, meat and produce actually tied at 21 percent each, perhaps reflective 13% of consumers’ rising interest in eating greater amounts of fresh fruit and vegetables, while last year, meat was the clear frontrunner, selected by 37.8 percent of respondents, with produce lagging behind at 12.2 percent. Deli/prepared foods, a well11% publicized section of late, garnered 15 percent, down from 17.6 percent in 2017. Next were the growing sector of private label, at 13 percent, up from last year’s 6.8 percent, and center store, at 11 percent, a precipitous de4% cline from the 37.8 percent logged in 2017. Organic offerings, chosen by 8.1 percent of respondents last year, fell to just 2 percent this year, suggesting that with the wider ac4% cessibility of such products, shoppers are less likely to see them as a unique draw. When it comes to generating sales, produce came in as the top department, dis3% placing longtime champion meat, which dropped to third. Taking over the second spot was private label, moving up from last year’s fifth spot, while beer/wine/liquor held 2% steady in fourth place and deli/prepared foods fell from second to fifth. Among the lower-ranked departments, seafood rocketed up five places from last year to land at 2% No. 10, driven by consumers’ greater willMeat and produce tied as the most ingness to purchase and prepare fresh items influential department in driving their found in that department. stores’ overall brand, image or point of For the departments driving the most differentiation, while produce came in traffic, produce also nabbed the top spot, as the top department for generating switching places from last year with meat, sales and for driving traffic. which dipped to third place, while deli/prepared foods held on at No. 2. Rounding out the top five, checklanes/front end rose from seventh to fourth, while organic dropped a notch to fifth. Interestingly, pharmacy climbed six rungs from Source: Progressive Grocer Market Research, 2018 last year to capture sixth place, while fresh bakery, last year’s

21%

progressivegrocer.com

Produce

Deli/Prepared Foods

Private Label

Center Store

Beer/Wine/ Liquor

Fresh Bakery

Gourmet/ Specialty

Organic

Checklanes/ Front End

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85th AnnuAl RepoRt of the GRoceRy IndustRy No. 6, fell to ninth. Also of interest: Ethnic products rose from 15th to 10th place, perhaps as consumers grow ever more comfortable preparing at home various culturesâ&#x20AC;&#x2122; cuisines. When asked about the merchandising/brand enhancement services that were most important to their companies, this yearâ&#x20AC;&#x2122;s respondents overwhelmingly went for prepared foods, which a considerable 73.2 percent described as extremely/ very important, a recovery of sorts from its fourthplace finish last year, but still below the 76.1 percent of respondents who deemed the category of paramount importance in 2016. Other crucial programs included signature products (72.6 percent), locally sourced products (67.9 percent), private label (65.5 percent), cross-merchandising (60.7 percent), and store-within-a-store specialty departments (54 percent). In common with last year, free WiFi (40.2 percent), in-store pharmacies (36.6 percent), BOGOs (33.9 percent), and cooking meal/prep stations (31 percent) were less popular options, although all but BOGOs upped their percentages from last year.

Most Important Merchandising/ Brand Enhancement Services Percent of resPondents rating each strategy as extremely/very imPortant Strategy

Percent

Prepared Foods

73.2%

Signature Products

72.6

Locally Sourced Products

67.9

Private Label

65.5

Cross-merchandising

60.7

Store-Within-Store Specialty Departments (i.e., organic, gluten-free, specialty cheese, housewares, etc.)

54.0

Free Wi-Fi

40.2

In-Store Pharmacies

36.3

BOGOs

33.9

Cooking/Meal Prep Stations

31.0

Source: Progressive Grocer Market Research, 2018

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85th AnnuAl RepoRt of the GRoceRy IndustRy Most Successful Departments at Generating Sales Rank

Department

Percent

Produce

65.7%

Private Label

63.7

Meat

59.8

Beer/Wine/Liquor

58.8

Deli/Prepared Foods

58.8

Dairy

57.8

Center Store

56.9

Fresh Bakery

54.9

Frozen Foods

53.9

10.

Seafood

48.0

11.

Organic

47.1

12.

General Merchandise

46.1

13.

Gourmet/Specialty

44.1

14.

Health, Beauty & Wellness

42.2

15.

Floral

38.2

16.

Checklanes/Front End

35.3

17.

Pharmacy

33.3

18.

Ethnic

30.4

In the realm of customer interaction, meanwhile, community involvement continued to lead, with 73.2 percent rating it extremely or very important as a strategy. In common with last year, seasonal special events (59.8 percent) and sampling/ demos (55.4 percent) maintained their second and third slots, although 2017’s No. 4, healthy store tours, was eclipsed by wellness events/counseling (31.3 percent) and health screenings (24.1 percent). The next-to-last rung was occupied this year by in-store restaurants (17 percent), while cooking classes again brought up the rear, this time at 9.8 percent. For in-store services, on-site butchers (63.4 percent) — despite the shift to produce as a sales and traffic generator — and community programming (41.1 percent) once more topped the chart of extremely or very important strategies, while seafood specialists (31.3 percent) fell behind service-based kiosks, at 32.1 percent, as consumer-friendly currency conversion, deli/ bakery-ordering and wine-tasting booths continue to infiltrate retail. Although relatively less used by survey respondents, such amenities as wellness experts (24.1 percent) and registered dietitians (17.9 percent) still outdid their 2017 percentages, indicating increased deployment in stores.

Most Important Customer Interaction Strategies Percent of resPondents rating each strategy as extremely/very imPortant

Most Successful Departments at Driving Traffic Rank

Department

Percent

Produce

57.8%

Deli/Prepared Foods

51.0

Meat

51.0

Checklanes/Front End

41.2

Organic

40.2

Pharmacy

38.2

Gourmet/Specialty

36.3

Beer/Wine/Liquor

35.3

Fresh Bakery

31.4

10.

Ethnic

30.4

11.

Center Store

28.4

12.

Private Label

27.5

13.

Health, Beauty & Wellness

25.5

14.

Seafood

25.5

15.

Floral

24.5

16.

Dairy

23.5

17.

General Merchandise

18.6

18.

Frozen Foods

17.6

Source: Progressive Grocer Market Research, 2018

progressivegrocer.com

9.8% 55.4%

Cooking Classes

Sampling/Demos

31.3%

Wellness Events/ Counseling

73.2%

Community Involvement

24.1%

Health Screenings

Seasonal Special Events

59.8% 21.4% 17.0% Source: Progressive Grocer Market Research, 2018

Healthy-Eating Store Tours

In-Store Restaurant

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85th AnnuAl RepoRt of the GRoceRy IndustRy

Work in Play TalenT, Tech le ad Tally of e xecs’ Top-of-mind issues. By Jim Dudlicek

s grocery retailers attempt to better cater to younger consumers, they’re apparently concerned with having the appropriate workforce to keep them on the right path. With Millennials’ purchasing power continuing to grow and Generation Z’s not far behind, retailers are going to need to make the grocery industry more attractive as a career choice so that their talent within reflects the audience to whom they need to appeal. It makes sense, therefore, that retail executives responding to Progressive Grocer’s survey named labor as the top issue keeping them up at night. Replacing benefits (which dropped to No. 7) at the head of the list, recruitment, retention, diversity and

66.7% Labor is the top issue keeping grocers up at night, replacing benefits, which dropped to No. 7.

What are the big issues keeping you up at night?

Current Ranking Year Ago

No. 1

No. 2

No. 3

No. 4

No. 5

No. 6

No. 7

66.7%

58.3%

45.0%

38.3%

34.2%

30.8%

30.0%

Labor

Competitive Threats

Keeping up with Advancements in Technology

Online Sales/ Omnichannel

Market Saturation

Increasing Overhead Costs (energy, infrastructure maintenance, etc.)

(minimum wage, Affordable Care Act, etc.)

No. 2

No. 3

No.9

No. 7

No. 8

No. 1

48.9%

42.8%

24.5%

N/A

28.1%

27.9%

50.3%

No. 8

No. 9

No. 10

No. 11

No. 12

No. 13

No. 14

24.2%

20.0%

18.3%

17.5%

16.7%

6.7%

3.3%

Price Increases

Sustainability

Data Protection/ Security

Food Safety

Trust/ Reputation

Transparency

Feeding the Hungry

No. 10

No. 5

No. 6

No. 11

No. 13

No. 12

17.8%

31.2%

28.7%

16.8%

4.4%

5.2%

(recruitment, retention, diversity, training)

N/A

Benefits

Source: Progressive Grocer Market Research, 2018 Progressive grocer April 2018

85th AnnuAl RepoRt of the GRoceRy IndustRy training of a workforce to propel them into a new era are seen as key concerns for the coming year. “We’ve grown so fast in the last five years, the biggest thing is help,” says Doug Cygan, president of Itasca, Ill.-based Jewel-Osco, a 187-store grocery chain in metro Chicago that’s part of Albertsons. “We hire people at a record pace. We’ve got 32,000 people, one of the biggest employers in the state of Illinois. But just finding people to work in our stores — we’re hiring at almost every location we have. We’re looking for future leaders, for future managers. So we continue to hire, teach, train people to be successful. It’s the thing that keeps us up the most at night.” Keeping up with advancements in technology (ranked ninth last year) and online sales ranked third and fourth, respectively — understandably, considering Amazon’s acquisition of Whole Foods Market and the accelerated pace at which technology is taking over all aspects of retailing, from shopping to checkout to delivery to the supply chain. Industry statesman Fred Morganthall, the nowretired executive who led Southeastern grocery chain

Right now, retail pharmacies must conduct business in an unpredictable environment where we are unsure of reimbursements and fees for administering much-needed medication for our customers.” —Randy Edeker, chairman, CEO and president, HyVee

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Harris Teeter through its merger with The Kroger Co., recently told an audience at Western Michigan University’s Food Marketing Conference that retailers should be redirecting brick-and-mortar cap ex budgets to online. “If you don’t do that, I don’t think there’s a future,” Morganthall remarked. But it’s clear that nearly every issue related to being a relevant retailer in today’s climate is constantly

FUNDAMENTALS THE TIME IS RIPE FOR NUTRITIOUS AND CONVENIENT FRESH PRODUCE Brands are playing an increasingly important role in the produce department, as consumer interest in fresh foods continues to grow. Between 2012 and 2016, the dollar share for branded produce grew by

Consumers are eating more fruits and vegetables than they did five years ago. Bananas are the top fruit.

7.7%

Fresh foods are now driving total store sales, with fresh produce emerging as a key factor driving store choice.

Global net sales for Fresh Del Monte Produce fresh-cut products climbed

In another notable leap, branded produce dollar sales jumped

18% to $607.8 MILLION in 2017 Today’s younger consumers are much more interested in — and willing to pay premium prices for — food products they perceive as healthier.

8% since Sept. 20, 2017. Six of the seven varieties of value- added vegetables increased

in both dollar and volume sales compared to 2016.

PRODUCE SPOTLIGHT Single-finger bananas and fresh-cut fruit/veggies are perfect examples of products that meet the needs of on-the-go Millennials

Millennials, who spend about $200 billion each year in the U.S., are leading the change in the food revolution including trends such as fast casual to farm-to-table Born between 1997 and the present, Generation Z is already impacting the food industry. Gen Z’s grew up understanding the purpose of food and how it fits into a welllived life. This tech-savvy generational group also seeks personalization, engagement, and fluidity, like portable foods, to meet the needs of their busy lives.

PACKAGE SPOTLIGHT Del Monte’s on-the-go line includes innovative features such as non-spill containers, re-sealable containers and packaging that fits in car cup holders.

SOURCES: “When It Comes to Branding, the Produce Department is Ripe with Opportunity”, November 2017 article, Nielsen; The Packer 2017 Fresh Trends, Produce Marketing Association; Food and Drink Shopper 2017 Report, Mintel; Nielsen FreshFacts, 52 weeks ended Sept. 30, 2017; Make It Happen for Gen Zs, The NPD Group, Inc.; Del Monte Fresh Produce; FreshFacts on Retail, Whole and Fresh Cut Produce Trends, Q4 2017, Nielsen Perishables Group FreshFacts, with United Fresh Produce Association; The Nielsen’s Global Health and Wellness Survey

Del Monte Fresh Produce N.A., Inc. is one of North America’s leading marketers and distributors of highquality fresh and fresh-cut fruit and vegetables. Del Monte Fresh Produce N.A., Inc. markets its products in North America under the Del Monte® brand (as well as other brands), a symbol of product innovation, quality, freshness and reliability for 125 years.

85th AnnuAl RepoRt of the GRoceRy IndustRy

ATIONS • E ENER ST. EG 19 RE 39 H T

O NTE

F RES H C O

on the minds of grocery executives. “The biggest issue that keeps me up at night is the rising cost of doing business, in particular, the ongoing increase in DIR [direct and indirect remuneration] fees,” says Randy Edeker, chairman, CEO and president of West Des Moines, Iowa-based Hy-Vee, which operates nearly 250 supermarkets and as many retail pharmacies, and is the parent company of Amber Pharmacy and HyVee Pharmacy Solutions. “Right now, retail pharmacies must conduct business in an unpredictable environment where we are unsure of reimbursements and fees for administering much-needed medication for our customers,” Edeker tells PG. “Operating in this business situation creates uncertainty not only for a retailer, but most importantly its patients who are trying to navigate an already complex health care system.” In a retail atmosphere that’s focused on convenience and the individual consumer experience, Edeker notes, “My thoughts are on meeting personal shopping needs and on-the-go habits while providing an overall great customer service experience for everyone who walks through the door at Hy-Vee.” The provider that adapts to emerging trends and acts quickly to enable continued growth will be rewarded with loyal customers, according to Judy Spires, chairman and CEO of KB Holding Inc., a Delaware-based investment firm that owns Kings Super Markets and Balducci’s, which operate a combined 35 locations in the northeastern United States. “We are in a new era of food solutions, one that is full and ripe with exciting opportunity,” Spires says. “In our industry, the consumer is willing to try anything and is open to tasting new flavor profiles, all while on the quest for the very best quality. Businesses survive and thrive by accepting change and planning for it. My team has clear insight into these trends, and we see the path to success. With so many opportunities, prioritization is an important ingredient to determine our future and what we’ll continue driving forward to move our business ahead.” Edward “Trey” Basha, president and CEO of Chandler, Ariz.-based Bashas’ Family of Stores, which operates 130 locations under three banners, observes that growing sales, integrating innovation and battling competition “are three key components of everyone’s sleepless nights.” Basha continues: “Sales will always be a crucial driver of success in the grocery industry, and finding ways to increase sales is a delicate balance of having the right products on the right shelves and in the right stores. What’s equally important is that we’re taking care of, and responding to, our customers.” Basha expects online sales to grow in the coming year. “With online delivery of shelf-stable and nonfood items becoming more of the norm, especially for time-pressed families, organizations need to grow these areas with the demand,” he said. “This connects with the critical element of continuing to invest in remodels and technology, with the end goal of providing a better shopping environment for our customers and a better work environment for our employees.”

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85th AnnuAl RepoRt of the GRoceRy IndustRy

Won’t Back Down

What omnichannel services do you offer?

Grocers strive to keep up with the l atest tech solutions. By Randy Hofbauer

lthough human capital and competition remain the chief concerns over which grocers lose sleep, keeping up with technology has reached unprecedented heights of concern, rising to No. 3 (45.5 percent) from No. 9 since last year’s Annual Report. And while Amazon might have many grocers backed into a corner, these retailers aren’t going down without a fight: Nearly three in four (73.6 percent) respondents plan to increase their technology spend in 2018. Technological innovations for marketing and merchandising have taken priority over traditional methods in 2018: Taking up the top three spots on the list of important strategies are in-store signage/ digital media (71.1 percent), digital marketing (67.5 percent) and mobile marketing (57.9 percent), trailed far behind by direct mail (38.6 percent), newspaper inserts (29.8 percent), newspaper ads (23.7 percent), radio advertising (19.3 percent) and TV advertising (18.4 percent). The biggest news comes on the omnichannel front: Fewer grocers are still in the planning and development phase, with 56.1 percent — compared with 43.3 percent last year — currently executing or running a fully integrated strategy using in-

54.2%

Mobile Shopping Apps

31.8%

Click-and-Collect

31.8%

Third-Party Vendor Home Delivery (e.g. Instacart, MyWebGrocer, etc.)

30.8%

Drive-Up Collection Sites

Store-Supported Home Delivery

28.0%

In-Store Mobile Product Scanning

24.3%

16.8% 32.7%

Ordering Kiosks

None

Source: Progressive Grocer Market Research, 2018

What do you consider to be the most advantageous benefit offered by mobile devices/smartphones? 55.6% 50%

42.6%

33.3%

32.4%

30.6%

27.8%

25.9%

23.1%

17.6%

16.7%

Scan-asYou-Go/ Bypass Checkout

Mobile Wallets

10 0 Ecoupons

Order Online/ Pickup In-Store

Digital Circular

POS Loyalty Card

Source: Progressive Grocer Market Research, 2018

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Store Circular

Personalized Discounts

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85th AnnuAl RepoRt of the GRoceRy IndustRy Please grade your company’s strategy for connecting with consumers at multiple touchpoints 12.1% 28.0% A We have a fully integrated strategy using in-store, online and digital channels B We’ve got a strategy that we’re executing C We’re just getting started D We don’t have plans for omnichannel 31.8% 28.0% Source: Progressive Grocer Market Research, 2018

store, online and digital channels. However, smaller grams with their ecommerce operations over the past chains are further behind than larger ones, showyear, including Northeastern club chain BJ’s Wholeing the advantages that third-party companies can sale Club, Minnesota grocer Lunds & Byerlys, and have in assisting where scale and resources might Midwest retailer-wholesaler SpartanNash. Other be limited: While about one-third (32.1 percent) of grocers nationwide, such as Jewel-Osco, Safeway, respondents with fewer than 50 stores (versus 79.6 and Stop & Shop, have even worked to bring digipercent of those with 50-plus locations) are executtal coupons to Supplemental Nutrition Assistance ing or running a fully integrated strategy, roughly Program (SNAP) participants. Meanwhile, retailers half (50.9 percent) said they’re just getting started. large and small have worked to expand mobile wallet Although last year’s report showed growth functionality across stores, including Walmart, Taronly in select omnichannel services being offered get and Kroger, while checkout-free technology has compared with the year prior, this year’s showed also expanded from giants like Kroger and Walmart robust expansion across the board. Mobile shopto independents such as Macey’s in Utah. ping apps saw the strongest amount of growth Aside from mobile shopping apps, all om— from 29.6 percent to 54.2 percent — which nichannel offerings other than click-and-collect corresponds with a shift in what grocers value saw double-digit growth over the past year. This in mobile devices over the past year. could be because click-and-collect saw strong Social media no longer seems to be the greatgrowth in last year’s report, meaning that groest value in mobile for grocers: Facecers have moved into more sophisticated book, which topped last year’s list, fell waters — for instance, in-store mobile dramatically in this year’s survey (59.1 product scanning (24.3 percent versus 8.5 percent to 25.9 percent), while order percent) and ordering kiosks (16.8 percent online/pickup in-store (42.6 percent verversus 2.8 percent) saw some of the most sus 27.9 percent last year); POS loyalty impressive growth, while delivery services card (32.4 percent versus 23.6 percent); — whether store-supported (28 percent ecoupons (55.6 percent versus 51.9 perversus 14.1 percent) or third-party (31.8 cent); and personalized discounts (27.8 percent versus 16.9 percent) — also had percent versus 23.4 percent) saw strontheir year in the sun, possibly due to Amager favor. Mobile wallets and scan-aszon’s ante-upping in the space: Walmart, of grocers are currently executing or running a fully you-go/bypass checkout, although not Target, Albertsons and Costco alone have integrated ominchannel represented last year, were selected by been working to expand same-day delivstrategy using in-store, online 16.7 percent and 17.6 percent of responery. Click-and-collect still grew, however, and digital channels. dents, respectively. with nearly one-third of grocers now ofSeveral grocers have been working to fering it, compared with just more than connect their loyalty and coupon proone-fifth last year.

56%

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April 2018

Store of the Month

Gold Standard a new Jewel-osco in downtown Chicago amps up fresh, prepared food and spirits offerings. By Jim Dudlicek Photography by Vito Palmisano

or nearly a decade now, the Chicago-area grocery market has been undergoing a dramatic transformation, driven primarily by two factors: the arrival of Mariano’s Fresh Market (owned by Roundy’s, now a part of The Kroger Co.), and the closing of longtime mainstay Dominick’s Finer Foods by parent company Safeway. The Mariano’s concept, built on an overall fresh experience and enhanced prepared foods, compelled other players to up their game, and the locations vacated by Dominick’s provided an opportunity for other operators — chains and independents alike — to broaden their footprints in the Chicago metro area. Both of these moves are part of the growth strategy of Jewel-Osco, which has been remodeling existing stores and opening new ones as it strives to fortify its position as the Chicago market leader and, since Dominick’s departure, the area’s one true hometown grocery chain. Among the latest projects toward that goal is a new, twolevel urban-format supermarket in the Gold Coast neighborhood on Chicago’s North Side. Replacing a 29,000-squarefoot store razed in 2015 after operating on the site for decades, the 56,000-square-foot market, opened in summer 2017, occupies two floors at the base of a new 35-story, 390unit luxury apartment tower called The Sinclair. “The flagship store at Clark and Division was an opportunity to rebuild a smaller Jewel-Osco into a unique grocery store that caters to the residents in that neighborhood,” says Anthony Suggs, VP of marketing and merchandising. “The store is the second location for Jewel-Osco that houses a full-service bar, named Division on the Rocks, along with fresh food offerings. This strategy falls in line with the company’s decision to better serve our customers by offering fresh and organic items that are already prepared, or easy to prepare, at competitive prices.”

progressivegrocer.com

Jewel-Osco’s corporate and Clark & Division store management team includes (from left) Anthony Suggs, VP of marketing and merchandising; Mark Laryea, district manager; Doug Cygan, president; Sheila Whitiker, store director; Tammy Stock, center store operations specialist; and Tina Browen, director of marketing.

Jewel-Osco

102 W. Division st., chicago

Progressive grocer April 2018

Store of the Month

Jewel-Osco

The store’s location at a busy intersection featuring city bus and L train stops makes it well suited to the needs of commuters and businesspeople in every daypart, as well as residents of The Sinclair, who can descend from their apartments via elevator to the store without ever setting foot outside, a plus during harsh Chicago winters. “Our store has a full assortment of everyday items and specialty items that meet the needs of our customers,” Suggs says. “Additionally, since we are a local company, the store is nimble and allows us to try new items. Currently, we are testing cold-pressed juice, poké bowls and several gourmet single-serve desserts. We also have our first premium wine cellar, in the second-floor liquor department, and online grocery delivery is available.” Convenience is key. There are many prepared meal solutions, including a made-to-order burrito bar, a Mongolian grill, grab-and-go sandwiches, a hot bar, fresh sliced meats and cheeses, and fresh-baked breads, plus ready-made rotisserie chicken, seafood and slow-cooker meal kits. Additionally, the Starbucks kiosk makes the store a popular coffee stop. “Our vision was to provide fresh, ready-to-eat solutions while still giving our customers a complete grocery shopping experience,” explains Doug Cygan, Jewel-Osco’s president. “We understand the ever-changing needs of our customers and their busy

Chef-created entrées, sandwiches and appetizers can be enjoyed with a glass of wine or craft beer in Division on the Rocks, a spacious bar area on the store’s second level.

progressivegrocer.com

The Jewel-Osco at Clark and Division in Chicago serves a bustling commuter trade area as well as residents of The Sinclair, a 35-story apartment tower that rises above the store.

lifestyles, so we wanted to make sure we had solutions for all of our shoppers. “The goal of Jewel-Osco is to meet the needs of our customers,” Cygan continues. “Not only do we want to have their solution for breakfast, lunch, dinner or snacking, but we want to provide the solution that best fits their time constraint. JewelOsco has our customers covered.”

STORE OF THE MONTH

Jewel-Osco

102 W. Division St., Chicago, IL 60610

Grand opening: June 27, 2017

Size

Selling Area

Total square footage

Square Feet

56,000 44,000 Hours: 6 a.m. to 1 a.m.

40,000 SKUs

190 Employees

16 Checkouts (including 6 self-checks)

Designer: Camburas & Theodore Decor package by

King Retail Solutions Fresh, Fast, Frequent Stepping off the elevator from the elegant Sinclair residences or the parking garage, visitors entering the store here (there’s also a street-side entrance) first encounter the deli, where they find a grab-and-go case stocked with sandwiches, salads and quick meal items. “We get an extensive lunch crowd here,” notes Sheila Whitiker, store director. Suggs adds, “All of our meal solutions are restaurant-quality and made fresh in-store. In addition, we have fully integrated local, specialty, natural and organic items, which are in high demand from our guests.” The burrito bar makes Mexican wraps to order, along with tacos and bowls featuring different proteins and other ingredients. Similarly, the Mongolian grill makes custom Asian dishes. There’s a salad bar, a hot bar with wings, a sushi bar with the earlier mentioned poké bowls, and a variety of other meal solutions, including rotating featured items. “We get a lot of movement here,” Whitiker says. “This store brings a lot to the area to keep traffic moving. Our customers are fast-paced and looking to get in and out of the store.” Folks looking to stay for a while can take their eats to the upper-level mezzanine, where they can relax at a table in front of the fireplace or order a drink at the aforementioned bar, Division on the Rocks. There’s a full liquor selection, wine, 56

progressivegrocer.com

PG 052-063 SOTM jimbg.indd 56

5/2/18 1:17 PM

S econd Floor

Fir St Floor

Progressive grocer April 2018

Store of the Month

Jewel-Osco

Extensive fresh prepared food and produce areas can be observed from the store’s second-floor mezzanine (above). Noodle bowls and other Asian fare are made to order at the Mongolian grill (right).

and beers on tap, including local brews. Guests can also order food to be brought upstairs to their tables. Need libations to take home? The wine and spirits department is nearby on the same level, featuring craft beers, luxury spirits and a temperature-controlled wine cave with bottles for all price ranges. Division on the Rocks “has allowed us to host events with live cooking demos and prestigious chefs while sharing wine- or beer-pairing ideas,” notes Tina Browen, director of marketing. “It is really fun watching our customers take part in these events.”

Anything Customers Want Back downstairs, the deli offers packages of pre-sliced meats and cheeses for faster service, along with signature items like in-house roasted turkey breast. The cheese counter features more than 400 specialty varieties from home and abroad. “We create party trays, anything customers want,” Whitiker says. “It’s a growing category.” The bakery department makes a host of in-house scratch products, including many celebration cakes, with same-day service available for custom orders. The display case shows off many colorful designs, with popular characters from kids’ TV alongside Jewel-Osco’s own one-eyed mascot, JoJo, whose cakes “sell better than Cookie Monster,” Suggs boasts. 58

progressivegrocer.com

Smaller portions are popular bakery choices, including half cakes and individual slices, along with cookies trays. A large display offers more than 30 bakery items at $5 apiece. The dairy case features many organic choices, with alternative beverages like nut and rice milks, pegged as “one of our fastest-growing categories in fluid dairy” by Mark Laryea, district manager.

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Keep It Interesante.

Store of the Month

Jewel-Osco

Ready-to-eat and heat-and-eat items abound for time-starved shoppers (left), while gourmet burgers are crowd-pleasers and food theater during lunch and dinner dayparts (right).

Value-added, ready-to-cook items dominate the meat and seafood department, including stuffed Cornish game hens, stuffed pork chops and many seasonal items. Chicken breasts are hand-trimmed in the store, which gets good movement on Prime beef items. “We have butchers in every store,” Suggs says. “You can customize and special-order.” Laryea adds, “Our [video] menu boards provide different recipe options, from nachos to how to cook a brisket,” with videos shared on YouTube. Seafood selections include wild-caught ocean and lake varieties, with the elaborate display case created by hand every morning, Whitiker notes. Case-ready meats include grass-fed beef, natural meats like lamb and veal, air-chilled chicken, an integrated kosher meat section, and “expanded smoked meats that cater to the ethnic customer,” Laryea says. Plant-based burgers are “completely integrated” into the meat case alongside their beef-based counterparts, he adds.

The expanded fresh side of the store has allowed us to test several new concepts that have been very successful. This will allow us to continue to innovate and evolve to the customer’s needs.” —Doug Cygan, Jewel-Osco president

progressivegrocer.com

Continuing to Grow A daily count of organic items is posted for what Whitiker calls “the freshest produce department in Chicago.” On any given day, more than 100 organic items are available. In fact, the Jewel team reveals, about 20 percent of the store’s produce sales are from organic items, with fresh-cut items accounting for another 20 percent, or about 4 percent of the store’s total sales, “and it continues to grow,” as Laryea notes. An island cooler features fresh-cut fruit bowls, while another display cross-merchandises berries with whipped cream. Snack packs offer fresh-cut veggies packaged with nuts and cheese, and yogurt parfaits, alongside pre-cut veggies for cooking, fresh juices and infused waters. Guacamole and salsas are made in house; trays include items like veggies, fruit and deviled eggs. “We will custom-make anything for customers,” Whitiker says. “Our associates do this in-store every day. A lot of work goes into this, to feature it for our customers.” Signage urging Jewel shoppers to “eat, live and breathe local” calls attention to the products of more than 100 area vendors. “We want to shout fresh every day,” Whitiker says. Local products include a case of condiments branded for former Chicago Bears coach Mike Ditka, as well as taco and guacamole mixes by Frontera, the brand of Chicago-based celebrity chef Rick Bayless. The store’s street entrance opens into the floral department, highlighted with a large centerpiece to entice purchasers. Jewel has floral designers in all of its stores to work on custom orders. Also up front for quick and handy shopping

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are seasoned take-and-bake items merchandised with vegetables and veggie noodles. Additionally, there are protein bars near the entrance for easy on-the-go grabs. The store’s 40,000 SKUs include some 6,000 organic items integrated into the overall inventory, including Albertsons-Safeway’s popular O Organics line. “It makes the shopping experience more cohesive to the customer, easier to find what they’re looking for,” Laryea explains. “We try to make it easy for the customer to shop — a nice easy flow,” Whitiker adds. In addition to the upstairs spirits department, the store merchandises some craft beers on the main floor. “We get a lot of movement in local craft beers,” she notes. Another “hot commodity,” according to Laryea, is kombucha, a fastgrowing category that includes O Organics SKUs as well as branded lines.

Evolving to Customer Needs By all accounts to date, the store is a hit with shoppers. “The most rewarding aspect of this store is giving the neighborhood what they want and continuing to innovate as their needs change,” Browen says. “It has been extremely rewarding to watch our customers walk out satisfied.” Suggs adds that locals’ affection for the banner “is very humbling — it’s always ‘my Jewel,’” or, for old-school Chicago-area residents, “the Jewels.” An extensive billboard campaign plays up the chain’s centuryplus longevity, along with the long tenures of many of its 32,000 associates. “They’re what make the difference. We really try to embrace that,” he asserts. “We wanted to show customers we’re here to serve you.” That has made efficient space utilization crucial. “One of our biggest opportunities is the volume of people that frequent our store in such a small footprint,” Suggs observes. “We maximized the square footage in this location as best as possible, but the area is so densely populated, so we saw an opportunity.” Replenishment and innovation are key areas of focus for supplier collaborations, Suggs adds: “We are prepared to test even more products in this store to see what works and to see if those items can get rolled to our other stores. Look for Plated meal kits in the near future.” And look for the most successful features at Clark and Division to start appearing at more of Jewel-Osco’s suburban stores. “The expanded fresh side of the store has allowed us to test several new concepts that have been very successful,” Cygan says. “It also allows us to receive customer feedback to better prepare us for other stores and to understand the areas outside of what we’ve already done. This will allow us to continue to innovate and evolve to the customer’s needs.”

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About Jewel-Osco Jewel-Osco was founded in 1899 by Frank Ross and his brother in-law Frank Skiff, who were selling tea and coffee from a horsedrawn wagon. Today, Jewel-Osco has 187 locations, most in the greater Chicago area, with four in northwest Indiana and one in Clinton, Iowa. One of 19 grocery banners owned by Boise, Idaho-based Albertsons Cos., Jewel-Osco maintains its headquarters in Itasca, Ill., a northwestern suburb of Chicago.

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SolutionS

Snacking

The Hunger Game As consumers snAck more of ten And in more Pl Aces, grocers e xPAnd snAck offerings throughout the store. By Lynn Petrak

he crave is a wave. While most grocers still have a center store aisle lined with traditional salty snacks and cookies, those shelves include an ever-growing array of products. At the same time, retailers have dedicated other shelf and case space to snack products that cross a variety of packaged, fresh, refrigerated and frozen categories. Virtually anything, it seems, can and is being consumed for snacking and grazing occasions. “Consumers are snacking on an average of 2.5 snacks per day in the U.S., and the snacking universe is far-reaching, encompassing many categories throughout the store,” concurs Sally Lyons Wyatt, EVP and practice leader for Chicagobased IRI. “Consumers are driving this by either snacking on nontraditional categories, such as hard-boiled eggs, and/or the expansion within traditional categories.” Indeed, there’s no shortage of data showing that snacks are, if not quite the new meals, a form of all-day sustenance. According to findings from Chicago-based Mintel, 55 percent of people now say that they snack two to three times a day, compared with 50 percent of respondents in 2015. Those in

Key Takeaways All-day snacking is bigger than ever, with Millennials the most likely demographic to nosh four times or more daily. A plethora of new products, both in traditional snacking categories and beyond them, is addressing consumer needs for taste, satiety and nutrition; examples include probiotic-enhanced items and protein-rich meat snacks. As snack offerings spread out across the store, crossmerchandising is key, such as carrying packaged fruits and vegetable products in center store as well as in the produce section. Suggestive selling across the entire store should spur impulse snack purchases.

Progressive grocer April 2018

SolutionS

Snacking

the Millennial generation are the most likely to snack four or more times daily. Within the broad spectrum of snacking, individual noshing across several categories is a macro trend. Research from The Nielsen Co., also in Chicago, pegs the individual-snacking category at $33 billion in the United States.

Core Value To Wyatt’s point, traditional snack segments, among them salty snacks and packaged cookies, now include a plethora of new and specialty products. “For core snacking, it has received an even greater boost in sales — up 1.9 percent in dollar sales — from the diversification of benefits across the categories,” observes Wyatt. “This may be from added benefits, such as protein or fiber, and the absence or less of other ingredients, like non-GMO.”

Some of those products are line extensions and additions from big brands — including bold, exotic flavors, like Doritos Blaze chips — while others have been developed by niche or smaller brands looking to capitalize on consumer interest in unique items that satisfy their cravings. A lot of the buzz in salty snacks stems from the growing variety of ingredients and flavors, in keeping with consumers’ evolving tastes and preferences. Potato chips may be a segment leader, but a look at many store shelves reveals that hummus chips, lentil chips and other types of plant-based salty snacks are now commanding attention and room on the shelf. Examples include the recently introduced line of Peatos, from Los Angeles-based Snack it Forward, offering crunchy puffed snacks high in protein and fiber, and Cassava Root Chips, from Needham, Mass.-based Plant Snacks, made from root vegetables and free of the “big eight” allergens. The health attributes of such snacks are a major driver, according to some industry experts. “Probiotic-enhanced salty snacks are a huge trend at present, as consumers continue to indulge in self-care, with a 360-degree approach that also impacts on their attitudes to snacking,” says Nicole Prefer, director of strategy for Vault49, a New York-based brand design agency that has worked in the snack sector. “Snack brands are stepping in to provide solutions with probiotic-enhanced nuts, chips and pretzels that help aid in digestion.” She cites the

SolutionS

Snacking

example of Richmond, Calif.-based Living Intentions, which offers an activated Thai curry superfood nut blend with live probiotics. Typically merchandised in center store and impulse areas, nutrition bars have become a quintessential snack for busy consumers, for health, flavor and portability reasons. The bar segment remains a focus of R&D activity, too, with new products launched almost weekly, including hybrid kinds of bars. Case in point: a savory snack bar made with real cheese, recently unveiled by Sonoma Creamery, in Sonoma, Calif. In the seed segment, underscoring the power of co-branding, Chicago-based Conagra Brands recently teamed up with Taco Bell to offer BIGS Taco Supreme. “BIGS fans want bold flavor, and the brand’s partnership with Taco Bell delivers,” asserts Conagra spokeswoman Priscilla Zuchowski. Meanwhile, given the popularity of protein-rich diets, the meat snack segment has been hot in recent years, and innovations keep coming. “The meat snacks sector is evolving, too, with better-foryou ranges proving popular,” affirms Vault49’s Prefer. “Among the reasons for meat snacks’ success is that they offer a quick and easy snack with portion control [that is] high in protein and satiates hunger.”

There are plenty of examples of new meat snack products, again from both major brands and smaller manufacturers. Conagra’s “snacks and sweet treats” domain includes more meat snacks, including new Duke’s Beef Brisket Strips, grass-fed, sliced brisket in Chipotle BBQ, Honey Bourbon, and Sea Salt and Pepper varieties, and new Duke’s Shorty Tall Boys, smoked mini sausages in Original, Hot and Spicy, Hickory Peach BBQ, and Hatch Chile flavors. Prefer points to other interesting types of meat snacks, such as Boulder, Colo.-based Wilde Brands LLC’s chicken chips. “The brand has only four ingredients that dial into consumers’ desire and need for healthy yet tasty salty snacks,” she observes. “According to the founder, the chicken chips are the first-to-market salty snack that has all the taste and texture of your favorite potato-based chip, but with clean ingredients and protein instead of carbohydrates.” The changed-up forms of meat snacks are likewise showcased in a new Beef Thin line from The New Primal, based in North Charleston, S.C. The thinly sliced cuts of grass-fed, grass-finished beef jerky are touted

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as easier to chew than traditional jerky and fit into high-protein regimes like the Whole30 diet and the Paleo eating plan. â&#x20AC;&#x153;Our goal with the Beef Thins is to bring a new type of meat snack to market that not only caters to the particularities of Whole30, but also appeals to consumers who are put off by the toughness of traditional jerky,â&#x20AC;? says founder Jason Burke. Meat snacks arenâ&#x20AC;&#x2122;t relegated to jerky and dried products, though. For example, pork rinds arenâ&#x20AC;&#x2122;t new, but there are fresh takes on this classic snack, with items like Southern Recipe Small Batch pork rinds in Cilantro Lime, Blackberry Habanero and Smoked Sea Salt flavors; the Lima, Ohio-based company is also debuting Tender Style Pork Cracklins in a Honey Chipotle variety.

Total-store Snacking While their snack aisles encompass more and different SKUs, grocers are delivering solutions for shoppersâ&#x20AC;&#x2122; cravings across most, if not all, departments.

Those solutions can help boost total store sales and demonstrate to shoppers that grocers understand their eating preferences. As a November 2017 report on snacking from Nielsen noted: â&#x20AC;&#x153;Expanding individual snacking options across all categories will provide consumers the variety they desire and keep them coming back for more.â&#x20AC;? In the refrigerated case, snacking cheese and combination snack packs offer consumers a host of snacking options. â&#x20AC;&#x153;Snack packs combining meat, cheese, crackers and/or dessert were a hit in 2017, with an increase in dollar sales of 45 percent,â&#x20AC;? notes Wyatt. â&#x20AC;&#x153;These not only deliver on variety, but convenience and satiety.â&#x20AC;? Yogurt has long been a snack as much as a breakfast food, and there are an array of yogurt and other cultured and probiotic-rich refrigerated products that appeal to on-the-go snack-seeking consumers. Here, too, the variety show continues: the maker of Alove yogurt, Torrance, Calif.-based Morinaga Nutritional Foods, recently added a drinkable low-fat Japanese-style yogurt with aloe vera gel pieces; the product is sold in a 7-ounce bottle and comes in three varieties. Snacks arenâ&#x20AC;&#x2122;t anything new in the frozen depart-

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ment — frozen pizza rolls and egg rolls go back decades — but there are examples of recent product and packaging creativity in the freezer aisle. One example is a new line of organic frozen rice bites, Grainspirations, from Richvale, Calif.-based Lundberg Family Farms. The risotto balls are available in Gouda and Mozzarella, Black Rice, and Gochujang varieties. Iconic brands have also gotten in on the snack trend, such as Velveeta with its Velveeta Cheesy Bites, featuring a tortilla coating in Original and Salsa con Queso flavors. Elsewhere in the store, fresh fruits and vegetables are snackable on their own, yet many grocers have added packaged snacks to their produce departments. “Some consumers are still opting for other fruit forms versus fresh, with an increase in other dried fruit of 2.3 percent,” points out Wyatt. Grocers can cross-merchandise packaged fruit and vegetable products, carrying them in the traditional snack aisle as well as the produce area. Packaged kale chips, for example, can be displayed near fresh kale or next to other packaged salty snacks, while single-serve packaged strawberries can be sold in a refrigerated case or display not far from larger, traditional fresh strawberry packages. A 2017 Consumer Insights report from Nielsen confirms shoppers’ gravitation toward packaged produce snacks. According to the research, the on-the-go snacking category within the produce department has grown more than 10 percent every year between 2012 and 2015, with more than 900 new snacking items introduced in that time frame.

Collaboration as Competitive Edge Providing snack solutions across the store is increasingly pivotal in a competitive marketplace. “An omnichannel approach is more important now more than ever, since the majority of consumers look online before going into stores,” observes Wyatt. “There are channel preferences across the generations that require targeted messaging and assortment by retailers to ensure they are the store of choice for their target consumers for their snacking needs.” She also emphasizes the importance of assortment and merchandising for snacks in the perimeter and center store, as well as in impulse displays and any other places where snacks can be sold. “Once in the store, suggestive selling across the entire store will be beneficial and will drive impulse purchases,” suggests Wyatt. “Collaboration between retailers and manufacturers should leverage the checkout and shopper loyalty cards to continue driving snack growth.”

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Fresh Food

Produce

Cutting a Path to Profit Produce butchers can cre ate a PoPul ar Point of differentiation. By D. Gail Fleenor

ustomers are stepping right up to counters or kiosks and receiving personal attention with a new service: produce butchers. At least a half-dozen supermarket chains in the United States and Canada are now offering this service to customers who want to add fresh produce in a convenient form for a healthier diet, are seeking convenience in meal preparation, may be uncertain about cutting some fresh items, or just don’t want to be bothered with slicing and dicing. The new service is a way for supermarkets to compete with mass merchandisers and online grocers offering ready-to-cook meals.

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Key Takeaways Consider your store’s customer profile before adding a produce butcher. For example, do you have many Millennial shoppers or big spenders? Plan what your produce butcher will do between orders to maximize the labor invested. Decide whether you’ll charge a fee for the produce-cutting service, and what that fee will be based upon, such as by the pound or by particular vegetables or fruits. Pilot the program first at one or two stores to see how produce butchering works in your stores’ area and with your customers.

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slicing for success Supermarkets are experiencing an earth-shaking change due to the effect of big-box retailers and ecommerce on sales. “Consumers are not going to visit a grocer just because it has a produce butcher,” says Caleb Bryant, senior analyst for Chicago-based Mintel. “However, a produce butcher can be one component of a popular grocery store.” Because of threats to the bottom line, supermarkets are focusing on providing customers with a unique experience when shopping, he observes. “The growth of meal kit services, such as Blue Apron, demonstrates that consumers want to cook fresh meals at home but are looking for easy ways to cut down on the time it takes to actually cook a meal,” notes Bryant. “A produce butcher offers customers one less step in the cooking process.” Produce butchers not only slice and dice, they also provide samples of items and educate customers. New produce items, particularly fruits, debut regularly. Some customers may be reluctant to invest in a new item without tasting it. Most produce butchers will cut any item to allow the customer to taste-test before purchase. “A produce butcher likely appeals most to Millennials,

A produce butcher offers customers one less step in the cooking process.” —Caleb Bryant, Mintel who generally are most interested in unique offerings at grocers,” observes Bryant. Busy parents may also be willing to pay a bit extra for the convenience a produce butcher offers, he notes. The service could additionally be beneficial for customers who physically have difficulty chopping produce, such as those with arthritis. Consumers are interested in retail environments that provide memorable experiences, according to the Mintel Trend “Experience is All” report. Millennials crave experiences, so it’s not unusual that 26 percent of this group say that they’re more likely to grocery shop at a store that offers a unique experience, such as produce butchering, compared with 10 percent of Baby Boomers, according to the report. Millennials are also

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Fresh Food

Produce

interested in products and services that help them with at-home cooking, such as pre-cut vegetables.

A day in the Life of a Produce Butcher

Inder Salwan, of Saks Food Hall by Pusiteri’s at CF Toronto Eaton Centre, gets ready to prepare vegetables for customers.

Inder Salwan has been a vegetable butcher since 2016, when he was hired as the produce expert for Saks Food Hall by Pusateri’s at CF Toronto Eaton Centre. Pusateri’s notes on its website that it has Toronto’s finest prepared fare and offers a variety of experiences for shoppers. According to Salwan, his role as vegetable butcher began to flourish as he worked primarily on the produce wet wall. Prior to his produce butcher duties for Pusateri’s, he received training in how to chop certain vegetables in different ways. On a typical day, Salwan first organizes his station and then handles the store’s catering orders to have these finished before guests arrive. Guests hand the veggies they’d like to be cut to Salwan. He verifies the cut needed and also asks additional questions about the veggie’s use so that the cut will be correct for the customer’s dish. An estimated time of completion is given, and the veggies are then cleaned, butchered and packaged in tightly sealed plastic containers. Some must be packaged in a particular way, he notes, such as kales and leaf lettuces, with a paper towel sheet underneath the item to absorb moisture. Like most produce butchers, Salwan also handles pre-cut packages for the sales floor. After

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Fresh Food

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closing each day, he cleans and sanitizes everything to be ready for the next day.

Chopping for shoppers St. Cloud, Minn.-based Coborn’s is equally sold on produce butchers. Currently, three of the chain’s stores offer “Chop Shoppes,” but the future holds more, asserts Kevin Hurd, company communications and engagement specialist. “Our next-generation concept stores, new from the ground up or totally remodeled, will have departments that are boutiques,” notes Hurd. “The Chop Shoppe will be one of these. This offers us the chance to go the extra step for customers. We can offer fresh-cut fruits and veggies for time-pressed consumers, along with fresh juices.” Another change for Coborn’s is a rebranded produce department. “This department will be called ‘Farmer’s Market’ and will have island setups,” explains Hurd, adding that the company will identify markets that are suitable for the new concept, while other company banners aren’t involved in the change. Training in the handling of produce is big at Coborn’s. “Our produce butchers are taught the best ways to cut a variety of fruits and vegetables,” says Bridget Winkelman, Farmer’s Market and floral manager at Coborn’s Isanti, Minn., location. “Ever cut a mango? These guys are pros at cutting that challenging fruit! They are taught to start with working at doing it correctly first, then working towards speed.” Winkelman notes that Coborn’s produce butchers are taught many different knife skills and best safety practices. “Most importantly, they are taught food safety skills,” she points out. “Proper hand washing and product washing is emphasized before they even enter into the department. Any produce butcher can assure you that they know how to wash, rinse and sanitize their surfaces and dishes regularly.” Produce butchers bring value to supermarkets through their knowledge of produce, Winkelman maintains. “Our produce butchers are the experts at knowing what is delicious right now,” she observes. “They have cut it all, and can give tips and advice to our guests who maybe aren’t sure about items. They provide a service that builds loyalty. Our produce butchers have regular guests and know what those guests like and how they like it prepared.” What’s more, cutting produce in the department rather than in the prep room fills the department with aromas that evoke a fresh feeling for shoppers, adds Winkelman.

Preparing pineapple is a popular request for Produce Butcher Bridget Winkelman at the Chop Shoppe in Coborn’s Isanti, Minn., location.

etables in our juices — no water, no added sugars and no preservatives, for a clean and healthy drink,” she asserts. “The types of requests we receive can be anything from shredded cabbage for coleslaw to finely diced peppers for a stir-fry,” says Pusateri’s Salwan. The most common requests at the store are for celery, carrots, cucumber, peppers, and even potato sticks (julienne). “Diced celery, peppers and zucchini are very popular,” he continues, “and, of course, there is always one person who would like to get an onion chopped, sliced or diced.” Lowe’s Foods, based in Winston-Salem,

What’s on the Menu? Coborn’s produce butchers prepare an entire case of readyto-go fresh-cut fruit and vegetables daily, which can include only one item per container or five-plus for a fruit medley. Favorite items are ready-to-go berries for snacking, fruit and veggie trays for parties, and diced onion mixes “so our guests don’t have to cry at home,” notes Winkelman. A variety of fresh juices are prepared as well. “We only put fruit and veg-

progressivegrocer.com

Ever cut a mango? These guys are pros at cutting that challenging fruit!” —Bridget Winkelman, Coborn’s

N.c., offers its Pick & Prep service at some locations. customers choose the produce they want, fill out a form telling how they want it prepped, hand in the form and produce to the produce butcher at Pick & Prep, and pick it up at the end of their shopping trip. Francis Podrebartz, a produce butcher at a Lowe’s Foods store in Bolivia, N.c., points out that many requests from customers are seasonally dependent. “in the fall and winter months, butternut squash peeled and diced is a hit,” he notes. “in the summer months, it’s a toss-up between premium fruit bowls, Pico de gallo and guacamole.”

Making it Personal retailers are planning their own produce butcher programs to suit their customers and their facilities. Upscale grocer gelson’s Market, based in encino, calif., is piloting a produce butcher program at its century city, calif., location. “our produce chop shop features a produce chef,” observes Paul Kneeland, senior director produce, food service, floral and bakery operations for gelson’s. Like other grocery stores, the produce chef chops all day to keep prepared fruit and vegetables on the shelves. if a customer wants something cut, they select the produce or allow the chef to do so. “The customer fills out an order form detailing how they want the produce cut, such as coins, sticks, etc., and notes the size of the cut — fine, quarter-cut, etc.,” notes Kneeland. A menu is displayed on the wall behind the produce chef detailing the prices of types of vegetables or fruit prepared. in addition to ordering in-store, customers can order online or by phone. They can wait while their order is prepared, which Kneeland says many customers prefer to do: “They like to engage the chef about their order.” customers can also receive a text while shopping when their order is complete. if possible, the produce chef even takes the order to the customer in the store. Kneeland notes that the company has already identified locations for future chop shop services. smaller stores where there isn’t room on the sales floor for the service will likely have a “chop shop Light”: custom cuts performed in the prep room. so far, the initiative is a hit with shoppers. “customers are loving the extra

service; they love to be pampered!” enthuses Kneeland. “They are asking for things we don’t have listed, like sliced citrus and melon balls.”

Are Produce Butchers Keepers? Will produce butchers become as common as meat butchers in supermarkets? According to “The Power of Produce 2017,” from Washington, D.c.based Food Marketing institute, seven in 10 shoppers have an interest in their store offering a produce butcher, while only 18 percent were very interested. Those most interested in this service had a high shopping frequency of three or more times per week, were specialty/organic shoppers, were higher spenders of $100-plus per week and lived in the western United states. “i think produce butchers have great potential, especially in customer service and engagement, but also in customization,” observes Kneeland. “The trick will be to keep the chef productive. That’s why we have them cutting pre-packaged also.” “it’s easy to write off produce butchers as a silly concept designed for lazy Millennials, but it actually speaks to major trends occurring in the grocery retailing industry,” insists Mintel’s Bryant, although he doesn’t think that produce butchers will start appearing at all grocery stores. “i do expect more stores will start adding them,” he predicts, however. “Moreover, produce butchers represent the direction the grocery retailing industry is going, where stores become more experiential and offer products/services that allow customers to cook at home with more ease and simplicity.”

Progressive grocer April 2018

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Menu Boards: The Writing on the Wall P. 82

In-store Alliances P. 86

April 2018

Accent on Cuisine

Modern Jewish Deli Fare Whatâ&#x20AC;&#x2122;s old is new again P. 90

Volume four

issue 1

EquipmEnt & DEsign

Menu Boards

At Starbucks, bakery and packaged goods are merchandised to provide visual cues that reinforce the menu positioning.

The Writing on the Wall A foodservice pro offers menu boArd str Ategies. By Kathy Hayden

hen it comes to communicating menu offerings, grocerants are up against many more challenges than traditional restaurants. Drive-throughs have their bright, photo-heavy menu boards; full-service settings provide printed menus that diners can read in relative leisure; fast-casual settings devote entire walls to conveying their menus and missions. By contrast, grocerants have to fight space restrictions, visual clutter and evolving menus to get their messages across.

What are You selling? Despite these differences, menu design expert Howland Blackiston, principal of Westport, Conn.-based King-Casey, sees one common denominator in how restaurants and grocerants need to strategize their menus.

progressivegrocer.com

Key Takeaways Grocerants must decide how each of the items theyâ&#x20AC;&#x2122;re selling contributes to their strategy, and prioritize their menus accordingly. Whatever those priorities are, grocerants must make sure that theyâ&#x20AC;&#x2122;re conveyed in ways that are easy to navigate, help reinforce their brand and are distinct. Menu strategy is intrinsically linked to all concept strategy, including the amount of kitchen space, how focused the offerings will be, and even the seating arrangements. Grocerants can also create visual cues that demarcate various merchandising zones.

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EquIpmEnt & DEsIgn

Menu Boards

“Whether you have a chalk easel or an entire wall of whiteboard, it’s not about the board itself, but the items you are selling,” advises Blackiston. “You need to decide how each of the items you are selling contributes to your strategy — whether that’s price, popularity, what you have most of — and you need to prioritize your menu accordingly.” Presenting a menu is not just about words or even pictures, it’s also a tool that guides purchase behavior and changes decisions. Whatever your priorities are, make sure that they’re conveyed in ways that are easy to navigate, help reinforce your brand and are distinct. “There’s a McDonald’s example I use all the time,” says Blackiston. “At one point, McDonald’s wanted to shift their brand reputation away from ‘junk food’ and convey better health. So the drivethru menus had salads front and center. No one expected salads to become their top sellers, but that wasn’t the goal. The move was about prioritizing the image of healthier salads at McDonald’s.” Menu strategy is intrinsically linked to all concept strategy, notes Blackiston. “Your menu display decisions relate to how much kitchen space you have, how focused your offerings will be, and even what your seating arrangements are,” he notes. “I see too many small operations take up space with four-top tables that are used by solo diners.” If your grocerant concept focuses on grab-and-go pulled-pork sandwiches, for instance, narrow, communal bars or two-tops are a better use of space.

What are You Known for? “Ask yourself, what is your grocerant’s claim to fame? What is your Frappuccino or your Whopper?” says Blackiston, who points out that being known for something and doing that one thing really well are important in terms of branding and also in terms of helping to prioritize your menu displays. “Think of how a Starbucks is set up,” posits Blackiston. “No matter where you are, you know how the Starbucks is going to look. You know where to line up, and you know where to look for special drinks. It’s a branded look, and you recognize it, even within other retail settings. “We’ve worked with a fast-casual sandwich concept within cstores,” he adds. “They are competing with Subway, and use their spaces accordingly. Different zones are designed to meet the individual needs of different customers. Bars and counter seating are for quick bites or grab-and-go. Traditional tabletop seating — two-tops and four-tops — are available for those taking a longer sandwich break.”

With help from King-Casey, Popeye’s Chicken streamlined its menu board to make different portion sizes and bundles easy to order.

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Whether you have a chalk easel or an entire wall of whiteboard, it’s not about the board itself, but the items you are selling.” —Howland Blackiston, King-Casey

In the Zone “Another strategy is to think in terms of merchandising zones and creating visual cues that convey those zones,” says Blackiston, who notes that Austin, Texas-based Whole Foods Market does this well. “You see a pizza oven, and you know to grab a slice at the counter in front of it. You see a sushi chef with a white jacket, and you know you can grab a few rolls there.” Zone menus have to include simple staged messaging to correspond with customers moving through zones. Blackiston describes how fast-casual restaurants are often set up in zones supported by suggestive selling through branded messages and photos. Merchandising is designed to support menu cues. Pre-sale zones put purchasing ideas in customers’ heads. Purchasing zones convey addon messages, like ready-to-drink options and packaged cookies or candy. Customers line up and see photos of seasonal specials on sign stands. They see what’s available in the pastry case. They grab packaged snacks and sandwiches. By the time they cash out, they may have added a bag of gourmet nuts to their purchase. “Grocerants are competing with limited-service restaurants, and the best ones have menu strategies down to a science,” asserts Blackiston. “Don’t try to reinvent the wheel because you’re in a different setting. Follow their best practices.”

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Collaboration

Co-Branding N

In-store Alliances Working With established foodservice br ands brings credibilit y and oper ational e ase to more grocer ant progr ams. by barbara Sax

s competition heats up for every food dollar, more grocery banners are partnering with wellknown restaurants and chefs to give consumers another reason to visit their stores. The restaurant-within-a-store concept can drive traffic — a critical advantage as food retailers battle for share in a marketplace teeming with options. “If you change the experience, and the prepared food becomes entertainment, chains can leverage best practices in other areas of the store to increase sales per square foot and sales per hour by shift,” says Joshua Korn, CEO of Culimetrics, a San Diego-based restaurant and hospitality consulting firm. “Partnering with locally known chefs and upscale brands allows retailers to leverage the connection between the local community and a known restaurant brand,” explains Korn. “A strategic partnership with a chef provides instant brand recognition and a

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Whole Foods in Bryant Park teamed with renowned chef Daniel Boulud on Harbor Bar, a full-service seafood concept that fits with the upscale New York City location.

Key Takeaways Partnerships with local chefs and upscale brands enable grocers to capitalize on the connection between the community and a known restaurant. For foodservice operators, supermarkets offer prime retail real estate and captive foot traffic from foodfocused shoppers. Demographics and location are key considerations.

quality statement about the types of food served.” on the foodservice operator side, grocery stores offer prime retail real estate and captive foot traffic from shoppers who are already food-focused.

Built-in Credibility Joining forces with a local celebrity chef’s brand “gives a chain like Whole Foods Market an opportunity to elevate their brand, differentiate themselves in a market and create excitement in the store,” notes Bob goldin, partner at Pentallect, a food business management consulting firm based in chicago. Tien Ho, head of culinary and hospitality at Austin, Texas-based Whole Foods, seeks partnerships with local chefs who come with an established fan base in nearby neighborhoods. Local outreach provides a good way for Ho to bring shoppers more of what

they love, while also allowing Whole Foods staffers to learn more about local tastes. Ho explains, “in a lot of cases, we like to collaborate with chefs on a new concept just for Whole Foods, because that helps us push the envelope and try something new.” Ho says the company’s goal is to create win-win partnerships with chefs and restaurants in a variety of cities and neighborhoods across the country. “The key is finding the right menu concept for that community of shoppers,” he points out. “We work to understand whether the neighborhood is looking for fast family meals, vegan options, sit-down dining or perhaps a bar venue. once we can understand how to best serve those shoppers, we find the right chef or restaurant partner to help bring that vision to life.” Whole Foods has been particularly busy reaching out to restaurants in the Los Angeles market, where the company acquired a minority stake in L.A.-based Mendocino Farms, an emerging chain of fastcasual concepts focused on organic, locally sourced ingredients. Progressive grocer April 2018

CoLLAborAtion

Co-Branding

In November 2016, Whole Foods began a program to add Mendocino Farms outposts in some of its locations in the Los Angeles metro area. In a recently remodeled Tustin, Calif., store, for instance, Mendocino Farms anchors the prepared food section with a full-size restaurant and a full menu of gourmet sandwiches and salads for lunch and dinner. Menu highlights include on-trend items like Pork Belly Banh Mi Sandwiches and Avocado and Quinoa Superfood Ensaladas. The Tustin store also features a Hangar Bar restaurant with 36 on-tap beers, a dozen wines by the glass, signature craft cocktails, and chef-driven, seasonal cuisine.

Household-name Chefs A more recent partnership for Whole Foods is its work with James Beard Award-winning chef Michael Solomonov, who has located a kiosk-sized branch of his popular vegan falafel and shake shop, Goldie, in the chain’s Philadelphia Center City store. The majority of Whole Foods’ partnerships are with quickservice concepts, but Ho notes that, as in the case of Hangar Bar, full-service or mixed-service models can make sense for specific stores. Whole Foods teamed up with chef Erik Bruner-Yang on an in-store restaurant concept called Paper Horse designed for the grocer’s Foggy Bottom and Pentagon City locations in Washington, D.C. The “Asian comfort food” menu of soups, noodle entrées and the chef’s signature Chinese burgers appeals to shoppers in upscale city market settings with mixed retail use. Additionally, in a new Bryant Park store in New York City, Whole Foods teamed with renowned chef Daniel Boulud on Harbor Bar, a full-service restaurant featuring a raw bar and a menu of oyster towers, lobster rolls and seafood-centric small plates.

Following the Leader Other supermarket chains are adopting the co-branded strategy. Hy-Vee is partnering with Boston-based burger chain Wahlburgers to build, own and operate 26 Wahlburgers restaurants in seven Midwestern states, making the West Des Moines, Iowabased supermarket banner Wahlburgers’ largest single franchi-

Raising the Bar For retailers looking to take a small step into co-branding, Bob Goldin, partner at Pentallect, a food business management consulting firm in Chicago, suggests starting with a wine, craft beer, tea, pressed juice or kombucha bar. Smaller, single-focus kiosks, like Michael Solomonov’s falafel concept in the Whole Foods Market store in Philadelphia’s Center City, are another, smaller-risk way to bring a local brand inside a supermarket setting. For store differentiation at a lower cost of entry, think in terms of convenience and ease of service, like a local chowder bar open at peak lunch hours, or a fro-yo station for latenight snacking.

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see. Hy-Vee has also added select Wahlburgers menu items to its Market Grille restaurants chain-wide. In revealing the partnership, Hy-Vee Chairman, CEO and President Randy Edeker cited Bureau of Labor Statistics figures showing that eating meals outside the home has surpassed meals consumed in the home. Food industry executives like Edeker are scrambling to respond to Millennial shopping patterns that will shift even more to out-of-home eating. Wahlburgers family-friendly burgers and casual-dining concept could be the type of turnkey franchising solutions that fit the bill for grocery store banners.

Walmart’s Easy-grow Approach Even Bentonville, Ark.-based retail giant Walmart is on board with the co-branding trend, as evidenced by its recent partnership with Miami-based emerging chain Grown, a concept developed with former Miami Heat basketball star Ray Allen and his wife, Shannon. Billed as “slow food for fast people,” Grown is a contemporary health-food concept serving organic, clean-ingredient and on-trend food in an upscale setting. Consultants see these strategic partnerships with chefs or brands becoming more important as chains try to attract Millennial and Gen Z consumers. “These consumers are sophisticated, and they want more choices for higher-quality heat-and-eat or takeout meals and are willing to eat in a supermarket if it offers them a quality option,” says Culimetrics’ Korn. Younger shoppers make the same demands on the retail side of the partnership and expect highquality food and a convenient shopping experience, so it’s important that both sides of the partnership perform at a high level. “Diners are educated and, more than ever, are demanding better options — and they are willing to pay for it, so everyone has to level up,” says Shari Grunspan, a spokeswoman for Grown. Grunspan adds that, since the Walmart Grown location is owned and operated by the Grown team, Walmart can offer an upscale dining option to its customers with minimal effort — an important consideration. Retailers are taking a closer look at how profitable grocerants can be, while at the same time realizing how challenging day-to-day restaurant operations are. As Pentallect’s Goldin observes, “Smart supermarket retailers realize they don’t always have the category competence to run restaurants, so outsourcing the space makes sense.”

Location, Location, Location Retailers typically offer their grocerant-branded partners a leaseback arrangement or a lowered negotiated rent. As in all real estate matters, “location is king,” stresses Korn. “If a super-

market retailer can generate enough foot traffic, they are an attractive location for an upscale quick-service concept. They have a built-in consumer base focused on buying food, have store hours that enable three dayparts and can push the limits on late-night shopping as well as delivery.” Whole Foods’ Foggy Bottom location, for instance, fits the profile for BrunerYang’s Paper Horse restaurant: The area has a concentration of nearby office workers, as well as students from neighboring George Washington University. Both groups can provide traffic during the day and early evening. Goldin cautions that the approach isn’t feasible for every chain, or even every market. “The concept could be appealing to Millennial shoppers in urban markets,” he observes, “but even in those settings, there are so many other options available to consumers that there has to be a big draw.”

If a supermarket retailer can generate enough foot traffic, they are an attractive location for an upscale quickservice concept.” —Joshua Korn, Culimetrics

Culinary Trends

Accent on Cuisine

Modern Jewish Deli Fare What’s old is ne W again. By Amelia Levin

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Key Takeaways “Next-gen” Jewish deli concepts are reinventing authentic fare. Making corned beef and/or pastrami in-house is within reach for most grocers. Grocerants should stock an array of specialty smoked and cured products. Along with salty/savory offerings, grocerants should offer traditionally inspired sweets.

Photo Courtesy of our fathers

hose overstuffed pastrami sandwiches and ooey-gooey Reubens we associate with Jewish deli “cuisine” are having a moment. A big one, actually. Andrew Freeman & Co.’s annual trends list named Jewish deli food as a 2018 top trend. Places like Steingold’s, of Chicago; Wexler’s Deli, in Los Angeles, Mamaleh’s, in Cambridge, Mass.; Harry & Ida’s Luncheonette, in the New York borough of Manhattan, and Frankel’s, in neighboring Brooklyn, are just a few examples of the revitalization of Jewish delis. Consider this trend “next-gen” deli. Children of older-generation Jewish families — those who owned and operated delis, and others who grew up going to them — are opening their own, modern renditions. In fact, as next-gen delis open, some old-school institutions have

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CulinAry TrEnds

Accent on Cuisine

The Jewish food we are most familiar with is only part of the story.” —David DuBois, Franklin Restaurant Group

closed, most notably, the Big Apple’s Carnegie Deli, which shut its doors for good in 2016 after a 79-year run. But brisket, bagels, matzo ball soup, lox and knishes live on. Grocerants are in a unique position to capitalize on some of the more classic dishes of the iconic Jewish deli. Most already have full-scale delis in operation, with their nearly endless varieties of meats, cheeses, breads and pickles, as well as all of the slicing and sandwich-making equipment needed.

cases the restaurant-retail hybrid by featuring separate entrances for the two concepts under one roof. “Many people have fond memories of Jewish deli food, and why wouldn’t they? It is rich and delicious, replete with history, warmth and depth,” says DuBois, who found inspiration for the concept from his father’s love of traditional delis. “The Jewish food we are most familiar with is only part of the story, however.” On the deli side of Our Fathers, the all-day operation serves items like hand-cut-to-order pastrami sandwiches,

All-in-one Eateries We’re also seeing newer Jewish delis take shape as part restaurant (full-service and fast-casual), part takeout, and part retail operation. Boston-based David DuBois and Phil Audino, of the Franklin Restaurant Group (Tasty Burger, Citizen Public House & Oyster Bar), have added Our Fathers as their latest concept. The new space show-

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Culinary TrenDS

Accent on Cuisine

Deli Specialties for grocerants looking to expand their deli selection to include traditional Jewish favorites, one trick is just to pile meats higher on sandwiches. another must-have is a go-to reuben recipe tasty enough to generate buzz and profits: house-fermented sauerkraut and russian dressing are two ways to make a signature version. making corned beef and/or pastrami in-house is within reach of most groceries, especially those equipped with the large-production kitchens and high-volume equipment needed to make a big batch of brine or authentic chicken stock for matzo ball soup.

Designed to Go Upgr ade catering pl at ters with some tr aditional Je wish inflUences Catering is an important part of Jewish deli operation. Boston-based deli concept Our Fathers — and it’s not alone — caters everything from sliced corned beef to bagel and lox with all of the fixings, including cream cheese, pickles, sliced raw red onions, capers, and sliced cucumbers and tomatoes. These are the types of platters old-school Jewish delis have offered for decades. Grocerants that already feature, or that choose to add, some traditional Jewish deli fare to their repertoire can easily recreate these catering conventions for yet another profit-boosting move. Now that’s something to nosh on.

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Photo Courtesy of our fathers

fresh bagels, smoked salmon matzo ball soup and roasted za’atar-spiced chicken dinners with potato pancakes, hummus, salads and other sides, all ready to go for a full family meal or catering order. our fathers specializes in traditional, hearty deli fare influenced by the cooler climates of the eastern european origins of ashkenazi Jewish cuisine. items like gribenes (crispy chicken skin) and knish (meat- and vegetable-filled dough balls) are among the specialties. meanwhile, the restaurant side of the eatery serves fresh, spicy sephardic and mizrahi Jewish cuisine inspired by israeli, middle eastern and north african flavors. these are deep, complex and warm spice profiles from recipes like markouk (flatbread) layered with labne (yogurt cheese); radishes; schug (a chimichurri-like israeli condiment made with parsley, cilantro, chiles and spices); and za’atar, a middle eastern spice blend. there’s also lamb on cinnamon sticks, and duck breast with cabbage braised in a pickled mango condiment called amba.

at our fathers, beef brisket is brined for 14 days, and then smoked; rubbed with spices like black pepper, rosemary, coriander and cardamom; cooked; and wrapped and cooled down. “we do not cook it for service until days later, when we use a long, slow steam to rethermalize and tenderize the meat,” explains duBois. “it needs to be chilled down first, or it just doesn’t taste as good.” the restaurant’s corned beef is a nine-day brine, followed by slow cooking in an industrial or controlledvapor technology (cVap) cabinet. this meat also is wrapped and cooled, but rethermalized for slightly less time and at a lower temperature than the pastrami. corned beef is typically trimmed to be leaner, and a shorter rethermalized time avoids dryness. to-go sandwiches are wrapped in brown butcher paper to lock in heat and flavor before being bagged up. our fathers has also become known for its “burnt ends,” a collection of the extra cuttings of pastrami and corned beef from parts where crispy crusted pieces collect. “our general manager is from the midwest and has very fond memories of the burnt ends at slyman’s deli, in cleveland, ohio,” says duBois. “we sell quarts of them on a first-come, first-serve basis, as they accumulate. people take them home to put in their eggs or hash or whatever.”

Smart Outsourcing Bagels, another hallmark of Jewish delis, might prove to be a little trickier to make in-house for grocerants. traditional forms require boiling first, and then baking, and, as duBois acknowledges, they can be labor-intensive. “when we first started planning the concept, our thought was to make our own bagels in-house,” he recounts. “we studied the process and arrived at the method that worked best for us. we picked out our proprietary oven, broiler and seeding table before it became apparent that the kitchen in our restaurant would not have the space for this setup.”

7 MUST-KNOW FACTS TO MAKE YOUR PREPARED FOODS DEPARTMENT CUSTOMER CENTRIC SUPERMARKETS PLAY HUGE ROLE IN SAVING CUSTOMERS TIME PREPARING MEALS

81%

of consumers at least occasionally go to the supermarket JUST to buy prepared items

BUT NOT ALL OF THESE PREPARED MEALS ARE FOR AT-HOME CONSUMPTION

55%

of consumers are likely to choose a supermarket prepared department as a dining destination

This is an increase from 2013 when just 32% were likely to consider a supermarket prepared department as a dining destination.

For those dining in, they expect: Freshness

Cleanliness

They also want variety, including:

35% 33%

Unique prepared items Healthier options

30%

Healthier options of traditionally “bad for you foods”

27%

Items they can customize

Food that is visually appealing

And access to global cuisines, such as:

45% 38% 37% 33% 26% 25% 23%

American Italian Mexican Chinese Southern Japanese/sushi Thai/Vietnamese

BUT IT GOES BEYOND THE FOOD, AS EXPERIENCE COUNTS, TOO. Among the many amenities grocers can oﬀer to get customers dining in, consumers most prefer:

26%

22%

14%

13%

Separate checkout in the deli area or online payment

Clean seating area, detailed nutrition information, or ability to order ahead of time

Restaurant vs. retail/cafeteria atmosphere

Free Wi-Fi

Dedicated parking for deli customers

Entertainment

Speciﬁc ethnic ﬂavors that saw strong growth on foodservice menus between 2013-17, include: 1,700% Gochujang 301% Za’atar 116% Sumac 80% Poblano 21% Adobo

Sources: Datassential Supermarket Keynote, 2016; FMI, “The Power of Fresh Prepared/Deli,” 2016; Datassential SNAP Tool, 2016

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Culinary Trends

Accent on Cuisine

What followed was a deep exploration of recipes, facilities and independent bagel makers until DuBois found one that could make the best bagel. He and his team chose ones that are chewy and on the softer side, with a polished exterior and a light interior. They’re handrolled, boiled, baked on damp burlap-covered boards to start, and then flipped onto a stone deck. The bagels are kept warm using halo heat warming, and then toasted to order in a vertical toaster. Our Fathers also works with a local artisan baker to source twice-baked rye bread as a sturdy yet soft base for sandwiches.

The Magic of everything and lox Steingold’s, a modern Jewish deli in Chicago, features sit-down fast-casual service and a takeout/retail component. This eatery also sources bagels from a local baker who specializes in slightly crispy, distinctly chewy plain and “everything” bagels. And speaking of Jewish deli influences, the flavors of “everything” bagels have become so craveable that this mixture

of salt, pepper, garlic salt and sesame seeds, among other savory spices, has become a favorite for chefs and home cooks who sprinkle it on just about, well, everything. Monrovia, Calif.-based Trader Joe’s introduced its version of the “everything” spice blend last February, and suggests adding its “crunchy, roasted, savory flavor to grilled chicken, buttered popcorn, baked potatoes, creamy dips, pizza dough, salad dressings, pasta, mac & cheese, or panko-breaded anything,” according to a product description. Another Jewish deli standard is lox. In terms of in-house preparation, curing whole planks of salmon is one thing, but smoking salmon for lox can also require more labor and space than many operations can afford. This is another ingredient that’s easily and expertly outsourced. Our Fathers works with a 120-year-old smoke-cure house in Brooklyn, N.Y., to source whole planks of lox that are hand-sliced to service. Grocerants are in a prime position to stock an array of specialty smoked and cured products showcasing regional flavor variations, different techniques and modern innovations. Jewish delis definitely know how to pile on the saltysavory flavors, but don’t forget those ubiquitous smiley-face or black-and-white sugar cookies, or chocolate-chip-studded mandel bread — think biscotti — to round out your service.

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Technology

Ecommerce

From Minor to Major League What must grocers do to help usher ecommerce into the mainstre am? By Randy Hofbauer

lthough it has skyrocketed in channels offering more durable goods in recent years, online shopping in the grocery channel still remains relatively niche. Sales of CPGs online still average only about 3.4 percent of total store sales for ecommerce-enabled supermarkets — 5.2 percent for those with an ecommerce service for four years or more — according to last year’s “Grocery Ecommerce Supermarket Scorecard Report,” from Barrington, Ill.-based retail consultancy Brick Meets Click. That’s all going to change soon, though. This year, roughly one in three consumers intend to shop for groceries online, says a January report from Toronto-based ecommerce platform provider Unata — a division of Instacart — and ShopperKit, an Atlanta-based order-fulfillment platform. Additionally, recent research from the Food Marketing Institute, in Arlington, Va., and Chicago-based market researcher Nielsen shows that number rising further: Second-year findings of the “Digitally Engaged Food Shopper” report predict that seven in 10 consumers will be grocery shopping online as soon as 2022 or as late as 2024. The $100 billion spend by then will be equivalent to every U.S. household spending $850 online for food and beverages annually. So what must grocers do to play their part in ushering grocery ecommerce into the mainstream? PRoGRESSIVE GRoCER April 2018

Technology

Ecommerce

Focus First on the customer, not the channel When grocers focus solely on the online channel, retailers imagine barriers of single-channel logistics and economics. If the focus is flipped to what happens from a customer-first perspective, however, compelling facts surface that change the conversation. For instance, retailers thinking in terms of “channel-first” can believe myths like online sales cannibalize in-store sales. According to David Ciancio, global head of grocery with Cincinnati-based retail analytics firm Dunnhumby, this simply isn’t true. “The data shows that online sales are 60 to 70 percent incremental business, that click-and-collect drives top-up trips in the store by 20 percent, that multichannel customers are three times more valuable than in-store shoppers alone, and that the average basket size is four to five times larger online than in-store,” asserts Ciancio. Another myth is that the online channel can’t be profitable, he adds. U.K.-based grocer Tesco and others have learned that a larger basket size and a higher gross-margin product mix online are key to driving favorable commercial results. Canada’s Metro and U.S. grocer Kroger, too, have realized this with a customer-first strategy over one of putting channel first.

Fix out-of-Stock Issues On-shelf availability (OSA) problems are a major hindrance in ecommerce, and grocers must address these before committing to order picking in stores. “The online experience greatly magnifies the negative perception of out-of-stocks,” says Jamie Tenser, principal of VSN Strategies, a Tucson, Ariz.-based business-to-business content marketer. “While a few out-of-stocks may be tolerated by shoppers in stores, handling ‘substitutions’ in an online order is a major disaster for the customer experience. Any solution vendor or third-party order/delivery vendor who claims otherwise is either ignorant or flat-out lying.”

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If they don’t already have them, food retailers should add meal kits for delivery or clickand-collect, as it allows for new ways to purchase meal solutions without the headache of a subscription.

It’s critical for grocers to offer an actual, current view of store inventory, not a disconnected global catalog that displays a theoretical assortment. That disconnect is what leads to frequent order-substitution processes that slow the picking process, raise labor costs, torpedo convenience and undermine trust. “I presently know of three retailers who display store-level inventory on hand for items on their digital sites: Home Depot, Lowe’s and Walmart,” offers Tenser. “The supermarket industry is lagging badly in this regard, but for those who already track store-level inventories in real time, it’s a fairly straightforward data interface.” Contrary to persistent industry dogma, OSA can be and is significantly optimized with the right store-level perpetual inventory and computer-generated ordering process, he notes. Northeastern grocer Price Chopper, for instance, has been the poster child for this for more than 15 years, as has Canadian retailer Sobeys for more than a decade, and more recently, East Coast supermarket operator Wegmans Food Markets.

Allocate Space for Store-level Fulfillment Not all grocers can build drive-through lanes such as those commonly found at European grocers like Carrefour or Auchan — or similar to Amazon Fresh Pickup in the States, points out Tenser. Additionally, grocers might not be ready to expand into concepts similar to the “giant vending machines” that Walmart has erected, as these devices have yet to prove their practicality. But it is necessary for all grocers seeking to handle store-level fulfillment for ecommerce orders to allocate space and design order-holding and -pickup areas with temperature controls. This ensures that the final step of the purchase process is rapid and seamless, he says. “I think most stores will need to allocate a space near the front of the store to handle the after-work pickup rush, but best practices are yet to be developed,” he observes.

ensure one-and-Done ordering Customers want orders to be set and done. The more that retailers involve customers after order placement, the more a customer may regret not just going to the store to pick

If you want to create an appealing retail experience for your customers, look at what the ordinary do

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Technology

Ecommerce

plans to expand voice-activated shopping nationwide through a partnership with Google, Walmart has debuted shopping via Google Assistant, and delivery service Peapod has launched hands-free voice ordering through Alexa-enabled devices.

Introduce Meal-Delivery and -Kit Services

up the product himself — or, perhaps worse, use a rival grocer’s ecommerce platform. “Things like having a different assortment online compared to on-shelf, having to make interpretations on a poorly described product, or experiencing search results that differ from actual product availability are all viable,” says Jason Wirl, director of solution consulting at Itasca Retail Information Systems, a West Des Moines, Iowa-based provider of inventory optimization solutions. “But once the order is placed, the experience [of] trying to rectify the occurrence of an unavailable item completely ruins the reason most consumers use the service: convenience.”

Adopt — and encourage Use of — Voice-ordering Technology As shopper adoption of grocery ecommerce rises over the coming five years, experts are anticipating a rise in shopping via voice assistants, too. New research from global firm OC&C Strategy Consultants reveals that voice shopping is expected to rocket to $40 billion in 2022, from $2 billion today. Further, at the moment, groceries make up the most commonly shopped category in voice shopping. The new research shows that currently, 20 percent of consumers who use voice-ordering technology report ordering groceries through devices. Growth in the voice-ordering sector will be driven by a surge in the number of homes using smart speakers. This corresponds with the insights of Peter Leech, partner and director of digital and ecommerce at The Partnering Group Inc., based in Cincinnati. “With 8 percent of U.S. households owning [voice-assistant devices] and a forecast of 55 percent in seven years, we see this as a seedling that will grow fast,” asserts Leech. Consumables and replenishment items, in particular, will become ideal orders through such technology, explains Leech, as devices such as Amazon Echo — which uses the Seattle-based technology and ecommerce company’s Alexa voice-assistant software — and Google Home show up in more household kitchens. Food retailers are already employing voice-ordering and encouraging shoppers to use it: Target

100

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As shopper adoption of grocery ecommerce rises over the coming five years, experts also are anticipating a rise in shopping via voice assistants.

Retailers and meal kits have been all over the news in the past year. On the partnership side, Chef’d has partnered to sell its kits in Gelson’s and Tops Markets stores, and Albertsons Cos. outright purchased Plated. Additionally, Walmart has begun selling thirdparty meal kits online, including options from Takeout Kit and Home Chef. Further, in the past year, grocers have introduced and/or greatly expanded their own private label meal kits. Some of the bigger names in this space over the past year include Publix, Walmart and Kroger. In response, Dunnhumby’s Ciancio recommends that food retailers, if they haven’t already done so, add meal kits and meal-delivery services for delivery or click-and-collect, as it allows for new ways to purchase meal solutions without the headache of a subscription.

embrace change For many years, the grocery channel has been one to stick with the traditional. As that changes, retailers that once were afraid of risk now have to make big decisions in a change-or-die climate in which an ecommerce program is now table stakes for playing the grocery game. But while change can be difficult — and potentially dangerous — the growing number of technology solutions available to speed processes while reducing costs can make it easier to embrace the new. Walmart, Kroger, Ahold Delhaize, Safeway, Target and Wakefern are all examples of retailers that remained traditional for many years but have made tremendous changes in recent times, notes Ciancio. “New ways of working utilizing zonepicking, handheld pick devices, robots and warehouse pre-packs are speeding up the process and lowering costs,” he says. “Delivery options like social delivery — Uber and others — drones, and autonomous vehicles are real options in the very near future.”

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Digesting your issues: containing a social media crisis Janine Smiley, public relations strategist, and Brittany VanMaele, community manager, Woodruff

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alleviated by supplies and over-the-counter medicines, on which pet owners spent an estimated $14.93 billion in 2017, according to figures compiled by the stamford, conn.based American Pet Products Association.

Humanization

Good for What Ails Them Foods and other products that address pe ts’ e volving he alth concerns can at tr act loyal shoppers. By Princess Jones Curtis henever i start talking about choppa’s diet, people laugh at me,” admits 30-year-old Bree Thompson, owner of a 5-year-old pug mix, “but i don’t care. He had so many skin issues before we went grain- and gluten-free. i’ll never buy another bag of dog food with grain in it.” Thompson represents a growing number of consumers who use ailment-focused pet products to manage their pets’ health. Ailment-focused products are ones that have formulas, packaging and advertising geared toward a specific problem or condition, such as anti-itch shampoo or a food for older cats. And while pet owners should always follow a veterinarian’s medical advice, many conditions can be

The biggest contributor to the rise of ailment-focused pet products is the increased humanization of pets. “Millennials are now the largest petowning population in the U.s. and the driving force in the pet industry. As pet owners, Millennials treat their pets as members of the family, and that bond is very important to them,” says Lindsey rabaut, vP of marketing for i and Love and You, a Boulder, colo.-based premium pet food and treat company that translates the latest natural health trends for humans into pet products. The humanization trend has grown to the point that many pet owners also think of their animals as their children. “Just like feeding your own babies, health awareness is very important,” explains Jennifer Lord, manager of Martin’s Paw Marts, an independent pet store chain associated with south Bend, ind.-based grocery chain Martin’s super Markets. “We all want our pets to live the longest lives possible. consumers are involving pets more in their everyday activities. Pets are no longer just pets; they are family.” That being the case, owners feel a responsibility to provide the best for their pets, notes rabaut. “We care for our family,” she says. “When they aren’t feeling well, we seek out healing solutions. We all want our pets to be in optimal health, and to keep them free from pain and irritations. it’s no surprise that the pet industry is providing natural solutions for these consumer concerns.” she continues: “We know that healthy foods support our longevity, so it’s a natural extension that quality pet food equals a higher-quality life for our pets. Who wouldn’t want that for their pets?”

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We know that healthy foods support our longevity, so it’s a natural extension that quality pet food equals a higher-quality life for our pets. Who wouldn’t want that for their pets?” —Lindsey Rabaut, VP of marketing, I and Love and You

result of personalization trends in consumer goods overall. Shoppers want to feel like a product has been developed especially for their needs. Savvy manufacturers are listening to consumers during the product development stage. Nicky Walsh, director of business development for Stamford, Conn.-based Daymon, says that this is crucial. As the eyes and ears in the pet business industry for Williamsville, N.Y.-based Tops Markets LLC, Walsh is involved in everything from analysis of the market to product development. “If analysis shows the need to develop an item or category for a specific audience, we pursue it,” she asserts. “We strive to bring unique and differentiated ideas to fellow pet enthusiasts,” notes Rabaut. “By understanding and relating to our core audience, we are able to design products that are made specifically for them. ... Our loyal tribe of social followers is often where we start when coming up with new products. The information they see is often very telling of larger trends/themes. This was the specific impetus of our recent launch of Lovingly Simple,” a pet food line addressing food sensitivities, such as food allergies and digestive issues, with a limited-ingredient formula. Joe Toscano, VP and director of business development and industry relations at St. Louis-based Purina, says that product development requires extensive data and market analysis. “At Purina we have a dedicated category team that’s sole purpose is to build the pet category,” observes Toscano. “The Cat Chow Indoor formula, for instance, was born out of the insight that indoor cats can be less active than their outdoor counterparts. Therefore, the product was formulated to help with weight management and nutritional needs that weren’t being met by conventional cat food.” He adds: “We utilize a vast assortment of data to lead and identify current pet trends in real time. We can work together with retailers to create a customized solution to meet [their] goals and targets.”

Senioritis While ailment-focused pet products can span a number of categories, food dominates in the numbers. Within that subsegment, foods for senior animals are highly popular. “Of course, as the average lifespan of a pet increases, so does the market for senior pet formulas,” notes Toscano. “Purina has made nutritional advancements with formulas like Purina ONE Smartblend Vibrant Maturity 7+, which includes enhanced botanical oils to support brain health and a dual-defense antioxidant blend to support an aging dog’s immune system and healthy skin and coat.”

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Another contributing factor to the numerous products for senior dogs is the current popularity of smaller, older dogs, he observes. “Changes in lifestyle, urbanization and shifting demographics are driving a recent boom in small-dog households, with the pint-sized pooches making up 70 percent of the dog population growth, and 49 percent of dog-owning households now including a small dog.” Smaller dogs also tend to live longer than their larger counterparts, leading to a greater number of senior dogs affecting market needs. Toscano adds that addressing the specific needs of those pets drives product development. “These dogs have unique nutritional needs, which led us to introduce Purina Bella, a full line of dry and wet dog food inspired by the little ones we know and love so well,” he points out. “The formulas are nutrient-dense with higher caloric content, since small dogs tend to eat less; [have] a proprietary blend of antioxidants to support their immune system; and are formulated to support overall health throughout their life to address their longer life expectancy.” The bottom line is that catering to the health needs of pets makes good sense for grocers. “People love their pets like family, and just as our pets differ in age, lifestyle and health condition, their nutrition should be tailored to meet their unique needs,” asserts Toscano. “Such tailored nutritional offerings are an underused retail strategy, representing a larger opportunity for personalized offerings that span breeds and pets’ needs.”

EquipmEnt & DEsign

Pallets

Weight Lifters Palle ts are an indisPensable Part of the suPPly chain. By Bob Ingram

hen it comes to moving stuff through the supply chain, pallets are, quite literally, the way to go. That’s long been true, but today’s models are better at doing it than ever. “Without the pallet, the modern distribution system could not operate,” asserts ralph rupert, manager of unit load technology at vienna, ohio-based Millwood inc. “The ability to unitize products for ease of movement is based on the pallet.” “The pallet is the foundation of the unit load,” says gary sharon, evP at Litco international inc., also based in vienna, ohio, adding that “a shipping pallet’s primary function is to protect, and facilitate the distribution of, products while traveling through the hazards of the supply chain.” sharon notes that pallets are the primary interface between the shipper’s valuable products and the many material-handling forces they encounter. “in other words,” he says, “they are the first line of defense for ensuring products reach their destination in the same condition as when they left the shipper.” For his part, vishal Patell, vP, marketing and customer solutions at Atlanta-based cHeP North America (whose last name, interestingly enough, is an anagram of “pallet”), makes the claim that “pallets are the fuel that

Key Takeaways Pallets are necessary to protect, and facilitate the distribution of, products as they make their way through the supply chain. Wood and plastic pallets each have their proponents, both camps citing superior performance, sustainability and price. Innovative features and technological advances are making pallets more useful than ever before. Industry priorities for pallets of the future will center on cost, waste, hygiene and safety.

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EquipmEnt & DEsign

Pallets

drives the U.S. and world economies. Global consumer spending will reach $40 trillion in 2020, and a large majority of consumer goods move from sourcing to manufacturing to retail on pallets.”

Wood is good The reasons that wood pallets dominate the market, Rupert notes, are their versatility, overall strength and durability — all achieved at an economic price. Automation advances in pallet construction enable more pallets to be manufactured with the same amount of labor, with each pallet being more consistent in quality, according to Rupert. “Wood pallets are produced from a renewable resource, mostly

The Case for Pallet-level Monitoring Most cold supply-chain monitoring products monitor only the environmental conditions of the supply chain, rather than the condition of the product moving through it. That needs to change. “For fresh food, end-to-end pallet-level data is essential for delivering freshness and safety,” asserts Peter Mehring, president and CEO of San Jose, Calif.-based Zest Labs. “Perishable products are constantly changing their state due to biological or chemical reactions. Trailer-only temperature recorders typically only reflect ambient temperature, which can be misleading, as palletto-pallet temperatures can vary up to 35 percent, and they don’t capture the product history before loading — [which is] critical to food safety and freshness.” Acceptance testing, which captures only the current state of the product, doesn’t reflect the rate of change of aging, which means that it can’t reflect the remaining shelf life, according to Mehring. “Pallet-level monitoring addresses all these shortcomings, and also provides comprehensive traceability, chain of custody, and source authentication,” he observes, noting that it also “provides complete product history to ensure delivered freshness and safety.” As an example, if a supplier processing delay occurred, reducing shelf life, the affected pallets could be routed to a local customer with a shorter transit time. Also, when an in-transit temperature excursion affects pallets, they could be flagged upon arrival for cross-dock shipment, effectively accommodating for lost shelf life. “With pallet-level monitoring, handling data can be directly translated into better decisions for routing and inventory management,” Mehring says, “proactively managing remaining freshness and food safety.”

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Litco International recently added the Retailer, a wood pallet for POP floor displays.

from low-grade lumber that is not used in other wood products, such as flooring and construction,” he says. “Wood pallets are recycled by repairing and reusing. Afterlife uses, such as mulch, animal bedding and fuel, make the pallet ‘green’ even after its life.” At Litco, Sharon asserts, “Wood is in our DNA.” The company’s engineered molded wood pallets are made from wood fiber and resin under high heat — more than 350 degrees Fahrenheit — and pressure. They’re typically used for one-way and export shipping, and as the base for retail floor displays. The Retailer pallet, a new addition to Litco’s line, is targeted for use as the base for retailer POP floor displays, and available in both European and domestic full, half and quarter sizes. The molded process ensures dimensional consistency, rounded corners, and no pests, odors or mold. “The absence of bottom deck boards eliminates consumer ‘foot trip points’ and makes it easy to enter and withdraw pallet jacks,” Sharon points out. “Our pallets are made of wood and contribute to the lower cost of goods through our efficient pooled operating model,” says CHEP’s Patell. “Pooled pallets also boost efficiency and reduce labor costs and product damage.” The company’s pooled — shared — pallets and sustainable operating model follow the principles of the circular and sharing economies, reducing demand on natural resources and creating operating and financial efficiencies in supply chains otherwise not available through single-use or alternative platforms. “Simply stated,” he notes, “our pooled pallets enable our customers to share and reuse resources that make them more efficient and more sustainable at the same time, without compromising one or the other.” Greenwise, according to Patell, 99.1 percent of the timber used by CHEP comes from certified sources, and 99 percent of the company’s pallets are recycled. Through significant investment in the ISTA (International Safe Transit Association)-certified CHEP Innovation Center and Pallet Test Track, in Orlando, Fla., the company seeks to make its pallets even stronger, more efficient and more sustainable. Patell notes that customers are seeing an increase in the sale of promotional items and other products displayed on half-pallets in high-traffic areas of the store.

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EquipmEnt & DEsign

Pallets

The half-pallet has also shown an ability to reduce out-of-stocks and product replenishment time at retailers, he observes.

cent washable, extremely durable, and easy to work with due to larger, tapered forklift pockets. Offered in 100 percent recycled material and itself recyclable, the Protech also contains ultraviolet stabilizers to protect the material and balance the color. The most recent TMF developments are Non-Deca Bromide Fire Retardant material, using 100 percent recycled material and FDA-approved material. “Higher-quality pallets allow a greater volume of products per shipment, reduce the amount of product lost to damages or contamination, prevent worker injury from overloaded or unbalanced shipments, and reduce expenses such as fuel costs,” says Jeff Liebesman, CEO of Orlando-based iGPS Logistics, one of the first pallet manufacturers to fully embrace the plastic alternative to wood pallets. According to Liebesman, iGPS’ high-density polyethylene pallets are 30 percent lighter than wood, meaning less fuel for transport, thus less pollution and greenhouse-gas emissions. Also, iGPS pallets are 100 percent recycled and recyclable, with broken pallets molded into new ones, a savings passed on to customers.

plastic’s Fantastic Not all companies are staunch proponents of wood pallets, though. At Havertown, Pa.-based TMF Corp., for instance, Sales Manager Tom Fitzgerald Jr. says: “Companies making the change from wood to plastic pallets are seeing improvements throughout their workflows, worker safety improvement and injury reduction, work-floor decluttering, increased efficiency, logistics progress, time and scheduling reduction, and loss minimization.” TMF’s Protech pallets are made of high-density polyethylene structural foam, which allows the item to be one piece, 100 per-

Engineering and design analysis have given pallet manufacturers the ability to reasonably predict a shipping pallet’s performance.” —Gary Sharon, Litco International

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TMF’s ProTech pallets of high-density polyethylene structural foam are one piece.

What’s more, igPs’ pallets are embedded with rFiD (radiofrequency identification) tags for “track-and-trace” technology to monitor shipment movement, provide real-time information on environmental changes, and even notify supply chain managers of suspicious activity, according to Liebesman. cHeP’s Patell similarly notes that pallets are becoming a source of relevant product information that can potentially be digitized, communicated and analyzed: “New technologies involving things like blockchain, low-power wide-area networks (LPWAN), and Bluetooth low energy (BLe) are making the digitization of pallet and product information more feasible and secure.”

Pallets to Come

Innovative Features “A few months ago,” recounts Liebesman, “igPs partnered with disinfectant manufacturer PUre Bioscience inc. to engineer an innovative new pallet sanitization system that delivers direct food contactlevel safety for igPs customers.” He says that the process reduces bacteria counts by 96 percent to 100 percent, which is more than double the current industry standard under the Food safety Modernization Act.

When he’s asked what’s on the horizon for pallets, igPs’ Liebesman notes: “Much of future pallet development is a continuation of current trends. While we cannot wholly predict what new tech will make its way into the supply chain, industry priorities will center on cost, waste, hygiene and safety. We can expect greater automation and tracking, though the exact methods to achieve them will be interesting to see.” “They may or may not look how they look today,” muses cHeP’s Patell in a similar vein, “but there will always be a need to move products, and platforms will be an integral part of the supply chain.”

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Editors’ Picks

Food, Beverage & Nonfood Products

Malty Goodness You’ve heard of wine vinegar, but how about beer vinegar? Known for its craft vinegars, Vermont Village is now serving up a malt vinegar made from Vermont craft beer. Brewed and fermented with a choice mix of hops and malts, the product is versatile, being suitable for salad dressings or marinades, and able to serve as an ingredient in home pickling brine or as a topping for fish and chips. Each 10-fluid-ounce bottle goes for a suggested $6.99. http://vermontvillage.com

time for Breakfast

twist on the traditional

Many pass up a hot breakfast simply because it’s too messy and time-consuming to make one before heading out the door. For those folks, Kraft Heinz has introduced Ore-Ida Just Crack an Egg, said to be the first product on the market that offers a hot, savory egg scramble in under two minutes just by adding a fresh egg. The refrigerated product comes in four varieties of classic breakfast flavor: the Denver Scramble (ham, mild cheddar cheese, onions, green peppers and diced potatoes); the All American Scramble (bacon, cheddar cheese and potatoes); the Rustic Scramble (turkey sausage, mozzarella cheese and mushrooms); and the Ultimate Scramble (pork sausage, mild cheddar cheese, potatoes, onions, and both green and red peppers). Each refrigerated cup retails for a suggested $2.49. www.kraftrecipes.com/ oreida.aspx

Despite its versatility, soy sauce has remained relatively unchanged for many years. With more consumers demanding spicier, more exotic dishes, however, the time seems right for a change, and a new brand is leading the charge. A line of soy sauces under the Ink brand contains “real-ingredient bursts of intense flavors” in the following options: Lemongrass, Garlic Sesame, Ginger Sesame, Orange Chili, Wasabi and Thai Chili. Incorporating real, wholesome, fresh ingredients, Ink soy sauces are naturally brewed in small batches to ensure the highest quality. They’re suitable for use with protein dishes such as fish, chicken, shrimp, pork, steak and burgers, as well as in salad dressings, soups, stir-fries, wraps, hummus and more. The SRP is $10.99 per 8-fluid-ounce bottle. www.inksoysauce.com

stick ’em Anywhere Sticky notes are still incredibly useful in an increasingly paperless world, but unfortunately, they’re not as effective in damper areas and more extreme conditions. Enter 3M, which has come up with a version of its iconic Post-it Notes to help improve communication and efficiency in the kitchen. Post-it Extreme Notes are designed to withstand the most daunting conditions, including heat, cold, wind and water. Offered in four colors, Extreme Notes stick to a range of surfaces often found in kitchens, such as stainless steel, brick and stone. Packs start at a suggested $4.99 each for 3-inch by 3-inch pads, which include 45 sheets per pad. www.post-it.com

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Advertiser index

United states Markets • Convenience • Grocery/Drug/Mass Store Brands • Specialty Gourmet Technology • Hospitality • Apparel canadian Markets • Convenience • Pharmacy • Foodservice advertis ing sales & BUsines s staff execUTive cHAirMAN alan glass 609-276-2842 aglass@ensembleiq.com cHieF execUTive oFFicer david shanker dshanker@ensembleiq.com cHieF oPerATiNg oFFicer/cHieF BrAND oFFicer richard rivera 973-264-4380 rrivera@ensembleiq.com cHieF BUsiNess DeveLoPMeNT oFFicer korry stagnito 224-632-8171 korrystagnito@ensembleiq.com cHieF cUsToMer oFFicer/PresiDeNT oF sTrATegic PLATForMs ned Bardic 224-632-8224 nbardic@ensembleiq.com seNior vice PresiDeNT/BrAND DirecTor katie Brennan 201-855-7609 • Cell: 917-859-3619 kbrennan@ensembleiq.com soUTHeAsT AccoUNT execUTive larry cornick 224-632-8248 lcornick@ensembleiq.com MiDWesT, MArkeTiNg MANAger angela flatland (Ar, co, iL, iN, iA, ks, kY, Mi, Mo, Ne, ND, ok, sD, TN, Wi) 224-229-0547 Cell: 608-320-4421 aflatland@ensembleiq.com seNior sALes MANAger Judy Hayes 925-785-9665 jhayes@ensembleiq.com seNior sALes MANAger theresa kossack 214-226-6468 tkossack@ensembleiq.com WesTerN regioNAL sALes MANAger rick neigher (cA, or, WA) 818-597-9029 rneigher@ensembleiq.com NorTHeAsT, MArkeTiNg MANAger Mike shaw 201-855-7631 • Cell 201-281-9100 mshaw@ensembleiq.com ADverTisiNg MANAger Jackie Batson 224-632-8183 jbatson@ensembleiq.com

8550 W. Bryn Mawr Ave. ste. 200, chicago, iL 60631 Phone: 800-422-2681 Fax: 978-671-0460 www.ensembleiq.com Progressive grocer (issN 0033-0787, UsPs 920-600) is published monthly by ensembleiQ, 8550 W. Bryn Mawr Ave. ste. 200, chicago, iL 60631. single copy price $10, except selected special issues. subscription: $135 a year; canada $164 (canada Post Publications Mail Agreement No. 40031729. Foreign $270 (call for air mail rates). Periodicals postage paid at chicago, iL 60631 and additional mailing offices. Printed in UsA. PosTMAsTer: send all address changes to Progressive grocer, P.o. Box 1842 Lowell, MA 01853. copyright ©2018 ensembleiQ All rights reserved, including the rights to reproduce in whole or in part. All letters to the editors of this magazine will be treated as having been submitted for publication. The magazine reserves the right to edit and abridge them. The publication is available in microform from University Microfilms international, 300 North Zeeb road, Ann Arbor, Mi 48106. The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

Beiersdorf UsA Blount Fine Foods Brother Mobile solutions Bundaberg Brewed Drinks celsius, inc. coca cola NA consorzio per la Tutela del Formaggio Pecorino rom consorzio Tutela Del Formaggio grana Padano crave Brothers Farmstead cheese, LLc creekstone Farms crown imports LLc csM Bakery Products Dean Foods co. Del Monte Fresh Produce NA inc. e&J gallo ernst & Young Ferrero UsA inc. Fiere Di Parma spa Fini sweets UsA Fresno Food expo godshalls Quality Meats inc. goya Foods, inc. Harold import co inc. Heineken UsA inc. House Foods America Hughes Network systems igPs inline Plastics corp international Dairy Deli Bakery Association international Paper retail Display and Packaging Litehouse Mann Packing co., inc. Mars chocolate NA/ Wrigley Mason vitamins inc. MasonWays indestructible Plastics Mettler Toledo MiWe National confectioners Association Naturipe Farms LLc Nestlé Professional New Pig ole Mexican Foods osi industries Perfetti van Melle UsA inc. Peri & sons Farms Pet Food Forum Premier Nutrition saputo cheese Usa inc. sato of America smithfield Fresh The J.M. smucker company Thermal Technologies inc. Tosca Ltd. Transcontinental robbie Trion industries inc. Tyson Foods - Fresh Meats Unilever North America United Fresh Produce Association Uniweb inc. viking cold solutions Zumex Usa, inc.

61 10-11 39 51 21 62 92-93 41 111 55 17 inside Back cover 28-29 45, 75 33 3 91 38 67 68 63 15 96 47, 59 70 Back cover 107 89 83 inside Front cover 19 46 31 71 109 101 44 66 73 80, 95 108 64 34 69 74 102 112 24-25 42 13 4 85 49 23 9 7 37 76 99 77 79

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Independent thoughts By Kat Martin

Encourage ‘Buy Local’ Shopping at Your Independent Store Coll abor ating with other loCally owned businesses will give any Campaign broader re aCh and le ad to more sales for all involved. ndependent supermarkets don’t operate in a bubble — it takes a village to operate a successful store. Being an active member of that village also is required. Luckily, independent grocers are often the heartbeat of their “villages,” and in a world that’s increasingly globalized, they’re also the ones that consumers turn to when they want to bring their shopping closer to home. Buying local is a growing trend, but one that doesn’t just need to be marketed on the Saturday after Thanksgiving. Two other organizations can help independent grocers market themselves as the places to go to buy local and promote the fact that they’re both locally owned and the most likely to carry locally produced goods. July is Independent Retailer Month, a Nolcha and Profits Plus partnership. The website, www.indieretailermonth.com, offers a variety of marketing materials that indies can use to help draw consumer attention to the benefits of shopping local, while the #indieretail hashtag can help both retailers and consumers follow related local and global events. The American Independent Business Alliance (AMIBA) also sponsors Buy Local campaigns and champions Independents Week, the first week in July. The Bozeman, Mont.-based organization offers a variety of resources at its website, www.amiba.net. As much as success depends on attracting shoppers, it also can rely heavily on the businesses’ relationships with other independents. “Individual businesses can reach a broader audience if they find effective ways to partner with their fellow independent businesses in the community than they can individually,” says AMIBA founder Jeff Milchen. “Pay attention to the individual building blocks within your business first, then seek to build on them through collaborative opportunities.” This “strength in numbers” outreach creates a broader audience for any campaign. These types of collaborative public education efforts produce better results than for businesses that go it alone, notes Milchen. Start planning now to make the most of either organization’s Buy Local campaign. While both occur in July, outreach and marketing can and should continue year-round. 114

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Benefits of Independent Retailing South Dakota Rural Enterprise Inc. found that a dollar spent at an independent retailer is usually spent six to 15 times in the local community before heading out of town. Just $1 can create $5 to $14 of value in the immediate area. According to the Indiana Main Street Program, only 6 cents of a dollar spent at a big-box retailer stays in the area. The Institute for Local Self-Reliance found that each $100 spent at local independents generated $45 of secondary local spending, compared with $14 for a big-box chain. According to the Small Business Administration, since 1990, big businesses eliminated 4 million jobs, while small businesses added 8 million jobs. A Civic Economics study in New Orleans found that if residents and visitors were to shift 10 percent of their spending from chains to local businesses, it would generate an additional $235 million a year in local economic activity, creating many new opportunities and jobs. According to the “Andersonville Study of Retail Economics,” local business generates 70 percent more local economic activity per square foot than that of big-box retailers. A local economy survey found that 57.2 percent of small-firm workers scored in the highest-commitment/ employee-loyalty category, compared with 40.5 percent of large-firm workers. Source: Independent Retailer Month, www.indieretailermonth.com

Local Economic Return of Indies vs. Chains Chain Retailers

Independents 25.2%

Profit & Labor

13.6%

Local Recirculation of Revenue

48%

Local Recirculation of Revenue

5.7%

Procurement for Internal Use

14.3% Source: Compiled results from nine studies by Civic Economics, 2012: www.civiceconomics.com Graph by American Independent Business Alliance, www.amiba.net

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Global Potato Innovations A LOOKBOOK FOR CULINARY PROFESSIONALS

“ I love how all the different potato formats can be incorporated in

one dish. You could really call a lot of these recipes potatoes two ways or even three ways.” CHEF DINA PAZ

Potato Cannoli with Salsa Verde 3

Miso Potato Potstickers

Stuffed Potato Fritters

Potato Power Bars

Potato Cannoli with Salsa Verde

Every Day. Every Way. Meet Your Menu MVP. For a behind-the-scenes look at the innovation

CROWD-PLEASING,

PLANT-BASED PERFECTION

process, firsthand potato tips and insights from the chefs, and all our new recipes, visit PotatoGoodness.com/ingredient.

Beloved by consumers, potatoes are one of the most popular, affordable and versatile items on any menu. Available in many varieties and formats, including fresh, frozen and dehydrated, potatoes are always ready to elevate any dish with amazing taste and texture.

global flavors. Due to their structure, texture and resiliency, they lend themselves perfectly to takeout and off-premise dining services. Potatoes are also a good source of vitamin C, vitamin B6 and potassium, making them nutrient-dense vegetables.

With consumer demand increasing for plantbased menu options, now is the time to put more spuds on your menu. Potatoes are a staple in nearly every cultural cuisine, so they’re uniquely suited to deliver today’s most craved

Potatoes USA partnered with some of today’s most innovative chefs to develop cutting-edge new inspirations for every menu and every daypart. Whether you serve a comforting classic or feature a new contemporary cuisine, with potatoes, the possibilities are endless. 5

Two-Tone Shoestring Fries

“ Potatoes can be used in so

many applications, every daypart, any type of preparation—whether it be a soup, salad, snack or centerof-the-plate—the possibilities are endless.” CHEF RJ HARVEY Potatoes USA

Miso Potato Potstickers

75% of consumers prefer dishes with potatoes over those without

Source: Technomic Inc., Foodservice Attitudes and Usage Study, 2017.

“ Potatoes can be adapted to so many dishes and are perfectly

suited for the plant-based trend.” CHEF DINA PAZ

Curried Potato Chickpea Burger

A Perfect Plant-Based Burger

Curried Potato Chickpea Burgers This deliciously spiced and seasoned potato-chickpea patty is a perfect plant-based twist on a traditional burger. The goodness of wholesome potatoes shines in this meatfree burger for a truly delicious and hearty sandwich. Flavored with curry powder, tomato, mustard and herbs, this mixture can also be shaped into fritters for a potato-based spin on falafel. Try topping this dish with a cooling cucumber-yogurt sauce for a craveable treat that delivers on classic Mediterranean flavors, a consumer food trend that continues to be in high demand. Looking for added inspiration for side dishes? Pair this burger with beautiful two-tone shoestring fries using yellow and purple potatoes for a colorful side dish. From appetizers to takeout, entrĂŠes to prepared foods, potatoes are a perfect plant-based solution. For these recipes, video footage and more, visit PotatoGoodness.com/ingredient. 13

Consumer demand is the number one reason operators are incorporating more potato dishes onto menus

Source: Technomic Inc., Potatoes USA Foodservice Attitudes and Usage Study, 2016.

Potato Power Bars: Heirloom Tomato and Herb

versatility of potatoes, especially when featured as â&#x20AC;&#x153; The the star of the dish, is what really drives innovation and excitement. They are the perfect canvas for global flavors. CHEF RJ HARVEY Potatoes USA

â&#x20AC;?

Miso Potato Potstickers

Umami-Rich Potstickers

Miso Potato Potstickers WITH WHITE TRUFFLE

SHOYU DIPPING SAUCE

When you combine riced russet potato with a hefty dollop of white miso and parmesan cheese, the result is a fluffy, tender, umami-rich bite. The light-as-air potato filling in these dumplings lends a beloved gnocchi-like texture while still delivering the savory global flavor of gyoza without the meat. Paired with a tangy yuzu and white truffle dipping sauce, this primarily plant-based dish is on trend and sure to be in demand. Combine the riced potato filling with any flavor profile from Italian to Latin American and bring new life to ravioli, tortellini, empanadas, filled dumplings and pockets of all kinds.

For these recipes, video footage and more, visit PotatoGoodness.com/ingredient.

Marbled Potato Maki Rolls

Potatoes are a favorite side dish, beating pasta and rice

Source: Potatoes USA Consumer Attitudes and Usage Study, 2016.

trade secret is to use dehydrated potato in doughs, â&#x20AC;&#x153; One so it grabs steam and moisture from the fillings and it hydrates and gets tender as the product cooks. â&#x20AC;? CHEF KEVIN APPEL

Stuffed Potato Fritters

A New Way to Roll

Stuffed Potato Fritters These savory stuffed fritters are boldly flavored and hearty, yet still light and fluffy, thanks to the inclusion of both fresh mashed potatoes and dehydrated potato flakes in the dough. Seasoned with turmeric and chili powder and stuffed with chilies, hash browns and lots of cheese, these vegetarian fritters are inspired by Indian samosas, but the flavor could go in any direction that fits your menu, even sweet. The dehydrated potato in the dough lets you stuff this fritter without it bursting open, even with creamier sauces and cheeses, thanks to its unique ability to absorb excess moisture as the fritter steams and fries.

For these recipes, video footage and more, visit PotatoGoodness.com/ingredient.

versatility of the various formats â&#x20AC;&#x153; The provided so many textural advantages in these dishes. â&#x20AC;? CHEF JOEL HOLLAND

Potato Cannoli

Holy Cannoli

Potato Cannoli WITH SALSA VERDE

When feather-light mashed potatoes meet thin and crispy potato chips in a form that resembles your favorite Italian dessert, the result is something magical. These savory cannoli are made from paper-thin slices of russet potato that are wrapped around a cannoli mold, quickly fried and filled with a mousse-like potato center, thanks to the addition of dehydrated potatoes. Add a fresh, tangy salsa verde to complement the transcendent texture of the cannoli. Feel free to experiment with other flavors as they are the perfect vehicle for any flavor combination. Try classic pairings like cheddar and bacon or rich butter-poached lobster and tarragon. No matter your food style, you can really let your culinary creativity go wild with potatoes!

For these recipes, video footage and more, visit PotatoGoodness.com/ingredient.

this dish, the addition of potatoes provides a structure and â&#x20AC;&#x153; Intexture that make this a really nice grab-and-go offering. â&#x20AC;? CHEF DINA PAZ

Potato Power Bars: Heirloom Tomato and Herb

Potato Power Bars: Blueberry and Toasted Coconut

Power Up with Potatoes

S W E E T O R SAVO RY

Potato Power Bars Potatoes equal performance, and they have an amazing story to tell. Potatoes provide the carbohydrates, potassium and energy you need to perform at your best. In fact, one medium-sized potato with the skin contains more potassium than a medium-sized banana and is a quality source of complex carbohydrates, making potatoes the perfect way to start your morning. These breakfast bars are easy to make and a deliciously fun alternative to the ubiquitous breakfast sandwich. They can be sweet or savory, and can be made ahead of time and reheated at the last minute as a portable grab-and-go addition to your menu. These potato bars will power up anyone, any time.

For these recipes, video footage and more, visit PotatoGoodness.com/ingredient.

Curried Potato Chickpea Burger

85% of the general population considers potatoes a vegetable that everyone can enjoy

Source: Potatoes USA Consumer Attitudes and Usage Study, 2017.

the best advantages of working with potatoes â&#x20AC;&#x153; One ofis their flexibility as an ingredient in the kitchen. Their inherent creaminess makes them a wonderful and indulgent comfort food you can feel good about serving to your customers.

â&#x20AC;?

CHEF JOEL HOLLAND

Marbled Potato Maki Rolls

Show-Stopping Sushi

Marbled Potato Maki Rolls Mashed and seasoned purple and yellow potatoes shine in this unique spin on a traditional maki roll. Potatoes not only bring vibrant color, but also a significantly creamier texture. You can fill these with sushi classics, like cucumber, pickled daikon and crab, and even take this dish to the next level and give it a crispy, crunchy, glutenfree coating thanks to finely shredded dehydrated potato flakes. You can keep it traditional or feature cutting-edge flavor combinations, like slow-braised barbecue pork with sweet, juicy mango or bulgogi beef and spicy kimchi. No matter your concept, this is a menu item that will shine as a great shareable dish in a restaurant or as a fresh spin on takeout sushi.

For these recipes, video footage and more, visit PotatoGoodness.com/ingredient.

P OTATO V E R SAT I L I T Y

The ever-popular potato is a familiar menu must for consumers. They are available for chefs in many convenient varieties and formats. Experiment until you find the potato that best fits your dish. Whether you choose between yellows and purples, reds or russets, labor-saving frozen options or versatile dehydrated potatoes for your operations, potatoes offer many unique benefits that are sure to satisfy your dinersâ&#x20AC;&#x2122; taste-spuds.

Potato Formats

Fresh The quality, consistency and variety of potatoes is second to none thanks to favorable soil, ideal growing conditions and an exceptional quality-control program. This is why U.S. potato growers are able to cultivate a broad selection of more than 100 varieties all across the country. From classic russets to distinctive purples, full-sized spuds to petites and fingerlings—there’s a potato for every plate. Here are a few of the most popular varieties: • Red Potatoes: Known for their sturdy, firm texture and an earthier flavor, these are great

baking and frying for its classic potato

for stews, braises or longer cooking times

flavor and texture

• Purple and Blue Potatoes: Bring eye-catching hues and a slight woody taste to any dish • Fingerlings and Petites: Perfect for imparting buttery potato flavor, texture and unique shape into salads and sides of all kinds

• Russet Potatoes: The gold standard for

• Yellow Potatoes: Known for their sumptuous, buttery flavor and moist, creamy texture means you can use less butter for a lighter dish

Potato Formats

Dehydrated Dehydrated potatoes deliver all the flavor, versatility and nutrition of fresh potatoes because they are just potatoes minus the water. The potato industry has committed itself to delivering quality dehydrated potatoes that maintain a fresh potato texture and flavor when rehydrated. Building on the potatoâ&#x20AC;&#x2122;s inherent versatility, dehydrated potatoes are available in dices, slices, shreds, flakes, granules and flours, and can shine in any dish from baked goods to snacks, soups, salads, ready meals, breadings, coatings and desserts. So, forget washing, peeling and boilingâ&#x20AC;&#x201D;dehydrated potatoes go to work for you straight from the bag. They also make a great gluten-free coating using a standard breading procedure.

Frozen With a field-to-freezer philosophy, only the best high-solid potatoes are cut and quickfrozen to consistently lock in taste, nutrition and convenience. All our frozen shapes and forms reduce prep time, ensure consistency and conserve costly fryer oil. Simply put, frozen potatoes boost bottom lines. From fryer staples like fries, hash browns and tots to time-savers like frozen dices, half shells, frozen mashed and baked potatoes, thereâ&#x20AC;&#x2122;s a shape, size and style of frozen potato for every menu.

YOUR RESOURCE FOR ALL THINGS POTATOES Potatoes USA is the marketing organization representing the 2,500 commercial potato growers operating in the United States. We are your resource for fresh table-stock and many potato products, including frozen, dehydrated, chipping and seed potatoes. Whether youâ&#x20AC;&#x2122;re looking for fresh new menu inspiration or tips and tricks of the trade, Potatoes USA can provide the support you need so that potatoes can help your organization. Contact our foodservice team to learn more about partnerships and promotions, and how we can help inspire your next great menu item.

PotatoGoodness.com/ingredient

For a behind-the-scenes look at the innovation process, firsthand potato tips and insights from the chefs, and all our new recipes, visit PotatoGoodness.com/ingredient.