Member Advantage November 2018 I Canada
Canadian preferred supplier
Details inside.
NOVEMBER CONTENTS
Program Announcements
CHEF’S CORNER Did you know...
3
Learn about Foodbuy’s new and extended contracts to take advantage of the savings.
Program Highlights
6
Learn about upcoming promotions, changes to existing programs and new product news.
Program Updates
7
Determine the month’s highs and lows by specific category and/or supplier.
Market & Commodity News
8
Find out the latest communications in the market that may impact current programs.
Member Advantage Canada I November 2018
When you hear potatoes... what‘s the first thing that comes to mind? Let me guess, French fries and potato chips. French Fries and we think of fast food, but the “French fry” was first served in the U.S. for the first time by Thomas Jefferson at a presidential dinner. Potato chips came about from a chef with an attitude (now that’s unusual). In 1853, railroad magnate Commodore Cornelius Vanderbilt complained that his potatoes were cut too thick and sent them back to the kitchen at a very prestigious resort in Saratoga Springs, NY. To spite his arrogant guest, Chef George Crum sliced some potatoes paper thin, fried them in hot oil, salted and served them. To everyone’s surprise, Vanderbilt loved his “Saratoga Crunch Chips,” and potato chips have been popular ever since. In the United States, a pound of potato chips costs two hundred times more than a pound of potatoes! Despite being delicious fried, baked, or boiled, the root vegetable rarely gets the praise it deserves.
More than 70% of the potatoes grown across the world are in processed form and are said to have a high amount of salt and fat content. However, potatoes are surprisingly very nutritious with low calorie content. It is always best to eat a potato with the skin on, as the skin is high in complex carbohydrates as well as fibre. The potato is the most important non-cereal crop in the world, and fourth most important crop overall. Only corn, wheat, and rice are more important. In North America, potato products are the second most consumed food overall, trailing only dairy products, but rarely do we give our starchy friend a second thought. According to history, potatoes have been first cultivated by the Peruvian Indians in and around the Andes Mountains some 4,000 years ago. Now, potatoes are available in every part of the world.
But did you know... During the Alaskan Klondike gold rush, (18971898) potatoes were practically worth their weight in gold. Potatoes were so valued for their vitamin C content that miners traded gold for potatoes.
Chef Wayne
Corporate Executive Chef, Foodbuy
Potatoes are 20% solid and 80% water. 2
PROGRAM ANNOUNCEMENTS Canadian Manufacturer Highlighted On July 1, 2018, Canada imposed a new 10% tariff on select goods produced and imported from the United States direclty impacting the purchasing of paper goods. After the finalization of the USMCA (new NAFTA) deal, we are hoping tariffs will disipate, but have not received any updates on if or when the tariff will be lifted. As a purchaser of toilet paper, paper towel and napkins manufactured in the U.S., our recommendation is to move to our preferred supplier Cascades in the Tissue & Towel category. Cascades is a leader in the production and conversion of corrugated products, tissue paper and specialty products in North America. Known and recognized for its strong environmental practices, Cascades mission is to improve the well-being of people as well as provide sustainable and innovative solutions. As a Canadian manufacturer, their products are not impacted by the tariff. We negotiated a best net price in place with Cascades and recommend converting spend to this preferred supplier in mitigating the tariff increase wherever possible.
Member Advantage Canada I November 2018
3
PROGRAM ANNOUNCEMENTS We have launched our FY2019 Cold Beverage Planogram Guide!
Did You Know?
This guide is a great tool which can support our members in driving cold beverage sales through the right products, in the right place at the right price. There is information on customers and insights into their preferences in the cold beverage categories, supported by the trends in the Canadian market. A useful tool is the planogram designs to support execution and merchandising of coolers – these have been designed based on the trends and insights we have seen in the last year. We are confident these principles can support growth across the cold beverage category in your business. Please contact your Foodbuy account manager for further information and access to the guide.
The water category
has grown 40 in the last 5 years and is the #2 category after Carbonated Soft Drinks
Ready to drink Tea is a fast growing category – on any given day, over
1.9m Canadians
are drinking tea and the category is
growing 14
70
YOY
of beverages
are purchased with an occasion in mind
51
of people
DO NOT order a beverage without a combo deal Member Advantage Canada I November 2018
4
PROGRAM ANNOUNCEMENTS Christmas Candy! Did you know that there is a 33% increase in confectionery purchases in December? This is an important time of year to offer seasonal products to our consumers and match what is happening in cafes and grocery stores in Canada. We have a great range of product available from the leading brands to drive an increase in confectionery sales leading up to Christmas.
Did You Know? M&Ms are seeing
17 Description
Case SCC
M&Ms Milk Chocolate Red & Green 200g
10058496430013
M&Ms Peanut Red & Green 200g
10058496430044
M&Ms Mint Red & Green 200g
10058496430068
Merryteaser 140g
10058496437128
Candy Egg Mini Festive Floor Pack 168/33 Gr
61200013207
Chocolate Toblerone Assorted Tiny Festive Christmas
10070221007475
Chocolate Mini Egg Christmas 24/33 Gr
00006120001271
Member Advantage Canada I November 2018
growth
in the market
Merryteasers are seeing
37
growth
in the market
5
PROGRAM HIGHLIGHTS KELLOGG’S - Product Switch Opportunity for cost saving in culinary with product switch from Premium Plus crackers to Zesta® crackers as a key initiative for low cost provider. Crackers are predominantly used in food court and restaurant environments giving consumers the option to take as an accompaniment to their soup or salad purchase. For the operator, they are an additional product cost to the meal, but it is an advantage in delighting customers with this add on. Zesta® crackers, manufactured by Kellogg’s, have undergone an extensive recipe evaluation and reformulation to improve quality and taste. These crackers have been reviewed centrally and corporately and this switch for the business is highly recommended.
Member Advantage Canada I November 2018
6
PROGRAM UPDATES Program Updates - November 2018 The information below offers a snapshot of some of the price changes customers can expect to see in November. Please review complete list of updates here.
Protein - Raw Bacon Olymel 7% Price Decrease This is likely the bottom of the market coming out of high prices. Expect to see increase again next month. $15,000 decrease/mth.
Various Categories Handgards 8.89% Price Increase Quarterly price increase (diverted Q2 increase). Asked for July 2018 implementation but we pushed out. VA improvement as well.
Member Advantage Canada I November 2018
Canned Tomato Based Products & Canned Legumes Primo 6.08% Price Increase All retail beans products, tomato based products (tariff and nontariff based), tomatoe ketchup and tomato sauce. Mitigated from July to November, might reverse with new USMCA agreement in the second half 2019.
Various Categories David Roberts 6.12% Price Increase Reason is US exchange and candy import tariff. $67K CGC impact, and $43K impact to MDG VA improvement $13k for CGC, $23k MDG.
7
MARKET & COMMODITY NEWS Food and Non-Food Tariff Based Price Increases Possible On July 1, 2018 the Canadian Government imposed tariffs on select U.S. products that are imported by Canada. These tariffs will likely impact pricing on popular products in the Canadian market, and consumers may see price increases on various items beginning in the next few months. Foodbuy is closely monitoring the situation and taking appropriate measures to ensure that alternative products are made available to our customers whenever possible. We remain committed to providing our customers with quality products at the best value possible, and we will continue to provide regular communication when there are areas where we can mitigate price increases happening due to uncontrollable market events. Products and services currently impacted by these conditions include: Manufacturer: Georgia Pacific Price Increase: 10% effective July 1, 2018 Impacted Items: A complete list of impacted items is attached. Recommendation for Mitigation: Transition to Cascades for paper goods, as it is a Canadian supplier. Manufacturer: Rubbermaid Price Increase: 7% effective September 1, 2018 Impacted Items: Hygientic or plastic toilet articles, tableware and kitchenware. Manufacturer: Ecolab Price Increase: 4.2% effective September 1, 2018 Impacted Items: Dishwasher detergents, air freshers and hand care products. Manufacturer: Erie Meats Price Increase: 2.6% effective July 1, 2018 Impacted Items: Diced chicken. Manufacturer: Rosemount Price Increase: 6.9% effective September 1, 2018 Impacted Items: Diced chicken and chicken meatballs. Recommendation for Mitigation: Move to Erie Meats (preferred vendor) for diced chicken.
Manufacturer: Smucker Foods of Canada Price Increase: 7% effective September 1, 2018 Impacted Items: Strawberry Jam and 4 Coffee Skus (Java Coast, Folgers and Moka D’Oro Skus). Recommendation for Mitigation: Move to Kraft Heinz our Preferred Supplier for Jam. Manufacturer: The French’s Price Increase: 6.97% effective September 1, 2018 Impacted Items: Mixed Condiments & Mixed Seasonings and Other Sauces. Franks Red Hot and Cattlemen’s affected brands. Recommendation for Mitigation: Move to Kraft Heinz the preferred manufacturer for BBQ sauce. Manufacturer: Kimberly Clark Price Increase: 9% effective October 1, 2018 Impacted Items: Towel and Tissue Recommendation for Mitigation: Transition to Cascades for paper goods, as it is a Canadian supplier.
Foodbuy will continue to update this list with recommendations as we are made aware of price changes from other suppliers. Please don’t hesitate to reach out if you have questions. Sincerely, Keith Carlson VP, Category Sourcing and Development, Foodbuy E:keith.carlson@foodbuy.ca, O:905.568.4636 x.7442 Member Advantage Canada I November 2018
8