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MARCH 2015

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Nugget Markets Unveils New Concept, Acquires Three Paradise Foods Stores Nugget Markets started 2015 with a new store concept open, and by the end of January the Woodland, Californiabased grocer had announced the acquisition of three Paradise Foods stores in Marin County. The additions will bring the family-owned grocer’s total to 15 stores. Nugget quietly unveiled its new concept, called Fork Lift, in early December. It remodeled one of its Food 4 Less warehouse-style stores to the new format that offers both conventional and organic products “at naturally low prices.” The store is located at 3333 Coach Lane in Cameron Park. According to the Fork Lift website, “Fork Lift provides the unique shopping experience of Nugget Markets housed within the warehouse style format. Offering stellar guest service and warehouse pricing on an amazing selections of healthy, top-quality groceries, Fork Lift features the best of Nugget Markets’ chef-prepared foods, fresh bakery goods and an expanded selection of local and organic meats and fresh produce.” The Sacramento Business Journal reported that the major changes Nugget made to the former Food 4 Less store included a heightened emphasis on fresh prepared foods

Haggen’s New ‘Journey’ Begins

The slogan of Fork Lift: “Lift a fork to organics, local goods and specialty products at warehouse prices.” as well as local and organic selections. Near the front of the store is a “wall of values” promoting national brands offered in large quantities, such as party-size Lay’s chips. Beyond the wall of values is organic produce as well as a salad bar and grain bar, with selections such as kale salad Please see page 78

Montana Grocer Honored Among 2015 IGA International Retailers of the Year Paul Matovich of Columbus IGA Plus in Columbus, Montana, was named one of three 2015 IGA USA International Retailers of the Year in January. The store is serviced by Supervalu-Billings Division, an IGA licensed distribution center (LDC). Matovich is joined on the exclusive list by Jeff Downing of Foothills IGA in Marble Hill, Georgia, serviced by Merchants

Distributors Inc. (MDI); and Bill Price of McMaken’s IGA in Brookville, Ohio, serviced by Laurel Grocery Co. The three winners were selected from a list of six finalists, all nominated by their LDC. The other finalists were Hal Blanton of Blanton’s IGA in Packwood, Washington, supplied by Supervalu, Tacoma division; Jason Linnes of Orcas Island IGA in Eastsound,

Haggen Pacific Southwest Division executives in their offices in Irvine, California, in January: Bill Shaner, CEO; Wendy Oliver, SVP of operations; and Chris Linskey, SVP of marketing. The more than $9 billion merger of Albertsons and Safeway was finalized in late January, but the bigger story may come from the stores it had to divest to receive Federal Trade Commission approval. A total of 168 stores across eight western states operating under Albertsons and Safeway’s Vons banners were sold to four buyers. The most notable acquisition was made by Bellingham, Washington-based Haggen. The 18-store chain picked up 146 of the divested stores and, in the process, created another division of the company—Haggen Pacific Southwest, with headquarters in Irvine, California. Bill Shaner, CEO of the Pacific Southwest region, which covers Southern California, Arizona and Nevada, recently sat down with The Shelby Report to discuss plans for the new division. While store conversions already are under way in Haggen’s Northwest Division (Washington and Oregon), the grocer’s Pacific Southwest Division will not begin makeovers of its 100 stores until March. And, even then, it will only be the beginning of what Shaner calls a “journey.” Please see page 14

Please see page 78

Southern California Market Profile see page 14

FMI Midwinter Coverage see page 48

Tanya Domier

see page 18

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MARCH 2015 • The Shelby Report of the West

Region

RETAILER/WHOLESALER NEWS

ROUNDUP...

Albertsons, Safeway Complete Merger; Combined Company to Operate 2,230 Stores

Arizona Natural Grocers by Vitamin Cottage opened its first store in Tucson on Jan. 20, joining the company’s three existing Arizona stores. The Tucson store is located at 7220 E. Broadway Boulevard and offers shoppers USDA certified organic produce and other affordable natural and organic groceries, the chain says. National brands as well as Arizona grown, raised and manufactured products line the store shelves. “We are excited to become the newest ‘neighbor’ in a community such as Tucson, which is very foodand health-oriented,” said Kemper Isely, co-president of Natural Grocers and a member of the founding family. “We also offer extensive complimentary, science-based nutrition education programs for making informed health and nutrition choices.” Currently, Natural Grocers has 91 stores in 15 states. The Tucson location is one of 18 Natural Grocers stores expected to open in fiscal year 2015. ••• Construction continues on PhoenixMart, a 1.5 million-s.f. foot trade complex located on a 585-acre site south of Phoenix in Casa Grande. It is said to be the largest commerce center in the Western Hemisphere. The global trade center is expected to benefit primarily North American manufacturers, distributors and materials companies in six industries, including food and beverage. Others include home and hotel; office and recreation; fashion and variety; electronics and accessories; and industrial and automotive. PhoenixMart plans to complete leasing more than 1,700 suites in 2015, most of them well in advance of the commerce center’s anticipated opening in the fourth quarter. ••• House Bill 2051, introduced into the Arizona legislature on Jan. 8, would prohibit the state’s EBT benefits cards from being used to buy fast food, according to a Jan. 8 article in the Phoenix Business Journal. The bill, introduced by Reps. Sonny Borrelli, T.J. Shope and Kelly Townsend proposes a change of where EBT funds can be used, adding fast-food restaurants to the list of places where the state cash benefits cannot be spent. The list already includes liquor stores, race tracks, adult entertainment establishments and casinos, the Journal noted. ••• Blue Cross Blue Shield of Arizona, the state’s largest locally owned health insurer, is stepping up its efforts to fight food insecurity and related chronic health conditions through a new program called “Nourishing Arizona.” Research shows that one in three Arizonans, or 2.02 million people, are considered “working poor,” meaning they are living at or below 185 percent of the federal poverty level. Families with limited incomes are often forced to make food choices based on price or convenience alone. Nourishing Arizona aims to help people understand the importance of good food, while gaining an understanding of how to make healthy decisions and know where to go to get help. Information is available at azfoodbanks.org/index.php/missingmeals.

California The Western Association of Food Chains (WAFC) elected four new board members during its annual January meeting in LaQuinta, California: Monica Garnes, VP-merchandising, Fry’s Food Stores, Phoenix, Arizona; Dennis Gibson, president, QFC Stores, Bellevue, Washington; Valerie Jabbar, VP-merchandising, Ralphs Grocery Co., Los Angeles; and Rob McDougall, president and CEO, Gelson’s, Encino, California. “We are thrilled to welcome these industry executives to the WAFC board of directors,” said WAFC President and Chair Sue Klug, EVP/CMO at Unified Grocers. “Their commitment reinforces our mission of ‘Advancing the Food Industry Through Education and Leadership.’ I am confident that their participation will further extend our education initiatives and look forward to working with each of them.” ••• Each year, the USC Marshall School of Business selects a Food Industry Management program alumni as the program’s Executive of the Year. This year’s honoree is Dave Hirz, CEO of Smart & Final, “a food industry executive who has shown extraordinary leadership while producing exceptional business results,” according to USC. Hirz, with 35 years of industry experience, was named CEO of Los Angeles-based Smart & Final in 2012. He was the FIM Executive in Residence in 2005 and served as president of the Western Association of Food Chains in 2006. Hirz will be recognized during FIM’s annual awards banquet April 29.

Dave Hirz

••• For the first time in its 23-year history, the California Grocers Association Educational Foundation (CGAEF) College Scholarship Program, the nation’s largest statewide program supporting the grocery industry, will provide half a million dollars in scholarships. CGA member company employees and their dependents are eligible to apply for their part of the $500,000 in financial assistance for the 2015-16 academic year through college scholarships awarded by CGAEF—a $92,000 increase over last year’s award total. “The significance of this scholarship program and the grocery industry’s generosity cannot be overstated; this program has been indispensable to countless individuals. At a time when students struggle to continue their education while attempting to lessen their financial burden, this program ensures that hundreds of students every year will receive the financial support they need,” said Jim Please see page 8

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Albertsons and Safeway completed their proposed merger on Jan. 30. Under the terms of the agreement first announced and unanimously approved by Safeway’s board of directors in March 2014, Albertsons will acquire all outstanding shares of Safeway. The deal is valued at approximately $9.2 billion. The merger creates a company with 2,230 stores, 27 distribution facilities, 19 manufacturing plants and more than 250,000 employees across 34 states and the District of Columbia. The new company will be comprised of three regions and 14 retail divisions, supported by corporate offices in Boise, Idaho; Pleasanton, California; and Phoenix, Arizona. Banners include Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Albertsons, Acme, Jewel-Osco, Lucky, Shaw’s, Star Market, Super Saver, United Supermarkets, Market Street and Amigos. In December, the companies announced the sale of 168 stores to four separate buyers, as divestitures required in order to secure U.S. Federal Trade Commission approval of the transaction. “We plan to be the favorite local supermarket in every community we serve,” said Safeway President and CEO Robert Edwards, who becomes president and CEO of the newly combined company, effective immediately. “We will do this by knowing, listening to and delighting our customers; providing the right products at a compelling value; and delivering a superior shopping experience. We will also continue to be active members of our local communities.” As previously announced, current Albertsons CEO Bob Miller transitions to executive chairman. “This is a transformative day for both Albertsons and Safeway. This merger creates a unified, strong organization that is dedicated to bringing a better shopping

experience to more customers across the country,” said Miller. “Our combined geographic footprint, vast range of brands and products and service-oriented staff will enable us to meet evolving shopping preferences.” Marc Perrone, international president of the United Food and Commercial Workers International Union (UFCW), released a statement following the merger completion announcement. “More than 250,000 Safeway and Albertsons workers are members of the United Food and Commercial Workers Union. UFCW members also work for several other Cerberus Capital Management-operated supermarkets across the country, including Albertsons, Acme, Jewel-Osco and Shaw’s. “UFCW members have a history of negotiating union contracts with Safeway, Albertsons and Cerberus Capital Management. Together in their union, these workers have been able to ensure that union grocery jobs are the best jobs in the industry with fair pay, decent benefits and job security—all the while ensuring that their companies are able to be profitable and successful. “UFCW members in California stores that were divested by Albertsons are pleased to learn that the grocery store chain Haggen will acquire many Albertsons stores in California. Haggen workers in the Pacific Northwest are also members of the UFCW. UFCW members across the country are looking forward to working with Safeway, Cerberus and Haggen on issues that pertain to the members and industry. Our members plan to continue to serve their customers and their communities with pride.” As a result of the completion of the merger, the common stock of Safeway will no longer be listed for trading on the New York Stock Exchange or any other securities exchange.

Unified Announces Team Promotions, Additions Unified Grocers promoted three members of its senior management team in January in addition to making additions to its executive team. Joe Falvey, president of Market Centre, and Sue Klug, CMO, were promoted to EVPs, and Gary Herman, CIO, was promoted to SVP. “To continue our recent momentum will take imaginative and energetic leadership,” said President and CEO Bob Ling. “That means continuing to develop and add to our senior team, giving opportunities to those who have proved themselves ready to take the next step in their careers and adding the best talent from outside the company.” Falvey has been with the company since 1999 and has been instrumental in driving the successful growth of Market Centre, Unified’s specialty division. Under his leadership, Market Centre has become an integral part of what sets Unified apart from the competition, the company says, adding that the division has created new sales opportunities in growing categories such as organic, natural and ethnic foods. Klug has served as CMO since joining Unified in 2012. She is responsible for all corporate marketing and communications activities, as well as the company’s retail marketing service and retail technology functions. She already has elevated Unified’s marketing efforts in a number of areas, including a robust scan data program giving retail insights to Unified’s retail members and the company’s successful Celebremos! and MercadoSavings Hispanic marketing programs. In an expanded role, she is now responsible for strategic sourcing and real estate. In addition, Klug, working closely with the Unified board, will take a leadership role in strategic planning. Herman has been Unified’s chief information officer since 2000, overseeing the company’s information services function. Under Herman’s direction, Unified maintains state-of-the-art logistics systems and an extranet that tie together the company’s vendors, buyers and retail members. “Joe, Sue and Gary have proven track records of delivering solid results for our organization,” said Ling. “All are dynamic leaders whose vision and passion have helped drive Unified’s recent successes. They will

play important roles in driving the next phase of the company’s growth.” Additions to the executive team at Unified include: • Mike Brown, promoted to VP of retail services, with responsibility for all retail services, including merchandising, advertising, retail pricing, consumer insights and retail technology. Unified says Brown’s understanding of the industry and his broad knowledge of Unified’s systems, products and services will be key assets as the company continues to provide exceptional services and develop cutting-edge technology products for its retail partners. • Blake Larson, promoted to VP of accounting, responsible for internal accounting and reporting, including business unit financial reporting and support, budgeting and forecasting, financial analysis, pricing support and analysis, as well as financial systems support. In addition, Larson is assuming responsibility for operational analysis and accounts payable. • Keith Miller, promoted to VP of Market Centre operations. An effective leader driving Market Centre’s business strategies, identifying opportunities for operational improvements and implementing revenue-building initiatives, in his new role Miller also takes charge of procurement for specialty/gourmet, Hispanic, natural, general merchandise and health/ beauty/wellness. • Ray VanWetten, promoted to VP of sales for the Pacific Northwest. VanWetten, a 14-year veteran of Unified, will be responsible for driving sales growth in the Pacific Northwest marketplace in his new role. • Gregg Bostick, who joined the company as VP of logistics, brings a wealth of experience in food distribution with Americold Logistics, Supervalu, Pinnacle Foods and C&S Wholesale Grocers. Bostick will oversee company-wide distribution, transportation and maintenance functions, responsible for developing logistics and distribution strategies to meet the needs of Unified’s members. Unified’s Gary Hammett, VP of real estate, soon will retire. Ling said, “Gary has contributed a tremendous amount in a distinguished 15-year career with Unified. His contributions will continue to serve us well into the future.”

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The

Shelby Report of the

March 2015 Volume 8 • Issue 3

West

A Division of Shelby Publishing Co., Inc. – Publishers of:

Founder The Shelby Report of the West • The Shelby Report of the Southwest Gary G. Shelby The Shelby Report of the Southeast • The Shelby Report of the Midwest (1940-2003)

CONTENTS

The Griffin Report of the Northeast • Shelby Food Service Magazine 517 Green Street • Gainesville, Georgia 30501 (P) 770.534.8380 • (F) 678.343.2197 www.theshelbyreport.com • www.griffinreport.com • www.shelbyfoodservice.com

Retailer/Wholesaler News Region Roundup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Art’s Angle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Updated Market Shares . . . . . . . . . . . . . . . . . . . . . . . . .10 Independent’s Perspective . . . . . . . . . . . . . . . . . . . . . . .12 Southern Calif. Market Profile. . . . . . . . . . . . . . . . . . . . .14 California Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . .16 FMI Midwinter Exec. Conference . . . . . . . . . . . . . . . . . .18 C-Store . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21

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Monthly Features Frozen Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Natural Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30

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Perishables BroccoLeaf growing its presence . . . . . . . . . . . . . . . . . .43 Meat Groups merge into NAMI . . . . . . . . . . . . . . . . . . .46

Editor Lorrie Griffith editor@shelbypublishing.com

Senior Editor, Griffin Report Mike Berger mberger@griffinreport.com

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Guest Columnist Art Patch, Consultant

Guest Columnist Peter Larkin, NGA CEO

ADVERTISING

Center Store MOM Brands selling to Post . . . . . . . . . . . . . . . . . . . . . .56

Operations AFS’s foray into mobile shopping . . . . . . . . . . . . . . . . .62 Suppliers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .69

Vice President, West Bob Reeves rreeves@shelbypublishing.com

Vice President, Midwest Geoff Welch gwelch@shelbypublishing.com

Vice President, Southwest Dave Dreyer d.dreyer@shelbypublishing.com

Vice President Business Development, Griffin Report Jack Walsh jwalsh@griffinreport.com

Executive Vice President, Griffin Report Karen Harty kharty@griffinreport.com

Foodservice Director Penny Smith pennys@shelbypublishing.com

Business Development Manager, Griffin Report Trish Happel thappel@griffinreport.com

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Southwest Contributor Gordon Lowry gordonl@shelbypublishing.com

Staff Photographer, Griffin Report Randy Smith

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Nation at a Glance Merger of ‘Dollars’ moves ahead . . . . . . . . . . . . . . . . . .72

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The Shelby Report of the West • MARCH 2015

Region Obituary Mike Proulx, Former Bashas’ President and COO

Michael John “Mike” Proulx, who spent more than 40 years with Chandler, Arizona-based Bashas’, died Jan. 6 at his home in Sedona, surrounded by family. He was 66. Proulx was born Oct. 12, 1948, in Stillwater, Minnesota, to George and Irene Proulx. In 1961, his family moved to Arizona, where he met his high school sweetheart, Germaine Peters. They married in 1969. Proulx spent 42 years with the Bashas’ Family of Stores, starting as a bag boy in 1966, moving to Sedona to open a new store, and eventually becoming president and COO, supervising the day-to-day operations of more than 160 stores and 14,000 employees and expanding Bashas’ vast Northern Division that is spread across hundreds of miles of Native American reservations, tiny agrarian burgs and burgeoning vacation destinations. He also traveled extensively and studied the grocery industry domestically and abroad. After his retirement in September 2009, the couple spent several spring semesters living in the Los Angeles area while he served as a professor of Food Industry Management at the University of Southern California’s Marshall School of Business until 2013. Proulx co-taught “Strategic Planning, Leadership and Management Priorities” during the spring 2010 semester with the late Bob Hermanns. Proulx, an avid hunter, fisherman and outdoorsman, is “remembered for being a loving husband, father and brother. He was a friend, mentor and colleague known to many for his integrity, honesty and work ethic,” according to his obituary in the Arizona Republic. He is survived by Germaine; daughter Jennifer and son-in-law Zach; son Michael and daughter-in-law Alexandra; two granddaughters, Isabella and Helena; three brothers, three sisters, and a “treasured extended family.” In lieu of flowers, the family suggests contributions to the City of Hope and cancer research.

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Newport Avenue Market Wins Unified Grocers’ 2015 Ben Schwartz Retail Grocery Visionary Award Rudy and Debbie Dory and their daughter Lauren come from near and far.” Johnson—owners of Newport Avenue Market in The annual award is named after Ben Schwartz, Bend, Oregon—are the recipients of the 2015 Ben a former Unified board chairman. It is given to an Schwartz Retail Grocery independent retail grocer Visionary Award from or grocery company that Unified Grocers. They is a leader and innovator. received the award at an They must have consistently awards dinner Feb. 3 in demonstrated initiative, Los Angeles. This is the creativity and leadership 10th year Unified has within their businesses and, presented the award to in the process, inspired an outstanding indepenothers to think and act dent retailer. creatively and with passion. “It’s an honor to To be eligible, retailers receive this prestigious must be—or have been—a award and I’m proud that member of Unified or one of Newport Avenue Market its predecessor companies. is the first single-store “The award carries recipient,” said Rudy Unified Grocers President and CEO Bob Ling, Newport the name of a true retail Dory. visionary,” Ling said. “The Avenue Market owners Debbie Dory, Lauren Johnson Bob Ling, president and Rudy Dory with Ben Schwartz (seated). idea behind it is to recogand CEO of Unified nize someone in our retail Grocers, said Newport community who exemplifies Avenue Market has thrived because it’s a reflection of the spirit and character Ben Schwartz demonstrated the Dory family. throughout his long career. We’re proud to give this “Rudy, Debbie and Lauren are committed not only award to the Dory family. Newport Avenue Market is a to their customers and their staff but also to the local great store and the best is yet to come.” community and that’s reflected in their many successes In addition to the award that was presented to over the years,” said Ling. “Their passion to create a Newport Avenue Market, a duplicate is on permanent unique shopping experience is clearly evident as you display in the lobby of Unified’s headquarters buildwalk through the store. Innovation, quality and a ing in Commerce, California. A plaque recognizing friendly, knowledgeable staff are central to the success Newport Avenue Market as the 2015 winner has been of Newport Avenue Market and that’s why customers added to the permanent award.

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wartz, to an grocer that vator. tently iative, ership s and, spired d act ssion. ailers en—a one of nies. arries retail “The ecogretail plifies trated e this et is a

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MARCH 2015 • The Shelby Report of the West

Column

RETAILER/WHOLESALER NEWS

For a Healthy Return, Invest Executive Time in New Hires If your company does not arrange for a member of senior management to spend time with new hires during basic training you are missing an opportunity. The opportunity to help newly hired employees get a clear understanding of your company’s brand character as well as the financial drivers that make a retail grocery business successful. At one point in my time as a retail grocer, I had the opportunity to work with a young district manager (DM) who consistently ticked all the performance boxes necessary to be a high-level performer. After following our DM’s good-and-getting-better results for several quarters, we thought it was time to learn how the DM led the pack in sales growth, margin improvement, labor management, workers comp and expense, and employee turnover. When asked, “Why such good numbers?” after a short pause the young leader responded, “New hires.” The DM had taken a portion of the standard training program and called it “An afternoon with the DM.” The meetings, with an average of 10-15 new employees, were usually held every four to six weeks. The common-sense format allowed the district manager to share their family and background information with new employees and in turn hear about their lives and interest in the retail grocery business. After introductions, the DM addressed sales—their origin and importance. The new employees learned that sales

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begin and end with the customer. Further, they learned that the most important part of their job was giving the customer their undivided attention! Margins were explained as a function of sales, costs and expenses. Generally speaking, a happy customer nurtured all three. Because over time it would affect the employee directly, the process of labor and scheduling were important for new employees to understand. The DM made sure they understood that the number of hours on a schedule was determined by the store sales, and the day and time of hours assigned were based primarily on customer traffic. The DM spent some time explaining the importance of a safe workplace and how careless accidents lead to increased workers comp expense. They were asked to report anything they felt was not safe. The DM was particularly proud of the district turnover rate. Historically the lowest in the company, in the DM’s mind, the low turnover could be attributed to “An afternoon with the DM” meetings, making new employees feel like they are part of the team. By learning personal information about their DM and a short list of business financials, newly hired employees felt a sense of belonging and ownership. Give it a try. Chase those sales—they won’t chase you!

After a 40-year career that included executive-level positions with Safeway, Lucky Stores, Appletree Markets and Save Mart/ Food Maxx, Art Patch retired from the retail grocery business in 2007. He is a graduate of San Jose State College and the Cornell Food Executive Program. Patch is on the ExecuForce Team of Encore Associates and is a counselor for SCORE, helping new and emerging businesses develop business and marketing plans. He welcomes your feedback. Email him at ALPangle@aol.com.

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The Shelby Report of the West • MARCH 2015

Region

RETAILER/WHOLESALER NEWS

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Van Gorkom, CGAEF chairman of the board of trustees. “CGAEF scholarship donors are investing in the development of tomorrow’s grocery industry leaders.” The program started with a single scholarship in 1992. ••• On Feb. 3 Ralphs Grocery Co. launched its fundraising campaign to support children’s hospitals in Southern California. Ralphs customers and associates can support their local children’s hospital through the supermarket chain’s nonprofit arm, The Ralphs Fund, by donating their spare change in collection canisters located at the checkstands. The Children’s Hospital fundraising campaign will run through March 24. Seven Southern California children’s hospitals will benefit from the fundraising drive; Ralphs has set a goal of $200,000. “Ralphs believes strongly in giving back to the communities our stores serve,” said Donna Giordano, Ralphs president. “We’re pleased to extend our commitment to community service to our local children’s hospitals. We cannot think of a better way to invest in our communities than by giving families and children hope through our support of the outstanding work these hospitals are doing to provide world-class medical care for children.” ••• Throughout the months of November and December 2014, Stater Bros.’ 6th Annual “Harvesting Hope in Our Community” campaign raised more than $1.7 million for hunger relief in the communities where Stater Bros. stores operate. The donations came from several sources, including food barrels inside Stater Bros. stores, checkstand donations, donations from Stater Bros. Charities to food banks and other organizations, a monetary donation to buy Thanksgiving turkeys to feed the hungry, and Salvation Army Red Kettle donations. “Together we can make a difference,” said Jack H. Brown, chairman and CEO of Stater Bros. Markets. “The ‘Harvesting Hope in our Community’ campaign encourages everyone—employees and customers—to take part in the fight against hunger in their communities. At Stater Bros., we just don’t do business in a community; we are part of the community. Helping our neighbors in need is being part of the community.” Stater Bros. operates 168 stores in San Bernardino, Riverside, Orange, Los Angeles, San Diego and Kern counties. ••• Thanks to its customers, employees and community partners, Raley’s “Food For Families” annual holiday bag campaign surpassed its goal by nearly 50 percent, raising 2.9 million pounds of food in Northern California and Northern Nevada. The total, raised Nov. 7-Dec. 31, is among the highest in recent years. “This year was one of our best Holiday Bag campaigns ever,” said Jennifer Teel-Wolter, executive director of Food For Families. “Not only did we raise nearly 3 million pounds of food for those in need, we also did it by providing fresh and healthy options to our food banks. We’re thrilled to see how the community supported this effort and we’re so grateful to everyone who participated.”

Oregon Newport Avenue Market’s “Food For February,” an annual fundraiser geared towards feeding the hungry in Central Oregon in collaboration with Family Kitchen of Bend, has surpassed last year’s numbers. A total of $21,278.57 in customer donations was matched dollar for dollar by Newport Avenue Market, for a total of $42,557.15. These funds will help Family Kitchen by providing roughly half of all ingredients needed to make the 60,000-plus meals they anticipate serving in 2015.

Washington Bartell Drugs, a family-owned drugstore chain in Seattle, has appointed Brian Unmacht president. The former EVP and COO of REI has served on Bartell Drugs’ board since 2011. Bartell Drugs, which celebrates its 125th anniversary in 2015, is the oldest and largest family-owned drugstore chain in the U.S. It has 63 stores in Washington’s King, Snohomish and Pierce counties.

Brian Unmacht

“He brings an excellent mix of leadership, operational experience, technical breadth and passion for exceptional guest service,” Chairman and CEO George D. Bartell said. “Our senior leadership team has never been stronger, and Brian will play a key role in our longrange planning and growth.”

Unmacht, who spent 27 years at REI, grew up in Seattle.

Wyoming Lucky’s Market will open a store in Jackson Hole, according to the Boulder, Colorado-based grocer’s website. Other Lucky’s openings will take place in Gainesville, Florida; Bloomington, Indiana; Ann Arbor, Michigan; Rock Hill, Missouri; and Iowa City, Iowa.

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IGA Names 2015 Five Star Retailers IGA has revealed its 2015 Five Star Retailers. Each year, IGA retailers undergo a series of rigorous assessments to ensure that customers are encountering exceptional shopping experiences as they enter an IGA store. IGA says that in-store appraisals combine with training and customer feedback evaluations to create a thorough assessment process and, in the end, the very best IGA retailers are awarded Five Star Retailer status. This year’s Five Star Retailers from the West, by state, are:

Arizona

• Olsens Market Place IGA in Ajo • Shope’s Market IGA in Coolidge • Weber’s IGA Supermarket in Sedona

California • • • • • • • • • •

Best Buy Market IGA in Hanford Best Buy Market IGA in Lemoure Best Buy Market IGA in Visalia Evergreen Market IGA in Greenville Foods Etc. IGA in Clearlake SPD IGA in Grass Valley Susanville Supermarket IGA in Susanville Young’s Payless IGA in Lockeford Young’s Payless IGA in Pioneer Young’s Payless IGA in Copperopolis

Idaho

• Archie’s IGA Plus in St. Maries

Montana • • • • • • • • • • • • • •

Broadus IGA in Broadus Columbus IGA Plus in Columbus Everyday IGA in Great Falls Gary & Leo’s Fresh Foods IGA in Conrad Gary & Leo’s Fresh Foods IGA in Florence Gary & Leo’s IGA Plus in Havre Milligan’s IGA in Absarokee Picchioni’s IGA in Roundup Reese & Ray’s IGA-Hardin in Hardin Reese & Ray’s IGA-Sidney in Sidney Teeple’s IGA in Browning Van’s Evergreen IGA Plus in Billings Van’s IGA in Great Falls Van’s IGA Great Falls East in South Great Falls

• • • •

C.E. Lovejoy’s Brookswood Market IGA in Bend Kenny’s Food Market IGA in Lincoln City Kenny’s IGA in Lincoln City Sun River Marketplace IGA in SunRiver

• • • • • • •

Blanton’s IGA in Packwood Camano Plaza Market IGA in Camano Island Dissmore’s IGA in Pullman Fischer’s IGA in Randle Granite Falls IGA in Granite Falls Kress IGA Supermarket in Seattle Wrays Food & Drug IGA-Meadowbrook in Yakima

Oregon

Washington

Wyoming

• Reese & Ray’s IGA-Buffalo in Buffalo • Valley Foods IGA in Saratoga

PCC Natural Markets Taps Former Starbucks Exec as CEO Seattle-based PCC Natural Markets appointed Cate Hardy as CEO, effective Jan. 23. Hardy, who comes from Starbucks Coffee Co., brings more than 15 years of retail experience in general management, retail operations, supply chain, growth and store development, and strategy. She was selected following a national search conducted by PCC’s board of trustees. “We welcome Cate’s experience and leadership at a pivotal time in PCC’s history,” said PCC CFO Randy Lee, who has served as interim CEO since May 2014. “Her background and values are ideally suited for guiding PCC’s growth in an increasingly competitive environment, and to strengthening PCC’s triplebottom-line business approach.” Hardy was with Starbucks for nine years and most recently served as VP of operations. She also held VP roles for global commercialization, customer service and global store development, as well as director positions in store development and strategy for the Seattlebased coffee company. Prior to Starbucks, Hardy was a VP at Washington Mutual and a management consultant with McKinsey & Co. and Deloitte. “PCC is recognized and admired in the Pacific

Northwest as a natural foods retailer that has achieved continual success through high product standards, sustainable business practices and putting its community of members, customers, growers and suppliers first,” Cate Hardy said Hardy. “I am thrilled to be joining this regional and industry leader, and look forward to working with PCC’s team of dedicated and talented employees to continue PCC’s record of growth and impact.” Hardy earned her MBA from the University of Chicago Booth School of Business and a bachelor of science in accounting from the University of Florida. She serves on the board of Seattle-based FareStart, a culinary training and job placement program for the homeless and disadvantaged. PCC is the nation’s largest certified organic retail cooperative with annual sales of $230 million and an active membership of more than 54,000 households. It operates 10 stores.

New Seasons Market in San Jose Expected to Open This Spring The former New Leaf Community Market in the Evergreen neighborhood of San Jose, California, will become a New Seasons Market by spring 2015, according to the website of New Seasons Market, which is based in Portland, Oregon. In an October 2014 statement, Wendy Collie, president and CEO of New Seasons Market, said, “The Evergreen area is unique in that there are few grocery stores and customers don’t have many convenient options available. They’ve asked for more of a neighborhood grocery store experience, which New Seasons Market offers with its assortment of natural and organic products alongside familiar name brand products. We are excited to be able to offer an all natural

and organic experience with our New Leaf Community Markets stores and the ultimate neighborhood grocery store experience with New Seasons Markets based upon what fits each community best. As we grow, we have the great option of matching the best fit from two strong store experiences to each community.” New Seasons purchased New Leaf Community Markets, based in Santa Cruz, California, in November 2013, operating eight stores in California’s Central Coast region. New Seasons opened stores in October and November 2014 in Tualatin and Grant Park (Portland), Oregon. Tualatin opened Oct. 22; Grant Park, Nov. 12.

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MARKETshares

The Shelby Report of the West • MARCH 2015

WASHINGTON

(Seattle, Tacoma, Olympia, Bellingham, Yakima)

COMPANY # OF STORES % MARKET SAFEWAY 132 31.2 QUALITY FOOD CENTERS (QFC) 65 14.1 WALMART 33 10.1 FRED MEYER 44 9.3 UNIFIED GROCERS* 90 7.1 ALBERTSONS 47 6.5 WINCO 12 4.3 SUPERVALU* 58 3.8 HAGGEN 21 3.6 THE MARKETS LLC 17 3.4 UNITED NATURAL* 21 3.1 TRADER JOE’S 20 3.0 GROCERY OUTLET 36 1.9 COASTAL PACIFIC 6 1.8

ACV = $13.20 BILLION

ORE./WASH./CALIF. (Portland, Salem, Eugene, Medford, Vancouver, Crescent City)

COMPANY SAFEWAY FRED MEYER WALMART WINCO ALBERTSONS UNIFIED GROCERS* C&K MARKET SUPERVALU* TRADER JOE’S GROCERY OUTLET UNITED NATURAL* ROTH’S FRESH MARKET NEW SEASONS SMART & FINAL

# OF STORES % MARKET 114 27.6 65 20.1 48 14.5 21 9.5 42 6.7 98 7.0 64 3.9 38 2.5 13 2.3 39 1.8 12 1.8 9 1.2 12 1.2 19 1.0

ARIZONA

(Phoenix, Tucson, Flagstaff, Yuma)

COMPANY WALMART FRY’S SAFEWAY BASHAS’ ALBERTSONS LLC TRADER JOE’S UNIFIED GROCERS* NATURE’S BEST WINCO SUPERTARGET WHOLE FOODS

# OF STORES % MARKET 105 26.5 124 23.0 113 18.2 127 13.4 42 6.1 14 1.9 28 1.8 23 1.6 5 1.5 8 1.4 8 1.1

ACV = $13.86 BILLION

ACV = $10.51 BILLION

Shares are for chains, independents and/or the wholesalers (voluntary or cooperative) that supply them within each region’s distribution area, extending well beyond typical metros or CBSAs. Thus, percentages may total greater than 100 percent in some markets. Each market is defined by the sphere of distribution, not limited to static geographic boundaries. All markets are “labeled” or identified by their primary state (with metros or key cities). Percentages are estimates based on annualized sales, industry data, institutional research and store footprints. Shares are updated routinely as market metrics dictate. Please see our other regional editions (Northeast, Southeast, Southwest and Midwest) for markets in your operating area. *Wholesaler

E. WASH./ID/MT

(Spokane, Coeur d’Alene, Missoula)

COMPANY WALMART U.R.M. STORES* SAFEWAY ALBERTSONS FRED MEYER WINCO SUPERVALU* SMITH’S

# OF STORES % MARKET 23 226.1 104 23.7 33 19.8 20 10.5 4 4.3 4 5.4 15 2.7 2 1.2

ACV = $3.46 BILLION

NO. CALIF./NEV. (San Francisco, Oakland, Sacramento, Fresno, Reno)

COMPANY # OF STORES % MARKET SAFEWAY 250 27.4 SAVE MART 212 14.5 SUPER STORE INDUSTRIES* 168 13.6 C&S* 329 12.0 RALEY’S 123 9.8 WALMART 82 9.4 UNIFIED GROCERS* 249 6.5 UNITED NATURAL* 58 5.6 TRADER JOE’S 66 5.5 WINCO 21 3.6 RALPHS 19 2.0 SMART & FINAL 61 1.8 GROCERY OUTLET 92 1.8

ACV = $30.41 BILLION

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MONT./WYO.

(Billings, Bozeman, Great Falls, Cody)

COMPANY # OF STORES % MARKET WALMART 11 32.3 ALBERTSONS 25 29.7 SUPERVALU* 33 11.7 ASSOCIATED FOOD STORES* 30 8.4 SAFEWAY 7 6.8 SMITH’S 2 2.5 U.R.M. STORES* 2 2.1 REESE AND RAY’S IGA 6 2.0 VAN’S IGA 5 1.9 REYNOLDS 5 1.8

ACV = $1.68 BILLION

UT/ID/ WY/NV/OR

(Salt Lake City, St. George, Boise, Twin Falls)

COMPANY # OF STORES % MARKET WALMART 70 31.5 ASSOCIATED FOOD STORES* 201 25.3 SMITH’S (KROGER) 87 17.1 ALBERTSONS 36 8.1 HARMONS 17 7.5 WINCO 14 6.4 FRED MEYER (KROGER) 10 3.3 RIDLEY’S FAMILY MARKETS 24 2.9 SUPER TARGET 6 2.0 WHOLE FOODS 5 1.6

SO. CALIF./NEV.

(Los Angeles, San Diego, Santa Barbara, San Bernardino, Bakersfield, Las Vegas)

COMPANY RALPHS (KROGER) VONS UNIFIED GROCERS* WALMART ALBERTSONS STATER BROS. TRADER JOE’S SMART & FINAL NATURE’S BEST NORTHGATE WINCO FRY’S UNITED NATURAL* WHOLE FOODS COASTAL PACIFIC K.V. MART

# OF STORES % MARKET 368 18.5 267 15.0 553 12.7 130 10.6 215 9.8 168 8.9 113 5.9 141 3.0 93 2.4 39 2.2 17 2.1 26 1.5 32 1.5 17 1.3 18 1.1 25 1.0

ACV = $43.88 BILLION

ACV = $8.69 BILLION

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More Coverage theshelbyreport.com

The Shelby Report of the West • MARCH 2015

Column

RETAILER/WHOLESALER XXXXXXXXX NEWS

The Power of Local New research on the surging growth of locally sourced food confirms something I’ve long believed about independent grocers: they own local. By their very nature, independent grocers tend to be homegrown businesses. Being part of the community, doing business with friends

PETER J. LARKIN

President and CEO National Grocers Association (NGA) Over many decades, independents have partnered with nearby producers of products and services that are staples of every grocery store, like fresh fruits and vegetables, meat and poultry, bread and baked goods, and a host of other items. Local food generated

Being part of the community, doing business with friends and neighbors, helps independents build and maintain strong ties to other local businesses, which has the added advantage of pumping dollars to the local economy. and neighbors, helps independents build and maintain strong ties to other local businesses, which has the added advantage of pumping dollars to the local economy.

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good revenue, but the market for such items was limited by factors such as transportation costs from farm to market. Now there’s solid data backing up the attraction of locally sourced product. According to a recent article in The Shelby Report, market research publisher Packaged Facts estimates that local foods generated $12 billion in sales

in 2014—about 2 percent of total U.S. retail sales of foods and beverages. Looking ahead, Packaged Facts predicts that local foods will grow faster than the annual pace of total food and beverage sales, with sales approaching $20 billion in 2019. The reasons why local items do well, the report goes on to say, has mostly to do with the perceived quality of freshness. In addition, more than half of consumers say they buy local products to support local businesses, and more than 40 percent of consumers say the products taste better. Roughly a third believes that local products are healthier, while others say they like knowing where their food is coming from. Clearly, not all these sales are coming solely from independents. Retailers large and small are now aggressively promoting locally sourced items, which are expanding demand in what once was a limited supplier niche. If you’re wondering where the power of local got its start, look at what independent grocers have been doing, and for decades.

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The Shelby Report of the West • MARCH 2015

Southern California Market Profile

More Coverage theshelbyreport.com

RETAILER/WHOLESALER NEWS

Haggen Pacific Southwest Makes Aggressive Launch Plans for New Market Northwest stores; Supervalu will be the primary supplier in the Northwest. • Supervalu’s infrastructure “The Supervalu TSA (Transition Services Agreement), which is all the back-office infrastructure support, the tech-

Meet Haggen Pacific Southwest CEO Bill Shaner

Bill Shaner speaks at a meeting in January for Haggen Pacific Southwest vendor and broker partners.

Imagine the very best of what Vons and Albertsons do today. Take the very best of what they do, and they do a lot of things well, and just sprinkle on top of that a little bit of Whole Foods, a little bit of Sprouts, a little bit of Bristol Farms, maybe a little bit of Gelson’s, and just mesh that together. That’s what I think customers can expect out of Haggen. That’s what we’re aspiring for. by Kristen Cloud/staff writer Haggen’s Bill Shaner is not a native West Coaster, but his experience across the nationwide food retailscape tells him one thing for certain: There is a place in the Southern California marketplace for Haggen. “What Haggen’s doing up there (in Washington) is pretty special,” he tells The Shelby Report. “It’s different, and there isn’t anything in the south that is like this.” Still, naysayers have their doubts. The question Shaner has heard most often since the Haggen deal was announced: How does a grocer go from being an 18-store operator to a 164-store chain or, as Shaner jokes, how does the goldfish eat the whale? The answer is simple, he says, and, as he told vendor and broker partners during an informational meeting Jan. 22 in Newport Beach that drew more than 800 people, it involves four components: • Comvest Partners’ financial and strategic backing Comvest Partners bought a majority stake in Haggen in 2011, at which time the grocer had approximately 30 stores. Because of the chain’s “operational challenges,” according to Comvest operating partner Chris Linskey

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Ira Genser, “Comvest spent the majority of 2012 and 2013 fixing the portfolio, closing some of the stores that were dragging the chain down. “The only reason we’re even sitting here today is because of that activity,” Genser said at the meeting. “Our 18 stores were so strong that it enabled us to take on this purchase.” • Haggen’s brand and people Shaner emphasizes over and over again the importance of Haggen’s employees. “The people in the stores are upbeat and positive and represent the stores well, and that’s a real linchpin to this whole thing—making sure that we had the people. Without the people it wouldn’t be possible to do this job,” he says. “This just wouldn’t be possible without the ability for us to get the management team and the people that are in the stores, that are doing a great job today serving customers. We just need them to continue to serve the customers, albeit under the Haggen brand.” Haggen expects to retain all employees from the Albertsons and Vons stores. • Unified Grocers’ products and services Commerce-based Unified Grocers will be the Pacific Southwest Division’s primary supplier, and the wholesaler’s Market Centre division will serve the Ira Genser

Bill Shaner, the retail food executive tapped to lead Haggen’s new Pacific Southwest Division as its CEO, has more than 30 years experience in the business. He describes himself as a “lifelong retailer” and aims to bring his expertise to Haggen to propel the brand to success in the Southern California, Arizona and Nevada marketplaces. Shaner started his career in Cleveland, Ohio, with The Kroger Co. and quickly worked his way through the management ranks, ending up as a buyer and pricer with the company. When Kroger pulled out of the Cleveland and Pittsburgh markets, Shaner was recruited by Supervalu in 1984. He worked for the company in a variety of merchandising and operations positions. In 1993, Supervalu bought East Coast wholesale company Wetterau Inc. The deal made Supervalu then the largest food wholesaler in the nation and expanded its strong business in the Midwest into the Southeast and New England. It also brought with it “many opportunities,” according to Shaner. “They had a bunch of different divisions and, ever since that time, I’ve had president-level positions—in wholesale from ’93 to ’95 and then ran the retail chain called Laneco Food & Pharmacy,” Shaner tells The Shelby Report. “They were early-stage supercenters, over 100,000-square-foot stores, that sold everything from guns and ammunition to cold fish, meat and produce to canned vegetables. I did that for a few years.” Shaner led Supervalu’s Dayton, Ohio-based Central region in the late 1990s and served as the COO of SaveA-Lot for six years beginning in 1999. When Save-A-Lot founder Bill Moran retired in 2006, Shaner took on the CEO role at the company. “We had a good run there,” he says. “When I first went there we had about 500 stores. When I left we had about 1,300 in 40 states across the country. It’s a really good growth story; a lot of fun, great format, great people.” Shaner left Save-A-Lot in 2011 and “dabbled with some different entrepreneurial things.” “I’m an owner of a gluten-free bakery (Andrea’s Gluten Free) in St. Louis,” he says. “I started…a closeout format called Here Today that’s in St. Louis. We have three stores right now.” “At the same time, I was looking for a company to invest in and run and be the CEO—try and take something and make something pretty special out of it,” Shaner says. “I went after a number of different companies in conjunction with private-equity firms and was 0 for 5; wasn’t able to get anything across the finish line just in terms of being successful in getting the deal done, until the Haggen opportunity came around.” He calls it “a once-in-a-lifetime opportunity for me.” “It’s exciting to be able to take what I believe in very much, which is the Haggen brand and the attributes it has,” he says. “I think what they stand for really will play very well with the consumer in the Southern California market; the chance to build a team from a blank canvas and be able to take some of the best and brightest talent that there is in the industry and bring them all together is just a chance of a lifetime. It’s energizing, it’s an adrenaline rush, for sure. “And,” he adds, “it’s going to be a lot of fun.” Shaner and his wife of 30 years, Donna, have two children, Stephen, 28, and Kimberly, 26; two dogs, Sam and Jezzie; and a cat, Lysander.

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ier in

ment), tech-

Coverage @ More theshelbyreport.com

MARCH 2015 • The Shelby Report of the West

Southern California Market Profile

RETAILER/WHOLESALER NEWS

nology support, payroll systems and all the different things that are behind the scenes—Supervalu’s doing that today for the Albertsons stores—and we were able to negotiate a deal with them to continue their being able to support those stores and stand them up from an infrastructure standpoint,” Shaner says. He notes, “Truly, it’s the Haggen people, the Supervalu infrastructure and the Unified distribution network that are going to enable us to be successful. That’s how this can happen.”

Store conversion plans

Those familiar with the Haggen brand know that, in recent years, the grocer has rebannered its stores in Washington and Oregon with the Northwest Fresh tag. But don’t expect to see any Haggen Northwest Fresh signs in the Pacific Southwest Division. “That’ll be maintained for the stores that are in the Northwest,” Shaner says. “The ones in Oregon and Washington, they’ll bring the Northwest Fresh brand and imagery to those, but not to the stores in the south. The stores in the south will be Haggen Food & Pharmacy since 1933, and one of the things we’ll be trying to explain to the customers is that Haggen has stood the test of time. It’s not a new unproven brand, it’s something that has served customers well for over 80 years in the Northwest…” “It’s important to know there is a very long history here. They have competed against the WinCos, against the Walmarts, against the Krogers, against the Albertsons, the Safeways—who’s who in retail competition, they have competed and they have won.”

“We are a full-line supermarket with an emphasis on healthy, an emphasis on fresh and an emphasis on quality. You’re going to see far more specialty, or what I call healthy-for-you products, in our assortment than what you’re going to see in the Albertsons and Vons stores today.” —Bill Shaner

Of the stores that Haggen Pacific Southwest acquired in the divestiture, 83 are in Southern California, 10 are in Arizona and seven are in Nevada. The first store conversion in the Pacific Southwest will be in Carlsbad in early March, to be followed by what Shaner refers to as “a tsunami” of conversions (between six and 12 stores per week) until mid June. The final store conversion will be in Las Vegas. Chris Linskey, SVP of marketing at Haggen Pacific Southwest, says the store

California WIC Moratorium Is Lifted The moratorium for stores to apply for authorization in the California Women, Infants and Children (WIC) Program was lifted Feb. 1. The announcement was made by Dr. Ron Chapman, director and state health officer at the California Department of Public Health (CDPH). “This positive step will improve availability and access for the approximately 1.4 million women, infants and children who participate in the California WIC Program,” says Chapman. To address rising food costs in the California WIC Program, the U.S. Department of Agriculture (USDA) in 2012 continued a moratorium on the addition of new vendors into the program so that CDPH and USDA could develop and implement strategies to contain costs and ensure program integrity. USDA notified CDPH by letter that the moratorium can now be fully lifted. In June 2014, USDA partially lifted the moratorium to include additional locations for stores that already had a master contract with the WIC program. Since that time, 217 stores have been added to the program. In September 2014, USDA partially lifted the moratorium to include new full-line grocery stores. Since that time, 24 stores have been added to the program. It is anticipated that

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200 stores will be added statewide after the moratorium is fully lifted. California currently has approximately 4,300 authorized stores that participate in the WIC program. “USDA and CDPH continue to work together to ensure the strategies now in place are effective in containing food costs and comply with federal regulations and mandates,” says Chapman. California WIC provides access to healthy supplemental foods, nutrition education, breastfeeding support and referrals to healthcare and community services for the infants, children and pregnant or postpartum women it serves. WIC spends approximately $83 million each month on food. At the federal level, WIC is administered by the USDA, and California’s WIC Program is administered at the state level by CDPH.

transitions will involve a “rolling close.” “The schedule does not make sense geographically because we’re converting the better stores first,” he said at the meeting. “The schedule is set up around the best-performing stores first. “The supply chain stuff changes from the minute we take over the store,” Linskey says. “That’s going to require a lot of work. …We envision redoing these stores within a very short period of time, taking a breath, making sure everything is scanning right, working right, and then shortly thereafter we will begin a pretty aggressive reset schedule to take those stores to where we think they should be. We will have a speed-to-shelf program and that speed-to-shelf program will be fast and quick and nimble.” Adds Shaner, “It’s going to take an awful lot of work in retagging these stores and getting them repositioned. We’re not going to shut the store down one day and, a day or two or three days later, all of a sudden have all the attributes of Haggen. That’s simply not possible. We’re going to do as much as we possibly can to have the store feel different and look different, put some ambiance into it. You will see different things happen in the store as much as we can possibly get done in one or two or three days. But beyond that it’s going to be a journey. It’s going to be a journey for us. It’s going to be a journey for our customers. It’s going to be a journey for our employees as well as in building all the attributes of the Haggen brand over 30 days, 90 days, six months, a year. “We do have the capital and the resources to bring this brand to life and, frankly, the overall conversion budget, marketing budget, the one-time expenses, is a little bit north of $100 million,” he says. Existing Haggen stores in the Northwest average about 70,000 s.f. The stores the company is acquiring, however, vary wildly in size—from 17,000 s.f. to 68,000 s.f. “One of our opportunities is going to be to say what parts of the Haggen brand translates well in the larger stores,” Shaner says. “As we get into the smaller stores, there’s going to be things that we’re not able to do, so one of the things that myself and my leadership team will be working on is what part of the Haggen brand translates to all stores and then what parts are we not going to be able to execute in the smaller stores but will be able to execute in the larger stores. The average footprint that we’re buying is around 45,000 s.f. We think that’s actually large enough to bring the Haggen brand to life. There may be some aspects of it that we’re not able to translate for different reasons, but in general we think the store fleet we’re getting will enable us to deliver the customers down here what Haggen does really well.” Most of the acquired stores have full-size pharmacies. About half of the Pacific Southwest store fleet have in-store pharmacies. The transition process also will involve retraining employees. On average, each store has about 80 employees. “As part of our acquisition, we agreed to and we wanted to be able to take all of the employees, whether it be the unionized, hourly employees or the store’s management team,” Shaner says. “That’s really important, because without the ability to take these great people we wouldn’t be able to do this.”

Haggen differentiators

Comvest’s Genser describes Haggen as a cross between Safeway and Whole Foods—a full-service, high-quality, local grocery store. “When I think of Haggen, it’s a place where I can get a Kobe beef steak and I can get my PBR in a can,” he says. “People are bored,” he explains. “People want to get excited when they go into the grocery store. And I think that’s really the difference that Haggen’s going to make. People are going to be excited to shop in the grocery store again. Shaner agrees, noting Haggen carries all the favorite products found in conventional supermarkets, with a bit of Whole Foods, Sprouts, Bristol Farms and Gelson’s mixed in. “We’re still going to have Cheetos and Snickers bars, but we’re also going to have a wider assortment of natural and organic in the stores,” he says. Shaner cites Haggen’s culture of quality, service, sustainability and local focus among the grocer’s chief differentiating factors, or “cornerstone values.” “Haggen was local before local was cool,” Shaner said at the vendor meeting. “Today, everything is about local, and

The First Haggen Pacific Southwest Leadership Hires During his first weeks as CEO of the Haggen Pacific Southwest Division, Bill Shaner has worked with his Northwest counterpart, John Clougher, who is handling the Haggen expansion in Washington and Oregon, and made his first hires for the Pacific Southwest Division. Chris Linskey, who’s from Southern California, has been named SVP of marketing, bringing more than a decade of experience in the couponing and promotions arena. For the past year he has served as EVP of sales for Intelligent Clearing Network (ICN). Before that, he was CEO of StorePort for two years. His background also includes six years at Advo as VP of sales and marketing; four years at Valassis as VP of marketing for grocery/drug/mass; and four years at Catalina Marketing as SVP and GM of Catalina Interactive. Wendy Oliver has been named SVP of operations, bringing with her 35 years of experience in the Southern California grocery business, most recently as VP of operations for Albertsons’ Southern California division. Oliver came to Albertsons through its deal with Supervalu in 2006. She started her grocery career with a six-store independent, Johnson’s Market, followed by Lucky/Gemco, then Supervalu and ultimately Albertsons. She was named to the Food Industries Sales Managers’ Club (FISMC) Honor Roll of Women in the Food Industry in May 2014. Blake Barnett serves as CFO of both the Pacific Southwest and Northwest divisions, and Moran Golan is director of communications for the Pacific Southwest. “One of the things that I know very clearly is for Haggen to be successful we’ve got to win the hearts and minds of all the over 8,000 employees that we have coming with the stores we’ve acquired. These folks are going to be questioning, they’re going to be wondering exactly what’s going, what’s a Haggen, what does it mean to me? I certainly get that, so one of my very first hires…is someone who can really help us have a voice with the people to bring them along on this journey—both from converting to the Haggen brand to all the things that’ll be happening over the coming weeks, months and years. Moran’s going to help us tell that story internally and externally.” Until Haggen gets its Pacific Southwest headquarters fully staffed with its leadership team, the grocer’s team in Bellingham is “enabling us to get off and running here in the south,” Shaner says. “I’m very dependent and very grateful for the people at Haggen that are in Bellingham, Washington,” Shaner says. “They’re not just managing the stores in the north that they’re acquiring.” Shaner expects to have a full team of category managers and merchants in place in the Pacific Southwest office in the next 60 to 90 days.

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Column CGA’s ‘Grocers Day at the Capitol’ in April Needs Your Support With 2015 comes a new, two-year legislative session— along with nearly 30 new members of the State Legislature. Grocers Day 2015 is the perfect opportunity to introduce our organization and its members to this new freshman class. Last year, nearly 100 CGA members met with 70 different legislative offices during our annual Grocers Day at the Capitol to discuss industry-specific issues such as California specific food labeling requirements, California Women Infant and Children’s Program (WIC) and single-use carryout bag regulation. Allowing our members to share their stories with their representatives had a direct impact on how legislators casted their votes.

RETAILER/WHOLESALER NEWS

Fong became President and CEO of CGA in March 2008. A native Californian and a lawyer, he joined CGA after 12 years with the California Credit Union League (CCUL). At CGA, Fong serves as the association’s chief legislative and political advocate and oversees government relations, member services, convention and communication programs. He also is president of the California Grocers Association Educational Foundation (CGAEF). His grandfather started Carmichael Supermarket, the first grocery market in Carmichael, California, in 1941, and Fong worked in the grocery business as he grew up.

Due in large part to our members’ efforts, CGA had a banner year in 2014—defeating measures mandating Californiaspecific labeling, passing the nation’s first statewide singleuse carryout bag standard and working with California WIC to lift the nearly three-year moratorium that was imposed on the state’s retail community (see story, page 15). Republicans celebrated as they were able to break the

Rumors are swirling around the Capitol regarding a retailer workers bill of rights bill package that would impose devastating scheduling mandates and penalties, define what a “retail” establishment is and require a successor employer to retain all employees from a business they acquire…

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Democratic supermajority in both legislative houses. Key Republican victories included Senate District (SD) 34 Janet Nguyen (R-Garden Grove); Assembly District (AD) 16 Catherine Baker (R-Dublin); AD 36 Tom Lackey (R-Palmdale); and AD 66 David Hadley (R-Manhattan Beach). With the elimination of the supermajority, Democrats no longer have the ability to pass new taxes without Republican votes. This year brings on a host of new challenges, which is why attendance at this year’s Grocers Day is vitally important to our industry. Rumors are swirling around the Capitol regarding a retailer workers bill of rights bill package that would impose devastating scheduling mandates and penalties, define what a “retail” establishment is and require a successor employer to retain all employees from a business they acquire—essentially bypassing an employee’s right to a fair union election process under the National Labor Relations Act. Additionally, retailer liability in data breach notifications and another state minimum wage increase are additional issues to be addressed. This year’s Grocers Day is Wednesday, April 8. The event includes policy briefings, guest speakers, meetings with lawmakers and, of course, our annual Ice Cream Social, sponsored by Nestlé USA, located in the Capitol’s basement. You won’t want to miss this year’s banner event.

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In The Spotlight

FMI Midwinter Executive Conference Fontainebleau Miami Beach • Miami Beach, Florida • Jan. 24-27

FMI Presents Its Biggest Awards at FMI Midwinter The Food Marketing Institute (FMI) presented its highest honor, the Sidney R. Rabb Award, to David B. Dillon, former chairman of the board of directors for The Kroger Co. Dillon accepted the statesmanship award among his peers and industry colleagues at the FMI Midwinter Executive Conference in Miami on Jan. 24. Dillon was recognized with the Rabb Award for his excellence in serving the consumer, the community and the industry. Attributes used to describe him typically begin with “genuine,” and his earnestness translates across his career to a deep understanding of the importance of diversity in America and in the American workplace. Recognizing his achievement and their longtime professional relationship, FMI President and CEO Leslie G. Sarasin said, “Dave is a respected leader in the larger food retail industry and consistently highlights the role of constructive feedback, believing that giving it establishes you as an informed leader and receiving it helps you become a better leader. A person of great vision and charisma, his passion for nurturing future leaders for the food retail industry was evident in his spearheading FMI’s 2013 Future Connect Conference, an event dedicated to developing those identified with leadership potential.” Dillon pledged and brought 200 Kroger employees to FMI Future Connect in 2013, saying, “I will be there, I’ll be taking notes, just like I did the last two times, and I’ll be learning, I hope hand-in-hand right along with you.” His leadership is reflected in the 37 years he dedicated to the food retail industry, focusing on nearly every aisle and role in the store. Dillon served as Kroger’s chairman from 2004-2014 and as CEO from 2003-2013. Prior to that, he held a variety of executive positions at Kroger and Dillons Cos., which merged in 1983. Rodney McMullen, Kroger’s chairman and CEO, describes Dillon as “a grocer’s grocer,” noting, “You are to me what the Rabb Award is all about—somebody that cares about our industry, cares about people and cares about Kroger and all the things in between.” Dillon was instrumental in developing Kroger’s “Customer 1st Strategy,” which today has resulted in 44 consecutive quarters of positive identical store sales growth. While Dillon served as CEO, Kroger increased revenue $45 Kroger veteran Dave Dillon, center, receives Statesmanship Award from billion, created 53,000 new jobs, reduced costs for eight consecutive years and returned $9.2 billion to shareholders FMI Chairman Jerry Garland of AWG and FMI President and CEO Leslie through share repurchases and dividends. Sarasin. Kroger also has become a leader in supermarket sustainability under Dillon’s leadership. Under his leadership, Kroger reduced energy consumption in stores by 33 percent since 2000 and its carbon footprint by 4.4 percent since 2006. Notably, more than half of the company’s 37 manufacturing facilities are zero waste. In 2011, Forbes Magazine recognized Kroger as the most generous company in America. The company’s efforts to feed families struggling with hunger grew to total contributions of 250 million quick dinner solutions, cooking classes FMI Foundation urges grocers meals—four million meals per week—annually. and nutrition advice, to shortcuts like preDillon’s regard for the community is arguably rooted in his appreciation for service and scout- to get on board prepped ingredients and freshly prepared ing. He received the Distinguished Eagle Scout Award in 2012, and he continues to empower The Food Marketing Institute (FMI) entrees,” she said. “FMI’s resources will entrepreneurial future grocers, mentoring Jayhawks at his alma mater, the University of Kansas, Foundation has launched a September give members a new way to showcase where he serves on the board of trustees of the University of Kansas Endowment. marketing initiative with the nation’s these creative meal programs throughout Dillon is a member of the board of directors of DirecTV and Union Pacific Corp. He serves on grocers aimed at highlighting food retailthe boards of the University of Cincinnati Foundation, the Urban League of Greater Cincinnati, ers’ unique family meal programs and their September.” Added FMI President and CEO Leslie G. and Catalyst. He also was an influential member of the board of directors of the Consumer Goods commitment to bringing Forum and FMI. families back to the table. Dillon’s loyalty and commitment is further exemplified in his family life. He has been married Numerous studies have to Dee for 41 years. They currently reside in Kansas, and have three grown children and seven underscored the longgrandchildren. term health, academic and societal benefits of eating IGA chairman accepts Humanitarian Service Award together as a family, yet, IGA Inc. Chairman Dr. Thomas S. Haggai received the FMI Herbert Hoover Award. The Hoover according to a 2013 Harris poll, only about 30 percent Award recognizes Haggai’s longtime humanitarian service in the food retail industry. Sarasin said, “Dr. Haggai is a true architect of the human spirit. He motivates, inspires and of American families share builds communities in his work with independent operators. Honoring him tonight is honoring a dinner every night. To promote family mealglobal legacy of achievement within our industry.” Haggai is often touted as the only non-grocery retailer to sit on the board of IGA. A radio time, the FMI Foundation is personality, author, minister and business consultant, Haggai has contributed a notably diverse calling upon the industry’s perspective to the board of IGA since 1972 and as board chairman since 1976. He often celebrates collective voice and influthe creative minds at IGA to media and in his addresses, and once referred to IGA as a think tank ence to launch “National Cathy Polley, executive director of the FMI Foundation. due to the talent at the helm of the organization. Under his advisement, Haggai helped introduce Family Meals Month.” This IGA in Japan and Australia in month-long FMI member communications Sarasin, “Food retailers are known supportthe late 1980s; but he also iden- campaign will give the grocery industry a ers of their communities and proponents of tified strong domestic growth unified theme and turnkey promotional neighborhood values. Their commitment opportunities, especially within tools to encourage consumers to lean on makes them a logical and reliable front of cities like Philadelphia and their local supermarket to prepare one resources and meal solutions encouraging Cincinnati where IGA contin- additional family meal per week at home. families to eat more meals together—an National Family Meals Month was intro- activity with known societal benefits. This ues to enjoy a strong presence. “It was his business influ- duced Jan. 24 during the FMI Foundation’s campaign highlights how food retailers and ence that earned Dr. Haggai the annual gala, which celebrates the accom- wholesalers fulfill their mission of feeding FMI Sidney R. Rabb Award in plishments and investments of the food families and enriching lives.” 2003, but it is his commitment retail industry in addressing social In February, FMI began offering its to youth, education and the concerns. members a free downloadable toolkit Cathy Polley, FMI Foundation’s executive featuring customizable promotional and community for which he earns the Hoover Award more than a director and FMI VP of health and well- social media materials that enable grocers ness, explained that National Family Meals and consumer product brands to easily decade later,” Sarasin said. Haggai founded Tom Month will provide FMI members with integrate National Family Meals Month Haggai and Associates (THA) both the platform and tools for showcasing marketing into their existing promotional Foundation in 1963 with 120 their mealtime resources. schedules. Members can access the toolkit “Our members are doing more than ever here. IGA’s Dr. Thomas Haggai receives his award from Jerry Garland, FMI national business and profesto inspire and support home cooking, from chairman, and Leslie Sarasin, FMI president and CEO.

September Declared as National Family Meals Month

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In The Spotlight

FMI Midwinter Executive Conference From page 18

Fontainebleau Miami Beach • Miami Beach, Florida • Jan. 24-27

sional leaders as associates. According to published reports, THA Foundation provides assistance “so young people would be prepared to help the youth of our country,” focusing on college scholarships to nontraditional students returning to school in pursuit of certification as elementary school teachers. Since its inception, the foundation has awarded more than 1,200 scholarships exceeding $3 million. His commitment to schooling was evident in his 1985 commencement address to Pepperdine School of Education and Philosophy where Haggai told graduates, “Education has been the ‘real resource’ contributing to the welfare and growth of society.” While he is often in the role of educator, he has described himself as a dedicated and constant student of the grocery industry. Haggai has been the recipient of many teaching honors throughout his career, among them earning honorary degrees from High Point University, Salem College, Charleston Southern University, Pepperdine University, Alderson Broaddus College, Campbell University, Boston University, Northwood University, Lindenwood University, Missouri Western State College, Virginia Union, Doane College and North Greenville University. IGA President and CEO Mark Batenic celebrated Haggai in a video testimonial, sharing many of the selfless qualities that make Haggai a deserving recipient of the Hoover Award.

GMA Honors Food City’s Smith With Industry Collaboration Leadership Award Steve Smith, president and CEO of Food City in Abingdon, Virginia, received the Grocery Manufacturers Association (GMA) 2015 Industry Collaboration Leadership Award at the Food Marketing Institute’s (FMI) Midwinter Executive Conference in Miami Beach in late January. The GMA award, established in 2011, recognizes an industry leader who has demonstrated excellence in fostering collaboration among consumer packaged goods industry trading partners throughout his career. “Steve Smith has exemplified through his extraordinary commitment the critical imperative of trading partner collaboration that extends beyond the traditional retailer-manufacturer relationship,” said Pamela G. Bailey, president and CEO of GMA. “Steve’s outstanding record of service to the Food Marketing Institute and the National Grocers Association has fundamentally changed the way our organizations work together.” Smith has held numerous Steve Smith, left, receives his award from J.P. Bilbrey, CEO of volunteer leadership positions Hershey and chairman of the GMA board. with FMI, including chair of the board of directors, chair of the FMI Foundation’s board of trustees and chair of the group’s public affairs committee. He also helped revitalize FMI’s board planning committee, on which he still serves. He is the only industry executive to serve as chair of both FMI and the National Grocers Association. As FMI board chair, Smith helped lay the groundwork for the Trading Partner Alliance, the industry’s preeminent forum for retailer-manufacturer collaboration. He was a champion of food safety reform and oversaw the establishment of an innovative recall management system to facilitate more effective communication between retailers and manufacturers during these critical events. Smith joined Food City more than 35 years ago, serving in multiple leadership positions before becoming president and CEO. Founded by Smith’s father in 1955, K-VA-T (Food City’s parent company) today operates 93 Food City supermarkets (including 78 pharmacies and 84 fuel/convenience stores), 10 Super Dollar Discount Foods and a wine and spirits store throughout southeast Kentucky, southwest Virginia and northeast Tennessee. The company supports numerous organizations throughout the tri-state region, including local food banks, the United Way, American Cancer Society, Boy Scouts of America, Juvenile Diabetes Research Foundation, Susan G. Komen, YWCA, Boys and Girls Club and Paralyzed Veterans of America Association. “Steve believes in the power of FMI, GMA and other allied trade organizations to affect positive change within the industry that will ultimately benefit the consumer,” Bailey said. “He represents the best of the grocery retail community from the way he manages his business to the way he works with suppliers and industry stakeholders.” The GMA Industry Collaboration Leadership Award is now in its fifth year, and past recipients are J.K. Symancyk of Meijer, Fred Morganthall of Harris Teeter, Joe Sheridan of Wakefern Food Corp. and Don Becker of The Kroger Co.

Batenic describes Haggai as humble, a strong communicator, a good listener and having integrity in business. “He’ll tell you he’s not a grocery person,” Batenic said. “The reason he’s in this business is because he knows people. And he knows how to motivate people. With IGA, he truly believes he’s on a mission, and that mission is to build community centers. He firmly believes in the entrepreneurial, family-owned business spirit. Not just in this country, but all around the world.” Batenic concluded with a personal message to Haggai, saying, “For you to receive this award is certainly, I think, a high point of your career. And I know you’ve received other awards, but this one to me means the most because it truly exemplifies the kind of life you’ve led. And that life is to be an example for everybody else as they move forward in their lives.” Haggai and his wife, Buren, currently reside in Jamestown, North Carolina. They have three daughters, one son, five grandchildren and three great-grandchildren.

ConAgra Foods’ Rodkin gets Albers Award for Business Collaboration

Gary Rodkin, CEO of ConAgra Foods Inc., was given the William H. Albers Award, recognizing his exemplary business partner relations within the retail food industry. Rodkin has a celebrated history at the helm of ConAgra Foods and in his industry role as Grocery Manufacturers Association (GMA) chairman, which led to the evolution of the FMI-GMA Trading Partner Alliance, a joint-industry working group aimed at streamlining business efficiencies along the food manufacturer and retailer supply chain. He was integral among FMI and GMA leadership to enact new programs and protocols, most notably regarding health and wellness, center store and sustainability initiatives. “Gary embodies the ideal qualities in a business partner, and he’s ultimately focused on serving the end consumer,” Sarasin said. “I’ve been fortunate to work alongside Gary for many years, and he never loses sight of how he’s going to work with his retail business partner to deliver on a promise to the shopper.” Rodkin joined ConAgra Foods in October 2005 and transformed it from a holding company into one unified operating company. Under his leadership, the ConAgra Foods Foundation has continued to lead the fight against child hunger in the U.S., a cause the company has been committed to for more than 20 years. Prior to joining ConAgra Foods, Rodkin was chairman and CEO of PepsiCo Beverages and Foods North America. He joined PepsiCo in 1998 after it acquired Tropicana, where he had served as president since 1995. From 1979-1995, he held marketing and general management positions of increasing responsibility at General Mills, with his last three years at the company as president of the Yoplait yogurt division. Working on the GMA board together, and most recently on ConAgra Foods’ board, Rick Lenny, chairman of IRI and former chairman and CEO of The Hershey Co., recalled in a testimonial video, “Gary’s had an exceptional career across multiple companies and numerous business models. His success can be defined by the three Cs: company-first mindset, consumer driven and customer focused. Nowhere have these principles been more evident than through his work on behalf of GMA and in collaboration with FMI.” One of Rodkin’s most recent and notable accomplishments during his service on the FMI and GMA board of directors was his influence in helping the food industry launch Facts Up Front, a nutrition guidance program, in order to help consumers make informed decisions about the foods they eat. Rodkin’s commitment to business and supply chain initiatives translates to the community and his involvement in local hunger programs. Under his leadership, ConAgra made a $4 million commitment to Omaha families, which localizes the company’s overall hunger effort, and he instituted a service program to encourage company employees to give back to their communities. Rodkin’s philanthropy also is evident in his creation of a college and trade school scholarship program specifically for ConAgra’s production employees. “Quite simply, Gary believes we’re better together,” Lenny said. “The prestigious William H. Albers Industry Relations Award is a fitting tribute for all that Gary has accomplished.” Rodkin graduated Phi Beta Kappa with a bachelor’s degree in economics from Rutgers College and earned his MBA from Harvard Business School. In addition to his tenure on the FMI and GMA boards, he serves on the board of overseers for Rutgers College, on the board of Avon Products and is chairman of Boys Town. Rodkin also is a member of the Omaha Chamber of Commerce and a fellow of executive education at Harvard Business School.

Gary Rodkin of ConAgra Foods accepts his award from Jerry Garland and Leslie Sarasin on behalf of FMI.

More FMI Midwinter photos on page 68

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MARCH 2015 • The Shelby Report of the West

C-Store

RETAILER/WHOLESALER NEWS

C-Stores Account for Bulk of All U.S. Retail Outlets The U.S. convenience store count increased to 152,794 stores as of Dec. 31, 2014, a nearly 1 percent increase from the year prior, according to the 2015 NACS/ Nielsen Convenience Industry Store Count. The link between fuels and convenience retailing continues to grow. Overall, 83.5 percent of convenience stores (127,588 stores) sell motor fuels, a 0.7 percent increase (930 stores) over 2013. Convenience stores account for 33.9 percent of all retail outlets in the U.S., according to Nielsen, which is significantly higher than the U.S. total of other retail channels including drug stores (41,799 stores), supermarket/supercenter (41,529 stores) and dollar stores (26,572 stores). “Our continued growth, even during a sluggish economy, shows that our core offer of convenience resonates more than ever with our customers, whether they visit us for a fuel fill-up, quick snack or drink, or stop by for fill-in groceries or healthy takeout meals,” said NACS Chairman Steve Loehr, VP of operations support at LaCrosse, Wisconsin-based Kwik Trip. The convenience retailing industry continues to be dominated by single-store operators, which account for 63.0 percent of all convenience stores (96,318 stores total) and 83.5 percent of store growth in 2014. Among the states, Texas continues to lead in store count with 15,434 stores. The rest of the top 10 states for convenience stores are California (11,403), Florida (9,810), New York (8,247), Georgia (6,766), North Carolina (6,301), Ohio (5,539), Michigan, (4,907), Illinois (4,670) and Pennsylvania (4,604), which nudged Virginia out of the top 10. The convenience retailing industry has roughly doubled in size over the last three decades. At year-end 1984, the store count was 85,300 stores, at year-end 1994 the store count was 98,200 stores and at year-end 2004 the store count was 138,205 stores.

Bus Depot Moves to Montana Flying J Jefferson Bus Lines has relocated its Bozeman bus depot to the Flying J Travel Plaza at 6505 Jackrabbit Lane in Belgrade, Montana, adding the convenience of an on-site restaurant, convenience store and fuel to its normal services. “We are excited about the move and our partnership with the Flying J. Although the new location is in Belgrade, it is within minutes of the current Bozeman depot, allowing us to continue to serve residents in that area,” said Kevin Pursey, director of

marketing for Jefferson Lines. The Flying J Travel Plaza is located off of I-90 with easy access on and off the freeway for Jefferson Bus Lines customers. “We feel strongly that this move better supports our goals to provide exceptional customer care and service,” said Bob Musil, business development manager of Jefferson Lines. Musil went on to say that while the physical location of the Bozeman depot is changing, all route schedules and contact information remains the same.

We feel strongly that this move better supports our goals to provide exceptional customer care and service. —Bob Musil, Business Development Manager, Jefferson Lines

NACS hires two

NACS has hired Anna Ready as its director of government relations and Ashley Short as its member services coordinator. Ready will lobby and assist in the continued success of NACS’ political engagement and grassroots initiatives, while Short will assist in the continued success of NACS’ industry update luncheons, retail membership activities and event needs, such as the NACS Human Resources Forum, the NACS Leadership Challenge and the NACS Show.

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Report

Skinny Cow adds lines

MARCH 2015

Nutritional and Natural Choices Heat Up the Frozen Food Aisle by Carmel G. Hearn/Shelby Report contributing writer Ask almost any grocery store clerk where to find the store’s organic or natural foods, and chances are they won’t point you toward the frozen food aisle. But if they did, would you be perplexed? With “fresh” and “healthy” leading the way as keywords in the food industry, it may come as no surprise that frozen foods have lost some appeal with the majority of American consumers. As they grow increasingly healthconscious, their grocery shopping habits are changing. Younger adults, in particular, are bypassing the frozen food aisle in search of the heath benefits associated with fresh, all-natural, organic foods. But the same trend that has caused sales of frozen foods to be on the decline in recent years may now be calling consumers to take a new look at frozen foods. According to the report, “Hot Meals, Sides, and Snacks,” released in January by Packaged Facts, a division of MarketResearch.com, which publishes market intelligence on a wide range of consumer market topics, consumers are slowly warming up again to frozen foods due to a return to product convenience and the recent introduction of more natural and organic frozen offerings. “Frozen foods of all kinds have been challenged in recent years as a result of the convergence of several trends, especially, but not exclusively, a growing demand for fresh products or, at least, fresher products in refrigerated rather than frozen form. Nevertheless, frozen food products still have much to offer,” said Packaged Facts research director David Sprinkle. “For instance, frozen products identified as natural or organic are having a more positive experience than frozen foods in general. These organic and natural frozen foods appeal to the consumer who is both cost conscious and health conscious.” But, how are manufacturers reshaping their product labels and consumer attitudes? What is the future of the frozen foods segment? We turned to several manufacturers of products in the emerging natural/healthy frozen food segment to learn where they see the industry heading, and discover what they’re doing to take it there.

The good news in frozen foods

“The good news is frozen foods can be fresh, healthy and portioncontrolled while still convenient and delicious,” said Heather Stouffer, founder and CEO of Mom Made Foods. “The flash-freezing process locks in freshness and therefore does not require any preservatives unlike shelf-stable food meaning there are some very clean ingredient labels in the freezer aisle. Generally speaking, seven in 10 households toss up Heather Stouffer, to 20 items of fresh or cooked food Mom Made Foods every month. But frozen food is easy to store, easy to prepare, eliminates waste and saves money in the long term. Most importantly for h e a l t h - co n s c i o u s , busy families, frozen foods offer meal-time solutions providing the entire family a healthy meal without a shred of guilt.” “Frozen is fresher,” agreed Leslie Kaplan, co-founder of The

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Piping Gourmets. “It’s a great way for the everyday busy consumer to enjoy convenience and quality of ingredients. Food can stay fresh longer, naturally without artificial preservatives. Transparency in the food that we eat is becoming more and more important and frozen is a great way to ease that concern. At The Piping G o u r m ets, Leslie Kaplan, remain The Piping Gourmets we diligent from the first step of creating our Whoopie Pies, in regards to creating a straightforward ingredient label, all the way through the freezing process.” “Frozen foods offer something that is truly unique by offering the convenience of at home accessibility with foods that have been frozen, which is still the finest food preservative in use, locking in fantastic flavor without the use of chemical preservatives,” said Dan Horan, VP of sales and marketing at Intevation Foods, makers of Fazoli’s brand products. “They also provide the opportunity to bring favorite restaurant flavors into your home when you’re ready for them. In the snack food Dan Horan, section of the freezer aisle there are Intevation Foods unique items that busy consumers probably won’t invest the time and energy to make at home. For example, our breadsticks offer restaurant flare that is easier than ordering and waiting for takeout. They’re a great option to accompany a quick homemade pasta dinner from the convenience of your freezer.”

Frozen food trends

“Exciting news in the industry, and specifically for Wholly Wholesome, is the ability to offer gluten-free foods and foods that are free from allergens, specifically the top eight most common food allergens: milk, eggs, fish, crustacean shellfish, tree nuts, peanuts, wheat and soybean,” said Doon Wintz, president and CEO of Wholly Wholesome. “Without question, the trend is a move to higher quality,” Horan added. “The entire industry is engaged in an all-out effort to take their product quality to the next level. I think if you speak to anyone in the industry, you’ll hear that repeated.” Doon Wintz, Horan also noted that customWholly Wholesome

ers are no longer accepting the bland boxed meals of the past. “They can bring the flavors of their favorite restaurant into their home from the freezer case with the new options on shelves now. The demand is for high flavor, high quality products with a gourmet touch, which is what Fazoli’s snacks provides in the convenience of a ready-when-you-are package.” “Consumers are, by and large, searching for the bold, exotic flavors they’re first discovering in restaurants in their grocer’s freezer aisle now,” reported Mike Ryan, VP of sales and marketing for Tandoor Chef. “For instance, Samosas are consumer-friendly because they’re visually appealing, can be eaten with your hands and offer new and exciting flavors. Freezing food is a natural preservative to anytime food and it consistently offers a wonderful tasting product.” Mike Ryan, “Because food trends are always Tandoor Chef evolving, we are constantly keeping our eyes and ears open,” Kaplan observed. “Right now, we see more and more of a selection of gluten-free and all natural food made with healthier ingredients and more realistic portion sizes. Consumers interested in gluten-free products tend to fall into several categories, however. They may have a dietary restriction or they may simply be health-conscious and concerned about the ingredients they are feeding themselves and their families. Regardless, this is a trend that we’re happy to be on board with.”

Rethinking frozen foods

With new choices, including more organic and natural products, on the frozen food aisle, consumers also have more options when it comes to incorporating frozen foods into meal planning. “In recent years, smart, growth-oriented brands like Mom Made Foods have been making it our mission to help educate consumers on how to eat healthier while still leading the busy American family lifestyle,” Stouffer said. “Regardless of whether a parent is preparing a family meal in two minutes or 30 minutes, developing a family mealtime ritual builds a stronger feeling of togetherness and teaches children lifelong healthy eating habits. Forward-thinking brands, such as Mom Made Foods, encourage parents to read nutrition labels searching for products that aren’t loaded with junk and instead contain real, clean ingredients.” According to Stouffer, the frozen food industry has faced challenges in the past few years because consumers are showing an increasing demand for fresh food that is ready to eat. “Frozen gets a bad rap and, to be honest, a lot of it is junk food and loaded with gobs of sodium,” she said. “Mom Made Foods is working diligently to combat this perception by

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Frozen Foods From page 22

showing how our frozen meals are healthy, convenient and a great source of nutrition for families and kids of all ages. We’re driving growth by using high-quality ingredients, such as antibiotic-free meats, organic ingredients and freshly made pasta to make family-friendly recipes.” “Restaurant-style appetizers and entrees are a great opportunity for families to incorporate favorite flavors into afterschool snacks, side dishes and entertainment spreads without the hassle of spending all day in the kitchen,” suggested Horan. “Furthermore, some of our favorite items may be hard to master for the home chef, such as our Lasagna Fritta or Chicken Alfredo Flatbread. They’re a great item that adds a bit of flare to a weeknight dinner with the family or a party spread.” “Consumers should be rethinking frozen foods for meal planning specifically for the convenience benefit,” noted Wintz. “Whether creating fast family meals, a quick lunch or supplementing a recipe with one less time-consuming homemade ingredient, incorporating frozen products like Wholly Wholesome pie shells for an easy quiche or dessert help people spend less time in the kitchen and more time with their families.” “I don’t think there is anything more convenient than having a full meal ready and waiting in the freezer that is ready to eat in just a few minutes,” added Ryan. “Our difference is healthy convenience. If someone has an aversion to microwaves, we have items like Naan Pizzas and Samosas that come out great in an oven. In fact, you can put any of our entrees in the oven, they just take a little longer.”

Rising to consumer expectations

While the product offerings on the frozen food aisle are changing with the addition of more natural products with clean labels, are customers really concerned that labels are clean and transparent? And if so, are labels catching up with the educated consumer? Or, are smarter labels helping educate consumers? “Absolutely, when chosen wisely, frozen foods are just as healthy, convenient and cost effective,” Kaplan pointed out. “Right next to my Whoopie Pies I have my frozen salmon, vegetables, gluten-free bagels and fruit. Frozen food is all about eating well and eating conveniently. Food shouldn’t have to be sacrificed when our busy lives get in the way.” “When shopping the freezer aisles, consumers are more aware now than ever before, looking for items without preservatives and artificial colors,” said Stouffer, adding that customers should look for these specific things when reading labels of frozen foods: • USDA organic label ensures you are buying a product with “real” food, lacking preservatives, food colorings, etc. and that it does not contain added chemicals. • Antibiotic-free meats you can feel good about feeding to your family. • Many frozen meals contain an over-abundance of sodium. Look for foods that are labeled “low in sodium.” Anything above 20% for daily value sodium is considered high. • Short ingredient lists and ingredients you are able to pronounce are always a good sign.

FEATURE dients they recognize to enjoy at home,” Horan observed. “High-quality Italian ingredients means fresh cheeses, tomatoes, meats and herbs are used and flavors are preserved at peak freshness through the natural preservative of the freezing process.” Noted Kaplan, “Consumers are demanding healthier choices from the food industry. It is much easier to eat healthier today in order to feel well and to have a better quality of life as you age. We think of it as the best investment in our portfolio. More and more people are developing food allergies and increasing the need for allergen friendly offerings. As a matter of fact, this was an important impetus for us in making sure our Whoopie Pies are major allergen free and contain no wheat, dairy, egg, soy, tree nuts or peanuts. As for non-GMO foods and ingredients, everyday consumers are becoming more educated about the transparency of their food and they are making the conscious choice to buy foods that are not genetically modified.”

Is frozen as nutritious as fresh?

When it comes to choosing between fresh produce and frozen foods, it’s not surprising to note that consumers may opt for fresh when basing their choices on health and nutritional benefits. But is fresh always the best choice? And if not, why not? What is the industry doing to update consumer perceptions about frozen foods? “Frozen is arguably fresher than fresh foods,” said Stouffer. “For example, Mom Made Foods purchases organic fruits and vegetables picked at peak harvest, we use the ingredients right away then flash freeze the meals to lock in the freshness. By comparison, fresh foods are often in the distribution chain for weeks and sometimes months, before they make it to the family table. Moms are lining up to support a new partner in making their lives healthier while still very easy—betterfor-you frozen food—because in the end, frozen foods can be nearly as healthy, as if mom made it herself.” “Frozen food is not necessarily better than fresh, but it can be as good or even better in some cases,” said Wintz. “This depends on the product, the amount of time a person has in the kitchen and the skill level of the cook. For example, a frozen pie shell made by a professional baking company may be better than a novice’s homemade pie shell.” “On a whole, yes, without a doubt, sometimes frozen is better,” agreed Kaplan. “I personally see some frozen foods as being healthier when they can be made without artificial preservatives. Not withstanding, you cannot take frozen

and vegetables used in the analysis. Like produce found in farmers’ markets, the fruits and vegetables used in the study were locally grown, harvested and stored by the UC Davis research team. Each fruit and vegetable was analyzed under the following conditions: frozen (analyzed within 24 hours of harvest and after 10 and 90 days of storage in a freezer) and fresh-stored (analyzed within 24 hours of harvest and after three and 10 days of storage in a refrigerator). The study results revealed that the nutritional value of frozen fruits and vegetables are generally equal to— and in some cases better than—their fresh counterparts. Dr. Diane Barrett, “The study was designed to UC Davis mimic the quality of produce found at farmers’ markets or grown in consumers’ backyards,” said Barrett. “The study revealed that in most cases frozen produce is nutritionally equivalent, and often superior, to its fresh-stored counterpart. In particular, the vitamin C content of frozen corn, green beans and blueberries was significantly higher than their fresh-stored counterparts.”

Frozen foods and kids

While studies about the nutritional value of the foods do trickle into the mainstream, shoppers are quickly learning it’s up to them to make decisions for themselves. As they become more self-sufficient in evaluating marketing claims, they’re also looking for clean, transparent labels and avoiding overprocessed foods. This is especially important for parents who are concerned about what to feed their children. But are they aware that the frozen foods aisle might be the perfect place to shop for their kids? “The frozen aisle is a great place to introduce new flavors to your family and kids,” said Ryan. “Choosing a frozen meal for the convenience of ready-when-you-are, or rather when your kids are, is a huge win for parents and can develop a child’s flavor profile to be a more adventurous eater overall.” “Kids are a perfect consumer of frozen foods,” explained Horan. “Convenient access to meals with or without adult supervision and a lower cost means that families get more bang for their buck. Fazoli’s snacks are perfect for kids for after-school snacks that can be cooked in minutes in the microwave or oven and perfect for an energy boost with authentic Italian flavors in the convenience of the frozen food aisle. Another smart choice is the CRUNCHtables line of lightly coated vegetables. It makes fulfilling your children’s vegetable needs much more fun and enjoyable for everyone.” “The new conscientiousness for allergenfree products and facilities is again very influential and important for families and children,” noted Wintz. “Many children are being diagnosed with allergies that their family and friends need to be aware of, so Wholly Wholesome’s ‘Free From’ segment is —David Sprinkle, Packaged Facts especially good for kids with allergies.” “Mom Made Foods creates bold and dinners loaded with fat, calories, artificial preservatives and interesting flavors through traditionally loved foods,” added sodium into this consideration, but when consumers choose Stouffer. “We take a kid favorite like mac and cheese, but add wisely, frozen food can be a great addition to a healthy life- fresh, organic green peas, sweet potato and butternut squash for added nutritional value. We also make our pasta fresh and style.” Choosing frozen also is a simple solution to meet dietary cook it perfectly for a child’s palate. With our newest product requirements for fruit and vegetable consumption. According line, Mom Made Meatball Bites, we create unique and fun to a 2014 study to examine the nutritional benefits of flavors like Chicken and Apple Meatballs that are antibiotic frozen fruits and vegetables conducted by the Frozen Food free and reduced sodium. We love incorporating different Foundation, 90 percent of Americans fail to consume the fruits and vegetables into meals to ensure high nutritional recommended amounts of vegetables and nearly 80 percent value and taste.” “Our Gluten Free/Dairy Free Whoopie Pies by The Piping fail to meet dietary recommendations for fruit. This not-for-profit organization, dedicated to fostering Gourmets are great for kids,” Kaplan said. “Certified by the scientific research, public awareness and education regarding Non-GMO Project, we offer a healthier snack cake for people the nutritional value of frozen foods, recently partnered with today that is fun and tasty, too. Available in six flavors, our the University of California-Davis to evaluate the nutrient Whoopie Pies are sold four per pack and are ideal for a treat content of eight commonly purchased frozen and fresh fruits in lunch boxes or as an after-school snack. Because they are and vegetables: blueberries, strawberries, carrots, corn, broc- individually wrapped for freshness and portion control, they also make a great grab and go snack or dessert. We took an coli, green beans, green peas and spinach. The study, conducted by lead researcher Dr. Diane Barrett iconic American dessert and cleaned it up for today’s dessertof UC Davis, used methodologies designed to eliminate loving generation.” discrepancies in the harvesting, handling and storage of fruits

“…frozen products identified as natural or organic are having a more positive experience than frozen foods in general. These organic and natural frozen foods appeal to the consumer who is both cost conscious and health conscious.”

“Ingredients and labels are changing in that they are becoming more transparent to the consumer,” Wintz added. “Labels are starting to consist of more recognizable ingredients because that is what the consumer is demanding. Consumers no longer accept labels with 20 unpronounceable and unfamiliar ingredients that they wouldn’t find in their own home. Consumers are also paying attention to what is in the foods, whether these products are created with GMO products, and also what other foods and allergens are being used in the facilities that make these products.” “There’s a clear movement in the category to non-GMO labeling, along with traditional certifications like vegetarian, vegan and gluten-free,” Ryan pointed out. “Consumers are interested in knowing more about the product on the front of the package as they see it in the aisle.” “Consumers are more aware of what ingredients they are purchasing and they are not only looking for a great flavor profile but also an ingredient panel with words and ingre-

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Coverage @ More theshelbyreport.com

MARCH 2015 • The Shelby Report of the West

Frozen Foods

FEATURE

Wholly Wholesome Debuts New Packaging Wholly Wholesome, the New Jersey company that produces all-natural and organic baked goods, recently unveiled its repackaging of its Wholly Gluten Free Frozen Pizza Dough Balls into a new, more convenient form featuring easy storage for consumers and easy display for retailers. The new packaging, holding a 14-oz. dough ball, also is better able to maintain freshness, providing reinforced protection.

“We’re committed to providing consumers fresh products in the convenience of their freezer,” said Doon Wintz, president of Wholly Wholesome. “The reinvented packaging replaces the outdated clamshell casing with a modern and easy-to-store container for consumers to enjoy.” Wholly Wholesome is made naturally free of wheat, dairy, egg, soy, nut, corn and casein. Wholly Gluten Free Pizza Dough Balls are suitable for vegans, kosher and are produced in a dedicated gluten-free facility to cater to those with celiac disease. The new packaging began to hit stores in February with an SRP of $6.99-$7.49.

Better4U Pizzas Made with Sprouted Ancient Grains Better For You Foods has launched Better4U Gluten Free

Sprouted Ancient Grains Pizzas. The line of frozen pizzas is made with four sprouted gluten-free grains—quinoa, flax, millet and chia—that provide the multigrain crust a hearty flavor. The new Better4U Gluten Free Sprouted Ancient Grains Pizzas are available in three varieties, each with natural toppings. The current offerings are all “thin crust”—Four Cheese, Uncured Pepperoni and Mediterranean. Like other Better4U frozen pizzas, these products are lower in fat, calories and sodium than those offered by competing brands, the company says. They also are made with non-GMO ingredients and are certified gluten free. “Last year Better4U Foods introduced frozen sprouted grain pizzas with 39g of whole grains per serving and we received rave reviews from consumers and retailers alike,” said Jack Lotker, founder and CEO of Florida-based Better For You Please see page 26

The future of frozen foods

The observations shared by these frozen food manufacturers along with the afore-mentioned Packaged Facts study all seem to agree that the future of the frozen foods segment is “encouraging.” The study further estimates that sales of the collective frozen food categories (dinners/ entrées, pizzas, side dishes, and appetizers/snacks) would edge up from $22 billion in 2014 to $23 billion in 2019. This increase, according to the study, will be based on the ability of major marketers to adjust to the changing consumer environment that calls for more variety (in terms of flavors and serving styles), healthier foods and better pricing. Also a factor, according to the report, will be the increased growth among smaller brands that offer natural and organic frozen dinners and entrées.

NFRA’s Upcoming Events The National Frozen & Refrigerated Foods Association (NFRA) has two major events coming up. Registration is now open for the NFRA Executive Conference, April 13-15 at the Tempe Mission Palms Hotel & Conference Center in Tempe, Arizona. This professional development conference features the latest consumer and industry trends. Retailer keynote speakers are Sue Klug, EVP/CMO, Unified Grocers, and Jerry LeClair, SVP-sales and merchandising, Giant Eagle. Visit NFRAExecutiveConference. org. The National Frozen & Refrigerated Foods Convention is Oct. 10-13 at the Hilton Anatole in Dallas, Texas. This “working” convention connects more than 1,300 executives for the purpose of conducting one-on-one business meetings with trading partners. The convention allows attendees to meet with dozens of companies in just a few days. Visit NFRAweb.org or call 717-6578601. Registration opens in March.

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The Shelby Report of the West • MARCH 2015

Frozen Foods From page 25

Foods. “We knew then that we had to develop a gluten-free line of pizzas with sprouted grains for our loyal customers who deserve a better variety of healthy gluten-free products.” Better For You Foods will feature the new line of Gluten Free Pizzas with Sprouted Ancient Grains at Natural Products Expo West in March, along with other Better4U pizza products, including vegetarian and vegan options.

Crazy Cuizine’s New Frozen Entrees Feature Bold International Flavors Crazy Cuizine is adding global flavor to its frozen Asian entrées with the planned rollout of Crazy Cuizine International Favorites in April. Each features a vegetable, rice or noodle component and offers the bolder flavor many consumers are seeking. The flavors are: Beijing Broccoli Beef (Chinese), Chicken Tikka Masala & Rice (Indian/ Southwest Asian) and Garlic Chicken & Noodles (Chinese/ Vietnamese). “We’ve seen an increased demand from consumers for bolder flavors, healthier ingredient profiles and more high-quality ethnic entrees,” said David Weinberg, marketing director at Day-Lee Foods Inc., Santa Fe Springs, California. “These first three International Favorites deliver well-known Asian entrees—‘kicked up a notch’ with ‘restaurant-quality’ flavors. They’re a real viable alternative to ‘takeout.’ We’re also adding hearty vegetables or grains to every dish in the line, so each offers a complete meal solution for busy families and individuals on thego.” The company also expects to expand the new line beyond traditional Asian foods to more international and regional cuisines as well. Crazy Cuizine foods have no added MSG or trans fats and are ready to eat from freezer to table in just minutes. Each International Favorites dish can be served as a complete meal or used as the starter for semi-homemade recipes (e.g. tacos, burritos, pizzas, wraps, salads, soups, etc.). Crazy Cuizine products are available at grocery chains such as Albertson’s, Safeway, Vons, Ralphs, Food for Less, Raley’s, SaveMart, Lucky Supermarkets, Jewel and many more. For more information, visit crazycuizine.com.

Respect Foods Rolls out Frozen Breakfast Sandwiches Respect Foods has launched a new line of frozen breakfast sandwiches in three flavors for immediate distribution in North America. Made with 100 percent whole grain and containing no artificial colors, flavors or preservatives, Respect breakfast sandwiches are available in single-serve packages.

“Customers are looking for brands to raise the bar,” said Kenny Hartman, president of Respect Foods in Palm Beach Gardens, Florida. “They want fewer and more readable ingredients. If apple, maple, egg and cheese are in the product’s name, shoppers want to find those same words in the ingredients. We respect their requests and deliver delicious sandwiches that have more than 15g of protein for a hot,

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FEATURE energy-packed breakfast in less than three minutes.” The three Respect varieties aree: Apple Maple Chicken Sausage, Egg & Cheese; Turkey Bacon, Egg & Cheese; and Double Egg & Cheese. SRP for each is $3.29.

Arctic Zero Gives Fit Frozen Desserts a New Look Arctic Zero, creator of Fit Frozen Desserts™, unveiled a vibrant new package at the Winter Fancy Food Show held in San Francisco, Jan. 11-13. The new look began to appear on shelves in late January. The package spotlights the brand’s premium ingredients and presents a refreshed logo, updated flavor names and descriptions, hand-drawn illustrations, original typography and organic earth tones. Emphasis also has been placed on each product’s core attributes with specially designed badges, as well as attention-grabbing lids and side panels filled with drawings and phrases to call out each product’s flavor and dietary profile. “As a team of avid ice cream lovers, we’ve perfected our Fit Frozen Desserts to truly satisfy every sweet tooth, and wanted the packaging to more accurately reflect our commitment to clean ingredients and passion for handcrafted, zero-guilt treats,” said Greg Holtman, founder of San Diego-based Arctic Zero. “Our mission was to provide consumers, including those with special dietary needs, with the highest quality ingredients in a delicious product that satiates on all levels, and we feel our modern makeover perfectly matches the excellence that’s inside.” The brand’s new look is reflected across Arctic Zero’s entire fleet of Fit Frozen Desserts, including its Creamy Pints and Chocolate-Dipped Bars. Arctic Zero is available for a SRP of $4 to $5 at natural and traditional grocers nationwide, including Kroger, Publix, Safeway, Sprouts Farmers Market, Walmart and Whole Foods Market, as well as online at Amazon.com and arcticzero.com.

Skinny Cow Unveils New Products Across Three Categories Skinny Cow is launching nine new products across its 2015 portfolio in the categories of ice cream, candy and, for the first time ever, beverages. New items include three new Chocolate Dipped Ice Cream Bars, a new Ice Cream Candy Bar, three new Creamy Iced Coffee Drinks and two new Blissful Truffle Candy Bars. “It’s a breakthrough year for Skinny Cow. We are thrilled to be sweetening our already delectable lineup with a contemporary, stylish new look and an entirely new collection of tasty innovations,” said Seema Sundar, brand manager for Skinny Cow, Oakland, California, adding that the products would become available in early 2015. Skinny Cow’s Chocolate Dipped Ice Cream Bars are the first-ever ice cream bars that are fully dipped in chocolate and made with low fat ice cream. They come in three flavors: Vanilla Almond Crunch, Double Caramel Swirl and Triple

Chocolate Ripple; each has fewer than 190 calories. The 2.65oz. bars are sold in packs of five; SRP $5.49. The new Ice Cream Candy Bars are available in a new Mochaccino Crunch flavor. The 2.1-oz. bars are sold in packs of five, SRP $5.49. In addition to the frozen treats, Creamy Iced Coffee Drinks are available in four-packs and individual bottles in the beverage and chilled drinks aisles, in 8-oz. bottles. Each bottle has an SRP of $1.99; $5.99 per four-pack. Blissful Truffle Candy Bars, available in two flavors, Milk Chocolate and Dark Chocolate, can be found in candy aisles nationwide in 0.77-oz. bars in packs of six; SRP $3.99-$4.99.

Freeze-Dried, Refrigerated/ Frozen Pet Foods Continue Strong; Gluten-Free Drops Sharply The natural food category, which has been driving the pet food market for more than 10 years, continues to spawn trends that rise and fall on much shorter timeframes—challenging manufacturers and retailers to keep pace while making a profit. The latest point-of-sale (POS) data from GfK’s pet specialty store panel in the U.S. shows that sales of gluten-free dog and cat food have already begun to plateau, posting 39.2 percent growth from January through August 2014, as compared to 91.2 percent for the same period last year. By contrast, freezedried food recorded a 43.8 percent sales rise in that timeframe (similar to 46.9 percent a year before), while the controversial refrigerated/frozen category saw a lift of 17.0 percent (consistent with 17.5 percent a year ago). The GfK pet retail panel includes neighborhood shops and superstores alike, representing more than 11,000 pet specialty outlets in the U.S. GfK captures and reports dozens of metrics—from pounds sold to new products introduced— covering more than 350 manufacturers and more than 22,000 SKUs.

“Dog and cat owners have shown a willingness to pay extra for emerging benefits—such as gluten free and freeze dried—that often mimic the ones seen in human food. Manufacturers and retailers need to give their customers access to the latest talked-about SKUs while keeping actual sales dollars in perspective; categories posting the highest growth and capturing the most headlines may still be minor forces when it comes to meeting revenue targets.”

—Maria Lange, GfK

Collectively, the freeze-dried, refrigerated/frozen and gluten-free categories accounted for more than $566 million in sales in the first eight months of this year, more than double the $243 million they posted in the same timeframe two years ago. Gluten free remains the heavyweight in pure dollars, though, representing $450 million in sales, vs. $71 million for refrigerated/frozen food and $45 million for freeze-dried. Natural food is still the category “to beat” in dog and cat food, accounting for 79 percent of all new items introduced from January through August 2014, and for $3.3 billion in sales during the same timeframe—two thirds of all pet food sales ($4.9 billion total). Both natural sales figures represent upticks from the same time period a year before. One element of natural food that appeals to pet specialty retailers is the higher-than-average price points these SKUs command. Natural dog and cat foods (including treats) sell for $2.55 per pound on average, compared to the average of $2.18 per pound for all pet foods in general. The price per pound for freeze-dried dog and cat items is essentially six times higher than the average price for all categories ($11.51 per pound vs. $2.18). Refrigerated/frozen food, meanwhile, is more than double the average price per pound ($5.11 vs. $2.18). “Natural remains pretty much the only game in town when it comes to high-growth dog and cat food items,” said Maria Lange, senior product manager of GfK’s retail and technology team, which manages the pet specialty panel. “Dog and cat owners have shown a willingness to pay extra for emerging benefits—such as gluten free and freeze dried—that often mimic the ones seen in human food. Manufacturers and retailers need to give their customers access to the latest talkedabout SKUs while keeping actual sales dollars in perspective; categories posting the highest growth and capturing the most headlines may still be minor forces when it comes to meeting revenue targets.” Although the refrigerated/frozen food category has been beset by negative media stories about recalls and salmonella risks, sales have continued to grow (at about 17 percent to 20 percent annually) over the last four years. And, despite the added burden of installing refrigerators and freezers and culling expired items, the percentage of outlets—neighborhood and superstores—carrying refrigerated/frozen food has grown from 65 percent in 2011 to 75 percent in 2014.

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The Shelby Report of the West â&#x20AC;˘ MARCH 2015

Frozen LOS ANGELES, CA

PHOENIX / TUCSON

MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

Private Label Ice Cream

91,698,392

(6.18)

3.50

0.02

Private Label Ice Cream

20,227,930

(5.87)

2.92

(0.08)

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

74,099,488

10.58

5.05

(0.14)

Private Label Fz/Rfg Chicken/Chicken Substitute

18,539,604

(0.05)

7.36

0.27

Private Label Fz/Rfg Chicken/Chicken Substitute

34,961,600

(5.48)

8.26

0.46

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

17,870,322

16.09

5.14

(0.14)

Di Giorno Fz Pizza

30,696,804

(7.58)

5.08

(0.05)

Di Giorno Fz Pizza

13,245,644

(8.94)

5.12

(0.06)

Stouffers Multi Serve Fz Dinners/Entrees

29,798,792

(0.99)

7.71

0.00

Stouffers Multi Serve Fz Dinners/Entrees

12,829,572

2.26

7.16

(0.02)

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

29,024,922

(5.11)

4.21

0.20

Private Label Fz Cooked Shrimp

11,947,293

(6.98)

8.18

1.30

Private Label Fz Meat (No Poultry)

28,898,656

(5.93)

9.40

0.17

Blue Bell Ice Cream

11,832,825

13.50

4.71

0.06

Haagen Dazs Ice Cream

28,160,674

8.95

4.13

(0.06)

Private Label Fz Fish/Seafood

11,563,637

(2.66)

7.67

0.37

Private Label Fz Fish/Seafood

26,992,522

6.50

8.68

0.93

Private Label Fz Meat (No Poultry)

11,228,251

(9.17)

9.66

0.46

Kelloggs Eggo Fz Waffles

25,558,080

(3.27)

3.05

(0.14)

Tyson Processed Fz/Rfg Chicken/Chicken Sub

10,832,084

0.58

6.55

0.19

Marie Callenders Single Serve Fz Dinners/Entrees

25,366,398

(3.90)

2.43

(0.13)

Private Label Fz Fruit

10,685,817

11.51

5.16

0.09

Private Label Fz Fruit

24,663,312

18.31

4.91

(0.06)

Private Label Fz Raw Shrimp

10,107,938

16.98

8.48

1.83

Dreyers Edys Grand Ice Cream

24,465,268

4.14

3.78

(0.05)

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

9,927,119

0.12

3.66

(0.08)

Private Label Fz Novelties

24,351,130

(3.62)

2.70

0.17

Private Label Processed Fz/Rfg Chicken/Chicken Sub

9,394,268

2.53

5.76

0.38

Dreyers Edys Slowchurned Ice Cream

22,730,796

(1.24)

3.83

(0.07)

Private Label Fz Novelties

9,170,668

(6.28)

2.63

0.17

Stouffers Single Serve Fz Dinners/Entrees

22,010,364

(3.17)

2.55

(0.09)

Marie Callenders Single Serve Fz Dinners/Entrees

8,896,156

4.16

2.26

(0.13)

Foster Farms Processed Fz/Rfg Chicken/Chicken Sub

21,404,000

10.36

5.94

0.02

Stouffers Single Serve Fz Dinners/Entrees

8,713,565

0.48

2.38

(0.05)

Private Label Fz Mixed Vegetables

20,673,578

4.46

1.62

(0.09)

Private Label Fz Plain Potatoes/Fries/Hashbrowns

8,622,027

6.32

2.17

(0.00)

Private Label Fz Cooked Shrimp

20,318,678

(5.60)

9.60

1.34

Kelloggs Eggo Fz Waffles

7,996,588

(1.24)

2.89

(0.08)

Tyson Processed Fz/Rfg Chicken/Chicken Sub

20,017,736

(0.81)

6.92

0.27

Private Label Fz Pizza

7,593,600

0.98

2.88

0.08

Nestle Drumstick Fz Novelties

19,905,716

7.80

5.20

0.10

Red Baron Fz Pizza

7,338,413

0.64

3.41

(0.01)

Ben & Jerrys Ice Cream

18,124,636

4.78

3.91

0.03

Dreyers Edys Slowchurned Ice Cream

7,025,181

0.32

3.42

(0.16)

Private Label Processed Fz/Rfg Chicken/Chicken Sub

17,325,454

24.55

6.50

0.03

Wells Blue Bunny Ice Cream

6,866,713

(10.36)

3.86

(0.09)

Private Label Fz Plain Potatoes/Fries/Hashbrowns

16,807,742

5.08

2.21

(0.15)

Totinos Party Pizza Fz Pizza

6,651,319

3.09

1.22

0.04

Great American Seafood Fz Fish/Seafood

16,013,076

4.83

8.82

0.47

Dreyers Edys Grand Ice Cream

6,479,097

0.25

3.29

(0.17)

PORTLAND, OR

SACRAMENTO, CA

MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

Private Label Ice Cream

13,933,710

(5.31)

3.20

(0.03)

Private Label Ice Cream

14,711,366

(3.56)

3.52

0.06

Tillamook Ice Cream

10,535,639

1.75

4.42

0.11

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

10,243,080

19.00

5.65

0.00

Private Label Fz/Rfg Chicken/Chicken Substitute

8,380,725

5.10

7.46

0.17

Private Label Fz/Rfg Chicken/Chicken Substitute

7,039,839

(2.25)

8.04

0.24

Private Label Fz Fruit

8,127,149

12.39

4.60

0.18

Di Giorno Fz Pizza

6,182,739

(2.72)

5.38

0.02

Stouffers Multi Serve Fz Dinners/Entrees

6,976,094

0.11

7.08

(0.22)

Private Label Fz Fruit

5,951,602

16.26

4.98

0.31

Di Giorno Fz Pizza

6,518,349

(6.96)

5.21

(0.05)

Stouffers Multi Serve Fz Dinners/Entrees

5,716,808

1.96

7.98

(0.15)

Private Label Fz Meat (No Poultry)

6,187,932

6.20

8.96

0.35

Foster Farms Processed Fz/Rfg Chicken/Chicken Sub

5,666,210

13.11

6.06

0.13

Haagen Dazs Ice Cream

6,003,212

7.51

4.02

(0.10)

Tyson Fz/Rfg Chicken/Chicken Substitute

5,372,096

18.93

6.93

(0.31)

Private Label Fz Novelties

5,876,905

(1.70)

2.62

0.18

Dreyers Edys Slowchurned Ice Cream

5,272,300

(1.54)

3.97

(0.05)

Umpqua Ice Cream

5,830,784

19.76

3.94

(0.24)

Dreyers Edys Grand Ice Cream

5,228,134

(0.37)

3.93

(0.05)

Ben & Jerrys Ice Cream

5,589,001

1.70

3.75

0.05

El Monterey Fz Handheld Entrees (Non-Breakfast)

4,573,893

10.17

3.57

0.14

Dreyers Edys Slowchurned Ice Cream

5,321,278

(1.85)

3.64

(0.09)

Ben & Jerrys Ice Cream

4,483,625

5.97

3.78

0.12

Private Label Fz Plain Potatoes/Fries/Hashbrowns

5,124,141

7.78

2.27

(0.06)

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

4,362,998

(0.15)

4.16

0.14

Foster Farms Processed Fz/Rfg Chicken/Chicken Sub

5,100,755

23.93

5.62

0.06

Kelloggs Eggo Fz Waffles

4,337,683

(1.78)

3.29

(0.06)

Foster Farms Fz/Rfg Turkey/Turkey Substitute

5,018,963

(2.83)

4.99

(0.04)

Private Label Fz Novelties

4,332,752

1.90

3.20

0.36

Marie Callenders Single Serve Fz Dinners/Entrees

4,967,073

(0.20)

2.34

(0.21)

Haagen Dazs Ice Cream

4,159,604

6.35

4.03

0.03

Tyson Fz/Rfg Chicken/Chicken Substitute

4,815,132

18.89

6.55

0.04

Weight Watchers Smart Ones Single Serve Fz Dinners/Entrees

3,783,528

(11.46)

2.15

0.07

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

4,712,001

18.83

4.99

(0.30)

Nestle Drumstick Fz Novelties

3,747,676

6.67

5.00

0.26

Stouffers Single Serve Fz Dinners/Entrees

4,392,421

1.41

2.42

(0.16)

Private Label Fz Meat (No Poultry)

3,636,263

0.29

9.05

0.03

Private Label Fz Pizza

3,983,362

5.06

3.86

0.01

Marie Callenders Single Serve Fz Dinners/Entrees

3,570,496

(0.77)

2.61

(0.11)

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

3,932,691

2.26

3.29

0.28

Private Label Processed Fz/Rfg Chicken/Chicken Sub

3,553,346

13.27

6.52

0.11

Private Label Processed Fz/Rfg Chicken/Chicken Sub

3,853,183

19.35

6.54

0.21

Tyson Processed Fz/Rfg Chicken/Chicken Sub

3,522,685

(1.87)

7.09

0.19

Private Label Fz Fish/Seafood

3,819,398

(6.75)

7.77

0.20

Private Label Fz Fish/Seafood

3,139,842

(3.37)

7.52

0.39

Private Label Fz Cooked Shrimp

3,700,441

(17.15)

10.35

2.13

Stouffers Single Serve Fz Dinners/Entrees

3,126,310

1.96

2.71

(0.07)

El Monterey Fz Handheld Entrees (Non-Breakfast)

3,636,201

17.65

3.08

(0.28)

Private Label Fz Raw Shrimp

3,125,856

(3.52)

12.32

1.87

Information represents retail sales data for the top 25 brands/categories for the 52-week period ended Sept. 7, 2014. Figures include supermarkets, drugstores, mass market retailers, military commissaries and select club and dollar retail chains. Data provided by IRI, a Chicago-based market research firm, @iriworldwide. page_28-29.indd 28

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MARCH 2015 â&#x20AC;˘ The Shelby Report of the West

Frozen SALT LAKE CITY, UT

SAN DIEGO, CA

MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

Private Label Ice Cream

9,578,286

(6.01)

Private Label Fz/Rfg Chicken/Chicken Substitute

6,710,087

1.32

Tyson Fz/Rfg Chicken/Chicken Substitute

6,584,096

(4.22)

Stouffers Multi Serve Fz Dinners/Entrees

6,302,252

2.38

Private Label Fz Fruit

5,068,681

4.24

Di Giorno Fz Pizza

4,550,243

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

4,442,112

3.15

MULTI-OUTLET

52 Weeks Ended 9/7/14

(0.01)

7.22

0.32

7.22

0.05

8.04 4.82

(7.82) 11.24

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

Private Label Ice Cream

16,481,249

(5.68)

3.44

0.02

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

12,186,840

13.68

5.10

(0.15)

Haagen Dazs Ice Cream

7,507,215

4.82

4.34

(0.08)

(0.03)

Di Giorno Fz Pizza

7,124,475

(7.28)

5.06

(0.01)

0.20

Dreyers Edys Slowchurned Ice Cream

6,358,044

2.07

3.84

(0.11)

5.49

(0.18)

Dreyers Edys Grand Ice Cream

6,226,822

5.33

3.78

(0.09)

4.57

(0.04)

Private Label Fz/Rfg Chicken/Chicken Substitute

6,076,827

(11.87)

7.83

0.33

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

4,348,214

(3.35)

3.88

0.05

Stouffers Multi Serve Fz Dinners/Entrees

6,010,851

(1.45)

7.67

0.00

Tyson Processed Fz/Rfg Chicken/Chicken Sub

4,187,969

(1.07)

7.13

0.21

Ben & Jerrys Ice Cream

5,852,948

4.57

3.90

0.00

El Monterey Fz Handheld Entrees (Non-Breakfast)

4,150,898

(0.19)

3.14

0.18

Private Label Fz Fruit

5,796,771

16.35

5.30

(0.03)

Totinos Party Pizza Fz Pizza

3,938,957

(0.09)

1.29

0.02

Kelloggs Eggo Fz Waffles

4,990,162

(7.08)

3.08

(0.11)

Private Label Fz Plain Potatoes/Fries/Hashbrowns

3,831,966

(4.82)

2.18

(0.10)

Private Label Fz Meat (No Poultry)

4,901,637

(0.98)

8.95

0.44

Meadow Gold Ice Cream

3,437,157

2.74

3.77

0.05

Private Label Fz Novelties

4,687,347

(2.55)

2.80

0.25

Farr Ice Cream

3,364,532

(2.06)

5.77

0.35

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

4,664,932

0.87

3.89

0.23

Marie Callenders Single Serve Fz Dinners/Entrees

3,296,300

(0.29)

2.32

(0.13)

Marie Callenders Single Serve Fz Dinners/Entrees

4,488,235

(4.07)

2.54

(0.13)

Private Label Fz Cooked Shrimp

3,238,787

7.04

7.64

1.18

Stouffers Single Serve Fz Dinners/Entrees

4,442,287

(5.93)

2.70

(0.08)

Kelloggs Eggo Fz Waffles

3,114,835

(1.18)

3.29

(0.05)

Foster Farms Processed Fz/Rfg Chicken/Chicken Sub

4,012,565

4.99

5.87

0.11

Marie Callenders Fz Pies

3,071,814

(4.43)

4.99

0.29

Private Label Processed Fz/Rfg Chicken/Chicken Sub

3,949,232

20.18

6.85

0.14

Private Label Fz Meat (No Poultry)

2,905,420

(10.83)

9.54

0.25

Nestle Drumstick Fz Novelties

3,868,542

8.21

5.08

0.13

Meadow Gold Fz Novelties

2,656,738

(12.22)

2.02

(0.09)

Breyers Ice Cream

3,845,872

(8.65)

3.71

(0.02)

Stouffers Single Serve Fz Dinners/Entrees

2,589,592

(1.52)

2.52

(0.07)

Private Label Fz Plain Potatoes/Fries/Hashbrowns

3,599,168

6.96

2.37

(0.11)

Private Label Fz Fish/Seafood

2,502,244

2.25

7.71

1.04

Tyson Processed Fz/Rfg Chicken/Chicken Sub

3,574,690

(3.09)

6.11

0.24

Tillamook Ice Cream

2,490,726

49.08

4.12

(0.04)

Private Label Fz Cooked Shrimp

3,335,751

(18.04)

9.36

1.46

Premium Creamies Fz Novelties

2,420,689

(4.28)

3.41

0.10

Private Label Fz Pizza

3,316,066

(11.80)

3.77

0.14

Ben & Jerrys Ice Cream

2,409,438

12.41

3.83

(0.01)

Private Label Fz Fish/Seafood

3,261,715

(8.99)

7.28

1.11

SAN FRANCISCO / OAKLAND MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

SEATTLE / TACOMA

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

MULTI-OUTLET

52 Weeks Ended 9/7/14

Dollar Sales

Avg. Price/ Dollar Sales Avg. Price/ Unit Chg %Chg v YAgo Unit v YAgo

Private Label Ice Cream

23,295,220

(6.26)

3.53

0.09

Private Label Ice Cream

15,764,835

(5.31)

3.25

(0.01)

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

17,165,554

14.55

5.48

(0.13)

Di Giorno Fz Pizza

9,363,294

(7.55)

5.28

0.02

Haagen Dazs Ice Cream

16,834,352

1.42

4.09

(0.08)

Private Label Fz Fruit

9,338,803

7.97

4.76

0.16

Ben & Jerrys Ice Cream

11,667,159

4.26

3.86

0.05

Tillamook Ice Cream

9,245,455

(0.25)

4.37

0.16

Dreyers Edys Slowchurned Ice Cream

11,384,826

(3.03)

4.09

(0.14)

Private Label Fz/Rfg Chicken/Chicken Substitute

8,840,280

3.21

7.90

0.16

Private Label Fz Fruit

10,863,872

16.20

5.56

0.10

Haagen Dazs Ice Cream

8,303,018

13.57

3.99

(0.02)

Private Label Processed Fz/Rfg Chicken/Chicken Sub

10,590,705

15.30

7.01

(0.05)

Stouffers Multi Serve Fz Dinners/Entrees

8,168,103

(2.52)

6.90

(0.39)

Di Giorno Fz Pizza

9,947,249

(6.14)

5.02

(0.03)

Jennie O Turkey Store Fz/Rfg Turkey/Turkey Substitute

7,624,692

21.11

5.33

(0.26)

Dreyers Edys Grand Ice Cream

9,947,172

(2.38)

4.08

(0.10)

Ben & Jerrys Ice Cream

7,586,456

7.36

3.78

0.03

Kelloggs Eggo Fz Waffles

9,941,910

(7.46)

3.23

(0.06)

Dreyers Edys Slowchurned Ice Cream

7,030,339

(1.01)

3.62

(0.07)

Private Label Fz/Rfg Chicken/Chicken Substitute

9,878,287

(1.27)

8.55

0.20

Private Label Fz Meat (No Poultry)

6,808,073

4.48

8.82

0.28

Foster Farms Processed Fz/Rfg Chicken/Chicken Sub

9,533,254

8.43

6.30

0.20

Private Label Fz Novelties

6,797,562

(2.59)

2.66

0.15

Foster Farms Fz/Rfg Turkey/Turkey Substitute

9,462,242

(5.30)

5.80

0.34

Foster Farms Processed Fz/Rfg Chicken/Chicken Sub

6,203,000

21.45

5.89

0.14

Private Label Fz Raw Shrimp

9,431,268

6.36

14.11

2.51

Foster Farms Fz/Rfg Turkey/Turkey Substitute

5,994,492

(7.20)

4.98

(0.12)

Private Label Fz Novelties

8,918,542

1.74

3.07

0.44

Marie Callenders Single Serve Fz Dinners/Entrees

5,748,588

(1.39)

2.41

(0.15)

Stouffers Multi Serve Fz Dinners/Entrees

7,515,363

(8.30)

7.96

(0.24)

Private Label Fz Pizza

5,666,240

2.42

4.03

0.12

Private Label Fz Fish/Seafood

6,837,525

(5.47)

7.89

(0.03)

Stouffers Single Serve Fz Dinners/Entrees

5,602,046

(3.31)

2.45

(0.18)

Stouffers Single Serve Fz Dinners/Entrees

6,836,631

(4.25)

2.93

(0.02)

Private Label Fz Plain Potatoes/Fries/Hashbrowns

5,554,777

6.45

2.33

(0.03)

Nestle Drumstick Fz Novelties

6,830,448

6.38

4.86

0.23

Private Label Processed Fz/Rfg Chicken/Chicken Sub

5,201,977

17.20

6.54

0.24

Breyers Ice Cream

6,492,300

(9.74)

4.01

0.04

Tyson Fz/Rfg Chicken/Chicken Substitute

5,120,612

14.90

7.25

(0.08)

Marie Callenders Single Serve Fz Dinners/Entrees

6,433,905

(8.95)

2.75

(0.00)

Dreyers Edys Grand Ice Cream

5,013,577

0.54

3.53

(0.06)

Private Label Single Serve Fz Dinners/Entrees

6,329,016

(18.90)

2.02

(0.02)

Kelloggs Eggo Fz Waffles

4,877,770

(2.09)

2.94

(0.18)

Hot Pockets Fz Handheld Entrees (Non-Breakfast)

6,202,797

0.59

3.65

0.29

Tyson Processed Fz/Rfg Chicken/Chicken Sub

4,857,009

(2.39)

6.58

0.18

Haagen Dazs Fz Novelties

6,150,113

4.16

2.35

0.05

Private Label Fz Fish/Seafood

4,797,496

(5.09)

7.96

0.14

California Pizza Kitchen Fz Pizza

5,598,151

19.25

5.00

(0.05)

Red Baron Fz Pizza

4,786,843

(0.50)

3.46

0.02

2/5/15 6:11 PM

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Report

MARCH 2015

Hershey buying jerky co.

Patricia Bragg Is a Living Testament to the Benefits of Natural Food Editor’s note: I spoke with Patricia Bragg for more than an hour by telephone in November after our VP-West Bob Reeves made a personal visit to Bragg’s home/business compound in Santa Barbara, California. He spent some time with Bragg and her staff and took some photos and called me right away to say we need to do a story. It is nearly impossible, on paper, to convey the vivacity and conviction of Patricia Bragg, who told me her age made her “nearly old enough” to be my mother’s mother; my mother is 70. Never married, Bragg says God is her “bridegroom, protector and teacher.” She loves the Lord, she is not ashamed to say, and she embraces each day she is given, calling it “a present and a gift.” She has worked with many of the country’s top ministers and earned her doctorate degree in theology. She started a prison ministry to give hope to those behind bars. She has had wardens tell her how much the atmosphere in their prisons changed after her visits. She told me the story of her father, Paul C. Bragg, and how he came to be a health crusader, traveling the world with the message of the importance of putting good, healthy fuel—i.e., fruits, vegetables, legumes, whole grains, purified water (no fluoride!), etc.—into one’s body. He was the originator of the health food store in this country and launched the Bragg line of healthy, natural food products that continues to grow decades later. One of Bragg’s primary products is organic apple cider vinegar; Paul and Patricia wrote an entire book about its uses and benefits, both for healthy and for beauty. There is a line of beverages made with the apple cider vinegar as well as vinaigrettes, dressings and marinades, organic extra virgin olive oil and seasonings of all kinds. One well-known item is Bragg Aminos, which Patricia describes as “the healthy version of soy sauce.” All natural, of course. A list of the friends of Patricia Bragg and her late father reads like a who’s who, too. Jack LaLanne was a sickly boy of 16 before meeting Paul Bragg; he lived to 97 and spent many years of his life encouraging others to exercise, get fit and build muscle. Clint Eastwood, now in his 80s, is another follower of the “Bragg Healthy Lifestyle”; others have included Cloris Leachman, Jayne Russell, J.C. Penney and the Henry Ford family. Katy Perry, the Super Bowl halftime performer on Feb. 1, said she uses Bragg vinegar drinks “daily.” Her godfather is Dell Webb, the developer who built airports, stadiums, hospitals and U.S. military facilities as well as Kroger Co. headquarters. He had been sprayed with DDT as a child in Fresno, California, but got better thanks to Bragg teachings. Patricia has danced with Fred Astaire, Gene Kelly and Arthur Murray and appeared on “The Lawrence Welk Show” as a dance partner for the host. She and her father hosted an exercise and cooking show on local TV called “Health and Happiness from Hollywood,” and she was called to the White House when Ronald Reagan was president to help decorate the Christmas tree. Paul was friends with founders of grocery chains like Safeway and Fred Meyer, and today Bragg products are found in supermarkets and health food stores across the country. Following are excerpts from my long conversation with Patricia Bragg, which I had the privilege of enjoying for a second time when transcribing her remarks. My hope is that you will come away with inspiration, as I did, to think more about what goes into your body and make it a point to get more exercise. Speaking of exercise, Patricia told me she was doing windmills and shoulder rolls while we were talking. Not a moment to waste. —Lorrie Griffith

A miraculous beginning

oped a little rosebud, and my nickname was Rosebud in the hospital. When they took me home after three months the Bragg: My life is very, very, very interesting. I have super nurses cried; I was their little pet. My family took me back energy; super health; and my father said I have a bullet brain— once a month to see the nurses. it moves fast and can almost think on three subjects at once. I was born in Northern California. My mother’s family I played concert piano at 6. I started piano when I was 3 and were pioneers in the San Francisco area—came to California played three to four hours a day. I had a love affair with the before 1849. Dad came to California because of Luther piano and later with the pipe organ. Then I had a love affair Burbank, the plant wizard, and we had our business for 50 with roses. I started planting rose cuttings. I think I was eight years in Burbank, California, which is the home of NBC and years old when I first put a rose cutting three notches in the Universal and Warner Bros. ground and three notches I’ve had a very dedicated up. When anybody in the life that I love what I do. I neighborhood was trimming love being a health crusader their roses, which you do and I am a citizen of the every winter, I would have world. My father taught me them marked which ones I to love all people, all religions wanted the cuttings from. and all colors. Our business, We had a rose garden in the we are almost worldwide town, and I knew exactly now. We are even in China which cuttings I wanted from now, and our health books those roses, and the gardenare number one in Russia ers knew the day they got and the Ukraine. their cutters out I would be The retired surgeon there with my bags and, boy, general, who lived into his I would get those cuttings. 90s, C. Everett Koop, said I was eight years old. And I that my father Paul Bragg looked probably five because Patricia Bragg has 700 varieties of roses at her home in Santa did more for the health of I have always been petite. Barbara; most of them are from cuttings, she says. America than any one person I came into the world at he knew of. What do you 2 pounds; a little dynamo. My mother’s car was hit by a big think of that? My father introduced organic gardening, pure truck and it rolled over three times. By the grace of God, she water, the importance of exercise, deep breathing, no fluoriwasn’t killed and I wasn’t killed in her belly. As they took her dation…Later I took up the cause of non-GMOs, and I’m sure off the stretcher at the hospital, the water burst and I rushed my dad would have been an advocate of non-GMOs as well. out. The doctor held me in his hands and said, “We need Some of father’s family lived next door to the Candler prayer.” Eight people put a finger on me and I have been going family that started Coca-Cola. Our old family homestead strong ever since—through the power of prayer and the Lord. is still there (in Georgia). There were two ponds; one pond (She’s 4’ 10” and 95 pounds.) was for the children to swim and play in and the other one I was in an incubator, and my mom used a breast pump to was for the animals. And there were porches all around the expel the milk from her breasts. It was so healthy, that milk, second floor and the first floor. In the summertime, your bed that I just started very early to react. On each cheek, I devel-

page_30-32.indd 30

Patricia Bragg with The Shelby Report’s VP-West Bob Reeves. was rolled out on your porch. That is what we’ve always had, porches, because we are breathing machines. We are breathing machines! Fresh air is very important.

Tuberculosis diagnosis launches lifelong crusade

My father saved a very, very wealthy man in Virginia who was swimming in the ocean and started to drown. Dad heard him calling for help, and he went to him. Dad was a strong young man, so he went to him and saved the man. The family was there on that Sunday afternoon enjoying the beach and they weren’t even paying attention to the man out swimming, probably the grandfather. When my dad saved him, they gave him a scholarship to one of the finest military schools in Virginia. My dad went from the farm, where everything was wonderful and homemade and they grew all their own vegetables and made their own vinegar drinks and had their own vinegar in barrels, grew their own apples. It was a wonderful. At the military school, all they had was white flour biscuits and…In the old days they had gristmills where you ground your own wheat or you could take it to the mill in town and they would grind it. The military school got into that refined white flour. Dad’s whole diet changed, everything changed… One year down the line, Dad was doing great in sports and everything, but then all of a sudden all the boys started getting sick. All that white sugar and white bread and cakes

Welcoming words at the Bragg offices. Please see page 32

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The Shelby Report of the West • MARCH 2015

Natural Foods From page 30

and cookies. And boy, oh boy, did they get sick. They came down with tuberculosis. When Dad was a boy, it was called the consumption disease because it consumed you, ate you. Mother Bragg (Paul’s mother) put Dad in a TB sanitarium, and he was there for about a month and got worse, not better. She heard from one of the nurses about another sanitarium quite a ways away and took him there, by horse and buggy. Well, my dear, he was there for about two months and didn’t get well there; got worse. The third one he was in, he soon looked like a war victim, skin and bones. They put you on bed rest; no fresh air, and they fed you cookies, cakes and fried everything with lard. He finally got to where he could hardly walk. He’d had bed rest, no exercise, no fresh air…In the old days, they thought TB had to be cured with bed rest and cold air was bad. But, you see, we’re breathing machines. There, Dad, for the first time since he came down with TB, looked at his arms all skinny and emaciated and started crying, saying, “I don’t want to die.” Just as he called out to the Lord, Nurse Marie from Switzerland walked by and saw my father crying. Above the bed was the name of the boy, his age and when he came in. She said, “Paul, why are you crying?” He said, “I don’t want to die, I want to live, and I asked God to help me.” She told him, “Where I come from in Switzerland, they put you out on a sun porch and they give you a water treatment with a hose; they go up and down your chest, your back, and the circulation in you tingles and you get healthy. People that have TB get healthy in Switzerland. They’re not doing it right here, Paul.” (The nurse wrote to Mother Bragg to come visit; she thought it was because her son was dying and was a bit skeptical when she heard the story about treatment in Switzerland. She thought the nurse had given him false hope and he was desperate enough to believe it.) Dad said, “Please, please, Nurse Marie, sit down and tell my mother all about it.” Mother Bragg listened for a half-hour to all the cases of people from all over the world who got healthy and fit with the simple treatments—sunshine, Vitamin D-3. Every day they’d wheel you out to the sun porch and give you massages for circulation—one of the keys to good health. And they would have you do breathing exercises. Oxygen, the invisible staff of life. Breathe it in…in, in, in, and slowly out. Fruits and vegetables. That’s where my father learned about juicing. There he heard about all these wonderful things. One week later, Dad, Mother Bragg and Nurse Marie were on the big old ship going to Europe. And Dad made a pact with God; he said, “Dear Heavenly Father, if I get my health back the way they’re saying, nature and God’s way, I want to be a health crusader. Lord, I’ll make that pact with you right now. You get me healthy and fit and I’ll share it with the world.” In Switzerland, they completely revamped his sick body into a healthy, fit body, with everything natural. He met so many of the pioneer health doctors from Europe. He went to school over there; he loved it. His mother was born in France; his name was Paul Chappius Bragg. So he came back and in New York got a naturopathy degree. The first school of naturopathy was in New York; an MD started it. Now they’re all over the world; they work with nature. He started working years ago for Bernarr Macfadden, “The Father of Physical Culture” in America. He had the early Physical Culture magazine. Dad took people out of old-fashioned tank suits…and put them in bathing suits. And he put women in bathing suits, not the long pants things they used

FEATURE WISDOM FROM PATRICIA BRAGG “For supermarkets, it’s very important to control the air. If it’s too cold, people will get in and out fast and won’t enjoy shopping; if it’s too hot or too smelly, they won’t like that; they’ll get out. You really have to control the air and the temperature.” “My father in 1912 started the first health food store...The old saying goes, keep everything as simple as 1-2-3. As soon as you complicate your life and start juggling you’re going to fall down.” “Before you put it in your mouth, ask is this going to bring health or sickness? Think about it before you eat. With your knife and fork, you could be killing yourself.” to wear. And he got arrested in New York City. He had them in one of the big department stores there, showing the new bathing suits, and the police arrested him.

these problems (if farms were organic). My father promoted pure water, no fluoride—fluoride numbs and dumbs the brain.

Teaching the next generation

I believe that our school children, kindergarten right on up to college, are the future of America. We’re very active in schools and right now; we have BraggHealthKids. org (a program of the Bragg Health Institute). I am preparing a video to go out to schools all across America telling them…the miracle their body is. Your feet are your foundation to carry you through life. You have your computer, your brain, that tells you right from wrong…You have your own plumbing, your own electrical….just remember every day is a present to you to enjoy. We each have 24 hours, and it’s up to you how you spend it. Plan, plot and follow through with your life. Keep a notebook and write down These small houses your daily journal—what you ate, contain Patricia’s doll collections, many related did you exercise, what did you learn new, what you want to do. Do that to Disney characters daily journal and you will find how like Mickey Mouse and you are doing in your life. This is the Minnie Mouse. Bragg Healthy Lifestyle—you are what you eat, what you drink, what you breathe, what you think, what you say and what you do. Dad also got the triathlon started—swim, bike, run. I wrote What you eat and drink, it walks and talks tomorrow. Your the triathlon training manual, 600 pages. Dave Scott has won mouth—that’s your fuel tank entrance. Before you put it in the Ironman Triathlon six times and he’s a Bragg follower. He your mouth, ask is this going to bring health or sickness? calls my book “the Bragg bible of health and fitness.” Think about it before you eat. With your knife and fork, you could be killing yourself. Product lines filled a marketplace void Oxygen is the invisible staff of life. Your miracle lungs… There was a need, so my father started the first vitamins, when you’re born they’re pink and wonderful, but if you minerals, whey products, protein products; we had the first smoke, you’re around a lot of pollution, they get sticky and health foods in America. He started the first honey; he put dark; they get sick. out Bragg Deripened Honey. The only place you could buy And you are what you think. You’ve got your brain, your honey was at a roadside stand if a farmer had some from his computer; garbage in, garbage out. You want pleasant, happy, bees. So Dad saw the need for that. wonderful, productive thoughts in your brain. Every day, He started the first organic products, he started Rodale, he learn something new. Books can be your best friend. You can started GNC in business… Seven-grain hot cereal, Chocolite learn the minds of great wizards of the world through books, made out of carob powder, a chocolate drink. We had some the written word. It never tires. Guard what you put in your wonderful things. We had the first salad dressings; you name brain, your computer. No garbage, no bad thoughts. it, we had it. Next is what you say. Words are living. You realize you can We had the first health cosmetics with no fillers. Dad put hurt your parents with wrong words, your mate, you can lose out the first sun-dried fruits, and we put out the first raw a job if you have a big fight with your boss. Before you speak, nuts, first herb seasonings, health seasonings. We had the ask, is it good, is it kind, is it necessary? All through school, I first health candy bars made never had arguments, I talked things out, worked things out, with carob, honey. We made and I stopped fights and I made them get along and work the first K-rations for the Army, things out. I teach that to young people. Navy and Marines with garlic Each one of us has 640 muscles; you either use them or and herbs, and we won a prize lose them. Right now I’m doing the Bragg windmill exercise… for our K-rations because the What does the windmill do? It brings the energy up from the GIs liked them so. You know ground, up from the earth. And when you do the Bragg windwhy they liked them? Because mill exercises it’s amazing. they didn’t taste like cardboard. I feel ageless; I’ve led a very exciting life. I just spoke to the With garlic and herbs they tasted Life Extension Institute in Fort Lauderdale, Florida. They had wonderful. We had a coffee so many people I had to give two lectures back to back. I’ve substitute endorsed by the Los lectured in every major city of America and the world. I’m Angeles Heart Association. Our gone eight months out of every year traveling…I travel the Bragg Sprinkle with 24 herbs world and I am a citizen of the world. and spices, we still have it today. I am the CEO and president of Bragg Live Food Products. Dad put that out in 1931. Right Live foods make live people! now it’s sold in Kroger and all the Right now, all the supermarkets are having to very strongly stores. move toward healthy products. Dad said years ago, go into Today we have 365 products. the greengrocer and tell them buy organic, and guess what, Heather Cass, marketing and advertising coordinator for Bragg Live Food Products, at the My father promoted organic practically every supermarket here in Santa Barbara now has Bragg compound. gardening. We wouldn’t have all organic sections.

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Promoting sales.

Relationships well rooted. Success well seeded.

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The Shelby Report of the West • MARCH 2015

Natural Foods

FEATURE

Navigating the Conundrum in Natural Food Trends by Carmel G. Hearn Shelby Report contributing writer

Consumers have spoken. They want their products to be “all natural.” And food manufacturers are responding with cleaner labels promoting more natural, healthier and nutritionally superior ingredients. Still, there continues to be a multitude of opinions as to what constitutes “natural.” A bag of potato chips made from all natural potatoes, salt and oil might not qualify as a health food. But do consumKaren Howard ers or manufacturers really Organic & Natural Health know or agree about what does? Association Are manufacturers producing natural foods that meet their customers’ demands for healthy and nutritious products? “Confusion reigns when it comes to consumer understanding of ‘natural’ foods,” said Karen Howard, CEO and executive director of the Organic & Natural Health Association (O&N). “Surveys indicate that consumers often believe natural is the same as organic only without the certification. Consumers also assume that natural products contain no artificial colors, dyes or ingredients. Few, it appears, are aware that natural is not regulated by the federal government.” The O&N was organized in 2014 to create standards, facilitate research and be an industry advocate through a partnership between companies and consumers. The trade group is dedicated to creating and promoting transparent business practices that safeguard access to organic and natural food, products and services. It also supports the development of rational standards for claims substantiation, promotes the communication of truthful and non-misleading information, and encourages research in the natural products industry. Since the O&N represents both corporate and consumer viewpoints, Howard states it is uniquely positioned to create a meaningful definition of “natural” and an accompanying seal that articulates the definition of the word. She further articulates that the definition should incorporate the follow-

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ing elements: • Organic, the industry’s standard-bearer and federally regulated program, will serve as a fundamental set of criteria for defining natural foods. • Transparency in manufacturing and marketing, including the exclusion of ingredients that fail the test of natural, (artificial colors, dyes or specific ingredients), the use of natural extraction and processing techniques and documentation of adherence to cGMP standards. • Traceability and the ability to document the origin of the ingredients in food and supplements. Consumers want to know where their food is from, and that includes internationally sourced ingredients for products manufactured in the U.S. • Sustainability, meaning that the company adheres to a set of corporate responsibility practices, and that the production practices and ingredients themselves are sustainable. For example, supplements and many fortified foods contain synthetic vitamins. “The question we are asking now is whether requiring these products to use natural vitamins is a sustainable option when defining natural. Is there enough natural vitamin C to meet consumer needs? Grass-fed beef represents farming practices that are highly sustainable for the environment. Will our definition of natural beef require it be grass fed and organic? These are the questions we are working through now. In fact, we have commissioned a consumer survey to guide us through this decision process,” Howard said.

Super natural foods

Another prominent keyword emerging in the natural food discussion is “functional.” The Mayo Clinic defines functional foods as those that have a potentially positive effect on health beyond basic nutrition. Mayo says oatmeal as a familiar example of a functional food because it naturally contains soluble fiber that can help lower cholesterol levels. There are some functional foods that are modified to have increased health benefits, and this may call into question as to whether those foods might still be defined as “natural.” Nonetheless, with proactive wellness and proper nutrition among leading consumer dietary trends, functional foods are emerging as an increasingly important part of the

U.S. food retail landscape. This, according to a December 2014 Packaged Facts report, “Functional Foods, Key Trends and Developments,” is driving growth in the functional food segment amongst three important consumer demographic segments: Millennials, Baby Boomers, and health-engaged and exercise-conscientious consumers. “Increased consumer awareness of health and wellness across the age spectrum and among those seeking to combat obesity will continue to fuel interest in functional foods for the foreseeable future, and therefore the ingredients selected for use and potential claims to be made by food processors and marketers,” said Packaged Facts research director David Sprinkle. A division of MarketResearch.com, Packaged Facts publishes market intelligence on a wide range of consumer market topics, including consumer demographics and shopper insights, consumer financial products and services, consumer goods and retailing, consumer packaged goods, and pet products and services. The report further explains how the three demographic groups are pushing the demand for functional foods: • Millennials are interested in optimizing current health and preventing declining health in the future. They are more likely to seek out food products fortified with calcium, fiber and vitamins and minerals, according to the report. In addition, Millennials are driving the trend toward more frequent and healthier snacking. Desirable, healthier snack foods are those that David Sprinkle Millennials are comfortable Packaged Facts selecting both in addition to and instead of traditional meals, offering flexibility to be consumed in either fashion. These include everything from yogurt to fresh fruit to nutrition bars. • Baby Boomers reportedly control 70 percent of U.S. disposable income and drive, to a large extent, demand for healthy food products. A majority of consumers in this demographic group want more of the ingredients that have been identified to help prevent or mitigate conditions that relate to aging and tend to afflict older consumers including fiber, antioxidants, heart-healthy ingredients, vitamins and minerals, omega-3 fatty acids, vitamin D, calcium and whole grains. • On a grander scale, well-accepted understanding of enhanced nutritional needs associated with athletic activity and performance and persistent high obesity rates, which are associated with chronic diseases and highlight the importance of weight loss and maintenance, also contribute to a robust market for functional foods and beverages. As a result, food processors are taking notice of the increased number of consumers embracing the concept of living a higher quality of life through an approach to health and wellness centered on nutritious food consumption and being active. According to the report, most food processors expect weight management and cardiovascular health to be the top issues for consideration over the next two years while developing foods, beverages and dietary supplements. In a previous study, the market researcher also factored another demographic in the decision-making process; particularly in Millennial households. The report stated that any American home with a child

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FEATURE

MARCH 2015 • The Shelby Report of the West

Natural Foods

present is also likely a household in which a child wields substantial influence over retail products purchased. It went on to say that like generations before them, Millennial moms’ consumer behaviors are greatly influenced by their own mothers and the parenting style they experienced growing up. The Millennial mom today was raised by the Boomer mom of yesterday. This means that the affluence that was garnered by the Boomers was lavished on their Millennial kids. A 2014 IFT report on Functional Food Trends further stipulates that specialty nutritional ingredients, the emergence of a health-oriented Hispanic market segment, and consumers’ ongoing interest in protein consumption are driving new opportunities for functional foods and drinks in the United States, based on the following criteria: • The United States is the world’s largest functional food market with sales of $43.9 billion in 2012, up 6.9 percent over 2011. • Six in 10 U.S. adults consume specially formulated functional foods/beverages at least occasionally. Yogurt for digestive health and cereal for heart health are the most-consumed items, followed by cholesterol-lowering butter/margarine, cholesterollowering orange juice, shakes/bars to reduce hunger, orange juice for joint health, immuneboosting dairy beverages and medicinal teas. • America’s 52 million Hispanics represent an enormous and virtually untapped healthy food and beverage opportunity. In 2012, U.S. Hispanics spent $6.9 billion on functional foods, up 7.7 percent vs. 2011. They also spent $9.4 billion on natural/organic foods/ drinks, up 12.9 percent, and $2.4 billion on supplements, up 7.6 percent. • With 41 percent of America’s 32 million moms saying they always buy healthy foods/ drinks for their kids and 88 percent claiming to do so at least sometimes, a wider range of healthy, convenient, kid-friendly foods/ drinks—with nutrient and calorie levels specific to kids—will find a welcome market. The IFT report also projects that with a fast-emerging middle class, more disposable income, and a greater number of working/ more educated women in emerging markets, the worldwide potential for functional foods/ beverages is unprecedented.

Locally sourced food surges ahead

Like organic products before them, locally produced foods are stepping out of the shadow of their once “quirky niche” designation to claim a much more prominent—and permanent—place in the U.S. food and beverage retail-scape. According to findings in a January 2015 Packaged Facts report, “Shopping for Local Foods in the U.S.,” it is estimated that local foods generated $12 billion in sales in 2014, accounting for 2 percent of total U.S. retail sales of foods and beverages. Looking ahead, Packaged Facts anticipates that over the next five years, local foods will grow faster than the annual pace of total food and beverage sales to approach $20 billion in 2019. “We’ve reached a tipping point for local foods. Over the past 10 years, there has been a surge in consumer demand for locally produced foods, along with widening availability,” Sprinkle reported. “And it’s not just farmers’ markets or natural food retailers lending credence to this trend. An increasing number of larger grocers are carrying and promoting local products. Even Walmart has been promoting local farmers in its bid to tailor its store selections more toward local communities.”

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A proprietary Packaged Facts National Consumer Survey conducted in November 2014 among U.S. adults found that 53 percent of respondents specially seek out locally grown or locally produced foods, with 19 percent “strongly” agreeing and 34 percent “somewhat” agreeing. Even more interestingly, almost half the respondents agree they are willing to pay up to 10 percent more for locally grown or produced foods, and almost one in three said they are willing to pay up to 25 percent more. A third of consumers also claim to consciously purchase locally grown or locally produced foods at least once a week. The Packaged Facts report concluded that among the primary reasons for purchasing locally grown or locally produced foods, the majority of consumers claim they do so because the products are fresher. In addition, more than half of consumers say they buy local products to support local businesses, and more than 40 percent of consumers say the products taste better. In addition, roughly a third believes that local products are healthier, and that they like to know where their food is coming from. This demand for local food has given rise to a surge in urban cooperative gardens and farmer’s markets popping up in large urban areas. This movement is starting to put a dent in the food desert landscape, but large grocers have also heard the call to bring farm-to-table food to the tables of their customers. “Kroger is dedicated to supporting locally grown produce to provide our customers with the freshest, most nutritious fruits and vegetables in the Southeast,” said George Harter, produce merchandiser with Kroger’s Atlanta Division. “Consumers also recognize that purchasing vegetables and fruits grown by local farmers has significant advantages, including helping the economy in the communities we serve, and delivering produce to our stores much more quickly.” “Natural foods are the fastest growing department in our stores on a percentage basis, and we expect it to double in size company-wide in the next five George Harter years,” added Felix Turner, natural foods merchandiser with Kroger’s Atlanta Division. “Kroger is committed to offering customers a wide variety of items that are excellent in quality and affordable for consumers. Kroger is always listening to our customers for ways Felix Turner to provide the best shopping experience. As part of that ongoing evaluation, we learned customers wanted a straightforward solution to shopping organic food. This is why we introduced Simple Truth and Simple Truth Organic.” Kroger’s two private-label brands—Simple Truth and Simple Truth Organic—were Please see page 38

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Natural Foods What’s New Angie’s Boomchickapuff

Angie’s Boomchickapop, maker of one of the nation’s fastest growing brands of natural popcorn, is making its way to another aisle in the grocery store with a new product—Angie’s Boomchickapuff. On shelves nationally starting in January, Angie’s Boomchickapuff is gluten free, made ade with non-GMO corn and ancient grains quinoa and sorghum. Three flavors are available: Angie’s Boomchickapuff White Cheddar, made with real cheese; Boomchickapuff Sweet & Salty, almost named “waffle puffs” for its breakfastlike taste; and Boomchickapuff Sweet Barbeque, which is tangy and crunchy.

Mamma Chia Chia Vitality Granola Clusters

Mamma Chia, creator of the first-to-market chia beverage, has introduced Chia Vitality Granola Clusters. The clusters are made with nutrient-rich chia seeds, whole rolled oats, wild blueberries or toasted nuts, naturally sweetened with honey and molasses. Each serving delivers 1500mg of omega-3s, as well as gluten-free whole grains, 10g of protein (soy-free and dairy-free) and 5g of fiber. Chia Vitality Granola Clusters are available in three flavors: Wild Blueberry, Vanilla Almond and Cinnamon Pecan. In addition, the clusters are non-GMO, kosher and USDA Certified Organic. SRP $6.49.

thinkThin Protein & Fiber Hot Oatmeal

thinkThin is expanding its product line beyond bars with the introduction of thinkThin Protein & Fiber Hot Oatmeal. Michele Kessler, CEO of thinkThin in Los Angeles, said, “As a leader in the protein bar category, we have a solid understanding of the important role protein and fiber play in providing the perfect balance of energy and nutrition. We are excited to continue to fuel thinkThin’s growth with the launch of thinkThin Protein & Fiber Hot Oatmeal and break into additional on-trend categories.” The oatmeal is made with a blend of grains including whole rolled oats, steel-cut oats and quinoa. The new hot oatmeal is in a multi-pack box of six packets or a portable singleserving bowl. Each serving has 10g of

KeHE Adding California Distribution Hub KeHE Distributors, one of the largest distributors of natural food products in North America, will locate its newest distribution center in Stockton, California. The 450,000-s.f. facility, part of an existing building in the NorCal Logistics Center, will be the distributor’s hub for frozen and fresh grocery products. “This is an exciting time in our organization,” said Gene Carter, COO of Naperville, Illinois-based KeHE. “We are continuing to fulfill the needs of our current and future customers with this distribution center. It will expand our product assortment offerings and reach in Northern California. In addition, we are looking forward to growing the KeHE employee base on the West Coast.” The building, originally constructed by Fresh & Easy, has been vacant since 2009. Fresh & Easy filed bankruptcy before ever occupying the building, which makes KeHE the first tenant to utilize the space. The company anticipates 200 new jobs at buildout in March. Recruitment is underway for managers, supervisors, delivery drivers and order page_34-35-36-38.indd 36

FEATURE protein, 5g of fiber and is 200 calories or less and comes in four flavors—Farmer’s Market Berry Crumble; Madagascar Vanilla, Almonds, Pecans; Original Sprouted Grains (box only); and Honey Peanut Butter (bowl only). Nationwide availability is expected in March.

Love Beets Launches New Organic Beet Juice

Love Beets, a line of premium, all-natural, ready-to-eat beets, has introduced Organic Beet Juice, which hit grocery store shelves nationwide in late January. Love Beets’ Organic Beet Juice comes in a 14-oz. glass bottle that aligns with the company’s new, more upbeat brand identity. Like the other juices in Love Beets’ lineup, the Organic Beet Juice is gluten free, with a 100 percent clean ingredient deck and no added sugar. “We are thrilled to kick off 2015 with this exciting launch and respond to consumers who continue to request organic options,” said George Shropshire, VP of Pennsylvania-based Love Beets. “Beyond meeting those demands, we are particularly excited that more consumers are embracing beets and their numerous health benefits— from boosting performance and stamina to improving overall heart health to even combating the effects of fatigue.” Love Beets also is relaunching its other juices nationwide with a new design. These include a Cherry & Berry flavor, which blends the sweetness of beets with the fresh tartness of black currant and cherries, and regular Beet Juice, both of which are available in a 20 oz. recyclable, plastic bottle. In grocery stores nationwide; SRP $4.99-$5.99.

Van’s International Foods Pastas, Granola

Van’s is rolling out a new line of whole grain pastas for its first foray into lunch or dinner options as well as new granola clusters for breakfast or snacks. New Van’s Whole Grain Pastas, SRP $3.99, come in three gluten-free varieties that can be prepared on the stovetop in 10 minutes. Each pasta variety is made with simple ingredients and seasonings and no artificial colors, flavors, preservatives or high-fructose corn syrup. The line includes Rotini & Red Sauce; Creamy Herb & Garlic; and Ultimate Cheddar Penne. Vernon, California-based Van’s also adds Soft-Baked Whole Grain Granola Clusters, available in Blueberry Walnut and Cranberry Almond. Made from gluten-free whole grain oats, the granola clusters offer 12g of nutrient-dense whole grains per serving and are free of artificial flavors, colors and high-fructose corn syrup. SRP $4.99.

RW Garcia 3 Seed Gluten-Free Crackers

RW Garcia, family-owned-and-operated maker of artisan and all-natural corn-based snacks for more than 30 years, is offering a new line of gluten-free snacks. Its 3 Seed Crackers come in three varieties: 3 Seed Sweet Potato, 3 Seed Kale and

selectors. “Stockton’s strength in transportation and logistics paired with its ideal central location and available workforce made it a perfect choice for KeHE’s latest operation and we couldn’t be happier with their decision,” said Micah Runner, the city’s economic development director. “They are a great employer and will bring a much needed boost to our local economy.”

SnackHealthy Names New President

SnackHealthy Inc. has appointed A.R. “Bud” Grandsaert president, effective Feb. 10. Grandsaert will be responsible for overseeing the Newport Beach, California-based company’s beverage and snacks groups, business and information solutions function, procurement, productivity, supply chain and corporate strategy. SnackHealthy’s lines include CrispyFruit freeze-dried fruit; RealFruit dried fruit snacks; LoliBar all-natural fruit and nut bars; LoliCrunch all-natural fruit and nut snacks; Multi-

a 3 Seed Harvest. The snacks combine flaxseed, sesame seeds and chia seeds with non-GMO corn and other vegetables. “We hear from our customers just how popular vegetables such as kale and sweet potato are right now,” said Margaret Garcia, co-founder and VP of sales and marketing for San Jose, Californiabased RW Garcia. “With our line of 3 Seed Crackers, we are responding to that demand, while providing retailers with something unique and great tasting to merchandise to their consumers.” The entire line features Non-GMO Project verified crackers that are rich in omega 3 and high in fiber due to the types of seeds used. The crackers are also free of trans fat and cholesterol. RW Garcia 3 Seed Crackers are available now to retailers across the country. The crackers come in a 6.5 oz. box; SRP $5.99-$6.49.

Ian’s Sriracha Fire Sticks

Ian’s has launched its Sriracha Fire Sticks, spicy fry-shaped chicken sticks ideal for dipping. “Sriracha has received a lot of food accolades, including being named Bon Appetit’s Ingredient of the year in 2010,” said Chuck Marble, CEO of Elevation Brands, Ian’s parent company, in Massachusetts. “Our consumers are familiar with its flavor profile, so they crave and ask for it. We are excited to be able to provide this popular zesty flavor in our allergyfriendly line of products.” Made with flavorful gluten-free, whole grain breading and antibiotic- and cage-free white chicken meat, the new Sriracha Fire Sticks follow Ian’s mission to provide options without the worry about harmful allergens. “We consistently strive to use only the best, natural ingredients in all of our products. The introduction of our new allergy-friendly, gluten-free Sriracha Fire Sticks boast our promise to provide individuals and families with innovative and healthy foods,” Marble also said. To be consistent with the Ian’s line of allergy-friendly foods, the Sriracha Fire Sticks are made with no wheat, milk, casein, eggs, peanuts, tree nuts or soy. They are available for purchase at Sprouts Farmers Markets nationwide. Sriracha Fire Sticks will be featured at Natural Products Expo West in March.

Grain Nuggets (pretzels made with unbleached enriched wheat); Zing! healthy energy drink mix; and Smart Shake whey protein and fiber shakes. Grandsaert has held leadership positions with Fortune 500 companies including Procter & Gamble, John Morrell and E&J Gallo Winery. “Bud is a highly skilled operator who has built impressive performance track records throughout his career,” said Richard Damion, CEO of SnackHealthy. “He brings the right qualities and experiences to his new role and his leadership will benefit SnackHealthy as we execute our strategy to deliver long-term sustainable growth.” Grandsaert added, “I am very excited to be a part of the SnackHealthy team. My decision to accept this appointment was made all the easier once I saw the overall direction the company plans to take from the team it is assembling, and most importantly, the exciting product line in development. I have no doubt that through our combined efforts and our unique beverage line SnackHealthy stands every chance of taking this new product to ‘super-brand’ status. In fact, to say I was more than enthusiastic at its market potential is an understatement.” Please see page 38

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The Shelby Report of the West • MARCH 2015

Natural Foods

FEATURE

Navigating the Conundrum in Natural Food Trends From page 35

introduced in September 2012. Simple Truth’s green circular logo identifies organic options free from more than 100 artificial ingredients.

Semantics, schemantics

While the natural foods rulebook may be far from being finished, and that may, in itself, be an obstacle in changing consumer attitudes about natural foods, what can manufacturers do to ensure their customers are receiving reliable, understandable and useful information about the foods they choose today? “Consumers are definitely seeking what they perceive to be healthier products,” said Howard. “Events like recalls of food, for both people and pets, high-profile lawsuits on what constitutes natural, announcements by retail chains, restaurants and manufacturers on their commitment to organic, or their sourcing of humanly-raised meats, and even the diet trending we see towards healthy school lunches and the slow food movement, represent just a few of the drivers moving people away from artificial, heavily processed foods. Industry now needs to support these changes through transparent and accurate business and marketing practices.” Meanwhile, consumers are still flipping product

packages around to search labels for words they recognize, watching television cooking shows for recipes, wondering about Paleo diets and reading news reports filled with industry buzz terms. “As increasing numbers of consumers seek healthier choices for their families, the biggest obstacle I see is the labeling of products,” Howard pointed out. “While the use of natural remains prolific, some manufacturers are moving to other terms, like simply, to avoid potential litigation. Other companies are using terminology as pure marketing gimmicks, like GMO-free or even gluten-free on products that would never meet the definition. Gluten-free (unprocessed) fish, GMO-free wheat (there is no GMO wheat), and organic dry cleaning—none of these are valid claims or provide important information for consumer choice.” It all comes down to this: What are consumers hoping to find as they push their carts down the grocery store aisles? “We are acutely aware that the consumer wants reliable, understandable and useful information,” Howard concluded. “Our process will incorporate quality standards and programs currently being utilized in the industry and role them up into a concise program for defining ‘natural.’”

From page 36

Hershey to Acquire All-Natural Krave Jerky The Hershey Co. has agreed to buy Krave Pure Foods Inc., manufacturer of Krave jerky, a leading all-natural snack brand of premium jerky products. The transaction will allow Hershey to tap into the rapidly growing meat snacks category and further expand into the broader snacks space. Financial terms of the transaction were not disclosed. “Krave jerky is a great fit to our portfolio and overall snacks and adjacencies strategy,” said Michele G. Buck, president, North America, The Hershey Co. “The Krave brand delivers on portable and protein nutrition while also understanding consumers’ food preferences, including the desire for simple ingredients and transparency, something that is also a part of Hershey’s strategic vision. We are excited to add Krave jerky’s unique, chef-inspired products and be a part of this transformational category.” Krave jerky, founded in 2009 by Jonathan Sebastiani, is now a leader in premium jerky, the fastest-growing sub-segment of the estimated $2.5 billion U.S. meat snacks category. Krave jerky flavors include Black Cherry Barbeque Pork Jerky, Basil Citrus Turkey Jerky and Chili Lime Beef Jerky. The products are also free of gluten and high-fructose corn syrup and have no added nitrites or MSG. Sebastiani said, “Our partnership with Hershey is a testament to our team’s dedication to creating something unexpected and striving to be a cut above the rest. We are confident in our future and look forward to further success with Hershey.” Hershey intends to leverage its supply chain capabilities, consumer insights and retail relationships to accelerate growth and access to Krave products. Krave will remain headquartered in Sonoma, California, and Hershey plans to operate Krave as a standalone business within its Hershey North America division. Sebastiani will continue to lead the business as president of Krave and will report to Buck. Krave Pure Foods has generated some $35 million in net sales over the last 12 months.

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U.S. Gluten-Free Food Market Reaches $973M

Natural Products Expo West Sustainable Seminar Focuses on Achieving Harmony Among Unlikely Partners Organic & Natural Health Association (Organic & Natural) in partnership with The Antarctic Wildlife Research Fund (AWR) and Aker BioMarine will host a special seminar on sustainability in business practices at Natural Products Expo West at 4 p.m., Friday, March 6, in Anaheim, California. Presenters include Alan Lewis, director of food and agriculture policy at Natural Grocers; Mark Epstein, chairman of AWR and executive director of the Antarctic and Southern Ocean Coalition; Andre Leu, president of International Federation of Organic Agriculture Movements (IFOAM); Michael Griff, commercial manager Americas of Marine Stewardship Council; and Tom Newmark, chairman of Greenpeace Fund USA and co-founder of Carbon Underground. “This event brings together organizations that are committed to merging policy and action in a climate oversaturated with disparate campaigns for the sake of future generations,” said Karen Howard, CEO and executive director of Organic & Natural. “You simply cannot have a meaningful conversation about organic and natural without addressing sustainability. Our intent with this seminar is to help retailers and manufacturers cut through the clutter of activism, research and commercialism of sustainability to get a transparent look at what is truly at stake and how all these groups can work together for a larger impact.” Some of the issues that will be addressed by the panel of speakers include new trends in sustainable partnerships such as the newly formed AWR; forthcoming developments in organic sustainability; deconstructing the ecolabel; how sustainable harmony can be achieved on a global level between businesses, researchers, activists and consumers; and helping retailers determine what products really have a sustainable impact and value to their customer.

The gluten-free market is cementing its staying power as more than a mere dietary fad and continues to make national headlines, including a recent announcement by Pizza Hut that it will begin offering gluten-free pizza. In the retail sector, sales of gluten-free foods posted an impressive compound annual growth rate of 34 percent over the five-year period ended in 2014, when market sales reached $973 million, according to market research publisher Packaged Facts in its recently released report called “Gluten-Free Foods in the U.S., 5th Edition.” “Retailers have embraced the gluten-free trend by stocking more gluten-free items, featuring them in store and launching their own private label brands. In addition, retail chains have been courting the gluten-free consumer with a variety of festivals and events,” said David Sprinkle, Packaged Facts research director. Packaged Facts’ July/August 2014 survey data reveals that more than a third of consumers claim gluten free/wheat free is an important factor when they are shopping for food. In addition, a quarter of survey respondents had purchased or used food products labeled gluten free in the three months prior to the survey. Looking ahead, the gluten-free market’s momentum isn’t expected to wane anytime soon. Packaged Facts projects sales will exceed $2 billion in 2019. The “Gluten-Free Foods in the U.S.” report highlights several key factors favoring continued growth in the market, including: • Consumer trends, including use of, interest in and opinions about gluten-free foods; • Growth in demographic groups showing a strong propensity to purchase gluten-free foods; • The escalating prevalence of health problems associated with diet; • More and better quality gluten-free food products that are readily available in mainstream retail channels; • The growing presence of large marketers in the segment; and • A ruling by the Food and Drug Administration on the definition of “gluten free” that will level the playing field among manufacturers. In the report, Packaged Facts’ analysis focuses on traditionally grain-based products in the following categories: Salty Snacks, Crackers, Pasta, Bread, Cold (ready-to-eat) Cereal, Cookies, Baking Mixes, Frozen Bread/Dough and Flour.

Almond Milk Drives Growth at Califia Farms Sales of Califia Farms’ premium Almondmilk tripled its revenues in the almond milk category from 2013 to 2014. Meanwhile, the company has expanded into the iced coffee category with premium cold brew coffee and Almondmilkbased iced coffee drinks. “More and more retailers nationwide, both natural and conventional, are integrating Califia Farms Almondmilk into their dairy cases and are experiencing the ‘Califia effect,’” said Greg Steltenpohl, CEO of the Los Angeles-based company. “Califia is growing the whole alternative dairy category by bringing super premium Almondmilk to the table. In turn, we are also delivering new customers, most notably the coveted Millennial demographic, to the early adopting retailers who carry our brand.” Califia Farms says the almond milk category in general is exploding, representing 55 percent of alternative dairy sales while soy represents just 35 percent. Its growth is expected to continue into the foreseeable future, a shift that is likely to cross over to the creamer category, Califia believes, adding that soymilk consumption has been steadily on the decline over the past few years. “Today’s consumers want high-quality, healthy premiumbrand experiences and are demanding that retailers deliver them,” said Steltenpohl. “It’s interesting that despite fighting the headwinds of a declining category, Coke recently announced its plan to premiumize dairy milk; I think it’s fair to say that we are the premium option in alternative dairy— and, in direct contrast, alt dairy is a category that is growing at an extremely vigorous pace.”

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Authentic and Delicious… a Salsa surpassing ketchup as America’s favorite condiment was just the beginning. Tortillas now outsell hot dog and hamburger buns. And according to InfoScan, sales of tortilla chips are increasing faster than potato chips. The fact is, Hispanics now represent over 17% of the U.S. population and that percentage is growing fast. According to United States Census Bureau, over the past decade America’s Hispanic population grew 43% while the total U.S. population grew only 10%. As a result, Hispanic foods are dramatically altering the American culinary experience. Last year, Hispanic foods and beverages were an $8 billion market. It is expected by 2017 the number will be closer to $11 billion. Few other aisles of your stores will experience this type of dramatic growth. Authentic and delicious, El Mexicano® brand products are perfectly positioned to help you take full advantage of this exploding category.

Breakfast Burritos

(6 Servings)

(4-6

Ingredients:

Ingre

large flour tortillas

large russet potatoes, peeled and diced

eggs, beaten

oz El Mexicano® Beef Chorizo, remove casings

2 1

½ cup El Mexicano® Queso Oaxaca, shredded ¼ cup El Mexicano® Queso Fresco Casero®, crumbled Olive oil

Prep

Salt and freshly ground black pepper

1. Pr

Preparation: 1. Heat a large skillet over medium heat. 2. Add 3 tablespoons of oil, when the oil is hot, add the peeled and diced potatoes and sprinkle with salt and fresh ground black pepper. Cook until lightly browned and thoroughly cooked. Set aside. 3. On the same skillet, cook the El Mexicano® Beef Chorizo over medium heat and drain any excess oil. Set aside. Remember to remove the casing from the chorizo before cooking. 4. In a small non-stick pan scramble the eggs, sprinkled with a dash of salt and fresh ground black pepper, in a little oil until fully cooked. 5. Warm the tortillas and fill them with the cooked potatoes, scrambled eggs, beef chorizo, and sprinkle generously with El Mexicano® Queso Oaxaca and El Mexicano® Queso Casero®. 6. Fold into a burrito and serve immediately. Serve with your favorite salsa! Chef’s Tip: For a healthier alternative, you can choose to use Gluten Free or Wheat Tortillas, El Mexicano® Soy Chorizo and egg whites in your burrito mix.

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… a Brand You Can Trust!

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Baked Cheese with Longaniza

Chorizo Street Tacos

(4-6 Servings)

(6 Servings)

Ingredients:

oz El Mexicano® Longaniza, casings removed

12 mini Corn Tortillas

oz El Mexicano® Queso Oaxaca, shredded

10 oz El Mexicano® Queso Muenster, shredded

oz El Mexicano® Pork Chorizo, remove casings

½ large onion, diced

oz El Mexicano® Queso Cotija, grated

½ cup Fresh Cilantro, chopped

cup Onion, chopped

Preparation:

Warmed Tortillas or Corn tortilla chips

1. Heat a medium sized skillet over medium heat.

Preparation:

2. Place the El Mexicano® Pork Chorizo until thoroughly cooked and drain any excess oil. Set aside.

1. Preheat oven at 350° 2. Heat a skillet over medium heat and cook onions for about 5 mins, then add the El Mexicano® Longaniza and cook until almost crisp, drain any excess oil. Set aside.

3. Warm the tortillas and fill them with the Pork Chorizo.

3. Combine the cooked Longaniza with the shredded El Mexicano® Queso Oaxaca, Queso Muenster and Queso Cotija in a bowl.

5. Serve immediately alongside your favorite salsa, guacamole, and lime wedges.

4. Place the mixed Longaniza and Cheeses into a baking dish and bake at 350° for approximately 15-20 minutes or until cheese is melted thoroughly and gets slightly golden brown and bubbly on top.

Chef’s Tip: As a variation, serve tacos with crumbled El Mexicano® Queso Cotija sprinkled over the top, and for a healthier alternative or diet sensitivity you can substitute for El Mexicano® Soy Chorizo.

5. Serve immediately alongside tortillas and/or chips.

4. Mix the diced onion and chopped cilantro and sprinkle over the top of the tacos.

Hispanic Buying Power to Hit $1.5 Trillion

Research says the buying power of Hispanics in the U.S. will be $1.5 trillion by 2015. Let’s grow together!

uten s in

www.elmexicano.net

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Perishables theshelbyreport.com

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Smári adds new products

MARCH 2015

United Fresh Unveils New Logo and Website The United Fresh Produce Association has redesigned its logo and website, unitedfresh.org. “January is symbolically a time of fresh starts,” said United Fresh President and CEO Tom Stenzel. “As we move into the New Year, this transition comes with a new look for our association and a new user-friendly website designed to align with our mission of providing the resources and expertise companies need to succeed.” The new brand aims to elevate the association’s mission to build a stronger connection across the United Fresh supply chain encompassing grower-shippers, fresh-cut processors, wholesaler-distributors, retail-food service operators, floral and industry service providers. This is expressed visually within the modern element—the halos—paired with a traditional type treatment representing the association’s history of more than a century of dedication to the produce industry. The website carries over the new design from the logo and offers streamlined navigation, improved user functionality, enhanced search features and a robust publications library. The goal of the site is to give the user a cohesive view of the produce industry highlighting news and events, association commentary and a spotlight on industry achievements.

Opal Apples Delivered to International Space Station The sweet and crispy Opal apple was sent to the International Space Station in January. Last fall, The Johnson Space Center sent the request for the apples to FirstFruits of Washington, a collaborative apple marketing company owned by growers. “This is a special honor to be able to provide fresh apples to the crew members at the International Space Station,” said Ralph Broetje, owner-operator of Broetje Orchards. “When we got the request for apples we knew right away that we wanted to send Opal, the most special apple in our lineup.” The SpaceX Falcon 9 rocket launched the seventh Dragon spacecraft on the fifth operational cargo delivery mission to the International Space Station on Jan. 10 from Cape Canaveral Air Force Station in Florida. The flight is being conducted under the Commercial Resupply Services contract with NASA. NASA indicated in its request it wanted to connect the fresh fruit back to the actual farmers, and approached FirstFruits of Washington and their growers with the request. The founders of Broetje Orchards and exclusive growers of Opal apples in North America, Ralph and Cheryl Broetje, were happy to oblige and sent a note to accompany the apples to the space station. Because of the high cost of sending items into space, the quantity of apples is limited, which means only one or two apples per crew member were delivered. Expedition 41 launched on Sept. 25, 2014. The crew consists of three Russian cosmonauts, two NASA astronauts and one member of the European Space Agency.

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BroccoLeaf Could Be Next Kale With Milder Taste, Versatility In the three months since Foxy Organics introduced its organic BroccoLeaf to grocery retailers, the vegetable already has earned accolades in food, nutrition and health media as well as from chefs, who were some of the first to be introduced to the leafy greens. And The Nunes Co. in Salinas, California, which is marketing BroccoLeaf, sees only growth ahead. “To say that we are pleased with the progress we’ve made in such a short time is an understatement. Our fans and distribution grow daily, and we believe that we have discovered the next big trend in produce,” said Matt Seeley, VP of marketing for The Nunes Co., a family-owned international marketing organization that markets its products under the Foxy brand. Founded nearly 40 years ago, Foxy Produce is a fourth-generation family-owned farming business. Seeley tells The Shelby Report that his company became acquainted with BroccoLeaf last year when it was in the midst of a juicing promotion. Juicing, he noted, “provides an outstanding opportunity for everybody in the produce business to increase sales of fresh fruits and vegetables.” Kale was the company’s go-to vegetable for juicing during the campaign, he said, until one of Foxy’s growers pitched the company on using broccoli leaves instead. Skepticism was the initial reaction for Seeley and many of his colleagues, but they followed up anyway. They had the leaves tested for nutritional content and discovered they are an excellent source of vitamins A, C and K; have more calcium than kale; and are a good source of folate. Then they took the leaves to a local juicing store to have them put through the juicer, and the people who tested it “were just astounded by it, couldn’t believe how much juice they got out of the broccoli leaves and how good it tasted.” Next, the company hired a dietitian to “make sure we were on the right path.” She suggested providing samples to chefs to see what their reaction was. They found it to be a “highly, highly versatile product,” Seeley said. “It’s great for not only juicing, but great in salads; soups when you sauté it. It’s just a great item.” In fact, celebrity chefs Spike Mendelsohn, Nora Pouillon and Akasha Richmond are

incorporating it into their menus. Armed with all that great feedback, The Nunes Co. launched Foxy BroccoLeaf at retail in September 2014. It has gotten a lot of press, being featured on “The Rachael Ray Show” (January) and on “Dr. Oz,” as well as in high-profile national consumer publications like Prevention, InStyle, Fine Cooking, Good Housekeeping, The Good Life, Shape.com, Slate.com, Washington Post, Huffington Post, Yahoo.com and numerous food blogs. Why are broccoli leaves just now being discovered as a greens option? Traditionally, broccoli leaves have been tilled back into the soil after the broccoli is harvested to help cleanse and replace the nutrients in the soil. That is still the case; the BroccoLeaf is harvested before the broccoli itself, when the leaves are still tender and immature. Any leaves left after the broccoli itself is harvested still go back to the soil. BroccoLeaf, which is smoother than kale without the bitter taste and when cooked wilts much like spinach, is merchandised at retail next to other greens, such as kale, chard and collard greens. Retailers can get POS materials that outline the nutritional benefits of the product that feature a recipe on the flipside. In addition, Foxy just finished printing a recipe booklet that it will make available free of charge to retailers to encourage consumers to try the new product. This spring and summer, in-store demos will take place to “showcase to consumers how to utilize the product in various formats.” The organically-grown product’s price point ranges from $1.99 to $2.99 per bunch; a bunch is generally nine to 11 leaves. Retailers that now carry BroccoLeaf include Whole Foods Market, Walmart, Shaw’s Supermarkets, Winn-Dixie and Bi-Lo, as well as many health food stores and juicing stores. “We’re very excited; everybody’s looking for what’s the next new, hot item, and I think we are part of that trend with the BroccoLeaf,” Seeley said. “We just look for overall sales of the product to continue to grow in the coming year.” —Reporting by Lorrie Griffith,

editor

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Produce

PERISHABLES

Calavo Forecasts Record Earnings in 2015 Calavo Growers expects revenues and earnings to reach new highs in 2015, buoyed by an estimated 20 percent rise in domestic avocado consumption to reach more than 2 billion pounds in total, as well as through growth in its Calavo Foods and Renaissance Food Group (RFG) segments. The forecast, released Jan. 15 in the company’s fiscal 2014 fourth quarter and full-year results, included a 21 percent rise in gross margin to $73 million for the year and 5 percent revenue growth for the quarter. “In sum, it was an outstanding final quarter and year for Calavo as measured by our formidable results from operations. Our company posted strong final quarter results to cap a record-breaking fiscal 2014, during which all important metrics reached new historic highs,” CEO Lee Cole said. “Of particular note, Calavo’s operating performance in the most-recent period reflects the beneficial impact of sourcing and marketing Mexico-grown avocados, which improved fresh business segment gross margin and counterbalanced the cyclically smaller harvest of California fruit.

“We registered sharply improved gross margin in our Calavo Foods business segment—a result of favorable fruit and production costs, as well as significant year-over-year improvement in segment sales—which further contributed to the uptick in overall company gross margin,” Cole added. He noted that the RFG segment notched 31 percent year-on-year growth in the fourth quarter. “RFG continues to execute impressively—penetrating the retail grocery channel with its broad line of refrigerated fresh packaged goods. Its operating performance made significant incremental contribution to Calavo’s top and bottom lines during fiscal 2014. “On the strength of Calavo’s record-breaking operating results, we were able to once again affirm management’s commitment to delivering the highest possible shareholder returns, increasing the annual cash dividend on our common stock by 7 percent to $0.75 per share.” Cole added all indicators were “pointing affirmatively” in 2015. “By all industry and company expectations, fresh avocado consumption is expected to resume its upward advance in the coming year after a ‘breather’ in 2014 from the dramatic growth of the past decade. According to industry forecasts, U.S. fresh avocado consumption, based on the all-source avocado availability from California, Mexico and South America, is on track to exceed two billion pounds in the current year,” he said. “With our avocado market leadership—strong sourcing capabilities, sales and distribution expertise, and the vast breadth of resources Calavo brings to bear—we will be beneficiaries of the upward consumption trend-line. “The consistently large Mexico crop, an expected resurgent California avocado harvest, which adversely affected the all-source fruit supply last year and, most importantly, strong consumer demand, all point to a brightening picture for fiscal 2015.”

Litehouse Sells Company to Employees Litehouse Inc., the Sandpoint, Idaho-based maker of salad dressings, sauces, dips, herbs and cheeses, has sold 100 percent of the company’s stock to its employees through an Employee Stock Ownership Plan (ESOP), effective Dec. 22, 2014. All current and future employees have the opportunity to become owners of Litehouse, which has been family owned for more than 50 years. Litehouse first formed an ESOP in 2006, selling 30 percent of the company to employees. The move to 100 percent ESOP ensures continued local ownership, Litehouse says. The company, which employs 650 people nationwide, was founded by the Hawkins brothers, Doug and Edward, who then merged with Wendell Christoff and his family dressing company, Chadalee Farms, of Lowell, Michigan, in 1997. “We are incredibly proud of our company and want our legacy to be shared with the talented and dedicated employees who have contributed to its growth,” said Doug Hawkins, chairman of the board. “The move to 100 percent employee ownership allows every employee to be an owner and ensures the future

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MARCH 2015 • The Shelby Report of the West

Perishables

Domex Superfresh Growers Expect Year-Round Promotional Opps for Washington Apples The record 2014-15 Washington apple crop is forecasted at more than 140 million boxes of fruit. Domex Superfresh Growers says the crop will give it good quality, sizing and aggressive promotional opportunities benefiting retailers and consumers alike. Most of the varieties—like Gala, Fuji, Red Delicious, Granny Smith and Golden Delicious—will be available through the summer months. With ample supplies of all major varieties from Washington state, retailers will have the ability to offer U.S.-grown apples to their customers for the entire year. Apples should be promoted yearround as they contribute approximately 12 percent of the entire produce department’s dollar sales, according to Domex. The top five apple varieties—Gala, Fuji, Red Delicious, Honeycrisp and Granny Smith—represent nearly 75 percent of the entire apple category. “Gala Apples are the No. 1 apple in both dollar and volume sales in the United States,” said Howard Nager, Domex’s VP of marketing. “Nielsen data shows that Galas represent almost 25 percent of apple dollars sales and 27 percent of the apple volume sales.” With the quality and consumer preference for Washington apples, it is critical for retailers to capture sales with continued and frequent promotional efforts in-store and online throughout the summer months, according to Domex. “Social media has been very successful in helping us educate and inspire consumers on the benefits of increased apple consumption,” said Nager. “We encourage retailers to view and share our consumeroriented content available on our blog at SuperfreshGrowers.com.”

Nielsen data show that Galas represent almost 25 percent of apple dollars sales and 27 percent of apple volume sales.

success of Litehouse for generations to come.” Doug and Edward Hawkins and Wendell Christoff will continue their roles as active board members. In 2010, Jim Frank was named president and CEO of Litehouse. He continues to lead the company in double-digit sales growth. “We are excited to have created this opportunity for our employees and we are confident that the ESOP will make us an even stronger company,” added Frank. “The success of the Litehouse brand and the move to a 100 percent employee-owned company is a strong reflection of our founders guiding principles: faith, stewardship, integrity, commitment to excellence and accountability. These principles continue to guide us today.”

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The Shelby Report of the West • MARCH 2015

Perishables Meat Groups Merge to Become North American Meat Institute

J.R. Simplot, Caviness Beef Packers to Build Idaho Beef Processing Plant

The American Meat Institute and North American Meat Association have merged to become the North American Meat Institute (NAMI), becoming a unified voice for meat and poultry companies large and small. The merger became official Jan. 1. Barry Carpenter will serve as NAMI’s president and CEO. In a blog post, Carpenter says the merger “brings together two great organizations, each with their own strengths, personalities and cultures, into one larger, stronger, better organization. “AMI brought a wide array of experts on issues like the environment, animal welfare and worker safety as well as scientific depth,” he adds. “NAMA brought a hands-on regulatory services team that works in the trenches each day with members that are challenged by the intense regulatory oversight that is ‘A Day in the Life of the Meat Industry.’ AMI was intensely Washington-focused while NAMA’s fingers were in the field.”

Caviness Beef Packers has formed a joint venture with J.R. Simplot Co. to build a new beef processing plant near Kuna, Idaho. Construction of the nearly 300,000-s.f. plant is expected to begin this spring, with an expected fall 2016 opening, pending approval of permits from all necessary regulatory agencies. Caviness Beef Packers is based in Amarillo, Texas; J.R. Simplot in Boise, Idaho. The new facility will operate under the name CS Beef Packers LLC. The joint venture expects to invest $100 million in the plant, which is expected to process a maximum of 1,700 head per day and could create up to 600 new jobs. “It’ll have a tremendous impact on my city,” Kuna Mayor Greg Nelson told the Idaho Statesman. According to the paper, the area has lost 37 percent of its meatpacker employment since 2010. Simplot spokesman Kevin Dey told the Statesman, “There’s an all-time high demand for beef right now and no processing facilities within this region, so we saw an opportunity.” The primary purpose of the plant will be to harvest cull cows and bulls from Northwest dairy farms and cattle ranches throughout the Intermountain West. The plant also will include hide and rendering processing and have the ability to process niche-fed beef programs. Chairman Scott Simplot said the new plant will be the first significant processing operation in the region, reducing the need for dairy farmers and ranchers to ship cattle out of the area for processing. It’s estimated that there are

Carpenter notes that NAMI will lead a unified effort to confront the challenges the industry faces. “This includes a strong voice with our regulators at USDA, FDA and others as well as hands on assistance at the plant level, where our staff can guide members on inspection rules and regulations and other issues that might arise,” he says. More specifically, he reveals, members will benefit from: •A combined website, meatinstitute.org, which features important regulatory, scientific, legislative, international trade, communic ations and other materials of importance to members; • Scientific research and expertise through the NAMI Foundation; • Crisis communications support before, during and after an event; • The “Lean Trimmings” newsletter with weekly industry news and updates; and • Expanded education and networking opportunities throughout the year.

more than 600,000 dairy cows and more than 600,000 beef cows in the region. “This effort complements the area’s dairy industry, including milk, cheese and yogurt processors,” Simplot said. “Our company has farmed and ranched in the area for nearly a century and we’re excited to be a part of this joint venture that will further guarantee the long-term success of the region’s dairy and beef industries.” Caviness CEO Terry Caviness said Simplot and Caviness are both family-owned companies that complement each other. “Together we will bring significant strengths and expertise to this project,” Caviness said. “We look forward to being a valued partner to area ranchers and dairymen as we expand our footprint in the United States with another worldclass beef packing facility.” The new plant will take advantage of advances in food safety and process technologies to create a processing facility that incorporates the best available technologies to effectively process beef safely and humanely. The final product will be prepackaged boxed beef, not hamburger, that will primarily be marketed toward food service suppliers and retail outlets. “We are excited to bring a new advanced plant to the area. This plant is ideally suited to meet the increasing demand for processing from the dairy and beef cow industry,” said Tom Basabe, president of Simplot Land and Livestock. “Caviness Beef has a long history in beef processing. Caviness is the perfect partner to join Simplot in this joint venture.”

IDDBA’s ‘What’s In Store 2015’: Online Grocery Shopping, Delivery Options on the Rise According to Nielsen and Booz and Co., online grocers are projected to account for 11 percent of food purchases by 2025, a trend that illustrates the continued emergence of online and mobile channels where consumers can shop and schedule pick-up or delivery of their orders right from their internet-connected devices. This and dozens of other consumer and food industry trends in supermarket fresh departments are detailed in “What’s in Store 2015,” the 29th edition of the annual trends publication of the Madison, Wisconsin-based International Dairy-Deli-Bakery Association (IDDBA). It’s composed of six comprehensive chapters: State of the Industry, Consumer Lifestyles, Bakery, Cheese, Dairy, and Deli. Among the findings reported: • The global online grocery market is projected to reach $100 billion by 2018, according to The Boston Consulting Group; • Of the top 75 U.S. grocery retailers, just more than onethird offer some type of e-grocery service, according to Bill Bishop of Brick Meets Click; • Click-and-collect and “drive” concepts, successfully implemented in European markets, is being tested by the grocery industry in the U.S. and Canada; • Two out of five online shoppers want to receive real-time offers on their smartphones while they shop, and one-third would like to use their smartphones as an in-store navigation tool to help them locate products, according to Planet Retail; and • Greater future use of augmented reality apps, where shoppers can use their smartphones to pinpoint exactly what they’re looking for or speak the name of a specific product in store and the app would show specifically where to find it, according to futurist Daniel Burrus. As reported in IDDBA’s latest research, “Engaging the Evolving Shopper: Serving the New American Appetite,” today’s shoppers live in an environment where the onceclear divisions between online and offline are increasingly blurred. From laptops to smartphones and beyond, shoppers

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have seamlessly integrated technology into their lives, fundamentally altering the way they engage with the world around them, including how and what they eat. “As our independent research and industry trends reveal, online shopping options are becoming an increasingly important channel as consumers look for quick and convenient ways to purchase their groceries,” said Mary Kay O’Connor, VP of education at IDDBA. “Many of today’s online shopping programs are much more intuitive than in the past, providing seamless experiences that make it easier for shoppers to move away from their entrenched ‘brick-and-mortar’ shopping habits.” The emerging online retail food channel provides new opportunities for stores to engage and connect with both current and prospective customers. “Retailers must realize that shoppers want to engage with them in store, online and through mobile devices,” said Tim O’Connor, VP of RetailNet Group. “Digital is the enabler for shoppers, not just a transaction portal.” “What’s in Store 2015” is a 224-page trends report that details consumer and industry trends affecting the in-store dairy case, cheese case, bakery, deli and food service departments. Its 200-plus tables, developed in cooperation with leading industry firms and associations, include department sales, per capita consumption, consumer preferences, system 2, UPC and private label sales data. The cost is $99 for IDDBA members and $399 for nonmembers, plus shipping and handling.

IDDBA expands mobile, online training with new free cake-decorating courses

In other news, IDDBA continues to expand its mobile and online training with the addition of seven new free cakedecorating courses at training.iddba.org. The new cake-decorating courses now available are Base Icing; Cake Toppers 1: Stems & Flowers; Cake Toppers 2: Pre-Made Decorations; Decorating Basics 1: Writing Practice; Decorating Basics 2: Lettering; Decorating Basics 3: Shells &

Borders; and Efficient Cake Production. The courses are the latest additions to training.iddba.org and its corresponding mobile site, a growing online training resource comprised of more than 65 short videos accessible through smartphones, tablets, laptops, desktop computers and other internet-connected devices, including some department scales. Available in both English- and Spanishlanguage formats, the free courses cover subjects such as food safety, customer service, cake, cheese, deli and bakery. Wisconsin-based IDDBA also offers a special corporate customized service for IDDBA that enables companies to readily centralize their service associates’ education training at training.iddba.org and instantly track their quiz scores and course completions. IDDBA online courses also are available on its YouTube channel. “Knowledge builds confidence, and our new cake-decorating courses are designed to give bakery department associates the resources they need to create appealing and captivating designs that catch customers’ attention and lead to more bakery department sales,” said Mary Kay O’Connor. “These engaging, free courses are designed to bring new associates quickly up-to-speed on cake decorating techniques, as well as serve as refreshers for more experienced bakery associates.”

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PERISHABLES

MARCH 2015 • The Shelby Report of the West

Dairy-Deli-Bakery

Sartori Rolls Out Citrus Ginger BellaVitano Cheese Artisan cheese maker Sartori Co. is launching Citrus Ginger BellaVitano. It will be available year round at specialty cheese shops across the U.S. beginning in February. Citrus Ginger BellaVitano is hand rubbed with a unique and exotic blend of spices, including ginger, onion, garlic, red bell pepper and citrus. The flavors work well with the slightly fruity, creamy, tangy notes of the BellaVitano cheese, according to Sartori. “When our internal sensory team first tried this cheese, there was a lot of positive feedback,” said Susan Merckx, Sartori’s marketing director. “Many enjoyed the punch from the ginger, the sweetness from the red bell pepper and the citrus finish. We are very excited to introduce this cheese.” Added CEO and owner Jim Sartori, “We’ve been working on this cheese for a couple of years now, and I couldn’t be more proud of the hard work and determination from our team members.”

WMMB Names Scott Director of Retail Programs The Wisconsin Milk Marketing Board (WMMB) has named Kirk Scott as its director of retail programs. He will manage and implement the organization’s retail cheese and dairy programs. Scott joins WMMB with nearly 25 years of experience in consumer insights, marketing and brand management, most recently serving as director of retail marketing at Grande Cheese Co. in Lomira, Wisconsin. He also has held roles in marketing and brand management at Kraft Foods, Rayovac, Careerbuilder.com and The Mark Travel Corp. “Kirk’s extensive experience building and marketing large, national brands will be a key asset to the growing success of our retail programs for Wisconsin cheese and dairy products across the country,” said Marty Pullin, SVP of channel management at WMMB, Madison, Wisconsin.

Nate’s Food’s to Triple Production With New California Facility Food manufacturer Nate’s Food Co. has broken ground on the development of a new facility that would increase production by some 10 million cans per year—from 5 million to 15 million cans annually. The facility is being built in Fairfield, California, in partnership with ABCO Labs. This plant will work in conjunction with the company’s current manufacturing facility located in Los Angeles in order to satisfy the company’s expected forecast. The new facility should become operational in the next 12 months. In the meantime, Nate’s Food is working with SouthCorp Capital to finalize the plans for its factory in Indiana, which are to be submitted for permits in the next 45-60 days, the company said Jan. 22. The factory in Indiana, which will be capable of producing up to 100 million cans per year, will handle the company’s expansion of its product line including: omelet, guacamole, cookie mix, brownie mix, cake mix, syrups and compound butters in addition to the flavor expansion. The Indiana factory should open its doors by 2017.

Brand name becomes Nate’s Homemade

Smári Yogurt Expands Line with Whole Milk Product, Peach and Coconut Flavors Smári yogurt recently added two new products: whole milk Smári in Pure and vanilla flavors, and non-fat peach and coconut flavors. Thicker than Greek yogurt and with less sugar than most yogurts on the market, Smári packs as much as 20g of protein, more protein per ounce than any other yogurts in the U.S., the Petaluma, California-based company says. Organic Smári is made exclusively from organic milk and fruit. Always local and never factory farmed,

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Smári’s Jersey and Guernsey cows live in Wisconsin and are pastured and fed grass, creating richer, thicker, more nutritious, better-tasting milk. Creamier, thick whole milk Smári comes in pure or vanilla, made with organic vanilla beans. Smári’s nonfat yogurt comes in Pure, strawberry, blueberry, vanilla and, now, peach and coconut flavors. Smári yogurt is available nationwide at Whole Foods, The Fresh Market, National Co+Op Grocers, Costco and other retailers.

In other news, Nate’s has changed its brand name from Nate’s Pancakes to Nate’s Homemade. With the addition of new products beyond the flagship pancake and waffle batter, Nate’s determined it was necessary to create an umbrella brand—Nate’s Homemade—to house the category extensions. As the company moves closer to its retail and consumer launch, the management team felt this was the appropriate time to make the transition. The company is updating its website, packaging and marketing materials to reflect the name change.

Superior Farms Names Eidman Director of Producer Resources and Sustainability Superior Farms has hired Lesa Eidman as director of producer resources and sustainability, a position recently created by the company. Superior Farms created the new position as part of its long-term strategic vision to partner with lamb producers, sheep industry associations and other industry stakeholders to strengthen and grow the American lamb industry. Eidman brings to the position extensive experience in the sheep industry, having served as the executive director of the California Wool Growers Association (CWGA) for the past 11 years. “Lesa’s experience, enthusiasm and energy are exactly what we are looking for to fill this important role at Superior Farms,” said Rick Stott, president and CEO of Davis, California-based Superior Farms. “Making an investment in our producer relationships is every bit as important as our investment in processing facilities and marketing. By working together, I see a great future for the American lamb industry.” Eidman’s primary focus will be to promote and facilitate information flow between Superior Farms and its producer community, as well as educational and government agencies. She will coordinate the company representation for local, regional and national sheep industry association groups and related industries. Additionally, she will work cooperatively with producers, packers and feeders to help improve the consistency of supply and the quality of lamb to ultimately enhance consumer demand.

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Ta nya D omi er

The Accidental CEO Left ‘Perfect Company’ for ‘Law of the Jungle’ Tanya Domier always aimed high, but never really set her sights on being a CEO. A U.S. Supreme Court justice, maybe. But CEO? No. As a student, she looked past law school, past practicing as a litigator to the place where she could make a difference and leave her mark. But first, she needed to work and save money for law school, so after being offered several opportunities following on-campus interviews at California State University at Chico, the political science major chose to work at Smucker’s. She didn’t just love working there. “I was in love with Smucker’s, the training programs at Smucker’s, the people at Smucker’s,” she says. “It was a perfect fit for me and I have so much respect for them and always did. They run a company that is vision- and values-based, and they don’t ever deviate from the vision and values. For me, that was very important.” Training at Smucker’s was intensive, delving into management, leadership and problem-solving with Kepner-Tregoe. Domier was impressed, but impressionable at the time as well. “I thought the whole world worked that way,” she says. She started out as a sales representative for Smucker’s and moved up to district sales manager covering a territory from San Diego to Santa Barbara. She paid her dues turning jars, making sure product was rotated and, more importantly, selling displays of juice and natural preserves. She

enjoyed the “psychology of getting people to buy and understanding through a sales territory what people wanted, what I needed to do to help them build their business,” she says. “It became very interesting and challenging for me.” Smucker’s offered her positions in Colorado and Chicago, but after four years with the company, she knew she had to make a change. She and her husband had decided early on that moving was a nonstarter for both of them. “Why did I leave Smucker’s, the company that I put up on a pedestal and thought was amazing?” she says. “Very simply, I had just gotten married. I have five brothers and sisters (Domier is first in the birth order). My husband (Dan) has five brothers and sisters. Nobody in our family has ever moved out of Southern California. My entire family, which is an immediate family of 53, lives within one hour of where I live.”

Dissatisfaction with the status quo a driver

Though she didn’t stay with Smucker’s long, she would carry the fundamentals afforded her there to the next company she chose to work for: Advantage Sales & Marketing. “Advantage was a very unsophisticated company at the time,” she says. “There were 50 people and $5 million in revenue. I like a more processdriven company than what Advantage was in 1991. It wasn’t a cultural fit for me. I had to make Advantage a cultural fit for me by making enough

of a difference and becoming a bigger part of it to have an influence on the culture.” When she went from, in her words, “a perfect company in a very idealistic world to the law of the jungle in the brokerage business,” she took her own moxie along as well. Domier was a Toastmaster and debater in college, and developed her modus operandi while there.

“I never grew up or even went through the business feeling like I needed to be number one in the organization.”

–Tanya Domier

“I was president of my sorority in college,” she says. “Trying to get 100 women to march in the same direction and align on what was important Please see page 50

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Tanya and Dan Domier with their three sons, Braden, Riley and Garrett.

in mission, vision and values was actually a very big part of shaping my leadership experience.” Her first position with Advantage was director of natural and specialty foods. Sonny King, founder and chairman of the board of directors, is her mentor today and has been from the start. “I would come in and he would say ‘Tanya, there are a couple of things that you’re going to need to learn: patience and wisdom. And guess what? None of those things are going to happen quickly.’ But he had infinite patience for my dissatisfaction with the status quo.” She never planned to stay with Advantage. She just wanted the work experience. Then she’d go start her own business. But every time she conquered something within the company and got bored, King would ask her what she wanted to do. He’d tell her to go make it happen. That is what kept her with the firm. “He allowed me to build businesses within this business at whatever rate I could build them and make a difference in the organization,” she says. “There was never a reason to leave because I was able to be enterpreneurial in an entrepreneurial environment with the most amazing leader and mentor who gave me the freedom and flexibility to do exciting and meaningful things with the business.” She ascended to CEO of Advantage, but says, “I never grew up or even went through the business feeling like I needed to be number one in the organization. The most gratifying thing about being number one in an organization is being able to shape the careers and chart the course for the future, so you can help shape the careers of young people.”

Please see page 52

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Congratulations Tanya! Woman Executive of the Year 2015

Congratulations to one of the most passionate leaders we have known on this well deserved honor. You inspire us with your commitment to â&#x20AC;&#x153;winning togetherâ&#x20AC;? for Advantage Sales and Marketing and its business partners, and we are proud to have the opportunity to support you.

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Family is a priority, and not just her family

Domier got her entrepreneurial spirit and work ethic from her parents. Her father always owned a business and her mother was a teacher and retired just two years ago. She talks to both of them multiple times a week.

“Tanya is truly a dedicated leader who lives her values every day.” –Sue Klug, Unified Grocers

“I learned a lot about business and how to make things happen and timing and how to win through my dad,” she says. “Both of my parents think I hung the moon, so a big driver for me is that I always

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MARCH 2015 • The Shelby Report of the West

want to make them proud—still, at 49 years old. A very, very big driver for me is that they’ve done such a great job and made so many sacrifices for me—and they raised five kids.” She keeps her involvement outside work to a minimum because as a CEO, wife and mother of teenagers, she only has time for the “things I have the biggest responsibilities to: my husband, my three boys and this company. I have 38,000 people who, when I put my head on the pillow each night, I think about. Those families are depending on us.” She is a member of the Network of Executive Women and very involved in her church and its various missions, including Catholic education tuition assistance. Those are her passions, she says. She also squeezes in five-mile runs with friends on Saturdays and Sundays. “Tanya is a truly dedicated leader who lives her values every day,” says Sue Klug, EVP and CMO at Unified Grocers. “I have tremendous respect for the consistent leadership she has demonstrated throughout her career. She deeply values her friends and family, while giving 110 percent to her ‘work family’ at Advantage. She has been a trailblazer and role model to many women in our industry. Tanya’s success is directly related to her strong values, hard work and amazing business acumen. I am honored to call her my friend.”

Leadership styles and emperors with no clothes

Domier has developed her own style as CEO. She describes herself as “scattered” and keeps everything in her head, which she admits is “a dangerous thing.” “I don’t make lists. I am a multi-tasker; I do seven things at one time,” Domier says. “I have a fantastic assistant who keeps me on schedule.” She also is a servant leader who empowers her staff to challenge her. “I have an agreement with my own team that, when I’m off task, they’ll say ‘I need you to just be here in the moment with me for a minute,’” she says. “I go very fast through a decision-making process and get to where I think, and sometimes I need to be challenged on that. My team has complete permission. “I am a big believer that any organization, when you have the situation where the emperor has no clothes, it’s very dangerous, and I like to surround myself with a team that will challenge me, say what they think and never go with the program just because somebody said so,” she says. “As long as they approach that with the right spirit of the business and for the good of the business, I am all ears. That’s important to me.”

Domier trusts the presidents of sales and marketing, and if they tell her she would add value to a meeting with a client, she goes. “We see the customer as a very important client,” she says. “Our business is with both brands

“I like to surround myself with a team that will challenge me, say what they think and never go with the program just because somebody said so.”

–Tanya Domier

Please see page 54

Congratulations to Tanya Domier on being named

2015 Woman ExEcutivE of thE YEar In recognition of her many achievements, close partnerships and inspiring leadership

Apax Partners is one of the world’s leading private equity investment groups with more than 30 years of investing in consumer businesses. For further information, please visit www.apax.com.

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From page 53

and retailers. Our job at the end of the day is to turn shoppers into buyers, and that includes everybody.” The advice she offers for women in the industry applies to every stripe of worker. “Work hard, add value, go as far as fast as you can,” she says. “Work so hard and make so much of a difference in your organization that people will listen to you because they really want you in the business and respect and care about what you think. Earn your way to be able to speak and share, and don’t just come with issues. Come with solutions and then be willing to be a person who will be point and take on those initiatives.”

Reading for business is a pleasure

Domier is an avid reader. Her favorite book is Daniel Goleman’s “Emotional Intelligence.” She believes everybody has the base skills of intellectual agility and technological competency once they reach a certain level. Leadership goes well beyond that. “It’s really what kind of leader are you, how can you inspire people, how self-aware are you and

“Tanya is a multidimensional leader with high intellect, high energy and very focused on results. She has risen to the pinnacle of her profession while maintaining a good balance in her family and personal life. She is very deserving of this recognition.”

–Sonny King, Advantage Sales & Marketing

how well are you able to craft a vision and get people to really want to tackle that vision to build the business,” she said. “Those are the things that are really important, so those are the things that I like to read about and think about.” She also loves to pore over the Harvard Business Review looking for snippets to use and pass on and enjoys reading about various leaders and the psychology of winning.

“I like to take a little bit of the best of what everybody offers and then sift through how that might help me bring value to the organization,” she says. “Tanya is a multidimensional leader with high intellect, high energy and very focused on results,” King said. “She has risen to the pinnacle of her profession while maintaining a good balance in her family and personal life. She is very deserving of this recognition.”

Tanya Domier was a panelist discussing “Personal Branding—Defining Your Personal and Professional Leadership Presence” at the Network of Executive Women (NEW) Southern California Fall Event last October. Pictured are Kitty Dunning-Boozari, NEW Southern California co-chair; Sue Klug, EVP/CMO, Unified Grocers; Donna Giordano, president, Ralphs Grocery Co.; Rob McDougall, president and CEO, Gelson’s Markets; Domier; Valerie Oswalt, VP-West area sales, Mondelez International; Cynthia Weifenbach, NEW co-chair.

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Honoring Tanya Domier

“2015 Woman Executive of the Year”

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MARCH 2015

Sales of Local Foods Reach $12 Billion Like organic products before them, locally produced foods are stepping out of the shadow of their once “quirky niche” designation to claim a much more prominent—and permanent—place in the U.S. food and beverage retail-scape. Market research publisher Packaged Facts estimates that local foods generated $12 billion in sales in 2014, accounting for 2 percent of total U.S. retail sales of foods and beverages. Looking ahead, Packaged Facts anticipates that, over the next five years, local foods will grow faster than the annual pace of total food and beverage sales to approach $20 billion in 2019. The findings were published in the recently released report, “Shopping for Local Foods in the U.S.” “We’ve reached a tipping point for local foods. Over the past 10 years, there has been a surge in consumer demand for locally produced foods, along with widening availability,” said David Sprinkle, Packaged Facts’ research director. “And it’s not just farmers’ markets or natural food retailers lending credence to this trend. An increasing number of larger grocers are carrying and promoting local products. Even Walmart has been promoting local farmers in its bid to tailor its store selections more toward local communities.” A proprietary Packaged Facts national consumer survey conducted in November among U.S. adults found that 53 percent of respondents specially seek out locally grown or locally produced foods, with 19 percent “strongly” agreeing and 34 percent “somewhat” agreeing. Even more interestingly, nearly half of the respondents agree they are willing to pay up to 10 percent more for locally grown or produced foods, and nearly one in three say they are willing to pay up to 25 percent more. A third of consumers also claim to consciously purchase locally grown or locally produced foods at least once a week. Among the primary reasons for purchasing locally grown or locally produced foods, the majority of consumers claim they do so because the products are fresher. In addition, more than half of consumers say they buy local products to support local businesses, and more than 40 percent of consumers say the products taste better. In addition, roughly a third believes that local products are healthier, and that they like to know where their food is coming from.

Registration for NCA’s 2015 Sweets & Snacks Expo Now Open Registration is open for the 2015 Sweets & Snacks Expo, to be held May 19-21 at Chicago’s McCormick Place. Sponsored by the National Confectioners Association (NCA), the expo is anticipated to be the most successful in the event’s 18-year history, with an already-sold-out show floor and exhibitors on a waiting list. The 2014 expo set an all-time record in volume of confectionery and snack products with more than 650 companies and increased exhibitor participation for five straight years with more than 3.5 acres of products. In 2015, the show floor square footage has expanded to accommodate more new exhibitors with plans to welcome more than 16,000 industry professionals. “Each year, the show continues to thrive and break standing records while reaching new milestones,” said Tim Quinn, expo chairman and VP of trade development for Mars Chocolate North America. “More specifically, the Most Innovative New Product Awards program has proven its value and popularity by recognizing candy and snack makers for their imaginative ideas, concepts and products. We have a grand celebration in store this year with an awards ceremony highlighted by a champagne toast happening right on the show floor at the close of the opening day. In addition this year, taste panelists will assist in presenting the awards to the innovation winners. It’s one of our most esteemed programs, demonstrating

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double-digit growth for the past three years and we wanted to ensure the winners and nominees receive show-wide recognition and accolades.” Added John H. Downs Jr., president and CEO of NCA, “The global market is growing at a fast rate in a $428 billion candy and snack industry worldwide, and it is essential that the expo provides access to more product categories from more international companies. Last year the show experienced doubledigit growth in international participation, making the expo a one-stop shop for candy and snack buyers from around the world.” Nearly 100 international companies from more than 20 countries are expected to exhibit at this year’s expo. “We asked, listened and delivered,” said Quinn of the expo’s retooled education offerings. “After extensive surveys and personal outreach this past year, we discovered that our attendees needed to gain more insights beyond the show floor, which is why we are offering the expo’s ‘Knowledge Series’ for the first time.” Also new in 2015 will be the expo’s Specialty New Product Showcase, located within the New Product Showcase, offering manufacturers a distinct location to exhibit their new organic, premium or gourmet candy and snack items in one place.

MOM Brands Selling to Post Holdings MOM Brands has agreed to be purchased by Post Holdings Inc. in a transaction valued at approximately $1.15 billion. MOM Brands is a leader in the value segment of branded ready-to-eat and natural cereals, hot wheat and oatmeal. The Minneapolis-based company’s brands include Malt-O-Meal brand ready-to-eat cereals, such as Frosted Mini Spooners, Golden Puffs, Cinnamon Toasters, Fruity Dyno-Bites, Cocoa Dyno-Bites and Berry Colossal Crunch as well as a variety of natural ready-to-eat and hot cereals, including MOM’s Best, Better Oats, Three Sisters and its original, farina-based MaltO-Meal cereal. Upon closing, MOM Brands Chairman and CEO Chris Neugent will continue to lead the MOM Brands business as president, reporting to Richard K. Koulouris, who is joining Post Holdings Feb. 9 to lead the combined Post Foods and MOM Brands cereal business. “By joining forces with Post, we will have more resources available to innovate, extend our brands and expand distribution,” Neugent said. “We believe that this new, combined enterprise will be uniquely positioned to help our customers find new solutions in the highly competitive cereal category. In addition, it will give us the opportunity to pursue our mission of saving families money on an even greater scale.” The transaction, which is subject to customary closing conditions, including regulatory approval, is expected to close by the third quarter of 2015.

Post reintroduces Strawberry Honeycomb Cereal

For the first time in nearly a decade, Post Foods is bringing Strawberry Honeycomb cereal back to the breakfast table. First introduced in 1983, Strawberry Honeycomb became an instant hit. “Honeycomb’s one-of-a-kind playful shape has made the cereal an instantly recognizable breakfast classic. We’re excited to bring Strawberry Honeycomb back to the market—not only will it be a blast from the past for our current Honeycomb fans, but it will help introduce the brand to a whole new generation of cereal lovers,” said Sue Fruzzetti-Reich, senior brand manager at Post Foods. The new Strawberry Honeycomb combines corn and oat hexagonal shapes coated with strawberry flavor.

Alkame enters Nevada

The cereal contains 8g of whole grain per serving, 10 essential vitamins and minerals, and is an excellent source of iron and vitamin D. Strawberry Honeycomb is available at select grocery stores nationwide.

Five new Weight Watchers cereals roll out In other MOM Brands news, it worked with Weight Watchers last fall to help roll out ready-to-eat cereals featuring the Weight Watchers brand. The cereals were introduced at select retailers in October and, starting in January, are available nationwide. MOM Brands, is licensed to manufacture and distribute the brand. The new Weight Watchers cereal lineup includes: • Weight Watchers Oat Clusters With Almonds highlights sweetened flakes of corn and wheat, with added granola clusters made with steel cut oats and sliced almonds. The 120-calorie cereal includes 8g of whole grains per serving (PointsPlus value of 3 per serving). • Weight Watchers Whole Grain Honey Nut Toasted Oats cereal is made with real honey and provides 13 essential vitamins and minerals. Low in fat and 120 calories per serving, it provides 18g of whole grains (PointsPlus value of 3 per serving).

• Weight Watchers Frosted Shredded Wheat With Protein features 12 layers of sweetened whole grain wheat. A good source of protein and fiber, it offers 6g of protein, 5g of fiber, 40g of whole grains and 210 calories per serving (PointsPlus value of 5 per serving). • Weight Watchers Oat Clusters With Cherries and Almonds starts with sweetened flakes of corn and wheat with added whole grain oat granola clusters, sliced almonds and real cherries. It provides eight essential vitamins and minerals and has 120 calories per serving (PointsPlus value of 3 per serving). • Weight Watchers Chocolate Frosted Shredded Wheat features 12-layer biscuits that boast 38g of whole grains and provide an excellent source of fiber, with 5g per serving. Made with real chocolate morsels, the 210-calorie cereal also delivers on flavor, providing a chocolaty taste (PointsPlus value of 5 per serving). “When it comes to food purchasing decisions, taste and health are high on consumers’ grocery lists,” said Dorothy Johnson, Weight Watchers brand manager at MOM Brands. “We are excited to give consumers new cereals that they can enjoy eating and will help them lead healthier lifestyles without sacrificing taste and convenience.”

Clear Lam Wins Award for Fisher Peanuts Package The PrimaPak Packaging developed by Clear Lam Packaging for Fisher Party Peanuts is a WorldStar 2015 Packaging Award winner in the food category, an honor bestowed by the World Packaging Organization (WPO). WorldStar award winners will be formally recognized at a reception in Milan, Italy, on May 19. Companies from 37 countries entered 264 packaging projects in the international competition. The judging session took place late last year at the WPO’s board meeting in

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Colombo, Sri Lanka. This is the third win for the PrimaPak package in a global awards category. The PrimaPak package is the industry’s first-of-its-kind flexible, stackable and reclosable package produced from rollstock on a custom vertical form-fill-seal (VFFS) machine. Lightweight and stackable, the packaging is designed to replace bulky rigid jars, blow-molded containers, injectionmolded packages, composite cans and select stand-up pouches. The finished package resembles a “pop-up” box. This innovative technology boosts cube utilization by 30 percent or more compared to traditional containers, taking up less warehouse space and reducing transportation demands. This translates into truckload and warehouse space savings, reducing fuel costs and greenhouse gas emissions, according to Clear Lam. “Leading food processors like Fisher Nuts are looking to the latest innovations to support their sustainability goals and drive costs out of the manufacturing process,” said Roman Forowycz, CMO for Clear Lam Packaging. “We’re proud to be among the WorldStar award winners from the U.S., and we’d like to thank the judges for recognizing Clear Lam with this honor. Our company has made a significant investment in the PrimaPak System, including a new co-packing facility and innovation center near Chicago, providing our customers with an end-to-end packaging solution.” The new co-packing facility meets growing demand for the PrimaPak System. The facility will produce PrimaPak packaging for test markets, regional rollouts, seasonal items and nationally distributed products. According to research firm Smithers Pira, the global market for sustainable packaging is expected to reach $244 billion by 2018.

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MARCH 2015 • The Shelby Report of the West

Center Store Campbell Among Most Sustainable Corporations in the World Camden, New Jersey-based Campbell Soup Co. has been named to the Global 100 Most Sustainable Corporations in the World list by Corporate Knights, a media, research and financial products company, for the third year in a row. Campbell is one of 20 U.S. companies included in the Global 100. The Global 100 drew companies from 22 countries on five continents, and inclusion in the top 100 puts Campbell in the top 2.2 percent of the 4,609 companies evaluated. “Campbell’s corporate responsibility and sustainability strategies are integrated into every aspect of our business and culture,” said Dave Stangis, Campbell’s VP of public affairs and corporate responsibility. “Having our performance and disclosure recognized by the Global 100 for a third consecutive year is evidence that Campbell employees continue to make progress in our commitment to being good stewards, as well as advancing our performance.” Corporate Knights ranks the Global 100 against 12 quantitative key performance indicators that run the gamut from energy and water use, to employee compensation and corporate tax strategy as well as sector-specific key performance indicators related to efficient use of energy and water, waste metrics and workplace safety. Over the past four years, Campbell’s capital investments in energy and water conservation have yielded a cumulative savings of more than $60 million. Additional environmental stewardship achievements include saving more than one billion gallons of water annually since 2009, a cumulative savings of more than five billion gallons; saving approximately one million fewer mmbtus of energy each year, a cumulative savings of more than 410,000 metric tonnes of carbon dioxide; reducing greenhouse gas emissions by 13.3 percent

per tonne of food produced over four years; initiating projects to extend renewable energy use from a few kilowatts to more than 12 megawatts; and saving more than 4.2 million pounds of packaging through light-weighting and package redesign in fiscal 2013. Campbell’s corporate responsibility and sustainability strategies are designed to deliver measurable impacts in four key areas the company refers to as “Our Consumers, Our Planet, Our Employees and Our Community.”

Gillette Adds Venus Swirl Gillette Venus introduces the new Venus Swirl razor for women, featuring Flexiball technology for multidimensional movement around difficult shaving areas. More than five years of research and testing on more than 7,000 legs went into the development of Venus Swirl. Traditional razors that move only two ways, but Venus Swirl moves in multiple directions for better coverage of tricky areas. “For over 14 years, Venus has continued to innovate to bring women the next-generation shaving experience,” said Brenda Bynarowicz, North America marketing director for Shave Care at Procter & Gamble, the brand’s parent company. “Women want a smooth, effortless shave that takes the ‘leg work’ out of hair removal. To answer their needs, we developed the Venus Swirl razor and Venus Shave Gel Violet Swirl with Touch of Olay to transform the shaving experience.” Available beginning in January, SRP for the Venus Swirl shaving system is $12.59; SRP for the new shave gel is $2.99.

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Beverages

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Anheuser-Busch to Buy Seattle’s Elysian Brewing Anheuser-Busch has agreed to purchase Seattle-based Elysian Brewing Co., which brews award-winning beers including Immortal IPA. “For two decades, we’ve welcomed guests into our brewpubs and served them creative and impeccably crafted beers,” said Joe Bisacca, Elysian CEO and co-founder, who will remain with Elysian along with his partners, Dick Cantwell and David Buhler. “After a lot of hard work, we’ve grown from one Seattle brewpub to four pub locations and a production brewery. With the support of Anheuser-Busch, we will build on past successes and share our beers with more beer lovers moving forward.” Cantwell, co-founder and head brewer at Elysian, added, “Throughout our journey, we’ve been focused on brewing a portfolio of both classic and groundbreaking beers and supporting innovation and camaraderie in the beer industry through collaboration and experimentation. By joining with Anheuser-Busch, we’ll be able to take the next steps to bring that energy and commitment to a larger audience.” Elysian sold more than 50,000 barrels of beer in 2014, with Immortal IPA accounting for more than a quarter of the company’s total volume. “Elysian’s story includes everything we look for in a partner,” said Andy Goeler, CEO of craft at Anheuser-Busch. “The team has spent their careers brewing distinctive beers in the thriving West Coast beer community and building unique venues that celebrate beer. As the fastest growing brewer in Washington, their recipe is working. Elysian’s brands are an important addition to our high-end beer portfolio, and we look forward to working together.” In addition to the Seattle Airport Way brewery, the acquisition includes the company’s four Seattle brewpubs, Elysian Capitol Hill, Elysian Tangletown, Elysian Fields and Elysian BAR. Anheuser-Busch’s purchase of Elysian is expected to close by the end of the first quarter of 2015. Terms of the agreement were not disclosed.

Anheuser-Busch’s purchase of Elysian Brewing includes four pubs.

Alkame Water Expands Distribution to Nevada Alkame Water Inc. has inked a deal with West Coast Beverage (WCB). The Las Vegas-based independent direct store delivery (DSD) distributor will act as the exclusive distributor for all current and future Alkame Water products in Nevada. Robert K. Eakle, CEO of Alkame, said, “We are very pleased to be working with the West Coast Beverage team and look forward to a long-term successful relationship. An important element of positioning Alkame Water to meet the needs of health-conscious consumers focused on nutrition, weight loss, energy, anti-aging and other health related issues is having broad and diverse distribution. West Coast Beverages has great reach throughout the state of Nevada, as well as the ability to fulfill products quickly and efficiently. This agreement makes it easier for us to quickly generate brand awareness and sales in Las Vegas and throughout the state of Nevada.” WCB owner Tommy Branch said, “After having been involved in the industry for over a decade, and having previously worked with several other alkaline brands, I’m extremely excited to be working with Alkame now with their superior product.” Alkame’s micro-clustered, fluoride free, alkaline, antioxidant and oxygenated bottled water is available at select retailers and online in 16-9 oz., 20-oz., 33.8-oz., 1-gallon and 1-gallon kids/nursery sizes, utilizing BPA-free and 100 percent recyclable eco-friendly plastics. In 2014, Alkame Kids was launched; it’s a fluoride-free kid’s drinking water that has the benefits of an electrolyte enhanced water but without the sugar, calories and flavorings of most sports drinks. A 1.5-liter bottle of Alkame Water is planned to launch in 2015. Alkame uses a patented technology that creates water the body can absorb and utilize more efficiently and help achieve an optimal pH balance. The technology also increases the available oxygen content and absorbability, which equates to more fuel for improved metabolic efficiency, boosted immune system and improved cardio respiratory function, the company says. In 2014, Alkame secured its first distributor, Avanzar, and has since established partnerships with UNFI, Nature’s Best, River Valley/Cavallero, Natural Wayz, Charm

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City and Senuca in addition to WCB. Alkame also recently entered the aquaculture industry with the acquisition of privately held High Country Shrimp; it also is in the process of closing the acquisition of another aquaculture company, Xtreme Technology. “We are proud to say that, for a fairly new public company that has only been around for a short period of time, we have accomplished a lot that should benefit our shareholders going forward,” Eakle said. “We will continue our efforts and long-term goals of becoming a truly diversified holding company in an array of water industries offering multiple potential revenue streams. We have quickly gone from being just a one-product company into a diversified holding company with many attractive assets. We are all very enthusiastic about our future and appreciate all the shareholder and customer support.”

Wines from Baja California Now Available in the U.S. Volubilis Imports Inc., an importer of premium wines from around the world, plans to distribute a prime selection of wines from Baja California’s Guadalupe Valley (Mexico) to restaurants and wine shops throughout the U.S. Chosen from labels produced by more than 100 wineries in the Guadalupe Valley, the current 25 labels represent a wide spectrum of the wines grown in this region and are now in storage in San Diego and ready to ship. “After witnessing the rapid evolution of this wine valley and the quality of wines now available, we decided that the Mexican wine production has reached a level of maturity and volume that we cannot ignore,” said Youssef Benjelloun, founder and CEO of Volubilis Imports Inc., La Jolla, California. “We are uniquely positioned, after 24 years in the wine business, to reach the Mexican consumers within the U.S. to provide them with a taste of the most sophisticated wines from their homeland.” With distributors in 30 states throughout the U.S., Benjelloun believes that the demand for premium wines from Baja California by wine lovers of all ethnicities, and especially Mexican restaurants and bars, will justify the investment required to enter this market. An exclusivity contract is now in place, after more than a year of discussions, and the wines are now available, representing the first comprehensive selection of Mexican wines available to wholesale clients in the U.S.

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MARCH 2015 • The Shelby Report of the West

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Noted Actor Steve Schirripa Remembers His Mom’s Love for Cooking as He Helps Grow His Italian Specialty Business by Mike Berger/senior editor, The Griffin Report There’s a saying, “Don’t give up the day job.” Actor Steve Schirripa doesn’t have to worry about that. Schirripa is enjoying his profession—acting and writing—as well as helping grow and market Uncle Steve’s Italian Specialties on Staten Island, New York. The products now are springing up in retail and special shops across the country. Best known for his role of Bobby “Bacala” Baccalieri on “The Sopranos,” Schirripa has gone on to become author of the New York Times bestseller, “A Goomba’s Guide to Life.” This comical book includes chapters on growing up in Brooklyn, Great Goombas in History, Goomba Recipes and Goomba’s Do’s and Don’ts. His second book, “The Goomba’s Book of Love” and his third, “The Goomba Diet For Those With An Appetite For Life,” are still in bookstores. After “The Sopranos” ended, Schirripa was cast in the ABC Family series, “The Secret Life of the American Teenager,” where he played a hard-working single father of a teenage boy. He also is host of Investigation Discovery’s “Karma’s A B*tch,” of which he also is co-creator and executive producer. In 2007, Schirripa had a popular TV program called “Steve Schirripa’s Hungry,” where he visited New York City’s restaurants and the homes of various guests, such as an Italian grandmother’s home, where he was treated to a cooking lesson. Growing up in Brooklyn, Sunday morning Uncle Steve’s Italian Specialties has been in was when you would wake up to the business for more than six aroma of tomatoes, garlic and olive months, since June 2014, and oil simmering on Mom’s stove as she the company’s Italian sauces and products are in 11,000 prepared the sauce for Sunday’s dinner. stores and climbing. My fondest memories are from those Some of the stores carrydays, my Italian heritage and the comfort ing Schirripa’s line of Italian sauces and products are of family. Whole Foods Market, Stop – Steve Schirripa & Shop, ShopRite and, most

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recently, Roche Bros. and Dave’s Marketplace in Rhode Island. The idea of the company started when Schirripa’s mother passed away in July 2013. ‘“I wanted to do something to commemorate her great cooking. It’s done quite well and it’s a lot of fun for me,” Schirripa says. “Growing up in Brooklyn, Sunday morning was when you would wake up to the aroma of tomatoes, garlic and olive oil simmering on Mom’s stove as she prepared the sauce for Sunday’s dinner. My fondest memories are from those days—my Italian heritage and the comfort of family,” he said. He credits the business’s success to Joe Scarpinito, the company’s CEO. “My job is to get out the message and demonstrate it. Joe works with brokers and distributors,” said Schirripa. “I feel we have the best sauce around—all gluten free, organic, non-GMO,” he added. “Everyone who tastes it loves it. Mom made the greatest pasta sauce, I feel, in the business.” The name of the company, Uncle Steve’s Italian Specialties, was started as a joke, to get his name under his picture. But he is quick to point out he is not doing this as a novelty; he is very serious about his business. “My sauce is all fresh ingredients. What you see is what you get, no added sugar. We tweaked the sauce till we got what we wanted. In fact, that was the most difficult thing so far, getting the sauce to where we wanted it. We threw away 10,000 jars of sauce until we got what we wanted. “My sauce may be a bit more expensive than the $1.50 jars,” he continued. “But you get what you pay for.” His sauces include Uncle Steve’s Marinara Sauce, Tomato Basil Sauce and Arrabbiata Sauce. “I am not a chef. But I love to eat, and I know what tastes good. All I want is for customers to try our product. I promise you will like it. I really believe in these products,” said Schirripa.

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Announcing the USC FIM Program Class of 2015 In its 57th year, the Food Industry Management program (FIM) at the USC Marshall School of Business, in association with the Western Association of Food Chains Inc. (WAFC), has brought together faculty, industry participants and teaching materials in a unique educational environment. The program runs 16 weeks—Jan. 9 through April 29, 2015. “The program at USC is designed specifically for the industry’s high-potential executives who have expertise in one or two areas of the business but need a bit more exposure to other disciplines. They are effectively being groomed as future leaders for their respective companies,” according to Cynthia McCloud, director of USC Marshall Food Industry Programs. “Our goal is to expose them to new and innovative ideas so they become stronger, more balanced contributors. Our motto is ‘You pick them. We polish them.’ These students leave the program as thought-leaders with more confidence, new techniques and the most current tools to address current business needs and identify future opportunities. They will

challenge their organizations to think differently and take risks to compete in an industry that is changing faster than we can imagine.” This year’s participants of the 2015 FIM program are handpicked by their employers to attend this career-building and often life-changing program. The ideal candidates are senior-level managers from food retailing, wholesaling or manufacturing companies, or from companies that support the food industry. Tuition is funded by WAFC, a non-profit organization composed of the senior executives from food retail and wholesale companies that account for sales exceeding $140 billion annually in 14 western states. Since 1959, the WAFC, with the generous donations of supplier companies and individuals, has supported the Food Industry Management Program with scholarships in excess of $23 million. More than 1,700 students have qualified, persevered and graduated.

2015 FIM Participants

Luis Aceves Category Director, Northgate Gonzales Markets, Anaheim, California

Marco Arzola

Bethany Blankmeyer

Director of Construction Floral and Garden and Facilities, Merchandising Northgate Specialist, Gonzales Markets, Smith’s Food and Drug, Anaheim, California Salt Lake City, Utah

Julia Buchanan

Liz Casula

Valerio Chiarotti

Danny Ciotti

Vincent Clougherty

Wendy Coldesina

Senior Marketing Manager, Niagara Bottling, Ontario, California

Category and Shopper Development Manager, Nestlé USA, Glendale, California

Founder and CEO, TerraVino, Pasadena, California

Store Manager, Fry’s Food Stores, Apache Junction, Arizona

Senior Account Executive, Farmer John, Vernon, California

Buyer, Costco Wholesale, Garden Grove, California

Sal Costanza

Nathan Doerschuk

Brooke Falvey

Gus Garcia

Senior Manager of Dry Procurement, Save Mart Supermarkets, Roseville, California

Sales Development Manager, Niagara Bottling, Ontario, California

Trade Efficiency Analyst, Mondelez International, San Ramon, California

Warehouse Operations Manager, Smart & Final, Commerce, California

Tom Meuser Senior Portfolio Manager-Accelerated Channel, Bimbo Bakeries USA, Sacramento, California

Chelsea Harrison

Store Director, Store Manager, Brookshire Grocery Co., Ralphs Grocery Store, Pittsburg, Texas San Clemente, California

Leah Hill

Andy Hotchkiss

Account Executive, The Coca-Cola Co., Los Angeles

Association Region Sales Manager, Unilever, Los Angeles

Bob Iacono

Mike Johnson

Aaron Jones

Karen Korytowski

Nancy Lebold

Reed McClung

Madeline McNeil

District Manager, Supervalu/Cub Foods, Stillwater, Minnesota

Food Supervisor CRO/ Drug-GM Coordinator, Fred Meyer, Lynwood, Washington

Buyer, Lazy Acres Non-Perishable, Lazy Acres/ Bristol Farms, Carson, California

General Manager-Lean Operations, Smart & Final, Commerce, California

VP-Procurement, WinCo Foods LLC, Boise, Idaho

Custom Category Manager, Kraft Foods, San Ramon, California

Merchandiser, MCW Supermarkets Ltd., Wellington, New Zealand

Nick Novak

Skyler Oswald

Jessica Rios

Nicholas Schott

John Shipp

Stacie Traficante

Levi Wingo

Bryan Zyrowski

Marketing Manager, Food 4 Less, Compton, California

Assistant General Manager, Costco Wholesale, Chino Hills, California

Store Team Leader, Raley’s, Fair Oaks, California

Frozen/Dairy Manager, Ben’s Supercenter, Brown City, Michigan

Assistant Store Director, Sales and Merchandise Metropolitan Market, Assistant, Seattle, Washington Broulim’s Supermarket, Rigby, Idaho

“USC’s Food Industry Management Class represents the future of our industry. These amazing students gather together to tackle the tough issues that are facing grocery retailers today and provide insightful solutions. In addition, each member of the FIM class learns about his or her own personal style and how to build their leadership skills to become more effective. This impactful 16-week curriculum shapes the careers of high-potential students and sends them back to their organizations with skills that they can leverage for many years to come. The WAFC is proud to support USC’s FIM class as they advance page_60-61.indd 60

Lane Garland

Customer Management VP of Sales-West, Associate Account Cytosport Inc., a division Manager-Retail, of Hormel, Pepsi Beverages Co, Benicia, California Aliso Viejo, California

our industry through leadership and education. ‘Fight On!’” said Sue Klug, EVP and CMO at Unified Grocers and president of the WAFC.

Taught by world-class faculty from the USC Marshall School of Business along with well-known executives from the food industry, this prestigious program educates leaders of the food industry. In addition to texts, lectures and discussions, teaching methods include team projects, role-plays, group presentations and materials developed specifically for the food industry, including special case studies. The

curriculum integrates the functional areas of business with cutting-edge theory and practical application to help students understand how all pieces of an organization fit together. Participants leave with strong leadership and management skills, enhanced business acumen and a solid understanding of communications, marketing, finance, strategy and more.For more information, contact Cynthia McCloud, program director, at cmccloud@ marshall.usc.edu or (714) 815-0000; website is marshall.usc.edu/fim.

2015 USC FIM Class Profile: • 30 companies (with five companies sending two students) • Eight states: Arizona, California, Idaho, Michigan, Minnesota, Texas, Utah and Washington • Two international students—New Zealand and Italy • Average age: 37 • Age range: 20-55 • 64 percent male; 36 percent female • 64 percent retailer; 36 percent suppliers • 45 percent Millennial • 45 percent Gen X • 10 percent Baby Boomers • Education: a mix of degrees are represented— masters, bachelor’s, associate and transfers

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Associated Food Stores Launches Platform to Provide Online, Mobile Shopping Opportunities Salt Lake City-based Associated Food Stores (AFS) is making grocery shopping more convenient through a partnership with software company Rosie, which will provide online/mobile shopping opportunities to retailers. The new platform will enable participating AFS corporate and member stores to reach new customers while providing consumer behavior analytics, data analysis and new marketing opportunities. Saveway Market in Salmon, Idaho, is the first AFS member retailer to launch the service. The new program called Saveway Swift launched Feb. 2 with in-store pickup. A delivery option was to be added soon. Several other member retailers will launch Rosie during the next month, including Lee’s Marketplace in Logan, Utah, Winegars Supermarkets in Roy and Bountiful, Utah, and Clark’s Market in Snowmass, Colorado. AFS expects more retailers to follow in the coming months. “We are delighted to team with Rosie to bring a new shopping experience to our guests,” said Neal Berube, president and CEO of AFS. “This alliance will transform the way people shop throughout the Intermountain West, how AFS operates and how independent retailers serve their guests.” The partnership with Rosie will provide a seamless online/mobile shopping experience by allowing guests to order their groceries online and pick up the order at their local grocer. Certain participating retailers also will provide a delivery option for online orders. The cloud-based software remembers consumer shopping habits, builds shopper-specific grocery lists from frequently purchased items and provides product recommendations based on individual shopping habits. Rosie is designed to work with all point-of-sale systems and does not require retailers to download software, allowing them to launch the new service quickly. Rosie’s services will help participating members of Associated Food Stores reach more busy moms, professionals and homebound guests. “Rosie provides best-in-class online/mobile shopping experiences for independent grocers and has transformed the way that local stores delight their customers every day,” said Nick Nickitas, Rosie’s CEO. “For the first time ever we’re putting Rosie’s renowned platform at AFS member and corporate stores. This is a radical step for online/mobile grocery shopping and something that only Rosie and AFS can deliver.”

Sprouts Recognized by Supply Chain Solutions Provider as Innovator of the Year iTradeNetwork, a provider of supply chain solutions for the food service and retail industries, has honored Sprouts Farmers Market with its Innovator of the Year Award for Supply Chain Technology. The Phoenix, Arizona-based grocer was recognized for its visionary contributions shaping the breakthrough new iTrade store order management solution, scheduled for general release later this year. The award was presented at iTradeNetwork’s recent annual customer conference in Las Vegas. Sprouts currently is live on the new solution and was a key contributor in helping shape a fully automated system with features that include order creation and confirmations, storeranked inventory allocation, item substitution management, order status updates and a robust reporting and analytics engine—all with full adherence to Sprouts’ business rules and processes. “For a company that’s growing as quickly as Sprouts Farmers Market is, it takes tremendous vision to step back and lay the technology groundwork to be fully prepared for their supply chain of the future,” said Joe

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Bergera, president of iTradeNetwork. “We’re very pleased to award Sprouts the Innovator of the Year Award for Supply Chain Technology.”

Kroger Lauded by EPA for Food Recovery Leadership The Kroger Co. has been recognized by the U.S. Environmental Protection Agency (EPA) for its leadership, innovation and education efforts to feed hungry people, protect the environment and save money through food recovery. A participant in the EPA’s Food Recovery Challenge, Cincinnati-based Kroger was named a winner in three categories: Leadership, Innovation as well as Education and Outreach.

While all of our associates play an essential role in our food recovery operation, our retail operations team in particular deserves credit for bringing that program to life in all of our stores. We remain committed to finding solutions to reduce food waste—because it is good for business, our communities and the environment. —Suzanne Lindsay-Walker, Kroger “Kroger is proud to be part of the EPA’s Food Recovery Challenge, and honored by this recognition,” said Suzanne Lindsay-Walker, Kroger’s director of sustainability. As part of the company’s food recovery strategy in grocery stores, Kroger’s Perishable Donations Partnership is responsible for the equivalent of 38 million meals of healthy, perishable food donated to local Feeding America food banks to help feed hungry families last year. Kroger’s retail operations team has implemented an organic recycling program in 1,000 stores across the country. This program utilizes composting and animal feed to limit the amount of food going into landfills. Kroger was the first major retailer in the U.S. to develop a clean energy production system that converts food that cannot be sold or donated into clean energy. The facility provides a quarter of the power needed to run the company’s Ralphs/Food 4 Less distribution center in Compton, California.

Lucky, Save Mart & FoodMaxx Now Accept Apple Pay Lucky, Save Mart and FoodMaxx stores are now accepting Apple Pay in all of their 217 stores throughout Northern California and Nevada. “Expect new things in our stores this year—the first of which is Apple Pay. We are working diligently to transform the shopping experience for our customers and this cutting-edge technology will help to speed them through checkout,” said Nicole Piccinini Pesco, co-president and chief strategy and branding officer. “Accepting Apple Pay provides shoppers a secure and private way to pay for their groceries and we’ve added support for this new mobile payment method solely for their benefit and convenience.” Apple Pay provides a simple, secure and private way for shoppers to pay for their groceries, according to the grocer. Apple Pay is easy to set up and users will continue to receive all of the rewards and benefits offered by their credit and debit cards. In stores, Apple Pay works with iPhone 6, iPhone 6 Plus and Apple Watch, upon availability. Security and privacy is at the core of Apple Pay. When a customer adds a credit or debit card to Apple Pay, the actual card numbers are neither stored on the device nor on Apple servers. Instead, a unique device account number is assigned, encrypted and securely stored in the secure element on the customer’s device. Each transaction is authorized with a one-time unique dynamic security code, instead of using the security code from the back of the customer’s card.

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MARCH 2015 • The Shelby Report of the West

Equipment, Services, and Technology

Save Mart also now accepts a variety of smartphone digital payments, including Google Wallet and Softcard.

Industry Expresses Disappointment as Supreme Court Dismisses Swipe Fees Petition The U.S. Supreme Court in January denied a petition by the Food Marketing Institute (FMI), National Association of Convenience Stores, National Retail Federation, Boscov’s Department Store, National Restaurant Association and Miller Oil Co. that challenged the Federal Reserve’s rule on debit card swipe fees. The court’s rejection of this case ignores its impact on U.S. businesses, schools, charities, government and customers every time they use a debit card, according to the groups. The most recent FMI Food Retailing Industry Speaks “Worry Index” ranked credit/debit card interchange fees among the most critical issues facing the industry. Card companies and banks collect “swipe” fees on each transaction for which a customer uses a credit or debit card to make a purchase, but these fees are set exclusively by Visa and MasterCard in conjunction with the banks that service the cards. Food retailers and other business entities have no opportunity to negotiate the fees to the benefit of their customers. “We are disheartened that the court rejected our case, reflecting utter failure to recognize the significance the ‘swipe fee’ issue holds for consumers and American businesses,” said FMI President and CEO Leslie G. Sarasin. “The food retail industry, on average, operates at a 1-to-2 percent profit margin, so every penny matters. When transaction fees are arbitrarily set by the big banks and the card companies they service, this becomes a matter of justice that threatens the economic survival of community grocery stores, businesses, charities, schools and every institution utilizing a debit and credit cards payment system. We now look to the Fed to improve this rule and carry out both the clear language of the statute and the intent of Congress.” In 2013, nearly 70 percent of all transactions were made with credit/debit cards, and these interchange fees often exceeded a retailer’s narrow profit margin on the items purchased. FMI and the retail community achieved a legislative victory upon passage of the Durbin amendment as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act,

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GVH Distribution Has New GM in Spokane Supermarket and food service packaging supplier GVH Distribution has promoted Luke Schmidt to GM for its Spokane, Washington, location. After earning his MBA at Wagner College in 2006, Schmidt started his career with GVH Distribution in Lubbock, Texas. He spent three years overseeing the operation in Lubbock before relocating to Spokane in 2010 to assist in opening the company’s first branch outside of the Southwest. In 2012, Schmidt was tasked Luke Schmidt with opening another new location in Ogden, Utah. Schmidt has been instrumental in facilitating GVH’s franchise in the Pacific Northwest, according to GVH. but the Federal Reserve’s final ruling in 2011 to implement the law failed to reflect the intent of Congress, thus sparking a lengthy legal battle. The Federal Reserve’s final rule allows banks to collect 21 cents, plus a fraud adjustment, for each transaction as opposed to the original Federal Reserve proposal of 7-12 cents. The rule went far beyond that which was contained in the statute or that which Congress intended, the groups say.

SoCal’s Yummy.com Expanding with Two New Fulfillment Locations Yummy.com, which has offered grocery delivery since 2002, has opened its fifth fulfillment center in the Los Angeles area, with plans to open its sixth later this year. In addition, the company announced sales growth of 21 percent in 2014 and the completion of its 2 millionth order. “We are excited to announce the addition of two new fulfillment locations in 2015,” Please see page 64

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said Barnaby Montgomery, co-founder and CEO of Yummy.com. “Our success is attributable to our unique operating model and to the development of our proprietary operating system. By developing and controlling our own fulfillment system we retain ownership of our customer relationships and the organizational insight needed to compete for modern customers. Best of all, we realize the holy grail of competitive advantage: lower operating costs, more demand and better customer service.” Located at 5520 San Vicente Boulevard, Yummy.com’s new location opened for business in late January. Its 35 new employees will serve the areas of Mid-Wilshire, Culver City, Palms and portions of Koreatown and Beverly Hills. The company expects to break ground on its sixth fulfillment location in Century City to service the communities of Westwood, Century City, West Los Angeles and portions of Beverly Hills. With its sixth fulfillment center, Yummy.com expects to fulfill more than 30,000 online orders each month. Other Yummy.com locations are in Hollywood, Santa Monica, Silver Lake and Playa Vista. Yummy.com fulfills online orders in about 30 minutes. Montgomery and COO Arthur Zonneveld founded Yummy.com in 2002 with a vision to bring the convenience of on-demand delivery to the consumer grocery experience.

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Save Mart Supermarkets Adopts Revionics Price Optimization Save Mart Supermarkets has inked a multi-year agreement to implement Revionics’ SaaS-based Price Optimization Solution and its Advanced Analytics services, which include the Key Value Item (KVI) Analysis and Store Cluster Analysis. Save Mart is a privately-held food chain with 221 stores under the Save Mart, S-Mart Foods, Lucky and FoodMaxx banners. Save Mart says it chose Revionics because of its robust science-based pricing solutions, which also include automated price management. Save Mart will be using Revionics Price Optimization to better align its pricing strategies and tactics with local shopper behavior to ensure it has the right KVIs by market and price more strategically, consistently and competitively. Marc Hafner, Revionics’ CEO, noted, “In today’s hyper-competitive retail environment there is no room for error when it comes to pricing and promotions. Our industry proven science-based solutions help ensure that retailers offer the right price, at the right time to the right shopper.”

NCR Unveils New ‘Grab and Go’ Self-Checkout Solution The NCR SelfServ 90 is the latest addition to the family of NCR FastLane SelfServ checkout solutions. It can be used as a freestanding, self-checkout kiosk installed on a countertop or even mounted on a wall. The NCR SelfServ 90 is ideal for high-volume stores with many shoppers checking out small baskets and using credit or debit cards. It is a cost-effective solution without the added expense of cash or coin tender options, or a produce and security scale. The key purpose is to reduce lines during peak hours for customers purchasing just a few items, such as during the lunchtime rush when customers come in to purchase lunch items or a snack. “Whether in the supermarket or at a convenience, department, specialty or DIY retailer, there is a large amount of checkout traffic that can be handled with this card-only, small footprint solution,” said Dusty Lutz, GM-self-checkout solutions at NCR Retail. “This technology is ideally designed for ‘grab-and-go’ convenience for driving more revenue and convenience during peak shopping hours.” In a recent study of consumers in nine countries, 90 percent revealed they use self-checkout technology. When asked what they liked about self-checkout, consumers’ top three responses were convenience (42 percent), ease of use (40 percent) and the speed of checkout technology in comparison to the cashier-assisted line (39 percent). SelfServ 90 features an EMV card reader with contactless capability; zero-bezel display with which supports multi-touch and gesture interactions; 2D imaging scanner; integrated receipt printer and coupon bin; and an intervention light.

NCR’s new SelfServ 90 is made for small basket purchases paid for by debit or credit cards.

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The Shelby Report of the West • MARCH 2015

Equipment, Services, and Technology

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OPERATIONS

From page 64

Marsh, inMarket Partner for World’s First Apple Watch iBeacon Experience at Retail Marsh Supermarkets and inMarket have deployed a closed-loop iBeacon platform, enabling shoppers with smartphones and Apple Watch to have their favorite apps come alive in store. This is the world’s first iBeacon-wearable integration at retail. iBeacons enable smartphone and wearable apps to wake up at precise moments and help shoppers based on where they are. For example, a shopper might be reminded to check her shopping list app upon entering a store, or to view ingredients for a recipe she favorited last week. inMarket’s SDK will enable opted-in shoppers with the Marsh app, shopping apps on the inMarket Beacon Platform and now Apple Watch apps to experience contextual mobile experiences in the store. inMarket’s beacon platform reaches 18 percent of all U.S. mobile users, or 32 million shoppers per month, according to comScore. “iBeacons have created new ways to connect with mobile shoppers in the store, and inMarket allows us to reach many of our shoppers through the apps they love and use everyday,” said Amit Bhardwaj, senior director of customer loyalty at Marsh Supermarkets. “Now with wearable integration, shoppers who use Apple Watch will enjoy the same digitally-augmented, real-world shopping experience.” With Apple Watch integration, Marsh and inMarket are the first to extend iBeacon enhancements beyond millions of smartphone users to the new audience of “wearers.” “Mobile isn’t just the phone anymore. Mobile includes any device that conforms to your life and helps you based on who, where and even ‘when’ you are,” said Todd Dipaola, CEO of inMarket. “It’s an amazing time for consumers and commerce as digital and physical experiences converge.” With inMarket, Marsh can use native proximity tools and beacons to reclaim the marketing in its digital airspace, drive incremental visits, and increase sales via personalized shopper engagements in and out of the store. In 2014, inMarket

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released data showing iBeacons, when deployed to help shoppers, increase sales and app retention. Indianapolis-based Marsh operates 66 Marsh stores, three O’Malia’s Supermarkets and nine MainStreet Markets in Indiana and Ohio, with 39 Indiana pharmacy locations. Marsh was the first grocery store in the world to use electronic scanners to ring up purchases.

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The Shelby Report of the West • MARCH 2015

In The Spotlight

FMI Midwinter Executive Conference Fontainebleau Miami Beach • Miami Beach, Florida • Jan. 24-27 FIRST-TIMERS WELCOME COCKTAIL RECEPTION

Rudy Dory, owner, Newport Avenue Market, Bend, Oregon; and Edward Salzano, president, EDNJ Associates Inc., River Vale, New Jersey. In the background is Rick Stein, VP-Fresh Foods, FMI.

Dexter Manning, partner, Grant Thornton LLP; Wes Dye, VP-sales, RW Protect, Refrigiwear; Eric Steele, director of operations, Groom Energy Solutions; and Claire Manning.

Dagmar Farr, SVP of member services, FMI, with Tomislav Kuljis, ALAS (the Latin American Supermarket Association).

FMI FOUNDATION GALA AND INDUSTRY AWARDS DINNER

Judy and Fred Morganthall of Harris Teeter, flank one of the evening’s award winners, David Dillon, former chief executive of Kroger.

Craig Musgrove, SVP, Frito-Lay, and Van Sapp, president of the Americas for TCC Global, which provided Wi-Fi service for FMI Midwinter.

Debbie & Steve Sklar, SVP/GM-Snack Division, and Lisa & Terry McDaniel, president and CEO, Inventure Foods; Steve Arnold, EVP-marketing, Associated Wholesale Grocers.

SCENES FROM MIDWINTER CONFERENCE

Rick Brindle, VP of industry development, Mondelez International; Ern Sherman, VP-retail industry affairs, Coca-Cola; John Downs, president, National Confectioners Association; and Jim Dinkins, chief retail sales officer, Coca-Cola.

Art Potash, CEO of Potash Markets, with Scott Johnson, SVP and director, Financial Supermarkets Inc.

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Cheri Phipps, director-Retail Management Certificate Program, Western Association of Food Chains (WAFC); Cindy and Kevin Davis, president and CEO of Bristol Farms; Carole Christianson, COO, with husband Paul Christianson, WAFC; Cynthia McCloud, director of Food Industry Programs, University of Southern California, with husband Jim McCloud.

Manly Molpus, principal, The Molpus Advisory Group, and wife Pamela; Holly Maher, VP-retail; Trent Overholt, SVP-sales and marketing, Rehrig Pacific Co.

Dr. Thomas Haggai, chairman, IGA Inc., with Thomas Kazas, CEO, Hometown Coffee Co.

Leslie Sarasin, president and CEO of FMI, with Ed Crenshaw, CEO of Publix Super Markets and chairman of the FMI Midwinter Executive Conference.

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Coverage @ More theshelbyreport.com

MARCH 2015 • The Shelby Report of the West

Suppliers

OPERATIONS

Todd Klug Takes on President, GM Role at L.A. Libations Todd Klug has joined L.A. Libations, a company he calls an “incubator for new brands,” as president and GM of its Heritage Street Food division. Klug previously was with Popchips, which he joined in 2013 and, prior to that, was with Coca-Cola for more than 20 years. L.A. Libations might best be described as an entrepreneurial beverage and food company. That’s what attracted Klug to the company. “It’s exciting because, to go down that path of Coke, I had the opportunity to learn classic brands and then brand building; to Popchips, and take something and help it get better and straighten it out; to something you get to build from the ground up. That’s what I’m excited about,” Klug tells The Shelby Report. L.A. Libations, with headquarters in Sierra Madre, California, has a joint venture with Relativity Media in which it creates and markets brands. “They have a series of not just movie studios, but sports and music assets that they are involved with,” Klug says of Relativity Media. “If you take a little bit of a food company and a beverage company that has access to these types of

marketing venues—and there’s also some capital investment from other investment groups— it’s not just a food or beverage company, it’s the incubator for food and beverage brands. A lot of food companies don’t really have access to the assets; if it’s movies, if it’s media, they’ve got a whole social media side to their business, along with brand activation, and then all the other tools…” Todd Klug Coca-Cola Co. is an investor, too. In May 2014, the company’s venturing and emerging brands group bought 25 percent of L.A. Libations. As for L.A. Libations’ Heritage Street Food division of which Klug is in charge, there are “a bunch of things in the hopper,” he says. Perhaps most notable is the division’s Mi Elote! brand, which features a chips and salsa line inspired by corn-on-the-

cob chips of Central America and Mexico. “It’s a great product,” Klug says. “It’s got a health and wellness and sustainability platform. It’s made with all non-GMO ingredients, kosher, natural, even the oils are all non-GMO. It has all the attributes that consumers are looking for these days. The salsa lineup is great, too.” The taqueria-style salsa is shelf stable and “very authentic,” Klug notes. Other products from the brand are coming. “Think of baked bean (products), think of spices, think of additional salsas, think of even sriracha sauces, too,” Klug says. He reveals the Mi Elote brand embraces the “foodie platform” and consists of premium items. “If you look at the world traveler—the foodies—we try to marry the right items to them,” he says. Mi Elote products currently are available at Ralphs. Fresh & Easy also plans to bring the brand to its stores, and Unified Grocers is expected to carry the brand for the retailers it supplies, according to Klug.

Mondelez International

U.S. bakery business also will be operated and managed within this division. Jeffrey Dunn, formerly president of Bolthouse Farms, is now president of Packaged Fresh, which will focus on accelerating growth in the packaged fresh categories. Packaged Fresh includes Bolthouse Farms’ portfolio of fresh carrots, superpremium beverages and salad dressings and Campbell’s retail refrigerated soup business, which accounted for approximately $1 billion of net sales in fiscal 2014. “The adoption of our new enterprise structure will be an important milestone for Campbell,” said Morrison. “This reorganization will help unlock the value of our brands and the growth potential of our business. It will drive focused investment on our largest growth opportunities. It is the logical next step in our ongoing effort to shift our company’s center of gravity, accelerate our growth trajectory and maximize value for our shareholders.” In connection with the reorganization, Irene Chang Britt, president of Pepperidge Farm and SVP of Global Baking and Snacking, plans to leave the company. “I’ve had the privilege of working with Irene for more than a decade,” said Morrison, “first at Nabisco and then at Campbell. She has made many important contributions to our company. I thank her for her dedicated and dynamic leadership, and wish her the very best in the years ahead.”

ment systems and hosted websites for media organizations.

Valerie Oswalt, currently West Area VP-U.S. sales, has been appointed president of U.S. sales for Mondelēz International, effective April 1. Oswalt will succeed Don Quigley, who has announced his intention to retire from the company, effective March 31 As president of U.S. sales, Oswalt will lead all directstore-delivery retail and customer headquarter activities for the company’s snacks and confectionery businesses in the U.S., supporting a product portfolio that generates annual revenues of approximately $6 billion and includes brands such as Valerie Oswalt belVita, Halls, Honey Maid, Oreo, Ritz, Sour Patch Kids, Stride, Trident, Triscuit and Wheat Thins. She will be based in East Hanover, New Jersey. Oswalt joined Mondelez in 1996 as a sales finance analyst based in Chicago. Among her many career highlights, Oswalt held the role of Walmart customer VP of beverage and grocery from 2008 to 2010, during which she and her team delivered unprecedented successive revenue and share growth for the business and were named Walmart’s “Supplier of the Year.” Oswalt serves as the Mondelēz International Ambassador to the Network of Executive Women and is the executive advisor to the Mondelēz International Women’s Sales Council. She also serves on the Northern California Board of the non-profit organization City of Hope.

Campbell Soup Co. Campbell Soup Co. is implementing a new enterprise structure—three divisions structured by product categories rather than by geographies or brand groups. The new division leaders, each reporting to Denise Morrison, president and CEO of Campbell Soup Co., took their roles at the beginning of February. Mark Alexander, formerly president of Campbell North America, has become president of Americas Simple Meals and Beverages. This includes Campbell’s current U.S. retail and food service businesses, Plum Organics and the company’s simple meals and shelf-stable beverage businesses in Canada, Mexico and Latin America; they netted approximately $4.5 billion in fiscal 2014. The division will focus on brand building, innovation and expanded distribution. Luca Mignini, formerly president of Campbell International, is president of Global Biscuits and Snacks, which includes Pepperidge Farm, Arnott’s and Kelsen businesses, with approximately $2.8 billion in fiscal 2014 net sales. This division will focus on driving the company’s growth in biscuits and snacks in its current developed markets and expanding its presence in developing markets. The Pepperidge Farm

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Aptaris Aptaris, a leading provider of enterprise marketing and promotions management solutions, has named Dave Wrigley VP of sales. Wrigley has more than 25 years of experience in senior management positions in the consumer packaged goods industry, advertising and marketing services, spanning grocery, apparel and big-box retailers. He most recently served as strategic partnership manager at Google, where he introduced a new product, Google CPG Offers, and doubled the Zavers by Google footprint. Dave Wrigley According to Aptaris CEO Tom O’Reilly, “Dave’s experience at renowned brands such as Google, Valassis, Dial, Smucker’s and as a pro ball player for the Pittsburgh Pirates allows him to identify inflection points and suggest pivot strategies in support of our clients’ campaigns.” Wrigley took his Aptaris position soon after the launch of the company’s vendor portal solution, which was developed to assist retailers in the promotional management, billing and proof-of-performance areas. Aptaris also has named a new CFO, William Gilmour. He has more than 20 years of experience in software industry finance. Most recently, Gilmour was EVP and CFO at Saxotech, a Tampa-based software company providing content manage-

—Kristen Cloud/staff writer

KOM International Montreal-based KOM International Inc., a supply chain consulting firm that was founded 52 years ago, has appointed Keith Swiednicki president and CEO. Swiednicki takes over the president’s role from Allan Kohl, who has served in that capacity for the past eight years. He becomes chairman of the company, providing guidance based on his 42 years with KOM. Swiednicki, a highly respected logistics and supply chain adviser, has been with KOM for more than 30 years, successfully managing in excess of 500 supply chain projects. He also is a sought-after speaker at trade shows and conferences and has authored articles and white papers related to supply chain and logistics. As president and CEO, Swiednicki will continue to build on the firm’s reputation as a leader in consulting services in supply chain and logistics.

Obituary Melvin Gordon, Tootsie Roll CEO Tootsie Roll Industries Inc.’s longtime CEO and board chairman, Melvin J. Gordon, died Jan. 20 after a brief illness. He was 95. “It is with great sadness that we announce…the passing of Melvin—we will all miss him greatly,” his wife, Ellen R. Gordon, said. “Melvin’s life represented the very highest values in business, wisdom, generosity and integrity. Melvin Gordon Tootsie Roll has seen great growth and success during his time as chairman. Melvin’s dedication to Tootsie Roll for over 50 years as board chair, his creativity and determination were an inspiration to us all.” In addition to his wife of 65 years, Gordon is survived by the couple’s four daughters and their spouses, six grandchildren, a large extended family as well as many friends and colleagues. The board of directors for Chicago-based Tootsie Roll has appointed 83-year-old Ellen Gordon, already a director of the company and its president and COO, as board chair and CEO. The appointment was made in accordance with Tootsie Roll’s existing succession plan.

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The Shelby Report of the West • MARCH 2015

Sales & Marketing

More Coverage theshelbyreport.com

OPERATIONS

GMDC Announces Board Changes for 2015 The Global Market Development Center (GMDC), headquartered in Colorado Springs, Colorado, has made changes to its board of directors, including the appointment of Dewayne Rabon of Bi-Lo Holdings Inc. in Jacksonville, Florida, as new board chairman. GMDC’s board of directors comprises leaders representing retailers, wholesalers, suppliers and service companies of the general merchandise (GM) and health/beauty/wellness (HBW) industries. In addition to Rabon, GMDC’s 2015 board officers include: • Immediate Past Chairman—Bill Anderson, H-E-B • Vice Chairman—Stephen Davis, Weis Markets • Secretary/Treasurer—Timothy Buskey, AmerisourceBergen • Dave McConnell, GMDC CEO. Newly appointed directors include: • Tom Duffy of Nielsen, co-chair of the Education Leadership Council • Dave Baer of Wakefern Food Corp., co-chair of GM Advisory Board • Dave Sutton of Valu Merchandisers Co., GM Advisory Board liaison • Rick Cicero of C&S Wholesale Grocers, Member Advisory Board liaison • Cheri Taylor of Kinney Drug, HBW Advisory Board liaison • Dan Sullivan of TBM Consulting, ex-officio.

Patrick Spear, president of GMDC, says he looks forward to joining both new and returning board members for the new year. “I am thrilled to report GMDC’s board leadership enhancements with the addition of these world-class industry executives,” he said. “2015 is looking to be an exciting year for GMDC, its members and associates as we work to develop new opportunities and build upon our existing business model.” Retiring from the board of directors are Pat Kiernan of Day/ Kiernan & Associates; Mike Botterman of 99 Cents Only Stores; Dan Funk of Associated Wholesale Grocers; and Kathy Williams, formerly of Raley’s Family of Fine Stores. “More than ever, GMDC retailers are looking to the association and its leadership for product discovery opportunities and innovation at our conferences,” said Spear. “By leveraging opportunities for first-mover advantages that build higher margins, we are activating business growth in this highly competitive marketplace.” GMDC is the global trade association dedicated to serving GM and HBW retailers, wholesalers and suppliers. GMDC promotes critical connectivity to grow and expand member companies by uniting members through business-building events and opportunities, and enriching their thinking through education and training; consumer and business insights; and information resources. Visit gmdc.org for more information.

Dewayne Rabon Bi-Lo Holdings

Patrick Spear GMDC President

The Pulse of the Independent Grocer

December Sales Up 4.93% in West Contributed by Mark Ehleben FMS Solutions • marke@fmssolutions.com

In the last month of 2014, independent grocers in the West reported their same-store sales were up 4.93 percent compared to December 2013. It was the seventh straight month of positive sales for the West, dating back to June 2014. The region well outpaced the nation as a whole, which saw its sales decrease 0.4 percent in December. With the strong month to close out 2014, the West was able to overcome the pace of food-athome inflation, which has increased 3.7 percent in the past 12 months, according to the Bureau of Labor Statistics’ December consumer price index report. No other region was able to surpass the increase in food-at-home prices. Food prices increased 0.3 percent in December 2014 alone. Individual categories that showed increases were dairy (+0.6 percent), fruits/vegetables (+0.4 percent), meat/poultry/fish/eggs (+0.3 percent), other (+0.3 percent) and cereal/bakery (+0.2 percent). The lone category that decreased in price was non-alcoholic beverages, which saw its prices decline 0.4 percent in December.

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Despite a quickening pace of food-at-home prices, the overall consumer price index fell 0.4 percent in December due to the plummeting price of gasoline. Gas fell 9.1 percent in December alone and has now fallen 20.5 percent in the past 12 months. The index for all items has increased just 0.8 percent in the past 12 months. In employment news, December saw a nice increase of 252,000 jobs and a decline in the unemployment rate to 5.6 percent. Every sector of the economy saw an increase in jobs, with categories like construction and education/healthcare leading the charge with 48,000 new jobs each. October and November’s job totals were also revised upwards by 50,000. While most of this report was great to see, showing that the economy continues to steadily add jobs, the one bit of bad news was seeing that the labor force declined by 273,000 workers. Despite the blemish, December’s unemployment report was a nice way to close out 2014.

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The Shelby Report of the West • MARCH 2015

NGA collaborating with Coke, RNG on retail intelligence:

In early February, the National Grocers Association (NGA) announced a new alliance with The Coca-Cola Co. and RetailNet Group (RNG) to provide a customized retail marketplace intelligence platform exclusively for NGA independent retail and wholesale member companies. The multi-year effort, supported by Coca-Cola and powered by RNG’s proprietary retail database, will provide NGA’s retail and wholesale member companies, among other benefits, 24/7 online access to a customized global database of more than 212,000 store photos in 2,600 photo galleries covering all retail channels and access to select RetailNet Group reports, including retail store news and rankings. NGA member access to RNG’s insights begins March 1.

Fred’s new COO hails from Family Dollar: Memphis-based discounter

Fred’s Inc. has named Michael K. Bloom president and COO. Bloom has more than 30 years of experience, most recently as president and COO of Family Dollar Stores Inc. But he has spent the bulk of his career in the drug store sector: 20-plus years with CVS Caremark Corp. and 10 years Michael Bloom with Virginia-based Peoples Drug Stores and the Florida division of Toronto-based Shoppers Drug Mart Corp. At Fred’s, Bloom will have responsibility for major operational areas, including general merchandising, marketing, store operations and supply chain management. There are 661 Fred’s operating in the Southeast.

Retail food store sales totaled $668.4 billion in 2014:

That figure was up 3 percent from a year earlier and accounting for 11.7 percent of all retail sales in the U.S., according to Census Bureau data. Meanwhile, eating and drinking place sales increased 5.8 percent over 2013 during the same period, with fourth quarter sales surging 7.4 percent over a year earlier, according to Food Institute analysis of the data. Warehouse, club and supercenter sales during the 11 months ended Dec. 1 were up 2.9 percent to nearly $390 billion, while drug store sales were up 5.7 percent to $224 billion.

Walmart reaches Neighborhood Market milestone:

The 500th Walmart Neighborhood Market opened Jan. 7 in Springfield, Missouri. The new store is located at East Sunshine Street and Blackman Road and is open 6 a.m. to 10 p.m. daily. Shoppers can find fresh produce and meats, frozen foods, groceries and pharmacy in the 41,000-s.f. store. Customers can shop additional items such as toys, gifts, electronics and home decor on Walmart.com through

Dollar Tree’s Acquisition of Family Dollar Approved by Family Dollar Shareholders Family Dollar shareholders voted to approve the merger with Dollar Tree on Jan. 22. The vote also put an end to Dollar General’s pursuit of Family Dollar. The merger of the East Coast chains, based in Matthews, North Carolina, and Chesapeake, Virginia, respectively, would create a discount retailer with more than 13,000 stores in 48 states and annual sales of more than $18 billion. The deal still must pass muster with the Federal Trade Commission; at press time, there had no announcement of how many stores would have to be divested for the deal to go through. The deal is expected to close in March. The new Dollar Tree will keep both brands and operate both dollar store models—Dollar Tree’s, where all items are sold for $1, and Family Dollar’s model, where everyday goods and groceries are sold at a variety of discount prices. “Today’s vote of approval by Family Dollar shareholders represents a crucial step toward combining Dollar Tree, North America’s leading fixed-price point discount retailer, with Family Dollar, a leading multi-price point retailer with a 50-plus year history of serving low- and middle-income customers,” said Dollar Tree CEO Bob Sasser. Goodlettsville, Tennessee-based Dollar General had offered more ($9.1 billion) for Family Dollar than Dollar Tree did ($8.5 billion), but reportedly Family Dollar shied away from the deal because of the number of stores that would likely have been required to close between the two

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Walmart pickup, which will offer free shipping to the Springfield Neighborhood Market. The first Walmart Neighborhood Market opened in 1998.

Earth Fare has new president and CEO: Frank Scorpiniti assumed his new role Oct. 29 (the announcement was made Jan. 7). Prior to Earth Fare, he was CEO of Katz Group Canada Ltd./ Rexall/Rexall Pharma Plus. His career began in 1986 at Long’s Drugs in his native California. Scorpiniti held various positions of increasing responsibility before joining Duane Reade in New York in 2008 as SVP of pharmacy operations. North Carolina-based Earth Fare operates Frank Scorpiniti 33 stores. Target closing its 133 stores in Canada: Target CEO Brian Cornell said the company was “unable to find a realistic scenario that would get Target Canada to profitability until at least 2021,” the Minneapolis-St. Paul Business Journal reports. Cornell joined the company last year. The costs of winding down the Canada operations will result in a recording $5.4 billion of pre-tax losses on discontinued operations in the fourth quarter of 2014. Tesco ready to divest Dunnhumby: Tesco, the British retail group, is looking at strategic options for the data analytics firm, the Cincinnati Business Courier reports. Dunnhumby, a 50-50 joint venture with The Kroger Co., pioneered data collection and analysis and runs programs like Kroger’s Plus Card to track buying habits. Dunnhumby works with about 20 major retailers in 50 countries, according to the report. That is where 40 percent of its revenue is generated. The other 60 percent comes from selling data to consumer goods companies. The Fresh Market names interim CEO: The board of directors at North Carolina-based Fresh Market has appointed EVP and COO Sean Crane to the post. He has been with the company for 14 years. Craig Carlock, former president and CEO, and a member of the board of directors, left the company and resigned as a member of the board. A national search for Carlock’s replacement is under way. Texas D.C. getting a new name: The Nature’s Best

warehouse in Flower Mound, Texas, will undergo a rebranding within the next several weeks, it was announced Dec. 29. Nature’s Best was acquired by KeHE Distributors in August 2014, and the KeHE logo will replace Nature’s Best in Flower Mound. Trucks, uniforms and corporate letterhead

similar-format retailers. Dollar General Chairman and CEO Rick Dreiling released a statement following the merger announcement, calling the vote “a loss not only for Family Dollar shareholders, but also for consumers across the country who will not have the opportunity to benefit from the cost savings and efficiencies that we believe would have been created by a merger between Dollar General and Family Dollar. “As we have said throughout this process, the scale of this combination would have provided better value and greater selection to customers of both Dollar General and Family Dollar,” he said. “Despite our best efforts over the past few months, Family Dollar’s lack of engagement and a contracted transaction timeline ultimately prevented us from completing this transaction.” “Dollar General is an extraordinary company with a promising future,” Dreiling added. “I am excited to remain with the company for another great year as we look to capitalize on the numerous opportunities ahead of us. We have been and remain focused on Dollar General’s core business, and we are confident that Dollar General is well positioned for sustainable growth and shareholder value creation going forward. As always, we will continue to look for ways to provide our customers with the everyday low prices that they count on from Dollar General. Additionally, Dollar General says Dreiling will continue as chairman and CEO through Jan. 29, 2016, or, if earlier, the appointment of a successor. He had originally planned to retire May 30, 2015.

also will reflect the change at the specialty food warehouse. While DOT requirements were part of the decision, another factor was that KeHE has strong brand recognition east of the Rocky Mountains, noted KeHE COO Gene Carter. KeHE will maintain the Nature’s Best name west of the Rockies and add “Powered by KeHE” as a tagline beneath the logo.

Information about retail dietitian pay revealed: The

Retail Dietitians Business Alliance (RDBA) on Feb. 4 revealed the results of the first salary survey for retail dietitians. There are more than 600 retail registered dietitians throughout the U.S. Among the findings: 75 percent of retail dietitians have an annual salary of $41,000-$70,000; 56 percent of retail dietitians have a bonus structure significantly higher than the 8 percent of RDs in other fields; 20 percent of retail RDs receive stock options and 30 percent the opportunity to participate in employee stock purchase programs; and average salaries between store, regional and corporate RDs have an approximate $10,000 difference, with store RDs paid less than corporate RDs. Retail dietitians’ rank their satisfaction with compensation a 6.0 on a 1-10 scale.

Strack & Van Til reorganizes executive team: Highland,

Indiana-based grocer Strack & Van Til has announced a reorganization of its executive management team. President and CEO Ken Diehl, who was hired to steer the 5,000-employee chain of 38 stores last October, said the changes are part of a plan to better position the chain for the future. The execs have varied experience, most with chains. Chris Bengtson, COO, came from Albertson’s Southwest Division; Stan Swinton, chief merchandising officer, was VP of center store for A&P; Jeff Strack, chief marketing officer, has been Ken Diehl with Strack & Van Til; Phil Latchford, CFO was promoted from S&VT’s controller following the retirement of Keith Bruxvoort; David Negron, VP of fresh and perishables, came from Jewel Food Stores; Andy Raab, VP of real estate, came from Ultra Foods; Rex Mudge, VP of human resources, with 25 years experience in the retail food industry; Derek Kinney, VP of labor relations and customer service, from A&P; and Tom Cohen, VP of IT, from Toms. com.

Thanx offers customer retention ideas: Thanx Inc.,

which helps merchants identify, engage and retain their best customers, has published “6 Critical Stats for Customer Loyalty,” a 2014 retail and restaurant study analyzing more than 18 million multi-location merchant transactions. Thanx says it has seen success delivering mid-week promotions since 49 percent of consumers make weekend-only purchases. Visit thanx.com for more information.

Aiken resigns as CEO of Feeding America: Bob Aiken has

decided to resign as CEO of Chicago-based Feeding America, effective June 30. “While we regret Bob’s decision, we support it,” said Jan Pruitt, chair of the Feeding America board of directors. “We appreciate the strategic focus that Bob brought to the role and the momentum he created to realize our vision of a hungerfree America. Under Bob’s leadership a long-range strategic plan was developed, and we are now beginning to implement that plan.” Aiken said he plans to return to the “for-profit world” in the near future. He joined Feeding America after a lengthy career in the food industry. He began his career as a business lawyer.

Census Bureau says 1 in 5 kids receives food stamps:

The number of children receiving food stamps remains higher than it was before the start of the Great Recession in 2007, according to the U.S. Census Bureau’s annual Families and Living Arrangements table package released Jan. 28. The rate of children living with married parents who receive food stamps has doubled since 2007. In 2014, an estimated 16 million children, or about one in five, received food stamp assistance compared with the roughly 9 million children, or one in eight, that received this form of assistance prior to the recession.

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The Shelby Report of the West • MARCH 2015

Southern California Market Profile

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RETAILER/WHOLESALER NEWS

Haggen Plans for New Market From page 15

we want to get embedded in the community and we want “People will be Haggen’s primary point of differentia- to do things... I mean every tion. It’s going to be our culture, it’s going to be our retailer, (even) Walmart…is service. That’s what I found when I visited Haggen talking about local. I mean in the Northwest, and that’s what we will work very no disrespect, but they can’t spell local. It’s not who they hard to achieve here in this market as well.” are. But it is who Haggen is.” —Bill Shaner Haggen’s primary produce supplier, Charlie’s Produce, will be responsible for Haggen Pacific Southwest’s core produce business, and Haggen’s work with local producers also will translate south. “Our store managers will have the authority…to be able to make sure the product in their store is very locally relevant, that we’re supporting local producers, local farmers, local growers,” Shaner says. In other words, Haggen Pacific Southwest stores will have a perimeter-of-the-store focus. Haggen’s private label program in the Pacific Southwest will include the Haggen brand and Unified’s proprietary Springfield label as its primary private label brands. “You’re going to see us carry a wide variety of the organic brands,” Shaner says. “Full Circle and Natural Directions—you’re going to see us carry a full array of those, a whole healthy-foryou segment is a passion for us. We’ll also have a value tier that we’ll be procuring through Unified. Private label’s a big deal for us.” Additionally, the stores being acquired that have a large Hispanic customer base will reflect

Three Retailers Elected to Unified’s Board of Directors

Vache Fermanian

Rob McDougall

Greg Saar

Three retailers have been elected to Unified Grocers’ board of directors. Vache Fermanian, co-owner of B&V Enterprises Inc.; Rob McDougall, president and CEO of Gelson’s Markets; and Greg Saar, president and CEO of Saar’s Inc. were elected during a company board meeting Feb. 4. “We are extremely pleased to have three very successful and talented retailers join our board,” said Richard E. Goodspeed, board chairman. “They bring many years of grocery industry experience and retail expertise to our board. Their wealth of knowledge gained from running stores of various formats and sizes will benefit the board and strengthen its overall composition.” Added Unified President and CEO Bob Ling, “We are pleased to welcome Vache, Rob and Greg to the board of directors. The quality and strength of their retail organizations reflect their leadership skills and they will be strong representatives for all of Unified’s owners.” Vache Fermanian is co-founder of Super King Markets, a family-owned chain of six Southern California grocery stores founded in 1993 in Anaheim. Over the years, Super King Markets have become recognized for their array of high-quality international foods, low prices and excellent service. Rob McDougall has been in the grocery industry for more than 40 years. He joined Gelson’s Markets in 2007 and assumed leadership of the company in January 2012. Gelson’s Markets is a chain of 18 Southern California supermarkets founded in 1951 that prides itself on quality and unmatched customer service. Greg Saar owns eight supermarkets in the Puget Sound region operating under the Saar’s Market Place and Saar’s Super Saver Foods banners. He opened his first store in 1988 in Oak Harbor, Washington, and has continued to grow the business with a focus on value and meeting the diverse needs of the communities surrounding his stores.

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that consumer preference. “That’s one of the bigger differences between the stores that we have in the Northwest and the stores we have here, particularly in Southern California but also Arizona and Nevada,” Shaner says. “We have to be very mindful and very respectful of that. Our assortment, our merchandising, has to be appropriate for that customer base. The vast majority of the stores that we’re acquiring are not in what would I would consider to be heavily Hispanic areas, but we do have a number that are, so we have to make sure we have the right merchandising and right assortment for that.”

Introducing Haggen to its new region

In early February, Haggen Pacific Southwest officially joined forces with Los Angeles-based Pitch, a full-service creative advertising agency. Haggen selected Pitch as its agency of record following a competitive review that began with a dozen agencies that were narrowed to four finalists. Pitch will launch a “strategic positioning” of the grocer as it moves into its new Southern California, Arizona and Nevada markets. The campaign will kick off with television, radio, outdoor, print, in-store, digital media, direct, experiential and social spots. “It’s a repositioning effort of taking some very good grocery stores, changing the assortment and telling that story as we go through the next few months,” Linskey says. Pitch also represents brands like Burger King and Meineke and has done project work for Pepsi, Asics and Pinkberry.

Team Shelby USA, with Help from Grocery Biz, Raises $700K for CFF in 2014

The grocery industry and Team Shelby USA, named The CFF’s Xtreme Hike program takes hikers through after Shelby Klug—the teenage daughter of industry exec- some of the most scenic trails in Southern California to utives Todd and Sue Klug—raised more than $700,000 for raise funds and awareness for CF. All hikers enjoy accomthe Cystic Fibrosis Foundation (CFF) in 2014. Shelby Klug modations for three days/two nights, including an enersuffers with cystic fibrosis (CF), and she and her family gizing pre-hike pasta party, early morning breakfast and and friends have long been avid supporters of the CFF. a post-hike “finisher” barbecue. Group training hikes and The following are the events that helped the Klugs and clinics are held monthly around the greater Southern their supporters raise the monies for the CFF: California area. • Huntington Beach—Great Strides • Hike the Halo Great Strides provides an annual opportunity for people The CFF’s Hike within the Southern California community to get involved the Halo event in a great cause. Participants can form walk teams at their takes place at Angel workplace, through their clubs and organizations or with Stadium. Hike the friends and family. Huntington Beach—Great Strides is Halo is a stairthe CFF Orange County Chapter’s signature walk event. climb event with a It is a fun, family-oriented event with a 5K walk, children’s course that boasts activities, food, festivities and live entertainment. more than 2,000 • Gala steps and integrates CFF’s annual gala takes place at the Newport Beach s u p p l e m e n t a l Marriott Hotel and Spa. Guests enjoy an evening of CrossFit obstacles elegant dining, fine wines, a silent and live auction, live designed to chalentertainment and hospitality. lenge elite athletes. • Pipeline to a Cure Two course options The Pipeline to a Cure gala takes place at the Hyatt are offered, a chalRegency Huntington Beach Resort & Spa. Guests join lenge course and a Laird Hamilton, Dave Kalama and Jamie Mitchell to cele- halo course, so all brate the benefits that surfing brings to the CF commu- skill levels of climbnity. Silent and live auctions, a gourmet dinner, special ers are welcome. musical guests and more are among the event’s highlights. The entire family • An Evening with Jimmy Wayne can enjoy the Guests gathered at the Klug home in 2014 to enjoy an “Vendor Village” exclusive evening under the stars with Jimmy Wayne to and on-the-field benefit CFF. Guests enjoyed a live performance by Jimmy games and activi- Smart & Final’s Dave Hirz, Shelby Klug and Bristol Farms’ Kevin Davis. Wayne, a live and silent auction as well as a gourmet ties. dinner catered by Bristol Farms. • Cycle for Life The CFF’s Cycle for Life is a fully supported ride with two route options (35 miles or 70 miles), stocked rest stops every 10-15 miles, support and gear vehicles, on-site medical services, preride breakfast, post-ride barbecue and beverages Shelby Klug, second from right, with as well as live entertain- CFF supporters like Cynthia McCloud, right, helped Team Shelby USA raise $700,000 last supporters, including musician Jimmy ment. Wayne, second from left. year. • Xtreme Hike

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More Coverage theshelbyreport.com

The Shelby Report of the West • MARCH 2015

Cover / Index THE SHELBY REPORT OF THE WEST INDEX OF ADVERTISERS Advantage Sales & Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55 Amerlux Lighting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 Apax Partners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53 Blount Fine Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35 Bragg Live Food Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 Cacique USA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50 Day-Lee Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 Dean Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11 Designer Greetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 Ducarto Systems. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 Food Marketing Institute . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37 Goya Foods, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25 GVH Distribution, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .63 Hillphoenix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67 IDDBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45 IRI Worldwide. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 J.M. Smucker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49 Leonard Green & Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 Libby’s Fruits &Vegetables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Marquez Brothers International . . . . . . . . . . . . . . . . . . . . . 6-7, 40-41, 80 Meyer Natural Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 Milk Processor Education Program. . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 Minsa Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5 MOM Brands. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44 Morton & Bassett . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 NACDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71 National Confectioners Association . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 National Foodservice Equipment Solutions . . . . . . . . . . . . . . . . . . . . . . .66 Nestlé Nutrition U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 Sabor Latino Food Show . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73 Stater Bros. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65 Supervalu Supply Chain Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .79 Uncle Steve’s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 Unified Grocers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39, 52 URM Stores, Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 Western Association of Food Chains . . . . . . . . . . . . . . . . . . . . . 16, 60-61 Western Family. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59

Montana Grocer Honored From page 1

Washington, supplied by Unified Grocers; and Wally Wagner of Wagner’s IGA CEO Mark Batenic, along with IGA SVPs Doug Fritsch and Dave Bennett, visited all the finalists’ stores in December. “Choosing which of these finalists would become our 2015 IGA USA International Retailers of the Year was extremely diffic ult—e sp e c i ally since we heard from employees and shoppers alike that each of these retailers delivers on the IGA Promise of personalized customer The Columbus IGA Plus in Columbus, service and Montana, has been serving its community Hometown Proud commitfor 40 years. Paul Matovich said in IGA’s ment in every possible way,” “The Independent View” newsletter on Dec. Batenic said. “The incredibly 12: “…anyone who has owned an IGA in a high standards that our final- small town knows the importance of giving ists maintain raise the bar back to the community. No organization for us all, making it easy to in Columbus that has asked for help has understand why we were so ever been refused. The same goes for an filled with pride after visiting employee. If an employee is in trouble, we’re each and every one of their going to act and that culture has spread to stores. our people. The team found out recently that “Together these three IGA a fellow employee was having a tough time, USA International Retailers so they banded together to give the money of the Year represent the that we put in their Christmas stockings to that coworker.” best the grocery retailing world has to offer, and we are particularly proud to have them as members of our IGA family,” he added. The three winners will be honored at this year’s IGA Global Rally at the Orlando World Center Marriott in Orlando, Florida, March 14-17. There they will be joined by global International Retailers of the Year chosen from other IGA countries.

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Nugget Markets Unveils New Concept, Acquires Three Paradise Foods Stores From page 1

offered for $6.98 per pound. According to Nugget, the Fork Lift store carries “over 20,000 new natural, organic and specialty items, the largest bulk selection this side of the western slope, and prices 10 percent below our competition; we are redefining what a warehouse store can be.” A healthy living specialist in the store’s Healthy Living section offers advice on nutrition and supplements; the store even has its own line of “Fresh to Market” vitamins. Local, organic and conventional produce is delivered fresh to the store six days a week, and fresh fruit is cut on-site daily. Fork Lift continues Nugget’s heritage in the meat department, as it was one of the first grocery stores to include a full-service meat department back in 1926. The Fork Lift butcher can supply recommendations, do special cuts and wrap meats to the shopper’s specifications. They also prepare signature meat products, like Fresh to Market Sausage. The bakery features artisan breads as well as sweet goods like cookies and cakes. The deli carries more than 50 chef-prepared entrees, including vegetarian selections. The self-serve grain and soup bar, fullservice charcuterie and sandwiches complement the Fork Lift deli offerings. In addition, the specialty cheese department has a selection of more than 200 varieties of conventional and specialty cheeses— local, domestic and imported. “We’re committed to buying local, supporting our community and taking care of our environment,” the Fork Lift website says. Kate Stille, director of marketing for Nugget Market Inc., told the Journal that the company does not plan to rebrand its other two Food 4 Less stores in Woodland and Vallejo to the Fork Lift concept. Fork Lift is owned and operated by the Stille family, which founded Nugget in 1926.

Paradise Foods stores folded into Nugget

Nugget announced Jan. 28 that it would acquire the Paradise Foods stores in Novato, Corte Madera and Tiburon, California. Paradise Foods has operated in Marin County for 14 years and offers an extensive selection of natural,

organic and local products, as well as a full line of prepared foods that include new and old-world classic dishes. The grocer also offers full-service catering. “I am thrilled to have found a strong retailer (in Nugget Markets) that will continue to offer my employees a dynamic culture and a secure work environment, while maintaining a strong focus on quality perishables, local and organic groceries, and our community,” said David Gilmour, president and CEO of Paradise Foods. Eric Stille, president and CEO of Nugget Markets, says he is excited about the opportunity to bring Paradise Foods into the Nugget family. “We’ve been looking to expand into the Marin community for a number of years and, when David approached us, I knew it was a perfect fit,” he said. “Paradise Foods and Nugget Markets share similar goals and values, and we both have built our businesses on quality, selection and service.” Nugget Markets was founded 88 years ago by Stille’s grandfather and great-grandfather. The company offers a “unique, down-home yet progressive shopping experience” that focuses on natural, organic and local products that are displayed alongside conventional and ethnic items. Nugget Markets is known regionally for its high-quality perishables, including produce, meat and seafood, bakery, specialty cheese and delicatessen offerings. “It’s been a pleasure to serve and support Marin County for the past 14 years,” said Gilmour. “I thank my friends and the Marin community for supporting my business…and welcome Eric and the Nugget Markets family to Marin County.” With the sale of Paradise Foods, Gilmour says he will turn his energy toward establishing the Marin office for Awareness Foundation America.

EVENT CALENDAR MARCH

MAY

1-4: Refrigerated Foods Association (RFA) 35th Annual Conference & Exhibition, Park Hyatt Aviara Resort, San Diego, CA; refrigeratedfoods.org. 4-8: Natural Products Expo West; Education & Events, Anaheim Convention Center, March 6-8; Trade Show, Hilton Anaheim, March 5-7, Anaheim, CA; expowest.com. 7-10: International Home + Housewares Show, McCormick Place, Chicago, IL; housewares.org. 14-17: IGA Global Rally, Orlando World Center Marriott, Orlando, FL; iga.com. 23-26: International Pizza Expo, Las Vegas Convention Center, Las Vegas, NV; pizzaexpo.com. 24-27: Anuga FoodTec, an international food and beverage production fair, Cologne, Germany; anugafoodtec.com.

2-6: Western Association of Food Chains (WAFC) 94th Annual Convention, JW Marriott Desert Springs Resort, Palm Desert, CA; wafc.com. 5-8: SIGMA Spring Convention, Omni Amelia Island Plantation Resort, Amelia Island, FL; exchange.sigma.org. 6-8: Southwest Fuel & Convenience Expo, Omni Hotel and Fort Worth Convention Center, Fort Worth, TX; sw-expo.com. 6-8: World Tea Expo, Long Beach, CA. 15-17: ROFDA Spring Conference, Hyatt Regency Coconut Point Resort & Spa, Bonita Springs, FL; rofda.com. 19-21: National Confectioners Association (NCA) Sweets & Snacks Expo, McCormick Place, Chicago, IL; sweetsandsnacks.com. 29-June 2: Global Market Development Center (GMDC) GM Marketing Conference, Orlando World Center Marriott, Orlando, FL; gmdc.org/conferences.

APRIL 13-15: National Frozen & Refrigerated Foods Association (NFRA) Executive Conference, Tempe Mission Palms Hotel & Conference Center, Tempe, AZ; NFRAExecutiveConference. org. 28-30: Food Safety Summit Expo & Conference, Baltimore Convention Center, Baltimore, MD; foodsafetysummit.com. 28-30: SIAL Canada—The North American Food Marketplace, Direct Energy Centre, Toronto; sialcanada.com. 29-30: KeHE Natural Spring Show, Indianapolis, IN; kehe.com.

JUNE 7-9: International Dairy-Deli-Bakery Association (IDDBA) 51st Dairy-Deli-Bake Seminar & Expo, Georgia World Congress Center, Atlanta, GA; iddba.org. 8-10: United Fresh, McCormick Place, Chicago, IL; unitedfreshshow.org. 8-11: Food Marketing Institute’s FMI Connect, McCormick Place (South Hall), Chicago, IL; fmiconnect.net.

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