As the voice of food retail, Food Marketing Institute offers a complete picture regarding the health, safety and merchandising practices of grocery stores. Unfortunately, sometimes FMI’s role requires refuting false claims we read in media outlets that are perpetuated via the Internet.
Food retailers are in business to serve their customers by providing safe, nutritious, affordable food and food safety is the number-one priority for supermarkets. Here are some common misunderstandings about the way in which supermarkets do business:
Today, the world of food retail is diverse: From the independent operator to the supermarket chain, from the pharmacy to the warehouse club store. Our research suggests consumers are shopping multiple channels.
Food retail competition is coming from multiple channels because shoppers are shopping multiple stores. According to FMI’s U.S. Grocery Shopper Trends 2016 report, on average, shoppers report using around 3.0 different channels fairly often. While supermarkets are listed as the primary store for 49 percent of respondents, loyalty to the supercenter has fallen from 28 percent in 2011 to 25 percent in 2016, and the number of respondents that list no primary store has grown from 2 percent to 9 percent - triple that of the past few years. Shoppers are less likely to choose one store to meet all their needs and are optimizing their satisfaction category by category, store by store, and potentially channel by channel.
The Supplemental Nutrition Assistance Program (SNAP) offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. SNAP is the largest program in the domestic hunger safety net. According to the 2015 FMI Food Retailing Industry Speaks report, about 5 percent of groceries are paid for using SNAP benefits.
SNAP fraud occurs when SNAP benefits are exchanged illegally for cash, when an applicant lies to get benefits or to get more benefits than they qualify for, or when a retailer has been disqualified from the program for past abuse and lies on the application to get in the program again.
According to a 2013 report by the Center on Budget and Policy Priorities, SNAP has one of the most rigorous quality control systems of any public benefit program. SNAP fraud has actually been cut by three-quarters over the past 15 years, and the program’s error rate is at an all-time low of less than 3 percent. In fact USDA’s Quality Control research finds SNAP has a 96.34% accuracy rate in providing correct benefits to low-income people. The introduction of EBT (Electronic Benefit Transfer) cards has dramatically reduced consumer fraud.
Today’s customer wants to know much more than just how much food costs. They want to know how the food was produced, where it came from, who produced it and what is in it. In 2014, the Trading Partner Alliance (TPA), a joint industry group made up of the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA) that focuses on shared retailer-manufacturer supply chain efficiency issues, information technology and the adoption of environmentally-friendly business practices, came together to identify a solution to address the growing demand for information. The Consumer Information Transparency Initiative was born and over 90 organizations and 400 stakeholders joined together to build what is known today as Smart Label. Although not the only digital disclosure option offered, Smart Label will allow consumers to access product information pages through a number of electronic platforms including web, QR codes or phone. Additionally, utilizing the advancement of digital technology to provide details about projects will allow industry a quicker response time versus the cost and time constraints of updating packaging. To learn more about SmartLabel, visit www.Smartlabel.org.
FMI food retailers were leaders in designing legislation – and getting legislation passed by Congress in 2010 – to bring some transparency, predictability and competition to fees merchants paid on debit cards. FMI members witnessed an increase every year before this legislation – authored by Sen. Dick Durbin (R-IL) with no ability to control it. Before the legislation, merchants were also forced to route transactions through a particular network, eliminating competition that provided greater up time, efficiency and lower cost. Food retailers remain staunch supporters of free enterprise, and generally do not support any market intervention unless markets are not functioning efficiently. The competitive gap between international and U.S. payment card accepters is growing every day. There are several reforms still needed in the credit card marketplace to improve payment acceptance as the U.S. continues to adopt new and innovative ways to pay in the mobile and e-commerce spaces. Debit card reforms have been a major step in the right direction, and any removal of those reforms would be a monumental step in the wrong direction for U.S. businesses and consumers.
Success in food retail relies upon customer loyalty, which is cultivated through proving trustworthy, providing quality goods and offering helpful service. Shopping carts, store layout and sales deals are designed to make the shopping experience more positive and convenient. Food retailers want to satisfy customers because happy customers will be return customers.
Food retailers have always been in the business of selling by volume. Substantiating the reliability and consistency of their business model, food retailers have earned a net profit of about one percent, or a penny-on-the-dollar, for the last two decades (a trend line can be found here).
FMI U.S. Grocery Shopper Trends 2016 suggests that price continues to drive store selection criteria for U.S. shoppers, and 66 percent of those shoppers are willing to travel beyond their most convenient store to seek out low prices. Grocery stores often call attention to cost-saving measures, which include coupon notification, employing social media tactics and giveaways, fuel reward programs, sales promotions and offering private brands.
The average number of products carried in a typical grocery store is 44,000, so you would need to know specifically about particular product in question and the retailer’s merchandising strategy. However, we can note that all products have individual, Universal Product Codes (UPC codes), loaded with attribute data, including price. UPC codes are specific to the item for sale and create uniformity across the store.
The grocery industry employs 3.4 million people and offers a multitude of growth opportunities. In fact, a significant percentage of the grocery industry’s leadership started out bagging groceries or stocking shelves at their respective companies. Not every person in the industry desires to achieve the level of CEO, so grocery stores offer seasonal and part-time opportunities across age and career level. Food retailers remain part of the communities in which they serve and often draw from the local neighborhoods for their workforce. The food retail industry continues to offer employment opportunities for those first entering the workforce and those making a late-life vocational shift.
If a customer reports dissatisfaction with a product, grocery stores do their best to make amends. Both quality and safety standards are engrained in the integrity of companies’ brand reputation and the majority of what’s sold in the store is strongly regulated. Furthermore, depending on the actual commodity, the dating is different. A potato, for instance, can last longer than four weeks, whereas green leaf lettuce only lasts a couple of days. As a resource, FMI created the Food Keeper and the FoodKeeper Mobile App in partnership with USDA and Cornell University. Food Keeper is a resource for consumers on product quality and storage information to maintain the freshness and safety of a product.
According to FMI’s U.S. Grocery Shopper Trends 2016 report, 86 percent of consumers indicated they are mostly or completely confident that the food at grocery stores is safe. This level of basic confidence has remained consistent over the past 10 years.
Since the 1950’s, adding hormones to chickens has been illegal in the U.S. By law all chicken products purchased in the U.S. must be free of added or artificial hormones. Because of this, there are no artificial or added hormones used in the production of U.S. chickens, which is regulated by the U.S. Food & Drug Administration. So why are chickens so big? It’s due to improvements in breeding, nutrition, veterinary care and bird health. Farmers grow bigger chickens, not because of genetic modification, but the use of vaccines, healthier nutrition and improved living conditions for broiler chickens (chicken raised for meat).
For more information, visit The Chicken Check In.
FMI’s SafeMark training program manual cites, “Some produce display equipment is equipped with misters that help assure the freshness of fruits and vegetables and prevent wilting, dehydration, and shrinkage. These misters must be connected to a potable water supply, and the system and heads of the system must be properly cleaned and maintained to assure maximum freshness, safety, and wholesomeness of produce exposed to the mist.”
We recognize misters also help preserve the quality of fresh greens; without water, lettuce will wilt and create food waste at a more rapid pace.
It’s imperative to note that consumers must do their part once they arrive home with the product. Consumers can visit www.fightbac.org to ensure they are using safe food handling procedures.
Grocery cart handles offer a utility, similar to a doorknob, an elevator button or a stairway railing. Many supermarkets have responded to shopper concerns about bacteria on shopping cart handles by offering antibacterial wipes to help limit cross-contamination. Some companies even steam-clean their carts to try and reduce the presence of pathogens. Overall, it’s important for consumers to regularly wash their hands as a primary step for prevention.
Cleaning and sanitizing the deli slicer is clearly an important food safety step. Deli slicers are cleaned and sanitized throughout the day as needed but must be cleaned no less than 4 hours according to the FDA Food Code. If not properly cleaned and sanitized, deli slicers can contaminate the deli meat with bacteria such as Listeria. Deli employees are trained on the essentials of food safety including how to properly clean and sanitize food contact surfaces.Check out this helpful guide for how retail delis handle Listeria risk.
Any food can harbor bacteria and is not unique to meat and poultry. Escherichia coli or E. coli is found naturally in the environment and is part of the normal intestinal tract of humans and other animals like cattle. Most E. coli does not cause illness; however, there are some strains, such as E. coli O157:H7, that are pathogenic and can cause illness. E. coli O157:H7 illnesses have been linked to a number of foods including undercooked ground beef, raw milk, apple cider, fresh produce, and undercooked roast beef. Although the incidence of E. coli O157:H7 illnesses have dramatically declined over the years, consumers should ensure their food is safe by properly storing, handling and preparing their meat by cooking it to the proper internal temperature. For more information, visit www.fightbac.org.
The goal of packaging meat is to protect the product from contamination, extend product shelf-life and ensure optimum product quality by maintaining the color and flavor of meat. Without oxygen, meat is purple. When meat is exposed to oxygen it turns bright red (the color consumers like to see) and with time, the meat will begin to turn brown or gray. There are many factors which influence meat color. Because oxygen plays a major role in the appearance of meat freshness and color, many packaging systems modify the packaging atmosphere by removing oxygen and replacing it with a mix of gases that enhance product quality and allow the meat to “bloom” and maintain the desired red color.
All meat packaging materials must be approved as safe for food contact by the Food and Drug Administration for its intended use. Color alone is not the best indicator of shelf-life. Consumers should store meat at 40◦F or below, look at product dates, ensure package integrity has been maintained (no holes or tears) and look for any signs of spoilage such as odor, bulging package, or slimy texture. When in doubt, discard or return the product to the place of purchase. Learn more from the North American Meat Institute.
FMI’s 2016 U.S. Grocery Shopper Trends acknowledged a notable shift in the shopping style of the American household. The prevalent model for years had one person (usually female) doing most or all of the planning and shopping, but now the shopping paradigm is shifting toward a shared shopping model where grocery duties are shared between adults in the household. A significant contributor to this shift is the rise in the number of male shoppers. Among those who consider themselves primary food shoppers – meaning they perform all or most of the grocery shopping OR at least half of the household grocery shopping - 31 percent are men and 69 percent are women. This means, on average, the gender division of shoppers in a grocery store is getting closer to being equally male and female.
Grocery shoppers can be divided into four categories:
The first group, the Self Shoppers, represents those living in a single-person household and therefore responsible for all the household shopping. Self-shoppers make up nearly one quarter (24 percent) of grocery shoppers with 48 percent being male, and 52 percent female.
Next, the Primary Shopper category constitutes 45 percent of all grocery shoppers and is characterized as those responsible for all or most of the shopping for a multi-person household. 31 percent of primary shoppers are male, 69 percent are female.
The ten percent of shoppers making up the Secondary Shopper category are those living in a multi-person household and are responsible for at least half the household shopping, but another person is the primary decision maker. This group has a 73 percent male, 27 percent women gender divide.
Those falling into the Shared Shopper category are the 22 percent of shoppers living in a multi-person household that divides the shopping responsibilities equally between the adults in the household. The gender split of this category is 59 percent men, 41 percent women.
Supermarkets maintain their stronghold as the primary channel of choice for food shoppers, with 85 percent of consumers shopping this channel most frequently. Still, according to FMI’s consumer research, less traditional channels are attracting more shoppers. Supercenters (54%), conventional discount stores (38%), limited assortment (21%), dollar stores (20%) and convenience stores (8%) all grew the most substantively in shopper visits over 2015. While the channel ranked last, online retailers certainly contribute to channel fragmentation and present a significant opportunity for food retailers in refining their business models in the future.
Family meals matter and they’re at a critical intersection in our nation. Over the past 18 years, The National Center on Addiction and Substance Abuse at Columbia University has surveyed thousands of American teens and their parents to identify situations and circumstances that influence the risk of teen substance abuse. This research report from 2012 demonstrates once again that magic happens during family mealtime when children and parents gather around the table and engage each other in conversation.
The will to return to the table exists, and research suggests that one more family meal each week at home helps kids do better in school and engage in less risky behaviors. In our recent Shopping for Health report, conducted with Rodale Inc., we asked parents with children, ages 0 – 17, about their shopping, cooking and family meal habits. We know that juggling work, kids and the busy demands of daily life can make it difficult to achieve a family meal at home. In fact, 57 percent of shoppers with kids eat dinner with their kids every night. Interestingly, fewer than half of dads eat dinner with their kids every night (46 percent), while two-thirds of moms do (66 percent). In an ideal world, three out of four parents said they would want to eat with their kids every night.
Every year, approximately 40 million tons of food waste is sent to landfills in the United States. At the same time, record numbers of Americans – one in six – are receiving government food assistance. The sources of food waste are varied and many. Food waste is generated by consumers, but we recognize it’s also a byproduct of manufacturing, retail and foodservice operations.
Before a product at a supermarket goes to waste, the business considers multiple options. It’s important to note that grocery stores are the number-one donation stream for food banks and more than 40 percent of wasted food from grocery stores is donated or recycled.
As industry leaders committed to improving our environment and our communities, the members of the Food Waste Reduction Alliance (FWRA) – representing food retail, food manufacturers and restaurants – are taking on the challenges of food waste in an attempt to shrink our environmental footprint, and simultaneously address hunger in America. FWRA’s goal is to increase donations sent to food banks and decrease the amount of food sent to landfills by: Reducing the amount of food waste generated
Increasing the amount of safe, nutritious food donated to those in need; recycling unavoidable food waste; and diverting it from landfills to productive use.
The concept of ugly produce isn’t new – think about the “baby carrot.” Carrots don’t have children, but they do grow at random rates and the carrots that don’t meet a retailer’s or supplier’s agreed upon specifications could find their way to a processing plant to become baby carrots. While beauty is in the eye of the beholder, ugly produce isn’t always visible. Misshapen produce is pervasive in the grocery stores - you just can't always see it; you'll find it cut up in the prepared foods section, salad bars, frozen cases and fresh snacks. Still, the ugly produce phenomenon has a way to go before it becomes a trend in the U.S. FMI’s consumer research indicates that shoppers are selecting produce in the produce section primarily based on appearance, but some food retailers are piloting exciting programs with partners.
Refrigerators in grocery stores are imperative to maintaining food safety and quality. However, food retailers are consistently working on ways to reduce refrigerant emissions and the impact on the environment. Through partnerships like GreenChill, retailers work closely with the Environmental Protection Agency (EPA) to install transition to environmentally friendlier refrigerants, lower refrigerant charge sizes and eliminate leaks, and adopt green refrigeration technologies and environmental practices. Dozens of retailers and manufacturers have partnered with the GreenChill program. Over multiple years, some retailers have reduced their emissions rate by at least 40 percent, and in 2015 more than 125 retailers are GreenChill certified.
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