By: Rick Stein, Vice President, Fresh Foods, Food Marketing Institute
I’ve worked in food retail for the last 40 years, most recently for a company that passionately set goals to be a model for health and wellness. Before joining FMI, I represented various facets across operations at Safeway where I witnessed some of the most dynamic trends in the area of fresh merchandising. Be it fresh produce, meat and seafood selection, deli options, a salad bar or prepared foods, stores are reinventing their fresh tracks. We know the consumer makes their decision where to shop based on the fresh offerings of the retailer. We devoted some special sessions at FMI Connect to all things fresh and have these lessons learned to share:
Growth of the Fresh Departments – Today, fresh accounts for 30% of store sales and only 13% of store space. Retailers can use the fresh department to pull shoppers into their stores and as a point of difference with the competition.
Driving Growth and Higher Basket Rings – It’s all about health, convenience, indulgence and multicultural. Capitalizing on these trends is boosting sales at checkout.
In-Store Deli is the New Fast-Casual – Deli prepared foods account for 57% of Deli Department dollars. Prepared food purchases from supermarkets, drug stores and other retail outlets will grow 10% by 2022. Finding the right mix of these areas and filling gaps left by restaurants is essential.
Decreased Meat Supply Impacting Prices – Beef and pork sales are most affected by the increase in prices, while consumers are not as price sensitive when it comes to chicken.
Downsides of Drought—Price increases may hit least price-sensitive categories hardest. Winners and losers will emerge across the store if consumers switch out of these categories and into other categories or center store items.
Non-Hispanics Driving Growth of Hispanic Products— Hispanic products have experienced significant dollar growth in non-Hispanic stores. Retailers should be sure traditionally Hispanic products are available in all stores, not just those with Hispanic shoppers.
For resources and more on fresh foods, visit www.FMI.org/Industry-Topics/Fresh-Foods.
*Sales Data provided by Nielsen Perishables Group.
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