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Canadian Grocer: A packaged deal in produceWednesday, November 12, 2014 > 09:55:14
Packaging is taking up a bigger part of the produce aisle. And grocers are coming up with new ways to capitalize
IT’S A MODERN DAY PARADOX: SHOPPERS SAY THEY hate packaging, but they can’t resist its convenience.
Nowhere is this yin and yang more obvious than in the produce aisle. Where tomatoes and peppers once roamed loose, they’re now likely merchandised in clamshells, bags or other pack types.
The reasons for not keeping produce loose vary. Some are practical; bags can help retain freshness, for example. But convenience also comes into play, as does branding.
A stroll through the Canadian Produce Marketing Association Show in Vancouver last April revealed several examples of packaging.
For customers’ ease, Shanley Farms put together six small, single-serve avocados in egg carton containers, sold under the name Gator Eggs.
Sunkist Growers upped its brand appeal by selling bags of grapefruits with a photo of a confident 20-some- thing woman and the tagline “Not your mother’s grapefruit.” The line is from a Sunkist ad campaign aimed at convincing younger women to eat grapefruit for breakfast.
Also at the CPMA’s show was a bagged salad from NewStar called “Cooking with Chard Plus Kale.” True to its name, the product had a recipe on the front. Bagged salads have proven popular with Canadians.
Dollar sales are up 15% across all channels in the past year, according to Nielsen. Bagged broad-leaf veggies are seeing growth, with sales up 13%.
The amount of packaged produce is expected to rise, not just in stores, but also across the produce supply industry and in shipping to stores as well. According to a U.S. report by Freedonia Group last November, industry spending will grow 4.8% annually on plastic packs, including clamshells, by 2017; 3.5% on bags and liners; and 2.8% for corrugated cardboard. Over the next few years, the report notes, growth in produce packaging will outpace overall fresh produce production.
The good news: grocers and producers are finding interesting ways to use packaging to better serve customers and improve the produce department itself.
Take meal kits.
“Most people want to spend 20 minutes preparing a meal today,” says Gina Jones, VP of research and development at the Produce Marketing Association. “The millennial generation wants to learn how to cook and this makes it simple for them.”
At Canada’s biggest grocer, Loblaw, produce meal kits include a President’s Choice roasting vegetable kit (potatoes, sweet potatoes and carrots) and a squash soup kit.
“We see a lot of consumer acceptance [for kits] so long as it’s around a single meal for two to four people,” says Dan Branson, Loblaw’s senior director of produce, floral and garden. “These foods mean dinner is very convenient. It allows [people] to put fresh onto the table.”
Veggie kits are especially ripe for cross merchandising. At Colemans in Newfoundland, customers can find a stir-fry vegetable package. Oftentimes Colemans runs a tie-in with fully cooked chicken or beef strips, which it merchandises in both the produce and meat departments.
Colemans also sells a bruschetta seasoning mix cross-merchandised with tomatoes and baguettes in produce. Byron Fellows, produce operations manager, says shoppers will pay more for the convenience of kits.
Packaging can also save shoppers money and create a sense that the store is giving them extra value. Choices Markets in Delta, B.C. was having trouble selling loose plums. So staff at the chain suggested the grower package them in one- and two-pound clamshells. The result was astounding.
“We sold hundreds of cases of product we wouldn’t otherwise sell,” says David Wilson, produce operations manager for the company’s seven stores. Since then, Choices has added apricots, heirloom and grape tomatoes–all delicate produce–to its clamshell range. And it’s all selling well.
“All these things people wouldn’t buy before because they had a slight bruise. Now they don’t have bruises anymore,” Wilson says.
Packaging is also leading to more vertical merchandising. In the past 10 years, Toronto chain Longo’s has increased its refrigerated merchandising space three- to five- fold due to the stackability of packages, says Mimmo Franzone, director of produce and floral.
“Clamshells allow us to create a nice, clean image,” adds Anthony Hadisurya, produce specialist for Choices Markets.
Packaging also gives grocers and producers a chance to brand fruit and veggies.
Loblaw in particular has added more President’s Choice items in produce, often focusing on unique products, such as Sable grapes or local, Ontario- grown peaches.
Loblaw also features photos of its produce farmers on bags of certain vegetables. One of those farms is Hillside Gardens, in Bradford, Ont. Ron Gleason, Hillside’s president, says packaging is the ideal place to tell a story about producers.
“[Shoppers] want to connect to their food and want to know it’s coming from [real] people,” he says. Some may think packaging hides produce’s best qualities from shoppers’ eyes. But in some cases, a smartly designed package can bring them to life.