CATEGORY MANAGEMENT | PRODUCE
Produce sales grow in a pricey market Category volumes are increasing despite higher fruit and vegetable costs
BY RICHARD MITCHELL
PRODUCE IS PROVING to be a most resil- ient commodity. While retail prices for most types of fresh fruit and vegetables are on an upswing, the higher costs are not halting category growth. Produce volume sales rose 0.9% for the 52 weeks ending July 12 despite a 1.1% average price increase to $1.89 a pound, reports Circana, a Chicago-based market research firm. That includes 1.5% sales growth for fruit and 0.1% for vegetables. Merchandisers seeking to sustain activ- ity should entice shoppers to visit the produce department more often as many consumers are buying less per trip and choosing smaller quantities while also becoming more selective, said David Sher- rod, president and chief executive officer of the Millen, Ga.-based Southeast Produce Council. The most successful operators will compete on quality, assortment and value rather than just price and be consistent suppliers of high-quality selections, ana- lysts said. That includes offering pre-cut and ready- to-eat items as many shoppers are willing to pay a premium to save time and reduce effort, said Chris Costagli, vice president, thought leadership, food and non-alco- holic beverage insights, at NielsenIQ, a Chicago-based consumer intelligence firm. “Convenience has become a form of value as lifestyles become busier,” he said. Because produce departments also compete with other store aisles for snack and meal component sales, operators must make produce “easier to find, easier to trust and easier to incorporate into everyday routines,” Costagli said. A VALUE PROPOSITION Merchandisers that get shoppers to per- ceive produce as a smart value regardless of price will generate greater activity too, Sherrod said. “Consumers are adjusting
Wide assortments and fully stocked displays are important produce department lures.
how much they buy, but not why they buy produce,” he said. “Produce is inherent to health and taste in the shopper mind.” Staying nimble and quickly capitaliz- ing on social media trends by promoting less-popular items that have strong con- sumer momentum, such as yams, kiwis and cucumbers, can boost sales as well, Sherrod said. “Shoppers are interested in trying something new and different,” said Elliott Lamoureux, produce merchandiser at PCC Community Markets, a Seattle-based chain of 16 Seattle-area groceries. He said, for instance, that there is “a lot of excitement” around novel organic grape varieties. Broccolini, a hybrid vegetable that is a cross between broccoli and Chinese kale, also is becoming popular as it is versatile,
easy to prepare and works well in many meals, Lamoureux said. In addition, more time-conscious shoppers are seeking in-house cut fruit and vegetables, he said. PCC focuses on creating abundant eye-catching displays to highlight new and in-season selections and make it simpler for shoppers to discover different varieties, Lamoureux said. Operators support the dis - plays with weekly ads, promotions, deals and by cross-merchandising products with items from other store departments. Ensuring there are consistent supplies of high-quality fruit and vegetables, however, can be challenging because of supply chain issues, he said. “Weather, seasonal shifts and rising costs all have an impact, espe- cially in organic where the supplier base is smaller,” Lamoureux said.
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