(Earlier this year The Produce News, a handful of experts took a look at the retail sector discussing operational trends for 2017. Here, the same group looks specifically at the produce department.)
The continued growth and expansion of value-added products, as well as a shout out for beets, topped the predictions a group of retail experts made for the fresh produce department in 2017.
“Anything beets will be the new craze in the race towards health and nutrition, similar to the kale kick,” said Ron Pelger, president of the retail consulting firm RonProCon and Fresh Xperts in Reno, NV, and a columnist for The Produce News. “Beets — red, yellow and orange — will be offered in a great number of ways. Bottled beet juice will expand in various varieties, similar to yogurt. Beets contain antioxidants and are loaded with heart-healthy benefits.”
Dick Spezzano of Spezzano Consulting Service in Monrovia, CA, also mentioned beets when discussing his top trends, noting that both yellow beets and beet juice are finding favor among consumers and retailers.
But the longtime retailer didn’t limit his list to beets. Jackfruit, he said, could make a big move, “if anybody can figure out what to do with it.”
Spezzano also expects organic produce to continue to flourish in the produce department and especially make gains in the more traditional retail outlets. He said retail trend reports from both the United Fresh Produce Association and the Fresh Produce & Floral Council have tracked the tremendous growth in the category.
“Some individual chainstores [from the conventional sector] are doing 18-20 percent of sales in organics,” said Spezzano, a former produce executive at Vons.
Ed Odron of Ed Odron Produce Marketing Consulting in Stockton, CA, has noticed the same thing. The former produce executive at Lucky Stores, opined that one of the reasons Whole Foods has experienced growing pains is because the conventional stores have upped their organic game quite a bit.
When looking at what product might be the next kale or Brussels sprouts, Odron said don’t sell the latter too short. “I don’t think Brussels sprouts have peaked yet. There is still an opportunity for a lot more growth with new products.”
But he added that he expects both butternut squash and pomegranate arils to see a significant increase in sales in 2017.
Bruce Peterson of Peterson Insights in Fayetteville, AR, formerly the top produce executive at Walmart Stores, was more general in his predictions. “I think value-added will continue to grow, and the definition of what that is will expand. I marvel at the increase in juice, which one could argue is a value-added product. With the increasing number of online shoppers, I see value-added as a more predictable way of ensuring consistency. And I see a significant increase in the convenience aspect of today’s shoppers. When you add the food-safety component to this, I think it’s safe to say the value-added category will have a wonderful 2017.”
Spezzano agreed, noting, “There will be more value-added items, and what I have noticed is that more chains are creating those products in the back room.”
Spezzano still has connections at his former employer and said Vons, as well as its parent company, Albertsons, are doing a large part of their cut fruit and vegetable product in-house. “They appear to be committed to it and it makes economic sense.”
He said that although shelf life takes a hit with back-of-the-house processing at retail, produce managers are reporting sales gains in the 200-500 percent range.
Steven Muro of Fusion Marketing in Chatsworth, CA, spends a good deal of his time analyzing store sales and retail marketing trends for various fresh produce industry clients. He said convenience is the No. 1 driver in the retail business today. While that means utilizing technology for home delivery, faster service and checkout, it also means more innovative value-added items marketed at retail.
Muro noted that some companies have made inroads in the meal-replacement sector with home delivery of meal kits, and he expects to see these same kits marketed within the grocery store.
“Meal kits, such as those marketed by Plated and Blue Apron, are doing very well,” he said. “Why shouldn’t a retailer have them available for pickup. Retailers need to differentiate themselves and this is the perfect place to do it.”
Muro added that as the economy continues to improve, consumers will have more disposable income and he expects they will increase their spending on time-saving food products. “I expect increased dollars to be spent on convenience.”
Both Spezzano and Peterson mentioned the local food movement when discussing 2017 trends.
“Another area to watch closely is how retailers deal with the desire to increase ‘local purchases’ with food-safety concerns,” said Peterson. “It’s well known that retailers impose a different set of rules on major commercial producers than they do for small, local farmers. We are one food-safety crisis away from casting a bright light on this whole issue. Whether 2017 is the year we will see this remains to be seen.”
Notwithstanding that fear, Spezzano said the local food movement continues to resonate with consumers. In California, he said the impact is not as evident because of the year-round availability of fresh produce. But in areas where the fresh season is much shorter, he said the concept of featuring locally grown produce is compelling and he expects it to be a continued emphasis in the retail produce department.
Severe winter weather continues to grip a significant swath of the West, with Idaho-Eastern Oregon’s Treasure Valley seemingly at the epicenter.
A series of structure collapses from heavy snow and ice started rolling across the region on Sunday, Jan. 8, and by Thursday, Jan. 19, the count was in the dozens, affecting the onion industry to a large degree and also having an effect on general commerce, traffic, power and communication. Oregon Gov. Kate Brown declared a state of emergency across the state on Jan. 11 as storms, which had been pummeling the Treasure Valley, continued.
As of Jan. 20 snowfall from this six-week/two-month series of storms was measured in feet in Ontario, OR, where average annual snowfall is 11 inches. Local media reports on Jan. 18 showed 11 inches had fallen in a few hours that day alone, with more in the forecast.
Onion packingsheds and storages from Weiser, ID, located north of Ontario down a corridor several miles to the south have fallen under the weight of continuing snow. Earlier in the week of Jan. 16 Owyhee Produce in Nyssa, OR, lost three storage structures at its base location. On Jan. 19 Snake River Produce, also in Nyssa, lost its packed product facility. Champion Produce in the Parma area has lost multiple structures the previous week; Partners Produce in Payette, ID, has lost its packingline; Four Rivers Onion Packing in Weiser lost its line; storage facilities have collapsed in Ontario as well.
Other operations have not confirmed losses, although there are unofficial reports of additional collapses.
Much of the communication concerning damages has been posted on social media as onion shippers move quickly to shore up structures and keep workers out of harm’s way.
Owyhee Produce in Nyssa released the following on Jan. 19: “At this point we are beyond blessed to report that our entire crew is safe and sound and we've experience no injuries, though one employee was on a forklift when one building collapsed. We are so grateful for the safety of our team and are continuing to ensure that safety is our top priority while we deal with these conditions. We've had four buildings collapse at this point and are in the process of figuring out how we will be able to continue storing and packing onions.”
Shay Myers, general manager of Owyhee, also posted two videos to the company’s Facebook page chronicling the collapse of four storages. The video can be accessed at https://www.facebook.com/OwyheeProduce/.
Another social media post was made to Snake River Produce’s Facebook page, with this account on Jan. 19: “Today, approximately 4:30 p.m., the packed product storage at Snake River Produce collapsed. We are grateful there were no injuries. All packed inventory and some packing supplies were lost in the collapse and at this time, any orders on the books for Jan. 20-21 may not be filled. We apologize for any inconvenience this may cause you. We will attempt to resume business on Monday, Jan. 23, 2017. Please be patient as we work through this difficult situation.”
In addition to the damage to the structures, travel in the Treasure Valley has been disrupted several times, with Interstate 84 closed along the Columbia River Gorge and farther east on Jan. 19.
Adding to the concern is the continued build-up of ice in the Snake, Weiser and Payette rivers, all of which have either breached their banks or have posed threats.
With no let-up in the storms, damage assessments are difficult. Fortunately there have been no reports of injury.
Champion Produce in Parma wrote, “If you don't think it's a state of emergency for the onion industry in the Treasure Valley, think again. This is very serious! We have lost three storages ourselves. Keep the Treasure Valley in your thoughts and prayers.”
A commercial shipment of fresh watermelons at the Pharr International Bridge cargo facility contained 3,000 pounds of alleged marijuana that was packaged to look like watermelons.
“Smugglers continue to be creative as they attempt to introduce illegal narcotics into our country,” Efrain Solis Jr., port director of Hidalgo/Pharr/Anzalduas port of entry, said in a press release. “Our frontline CBP officers’ experience, vigilance and attention to detail prevents the introduction of these dangerous drugs into our country.”
The seizure occurred Jan. 17 when U.S. Customs & Border Protection officers assigned to the Pharr International Bridge cargo facility encountered a white 1993 Thermo King tractor trailer. After the conveyance was referred for a secondary inspection, CBP officers utilized a non-intrusive imagining system along with the help of a canine team to locate the narcotics. CBP officers extracted 390 packages containing a total of 3,000 pounds of alleged marijuana concealed within the watermelon shipment.
CBP OFO seized the drugs, valued at approximately $600,092. The case remains under investigation by Homeland Security Investigations special agents.
ShopRite Supermarkets, a wholly owned subsidiary of Wakefern Food Corp., with 34 stores in New York and New Jersey, has appointed retail veteran Brett Wing as president. He replaces Dave Figurelli, who retired earlier this month after 15 years with the company.
Wing joined ShopRite in 2015 as executive vice president after serving as vice president of Food Maxx, a division of California-based Save Mart Supermarkets. Prior to that, he worked for 25 years at Cub Foods.
"Brett is uniquely qualified to take the reins at SRS and move the company forward in a challenging and competitive environment," Joe Colalillo, chairman and chief executive officer of Wakefern Food Corp., said in a statement. "He has spent his career in the supermarket business and brings to SRS a broad and deep knowledge of the industry."
Wakefern is one of the largest retailer-owned supermarket cooperatives in the country, with its members operating hundreds of stores under the ShopRite, Fresh Grocer, Price Rite and Dearborn Market banners.
Sarah Davis has been named president of Loblaw, effective Jan 19. Additionally, Galen G. Weston, chairman and chief executive officer of Loblaw, has added the role of CEO of George Weston Ltd., Loblaw's parent company and one of North America's larger food processing and distribution groups.
Davis will assume responsibility for the day-to-day operation of Loblaw's business and execution of its strategy. She will report to Weston as he continues in his role as chairman and CEO of Loblaw. Richard Dufresne, chief financial officer of George Weston and Loblaw, will continue to report to Weston.
Since 2014, Davis has served as chief administrative officer, responsible for supply chain, IT (including SAP implementation), process and efficiencies, real estate, goods not for resale and strategy. Prior to that, she served as chief financial officer of Loblaw, appointed in 2010.
"I am extremely pleased to welcome Sarah to the role of president. She has an exceptional understanding of Loblaw. This, together with her strong financial background, particularly in operational roles, positions her well for this expanded leadership role," Weston said in a press release. "I look forward to continuing to work closely with Sarah and the whole management team in the years ahead as we focus on delivering the best in food, best in health and beauty, operational excellence and growth."
Galen G. Weston became chairman of George Weston last September, succeeding his father W. Galen Weston, who stepped down at the age of 75 after over four decades leading George Weston. With his appointment as CEO, Weston succeeds Pavi Binning, who will become special advisor to Wittington Investments Ltd., owned by the Weston family. Binning will step down from the George Weston and Loblaw boards of directors.
The rest of the broader management teams at George Weston and Loblaw remain unchanged.