ORLANDO, Fla. -- Supermarkets have to abandon their desire for "instant gratification" when it comes to fresh meals programs, and give those programs time to produce results, said a panel of experts probing the meal solutions challenge during the annual conference of the Refrigerated Foods Association here.
The panelists said that in addition to accepting a sufficient break-in time for fresh meals programs to reach viability, the industry should also consider:
Cultivating commitment at the uppermost levels of retail management.
Allocating enough space for a critical mass display.
Taking merchandising and promotional action to get the consumer to believe in the quality of the product.
And accepting that there will be significant shrink in the beginning.
These prescriptions for seeing meals programs through to success closely mirrored the strategies described by British meals industry players in another panel discussion at the RFA conference. In the United Kingdom today, chilled "ready meals" for takeout are a major revenue and profit generator for supermarkets, the British panelists said. (See related story, starting on Page 33.)
In the United States, meanwhile, supermarkets are becoming frustrated with programs that they think are not working.
"Supermarkets in the United States are looking for instant gratification," said James Riesenburger, a partner in the retail consultancy, Design Associates -- Riesenburger, Leenhouts & Roberts, based in Rochester, N.Y. Riesenburger was on the U.S. panel.
"An understanding of how long it takes for a program to seed and germinate is one of the missing links. After two or three months, they tend to yank it.
"I think they're in for a rude awakening. They're not going to regain what they've lost [to restaurants and other formats] if they don't make a long-term commitment," Riesenburger said.
"It's of optimum importance to budget for time, space and shrink," he added. "It's imperative that the retailer and supplier get together to predetermine the longevity of the experiment and also agree on a planogram," he said, in addition to sharing R&D expenses and some other costs.
He urged manufacturers to push retailers to understand that shrink exists, pointing out that in the United Kingdom (where prepared foods are a success after a long evolutionary haul), retailers are geared to expect 7% to 8% shrink.
Riesenburger, former director of deli operations for Wegmans Food Markets in Rochester, used his experience there to support the idea that commitment must come from top management.
At Wegmans, he said, high-level managers traveled to other parts of the United States to see exemplary prepared foods programs in operation, and then budgeted time and money for the education of employees all the way down to deli managers.
"We had full-day seminars sometimes on just one product, such as olive oil or balsamic vinegar; we had two-day cooking classes," he said.
The panel also emphasized the need for supermarket chains' top management to take action.
"We have trouble getting a commitment from retailers for the [effective] amount of display," said Wendie DiMatteo Holsinger, president of A.S.K. Foods, Palmyra, Pa., who is also president of the Atlanta-based RFA.
"But we are seeing retailers begin to share more information with us, and they're starting to budget for shrink. I didn't think I'd ever see that day," Holsinger added.
Panelist Edward DeLuca, president of the meals manufacturing firm DeLuca Inc., Waterbury, Conn., said he has trouble getting retailers to cross merchandise products.
Both suppliers said they try to deal mostly with retailers who share their philosophy on marketing, as well as on food quality.
"I've zeroed in regionally," DeLuca said, "but also on particular supermarkets, retailers with whom we can make strategic alliances, retailers that have a philosophy like ours."
The hard part is getting any retailer to be consistent about training employees, he said. "A major area of concern is food safety. If I see a Hazard Analysis Critical Control Points manual that doesn't have a lot of coffee stains on it, I worry," DeLuca said.
Riesenburger, in an interview with SN following the RFA conference, said he and his consultancy partners are trying to get industry executives together to explore the possibility of establishing regional distribution centers for chilled foods, in a network similar to that in the United Kingdom.
Such a system would involve cross-docking facilities. For example, products from various suppliers would be cross docked at one point and then distributed to the units of three or four different chains in a particular region.
