CHICAGO -- Supermarket operators are slowly warming up to the idea of merchandising seasonal lines of candy more aggressively, on par with other trade classes, said Bill Ellis, chairman and owner of Farley Candy Co. here.
Speaking at a meeting of the Merchandising Executives Club of Chicago, Ellis said the supermarket industry's awakening to the benefits of mass displays of seasonal general lines will be one of the notable developments expected in 1995 for the candy business in supermarkets.
"Mass merchandisers and drug chains aggressively merchandise seasonal candy, with low prices and big displays," he said. "Grocery has not been as aggressive in merchandising seasonal candy.
"For example, one of our mass merchandiser accounts averaged 3,800 pounds of jellybird egg Easter candy per store, while a major supermarket chain averaged 280 to 300 pounds of the Easter candy per store. Some of the supermarkets could do better with seasonal candy," Ellis said.
His prediction that this situation is changing is based on new ground Farley has broken with some chains. He said his company is succeeding in establishing strong partnerships with some supermarket operators, and as a result they are becoming more attuned to the need for and dividends from a greater emphasis on their seasonal candy merchandising.
Ellis declined to name the chains Farley has been working with on such partnerships, but he claimed they were among the leading retail chains in the United States.
What those operators are acting on is the concept that, "Merchandising is one of the things that makes candy so different. It is not only an everyday item, but also seasonal," Ellis said.
He cited published statistics that indicate supermarkets are losing business as a percentage of total candy volume to other classes of trade. The main way to recapture the lost sales is through displays, he said.
"You need a good price on candy, but it is not just a price issue. You have to have the candy out there and be enthusiastic about it. The consumer knows the candy. An orange slice is an orange slice; a jellybird egg is the same, regardless of the brand name. Candy is an impulse sale," he said.
The coming year may offer opportunities to market candy in a new light, Ellis added. Increased consumer awareness of diet and nutrition, and good dental care, may actually contribute to the growth of candy sales in the future, he said.
For example, the fat-free characteristics inherent in nonchocolate candy should be played up while consumers' awareness of fat in their diets is high, he suggested.
"In the past year or two, Farley has added the words 'fat-free' to the packaging of all of our candy except for chocolate," he added.
Another encouraging development is that consumers are finally realizing that candy is not responsible for tooth decay, Ellis said.
"For years candy had a bad reputation, but that is going away now. People have become more aware of the proper care of teeth and gums."
Overall, selling candy to supermarkets has become more complicated, Ellis said. Among the hurdles are increases in slotting allowances and the unavailability of end display space.
"Today, with slotting allowances, you have to buy your space. Everything is in making a deal," he explained. The grocery industry has become even more competitive, "as club stores and mass merchandisers and drug chains have grown and expanded into what were traditional supermarket categories," he said. As a result, the real estate on many end displays in supermarkets is increasingly occupied by other categories on a permanent basis.
"Grocers will have to change. Supermarkets have their own programs that manufacturers have to buy into to get into the stores. So much money is spent for advertising. A supplier can't just go in and sell his products like the old days. It is much more difficult today," Ellis said.