NEW YORK (FNS) -- At this time of year, industry attention turns to the nation's largest trade association, the Food Marketing Institute, which meets this week in Chicago.
But many state trade associations are critical to food retailing and help pass or defeat important bills in state legislatures.
Many of these groups have been around for a century and the efforts they have made in those years have influenced wholesalers, manufacturers and retailers in their states.
Four of these state associations -- the Minnesota Grocers Association, the Iowa Grocery Industry Association, the Washington Food Industry and the Idaho Retailers Association -- have reached milestones in their histories, or soon will, and SN takes that opportunity to interview the groups.
MINNESOTA GROCERS ASSOCIATION
The Minnesota Grocers Association was the first state grocery organization in the U.S.; it celebrated its 100th anniversary in 1997.
When the group was formed, grocers faced far different issues than they do today. It was an age of price-cutting, when trusts and conglomerates put the squeeze on the little guys, according to Barbara Hansen, a writer for Minnesota Grocer, the association's magazine. The business was credit-driven, posing a real quandary for the retail grocer. "Figuring out how to collect from delinquent charge customers without losing their business was no easy matter," she wrote.
Supermarket giants A&P, Kroger and Grand Union were already in business. "The [local] grocers organized to seek solutions, develop better ways of doing things and present a united front against the legislation that threatened their businesses," Hansen said. Minnesota retailers over the years united to fight large chains, according to the MGA, and Minnesota now has the smallest percentage of chain stores of any state.
The national story is quite different: A&P, for example, grew from 585 stores in 1914 to 15,700 stores by 1930, according to MGA. By 1929, the average chain store in the U.S. had annual sales of $46,000; the average independent had sales of $17,380.
Minnesota independent retailers fought back by joining cooperatives or groups that kept members up to date on promotion ideas, consumer trends and operations tips. Leaders of some of these associations worked without pay.
In the 1920s, Minnesota's grocers' biggest challenges were industry consolidation and competition -- much the same as today, except that now the competitors are warehouse clubs, hypermarkets and "limited assortment" stores.
"There is a tremendous amount of expansion, even by independent retailers, so it is pretty clear that competition is intensive. And there is an enormous rush to consolidation," said Nancy Christensen, executive director of the MGA.
"This is a very exciting industry experiencing some challenging times. But, in a way, that's always been the case."
The legislative focus of the MGA has shifted considerably over the years. Some of the recent battles were to gain a 10% increase in grocers' lottery commission rate last year and to obtain government reimbursement for retailers that use their own equipment for Electronic Benefits Transfers.
The MGA, made up of 500 to 600 retailers, manufacturers and brokers, continues to focus on legislation that affects its members. Minnesota has a Republican House of Representatives, a Democratic Senate and a Reform Party governor, so legislation moves slowly. But a main issue the MGA is advocating -- reducing commercial property taxes in the state -- should come up for a vote by the end of May.
In the future, MGA members will be assigned to individual legislators to talk about various bills.
WASHINGTON FOOD INDUSTRY
The Washington Food Industry in Olympia, Wash., celebrates its 100th anniversary this year in a retail climate of intense consolidation.
"First, QFC [Quality Food Centers, Bellevue, Wash.] bought up a lot of independents; then it was bought by Fred Meyer, which was bought by Kroger. We became very global in a hurry," said Doug Henken, president of the WFI. Although the number of independent stores in the state has decreased in recent years, Henken said he expected strong players to continue to grow. Among them are Brown & Cole, Ferndale and Haggen Foods.
The WFI, with more than 1,200 retailer, wholesaler, manufacturer and broker members, has steadily grown and streamlined its operations to one purpose: acting as a legislative advocate.
"We're refocusing the association to do legislative and [government] agency work. We truly believe that to survive in the future, we needed to find an initiative to benefit the bottom line of members. By uniting the voice of the industry, we've been able to accomplish that," Henken said.
Major legislative issues the organization is confronting this session is a bill that would mandate a liquor license for wholesalers and retailers; the license would cost $3,000 a year for a grocery store of more than 5,000 square feet. Another bill, now in the state senate, would allow workers to receive unemployment benefits if they went on strike. "This extreme and harmful proposal is definitely on the WFI's priority list. Obviously, worker strikes could run rampant if this bill were passed," Henken said.
IDAHO RETAILERS ASSOCIATION
The Idaho Retailers Association, a group of grocers and other retailers, wholesales and suppliers, will celebrate its 40th anniversary in 2000. Its members have been affected most by a "tremendous growth in population" in the last decade, according to Jennifer Lindsey, president, IRA.
Although the population growth is leveling off now, it has had a profound effect on small retailers, Lindsey said.
"They've gotten ideas from customers from various areas of the country that have led to a lot of remodels and new products," she said.
IRA's membership grew 12% from 1997 to 1998. Its main strength is its members' ability to join in a common cause and fight legislation harmful to retailers.
"There is a lot of support for issues that may only affect one member. They recognize the power of their unified actions," Lindsey said.
"Overall, legislation has been the biggest strength and was really the impetus for forming the organization. That focus, and really strong grass-roots support, as well as the leadership before me, made for good successes."
Over the years, the IRA has backed legislation for a statewide sales tax and repealing the state's inventory tax, which was "not equitable" for retailers," according to Lindsey.
IOWA GROCERY INDUSTRY ASSOCIATION
The Iowa Grocery Industry Association is marking its centennial this year.
The IGIA has battled legislation it sees as harmful to the retail industry since its inception in 1899, but it now places more emphasis on influencing legislation and government affairs.
"Instead of waiting for something to happen to us, we want to educate legislators on how we operate our stores and the business in general. We want to educate legislators and government on all elements of an issue, so they understand all the issues, pro and con," said Jerry Fleagle, president of the IGIA, based in Des Moines.
The organization has defeated or helped repeal what it considers harmful state legislation, and last year helped pass a law allowing retailers to charge a 15 cents transaction fee for food stamps. "We provided information showing that is what the cost of doing transactions is. Once they understood it, they got it passed," Fleagle said.
About 75% of the IGIA membership is retailers, but other members -- manufacturers, wholesalers and brokers -- realize that issues that affect grocers affect them, too, Fleagle said.
The IGIA works with government agencies on behalf of its members. "Members are sometimes afraid to contact government agencies. They think they'll get in trouble," Fleagle said. And the group has created a political action committee, GroPac, that supports pro-grocery industry candidates.