WASHINGTON -- The theme of the Food Marketing Institute's annual convention this year is Turning Change Into Opportunity -- an apt description of what FMI has done as it marks its silver anniversary and as it contemplates a consolidation with Food Distributors International.
According to Tim Hammonds, FMI president and chief executive officer, the association's ability to succeed over the past quarter century has required an ongoing effort to adjust to whatever changes the industry has experienced.
"The industry has changed in terms of the nature of competition itself, the kinds of companies doing business and the global nature of competitive development," he told SN. "And I think the way we have changed is that we have done a good job trying to keep up with the industry as it has evolved, to maintain our leadership role in rapidly changing times, and to keep continuity when [everything] all around us was changing."
FMI will mark its 25th anniversary at this year's convention -- scheduled for May 5 to 7 at McCormick Place in Chicago -- with display boards between the exhibit halls and in presentations at social functions. In addition, Hammonds said the association is inviting several special guests to the convention -- past FMI chairmen, retired retailers and other one-time executives who may not have attended the convention in years.
A hot topic of conversation throughout the meeting is likely to be the possible consolidation of FDI with FMI.
FMI's board of directors is scheduled to vote on the matter May 4, the day before the convention starts, Hammonds noted. FDI's board has already approved the combination, with members scheduled to vote by early summer.
"If we get approval from our board and from FDI's members, we'll proceed to put the two associations together," Hammonds said, with the consolidation scheduled for completion by Jan. 1, 2003.
"But it's not as simple as pulling a switch," he said. "It's a case of working for the balance of the year to integrate operations and then to begin marketing for next year's joint programs."
To accomplish the consolidation, FDI would dissolve itself, with its members automatically becoming FMI members, Hammonds said. "Then, as the timing allows, we will bring FDI into our offices -- we have plenty of space to accomplish that."
Once the consolidation is completed, FMI will have two divisions -- one for FDI's wholesalers, the other for independent operators -- with other companies a part of FMI's general membership, Hammonds noted.
Hammonds said FMI has invited other associations to talk about similar consolidations, "but we're concentrating now on making the consolidation with FDI a success."
The theme of this year's convention, Turning Change Into Opportunity, will be reflected in workshops designed to help find ways for buyers and sellers to work together to improve top-line growth, Hammonds explained. "As an industry, we need to develop partnerships between suppliers and retailers that can be turned into business-building opportunities," he said.
The convention will feature several new aspects, Hammonds said, including the following:
The simultaneous scheduling of the Fancy Food Show at McCormick Place. "The Fancy Food Show traditionally attracts a lot of supermarket people," Hammonds said, "because it generates a lot of interest in merchandising and product ideas. It's a great idea show, so it makes a nice fit with our convention."
Both shows feature exhibit floors, and attendees at both meetings will be able to show their badges at the other group's exhibit on May 7, for entry to either show, Hammonds said.
Although the two events will be held in the same massive convention complex, the Fancy Food Show will take place in the old lakeside building across the highway from where the FMI show takes place, Hammonds noted, "though we're looking for ways to be in the same building next year."
Fewer workshops in breakout rooms and more on the convention floor. "We experimented with exhibit-level workshops last year, and most of them were SRO [standing-room only]," Hammonds said.
"Having the workshops on the floor means people don't have to leave the floor. They can go to their sessions and then, once the sessions are over, they can go right over to the booths that interest them. And people walking by an exhibit on their way to a workshop will have the chance to see something that catches their eye and come back there later."
An interactive presentation demonstrating use of the Electronic Product Code at the SuperTechMart exhibit on the convention floor. "A lot of people have heard about EPC but they haven't seen it in action," Hammonds said.
EPC is a new product identification technology that uses tiny microchips embedded in packages to track individual products through the supply chain -- an outgrowth of a program developed by researchers at the Massachusetts Institute of Technology. MIT people will be available in the exhibit pavilion to answer questions, Hammonds noted.
An effort to highlight the marketing power of independent operators. FMI will distribute buttons that read, "Independent Operators You're a $130-Billion Market," to demonstrate the selling power of wholesaler-supplied operators, Hammonds said.
The goal is to encourage exhibitors to pay more attention to independents who approach their booths, he explained. "Exhibitors often prefer doing business with larger companies and because of that, one of the first questions they ask when a retailer comes up to their booth is, how many stores do you have?
"That independent may want to do business with the exhibitor, but when he hears that question, he suspects the manufacturer only wants to do business with large operators."
Wearing the buttons should accomplish two purposes, Hammonds said: "First, it will drive home the point that independents are alive and well and a big part of the market, and second, it will enable manufacturers exhibiting at the show to immediately identify independent operators when they come into the booth without asking that question.
"We believe this will lead to more productive business discussions."
Asked what key issues are on FMI's legislative agenda this year, Hammonds listed the following:
Getting passage of a long-term farm bill before the existing bill expires at the end of the year. FMI is particularly concerned with eliminating language that makes country-of-origin labeling a retailer responsibility and eliminating dairy compacts that it believes inflate prices artificially and raise consumer prices.
Making the repeal of the estate tax permanent, which is of key importance to family-owned companies. The repeal of the estate tax, which was passed last year as part of Bush's tax agenda, is in effect for only one year, Hammonds noted.
Passing health care reform and pharmacy benefits for seniors, "though we expect a lot of that will play out after the fall elections," he said.
Removing a provision from the bioterrorism bill that would require supermarkets to register with the federal government, since they already must register with the states. FMI is particularly opposed to language that makes failure to register a misbranding violation subject to a fine of $10,000 per stockkeeping unit, he noted.
Hammonds said FMI has been designated by the FBI as an Information Sharing & Analysis Center for the food distribution industry.
A convention workshop on food safety and security will touch on potential terrorism, Hammonds said. "Clearly, food isn't an easy terrorist target. But it would have a tremendous impact if a terrorist event took place, because food is such a basic necessity of life and supermarkets are such a basic part of every community."
