BASKETS OF GOLD

Nov 26, 2007 12:00 PM, By CAROL ANGRISANI

Looking for a way to bundle high-margin specialty items or private labels? Gift baskets may be the answer


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Gift baskets aren't just for the holidays anymore.

Food retailers are giving companies like Harry and David more competition as many turn gift baskets from a seasonal side business into a year-round profit center.

The bundled offerings enable retailers to present national-brand, private-label, locally grown and gourmet items in a beautiful package that carries one of the highest retails in the store.

Today, food retailers are selling $100, $200 and — at certain upscale stores — up to $1,000 baskets holding expensive bottles of wine and high-end specialty chocolate.

“Gift baskets are definitely worth the effort,” said Jeff Tomassetti, floral merchandiser at Wooster, Ohio-based Buehler's Fresh Foods.

Buehler's customers can choose baskets filled with virtually anything in the store. Retails range from about $10 to $150, with most sales totaling about $100. Margins range from about 30% to 50%.

By offering gift baskets, Buehler's is tapping into a growing national trend. That's because gift baskets and other “consumables” were the fastest-growing gift category for the 2006 holiday season, according to Unity Marketing, a Stevens, Pa., consulting firm.

People favor gift baskets and other consumables like wine and chocolate over other popular “giftables” categories, such as flowers or plants.

Unity attributes the rise to the fact that consumables are highly experiential, meaning they're more than just a token of affection; they deliver an experience.

The holidays are no doubt the biggest selling period for baskets. Buehler's, for instance, sold about 3,500 baskets last December, a 3% increase in sales from the 2005 winter holiday season.

Strong year-round sales, though, are becoming increasingly common. A big reason for this is that retailers that once focused primarily on fruit are now incorporating food into their assortments.

“A lot of grocery stores are getting into specialty baskets,” said Alfred Fearon, chief executive officer of OIC International, a Bolivar, Ohio, basket supplier.


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