It's only natural that shelf space in the produce department is some of the most coveted real estate in the store. The department's vibrant colors, prominent location and perception of health and freshness can all help boost the appeal of almost any item merchandised there, and generate incremental sales.
In recent years, non-core produce products have been slowly trickling into produce departments. It's a great area for growth, as long as department managers are sure to keep the focus on core items.
“Any opportunity that the retailer can take to suggest pairings that a consumer might not have immediately thought of is to their obvious benefit,” said Julia Stewart, public relations director for the Produce Marketing Association, Newark, Del.
“Making shopping as simple as possible for the consumer also benefits the retailer. One of the things that immediately comes to mind is every fall when apple season kicks off, cross-merchandising the peeler, corers and slicers, and the kits to make apple pies. I've also seen grapefruit sectioners and spoons cross-merchandised with citrus.”
Bruce Axtman, president of the Perishables Group, West Dundee, Ill., agreed, noting that brands like Pom Wonderful and other super-premium juices began demonstrating the opportunity for non-produce categories to thrive within the department.
“There certainly is an influx of new items across the board,” Axtman told SN.
“There's a lot of activity going on in produce, certainly more now than there ever has been before, and that trend is probably going to continue.”
Lequitte Perry, produce manager at a K-VA-T Food City in Louisa, Ky., said the perceived health benefits of super-premium juices make the category relevant within the produce department, and help boost sales.
“Pomegranate juice goes over really well,” Perry said. “I have a lot of people that buy the pomegranate juice because of the high antioxidant [content].”
Perry told SN that salad condiments and dressings also sell very well, particularly when they are merchandised with relevant produce items.
“When we do the tomato displays with the croutons and the bacon bits, [shoppers] do buy a lot of them. We sell quite a bit of those,” she said.
“We also do a lot of dressings and dips. We have fruit dips — a chocolate dip for strawberries, a caramel dip for the apples; and I do sell a lot of the cold dressings.”
Coleslaw dressing, in particular, sells very well in the produce department when merchandised next to prepackaged coleslaw mix, Perry said.
The versatility of the produce department presents a lot of great cross-merchandising opportunities, noted Leigh Vaughn, produce director for Associated Food Stores, Salt Lake City. “The juice category has really exploded in our market, about 47%, so we've always carried Pom and Naked juices,” he said.
Vaughn said he has added Odwalla and Fruitzzo, a juice brand from Utah, to expand the category.
Items like fresh croutons and gourmet salad dressings have also helped pave the way for other grocery items in the produce department, Vaughn said. Currently, he's working to incorporate other items like a new line of local salsas and gourmet jams, as well as a new line of locally made, shelf-stable gourmet salad dressings called Casper's.
“If you can get demos on the right items, anything will sell,” Vaughn said. “When we're trying to find things in the produce department to grow sales, it's always an interesting endeavor to bring in more perishable products, so you have to turn more product on a more timely basis. But we can find things that are shelf-stable, like that salsa and the dressing, and it just becomes an incremental sale that the produce [department manager] really doesn't have to worry that much about. They begin to sell themselves, especially with that local flair.”
However, Axtman emphasized that produce department managers should avoid bringing too many nonfood items into their departments.
“I think it's walking the balance,” he said. “I think those chains or those stores that go too far and have too [many non-produce items] incorporated frankly are at risk of not putting enough emphasis on the core categories and of giving consumers a non-fresh or a junked-up view of produce. So, I think that is a risk if you go too far or too aggressively in this area.
“I think there are great opportunities for some of these products to add incremental sales and complementary sales to these categories, and that's really the upside. So, I think it's really making those determinations on an ongoing basis — which products make sense and which products don't. There's no right answer.”
Axtman added that there are also plenty of new product opportunities within the produce category itself that, in many cases, should take precedence over cross-merchandised grocery or nonfood items.
“There are lots of other opportunities that retailers probably should be focusing on,” he said. “There's so much new product development going on within produce right now, with new varieties, new value-added packaging and steamer technology, things like that.”
The challenge, Axtman said, is that this current level of new product innovation is relatively new to the produce industry. “The produce industry doesn't develop and introduce products all that well,” he said.
“It's a newer requirement of this business model. In the past it was pretty much what was available and what made sense, and now there's so many more options in terms of variety and packaging.
“We've got lots of opportunities out there that are not being optimized yet. Suppliers will have to devote more time and energy to truly developing and launching new products, and many suppliers are not used to doing that. Research, consumer testing, resources to engage on the packaging technology side, for example — these are things that are all required to do a good job developing new products.”
The increased presence of shelf-stable items in produce departments follows a broader trend of integration throughout the supermarket, Axtman observed.
“I think the opportunity is that produce and fresh foods in general are continuing to become more and more important to retail supermarkets,” he said. “There's more emphasis on it; they are getting more space; the fresh side of the supermarket is growing; there's more integration of produce to deli and to convenient-food sections — things like that.
“So as that happens, there certainly is more opportunity for more complementary items or things to come in that maybe aren't necessarily your core fruit and vegetables. From that perspective, there is some upside in opportunity. But then again, I guess my ‘Watch out’ is that there's lots of core product development [by produce suppliers], more so ever than in the past, and that — combined with this hesitancy to de-freshen produce — I think those are the two things that are going to limit these opportunities.”
Stewart agreed that integration can be seen as an opportunity. “I think the biggest issue perhaps is territorialism. That natural competition between grocery and produce needs to be overcome, because both departments benefit from smart cross-merchandising,” she said.
Food City tries to have different departments cooperate and find cross-merchandising opportunities when it is appropriate, Perry told SN.
“We have green bags that hang on each side of my bag racks, the garlic presses by the garlic — as long as it doesn't get in the way, we've got no problems,” Perry said, adding that the produce department also carries little cutting boards, paring knives and strawberry de-stemmers.
In the summer, when corn is in season, butter from the dairy department will be merchandised in produce, or when green beans are in season, salt pork or jowl will be merchandised with them, Perry said.
“So, the whole store tries to work together, if they have extra product and they need to display it somewhere. Sometimes, bakery/deli will let me put strawberries over there, or, sometimes they'll put cakes over in my department,” Perry said.
“I don't know that all stores do this, but we do try to work together as a whole, not just as a department, and it seems to work out better that way.”