RETAILERS WANT SINGLE PRODUCE TRADE GROUP

AMY I. STICKEL

The prospect of merging the country's two biggest produce trade groups into one organization is looking dimmer -- but for some retailers, at least, the proper course of action is as plain as day.

Just do it, they said. In interviews with SN, retailers across the country said they would like to see one organization serve the industry instead of two.

"It couldn't happen soon enough," said Harold Alston, vice president of perishables sales and procurement for Stop & Shop, Boston, of the concept of blending the Produce Marketing Association and the United Fresh Fruit and Vegetable Association into one group, with one agenda, one set of programs and one trade show.

"I think it's the best thing for the industry. As a retailer, we don't have to send people to two different conventions," Alston said.

Jack Lanners, director of fresh fruits and vegetables at Glen's Market, Gaylord, Mich., said the idea of a single trade organization supporting the entire produce industry sounds exciting.

"A total united organization between the two will really show some super strength within the industry, and for the industry," Lanners said.

Clark Wood, corporate produce specialist for Associated Food Stores, Salt Lake City, agreed.

"There is absolutely, no question there should be a merger," he said. Wood said it is only natural that the supermarket industry's drive towards Efficient Consumer Response should spill over to produce industry.

Throughout the summer, the PMA, Newark, Del., and Alexandria, Va.-based United have been mulling the possibility of merging.

Before Labor Day weekend, however, negotiations seemed to have stalled.

PMA laid out several fundamental, non-negotiable conditions for a merger, which would essentially fold United members and functions into PMA. United officials, on the other hand, stated that a completely new organization should replace both existing groups.

As progress toward a solution began to falter, United proposed a joint "SuperProduce" show, which would eliminate competition between PMA's October convention and exposition and United's February convention and exposition.

The burden of attending or exhibiting at two separate trade association conventions is one of the biggest factors behind an industry push for the two trade groups to merge.

Mark Luchak, director of produce and floral operations for Rice Food Markets, Houston, said that one trade show would be a boon for the entire industry.

"I think it would be a great idea," Luchak said. "It would save money for us and the associations. We have so little time to get away from work."

Wood, like several other of the retailers interviewed, admitted his sympathies lay with PMA, which currently has a larger membership than United, and which also counts a greater percentage of retailers among its members.

Lanners, a member of the board of PMA's retail division, said a merger would free the executives of a new resulting organization from the pressures and distractions of competing.

"I think now, you end up with too much of a competitive situation," he said. "Nobody benefits from that. There will be a greater synergism there that will make a world of difference [if the groups merge]."

A retailer with a close affiliation with United also said he was eager for a merger of some sort should take place.

"I think there's a lot of duplication, and I think there's a lot of opportunity for energy that's being duplicated and wasted to be put to better use," said the produce executive, who asked to remain anonymous.

He said either a full merger or a merging of association functions would help to prevent duplication.

"I think PMA has a very strong educational format. United has a very strong government relations and international format," he added.

The produce executive said United's strength lies in its grower/shipper membership, while PMA's strength is its retailers. "They complement each other so well working together, as opposed to working opposed to each other." "I think it's good," said Mike Genuardi, director of produce operations for Genuardi Family Markets, Norristown, Pa., of the idea of a single trade group. "It can't hurt to have one voice for the industry."

Genuardi said he hasn't had time to study the issue carefully, but it seemed like a merger would help United, which has lost membership and is reportedly experiencing financial difficulties.

Ken Lanhardt, director of produce and floral operations for Cub Foods Stores Georgia division, in Lithia Springs, Ga., said he is not active in either organization. Nonetheless, he said retailers would benefit from a merger, or a merging of some functions.

"As a bystander, I think it's good to see the two companies getting together," he said. "I have a feeling it will be good for retailers.

Of the barriers standing in the way of a merger, however, retailers agreed that the issue of government relations could present the biggest hurdle. United has earned a reputation as the produce industry's standard bearer in Washington.

PMA has made it clear it does not want to control an official government relations program representing buyers and suppliers in any new, merged organization.

Instead, PMA has suggested a "pay to play" coalition that PMA would support along with other, more grower-oriented groups, an option United has rejected so far.

Several retailers, however, said in their opinion, one organization would be large enough to accommodate growers/shippers and retailers.

"I would hope we're all on the same team," said Wood of Associated Food Stores. "I don't see a problem. We are one industry."

Wood said the produce industry came together to save the Perishable Agricultural Commodities Act, which regulates business between suppliers and buyers. Retailers wanted PACA abolished, while growers and shippers fought to preserve it. Eventually, the industry worked out a compromise.

"Look at PACA," Wood said. "I think that worked out okay."

"Everyone's going to have some concerns, and it's not going to be a perfect situation, but it's going to be a lot better than it's been," Lanners said.