PRODUCE/FLORAL: BIGGER AND BETTER

ROBERT VOSBURGH

Produce and floral easily retained their crowns as the brightest and most exciting categories in the supermarket this year, with the industry-average, 4,000-square-foot department offering upwards of 600 items on any given day. The growth in large part has been spurred by a continuing influx of value-added and produce-related goods, ranging from bagged salad mixes to soy products.

Smaller chains and independents are heavily investing in updating their produce and floral selections as a way of capturing business from big chains. There's new interest in using educated department associates to sell specialty, ethnic and signature items, all subcategories that are experiencing fast growth and increased demand from consumers.

Retailers sought out new ways to create exclusive merchandising schemes for select produce items. Kroger made a big splash when it purchased nearly the entire 2001 crop of Colorado's Olathe Sweet corn; not to be outdone, Queen Anne Thriftway and Admiral Thriftway stores in Washington state offered customers signature, tree-ripened peaches this summer, and planned to offer more fruit, including Rainier cherries.

Retail initiatives like these helped quicken the pace of post-consolidation realignment within the entire produce supply chain. But the new emphasis on partnerships between growers and operators is just one result of the activity. Federal officials spent part of the year investigating claims that slotting fees and related trade practices were beginning to creep into the produce department. An interim report by the Economic Research Service of the U.S. Department of Agriculture found that such allowances were being applied to branded, fresh-cut salads. But, in regards to commodity items, "this [policy] does not appear to be the case, at least not yet."

Also drawing grower/shippers and retailers closer together was the industrywide push to implement a standard produce box size of approximately 16 inches by 24 inches. A recent poll found that some items like apples enjoyed a high rate of switchover to the new pack size, though not all crops were moving to the footprint.