STANDARDIZED PRODUCT CATEGORIES EXPLORED

AMY I. STICKEL

MONTEREY, Calif. -- Does the retail produce industry want or need standardized product categories for the purpose of category management?

The question, without a clear answer, was raised during a seminar at the Annual Produce Conference here last week. Currently, retailers involved in produce category management designate as few as four categories in the department to as many as 25.

Proponents of standardization say it will provide supermarket operators with industrywide benchmarks, and allow suppliers to speak the same language to different retail customers. Detractors say standardization is unnecessary and unwieldy.

At a seminar that touched on the "category" part of category management, the panel had representatives of both positions speak up on the topic of standardization.

Dean Fahselt, director of retail merchandising for Melissa's/World Variety Produce, Los Angeles, said there should be an industrywide initiative to standardize at least some categories.

Fahselt said an initiative could occur within the next three or four years.

"We could get more synergy," he said. "I think that eventually that type of thing will happen. I don't think we're there yet. And everybody is just getting started."

However, Terrence "Tip" Murphy, vice president of sales for the Eastern division of Chiquita Banana N.A., Cincinnati, did not see the need for standardization.

"I think there are a lot of things we need to work on before we start talking about an industry standard on categories," he said. "Look at the struggle we've gone through with just PLU numbers. So I'm not convinced that there should be standardization on how retailers define categories."

Murphy added that retailers could use their own approach to grouping products into categories as a way to differentiate themselves from the competition.

Bruce Knobeloch, director of produce for Schnuck Markets, St. Louis, said the issue of standardization could go either way.

"What we can't lose sight of is, if we have the data, we can define the categories in whatever fashion we want," he said.

"In any partnering or in any category planning effort, if you have the data stream -- whether you define bananas as a category or bananas and tropicals as a category -- you can still get performance measures from that," Knobeloch said.