HIGH EASTER HAM SALES HIT HARD BY LOW PRICES

PAMELA BLAMEY

Although ham remained a best-seller for the Easter holiday, low prices, procrastinating customers and the increasing popularity of eating out for the holidays conspired to make this a disappointing season for retailers and wholesalers.

"Ham moved spectacularly at about 20% over last year," said Gary Sherman, supervisor of retail meat merchandising at Spartan in Grand Rapids, Mich. "But pricing was about 10 cents below last year's levels."

Customers were looking for a slightly more upscale product than in previous years, Sherman said. "If anything, it was the lower-grade products that suffered." "Prices were definitely cheaper this year," noted one major Midwestern retailer. "Shank was selling for as low as 69 cents per pound in the Dayton-Cincinnati area, with boneless as low as 99 cents. Even top-of-the-line hams averaged between 99 cents and $1.39.

"With Meijer's coming in to Cincinnati and Kroger's stepping up competition, we see some ridiculous prices," the retailer said.

"This year we noticed that value-added hams are in great demand," said Harry Pappas, vice president of meat merchandising for Mayfair Super Markets in Elizabeth, N.J. "When it comes to the holidays, people are buying just a little better product: spiced, sugared, cured boneless, etc. Just as with other meats, they don't want waste."

Mayfair quadruples sales of hams during Easter, said Pappas.

Even price shoppers are pursuing higher-quality products, said one Southern wholesaler.

"The consumer is aware of the fact that the industry is putting out a product with 35% added ingredients, and recognizes that it affects taste and quality," said the wholesaler.

"Movement was good, with a lot of good emphasis on products like spiral-sliced ham," said Frank Lavin, director of meat and deli for Super Fresh, Florence, N.J. "Premiums did well compared to the commodity type of hams, but retail prices were down across the board. Smoked hams were about 10 cents per pound cheaper than last year. We sold our most popular ham for 79 cents."

Shoppers in many areas made the week even more hair-raising than usual by waiting until the last minute to make their purchases. If that made retailers nervous, the effect was even worse on the wholesale end. "We were holding our breath hoping that the stores wouldn't hold out until they were out of product," said one product manager from a wholesale firm.

Overall meat sales were up 5% over last year at Seaway Food Town, Maumee, Ohio, according to Wally Bilius, director of meat operations. The chain ran a promotion for a boneless ham at $1.18. At Riesbeck in Wheeling, W.V., sales for Easter were somewhat stronger, with boneless ham selling for 99 cents to $1.45, and bone-in hams from 89 cents to $1.17.

"There is a revival of bone-in products and spirals," said meat program director Michael Yoss. Yet retail was still 10 cents to 20 cents per pound lower than last year, he said, with competition as low as 87 cents. Although beef continued to be priced aggressively, he noted, and overall beef sales were very strong, lamb was "not a fast mover in this area."

Yoss said Riesbeck doesn't go for the promotions favored by other chains, where they cut prices on certain meats in order to get customers to buy the rest of the holiday meal in the same store. "We haven't been real successful with [those] promotions in the past," he said. "We prefer to just give the customers a good discounted price and leave it at that." Other chains, however, continue to treat ham as a "loss leader," judging from Easter advertisements in markets across the country.

Customers at Fry's Food Stores of Arizona, Phoenix, could purchase a bone-in hickory smoked, reduced-sodium ham for 59 cents per pound, or a butt portion ham for 79 cents per pound if they purchased at least $10.00 of other goods there. Some chains take the opportunity to move quantities of target products. A promotion at Tom Thumb in Dallas allowed customers to earn a free ham with the purchase of several specific items.

Turkey is another big Easter holiday seller in many regions. "Turkey Breast is a front runner at Easter," said Mayfair's Pappas. "Even for Thanksgiving, people are buying turkey breast instead of the whole turkey."

But mostly, the market is price driven, Pappas noted. Lamb, for instance, sold 20% better than last year, but simply because the retail price was lower. "Customers like a bargain," he said.

A former favorite for Easter, lamb has been generally a sluggish mover due to price competition from beef, poultry and pork, said one Southern wholesaler. "But there's still a huge spike on lamb at Easter, with a huge demand for lamb legs," the Southern wholesaler added.

One major wholesaler sold more than 100 cases of lamb at $3.99 per pound, but, he added, "there were cheaper prices out there."

Although sales for the holiday increased as expected, they were still poor in comparison with historic levels. Several merchandisers cited the Yuppie factor as a reason for sales dropping off. As one retailer explained, "Many of them live far from their families and don't come home for the holiday. More people are going out to eat instead of going to Grandma's house."