SHELF-STABLE MILK COMES OF AGE

RICHARD TURCSIK

A septic packaged milk, first introduced in the United States in 1994, has found a place in the American pantry.

Products from Parmalat and Hershey are becoming popular with shoppers and are often kept for emergency situations, like hurricanes and other natural disasters, or for a nonrefrigerated lunch-box treat, retailers report. Sales have also been increasing for soy and rice milks, which are used by lactose-intolerant consumers.

"Parmalat is viewed by a lot of people as a camper's type product or something that can be used in case of a power failure or other emergency. It becomes a secondary product," said Suren Avedisian, director of operations at Omni Foods, Newton, Mass.

Ruth Kinzey, corporate communications manager for Charlotte, N.C.-based Harris Teeter, said that at her chain the shelf-stable milk appears to be bought primarily by older, single adults.

"Although sales of these items have been consistent, they have had virtually no impact on fresh milk sales," she said.

"At Harris Teeter, we merchandise these items either in the shelf-stable juice area or in the milk modifier section. Overall, margins on these items are higher than on juices," Kinzey added.

"Aseptic packaged milk is still a small segment of the shelf-stable milk category in the United States, accounting for less than 2% of sales," said Craig Hoff, director of category management in grocery, frozens and dairy at Fleming Cos., Oklahoma City.

"Fleming has found that it is typically merchandised with other shelf-stable milk products, such as powdered, canned evaporated and sweetened condensed milk," he said.

"There are some sections of the country where aseptic packaged milk is not even marketed, and most of the sales are coming from the East and West Coasts. The trend has not really caught on in the United States as it has in other countries, because Americans have a lot of refrigerator space to store larger containers of milk," Hoff noted.

The shelf-stable milk category grew 22% for the 52-week period ended Dec. 29, 1996, to reach $43.8 million in sales, according to Information Resources Inc., Chicago. The largest brand by far was Parmalat, with sales of $17.7 million, up more than 100%, and a market share of 40.4%.

Jim Lefebvre, director of purchasing for Stanley Stores, Bay City, Texas, said while sales of shelf-stable milk are generally slow at his chain, he still feels a need to stock it to offer his customers variety.

"We generally merchandise them in the milk section, but I do have some milks in the aseptic packs that I put in with the aseptic juices," he said.

For the most part, Lefebvre said customers with children purchase them to place in lunch boxes.

Omni's Avedisian said when a major snowstorm is predicted, sales of Parmalat, soy milk and other nonperishable milk pick up. Ironically, sales of fresh milk also pick up during those periods, he said.

"If you lose power, having [refrigerated] milk doesn't do you any good because it is going to spoil," he said, noting customers also stock up on microwavable frozen dinners when nasty weather is predicted.

Patrizio Spagmoletto, marketing manager for Parmalat USA, Moonachie, N.J., said his company's sales are steady all year long. Parmalat is distributed along the East Coast, California and parts of Arizona and Texas. Its sales peaks are similar to that of fresh milk, increasing around holiday periods, he said.

"The only peaks that we see that are not seen with refrigerated milk are during emergencies, such as hurricanes or winter storms and other natural disasters when there is a fear that power might go out," he said.

"Our product really offers convenience. You don't have to worry about a short expiration date with us," Spagmoletto said, noting Parmalat has a shelf life of six months and will keep for seven to 10 days once it is opened.

"This is definitely a milk for the person on the go, who doesn't want to worry about their milk going bad," Spagmoletto said, adding that on the average, 50% of American families run out of milk once a week. He noted that it is often used as fill-in purchases or by the elderly who cannot get out to shop for milk on a regular basis.

Hershey, Pa.-based Hershey Food Corp. has been having success targeting the children's market. It manufactures a line of chocolate-flavored milk that is sold in three-packs in what is called the perfect size for lunch boxes.

"The overall aseptic flavored milk category is doing very well. Our chocolate milk is selling well and is the market share leader in that specific flavor. It is a very convenient, portable option for consumers," Mike Kinney, a Hershey spokesman, told SN.

Meanwhile, to help build brand awareness, Spagmoletto said, Parmalat has just completed a three-month radio advertising campaign. It also ran in-store price promotions in March to drive sales. The company has also begun testing on a lactose-reduced milk.

Montvale, N.J.-based A&P is one of the chains that promoted Parmalat during March. The week of March 17 it was featured for 99 cents a quart, a 30-cent savings. In stores visited by SN it was merchandised in the coffee and tea aisle, along with soy milk, canned milk, evaporated milk and powdered milk. In addition to being merchandised on two, 4-foot shelves, the promotion was supported by aisle stacks of Parmalat whole milk, low-fat, skim and 2% fat. Officials at A&P could not be reached for comment.

The upscale Kings Super Markets chain, based in West Caldwell, N.J., has been trying to boost sales of shelf-stable soy milk by working it into a February class at its cooking school. The class covered the health benefits of soy and was available for $35 per person. Officials at Kings could not be reached for comment.

Avedisian said Parmalat has overcome some of the hurdles it witnessed when it first entered the market.

"When Parmalat was first introduced here, part of the problem for the supermarkets was that it was presented to the dairy buyer. So the dairy buyer buys it and puts it in the dairy aisle, which is the wrong place for it because it defeats the purpose. People need to understand that it is a shelf-stable product," he said.