WALKING THE WOK

MIKE STERNMAN

Sizzling sales of stir-frys, blends and other vegetable mixtures are offsetting sluggish results among commodity vegetables, helping the embattled frozens aisle hold its own.

These latest attempts to pump up the convenience aspects of mixed vegetables with meal kits apparently have struck a chord with consumers, said retailers, some of whom noted that each meal kit sold means one home meal replacement that isn't bought elsewhere.

Retailers, who ordinarily balk at squeezing products into tightly merchandised freezer cases, have accepted most of the new value-added stockkeeping units, and report they're happy they did.

Kevin Pruitt, manager of frozen and dairy at Harris Teeter, Charlotte, N.C., said stir-fry and add-meat items were in his stores for only part of last year, but that was enough to affect the category greatly. "Polybag prepared -- that's up 30% with me in 1995," Pruitt said.

Others, such as Peter Kemp, category manager at Randalls Food Markets, Houston, have also seen the new products help the category. "The frozen vegetable department has been a flat category selling the 16-ounce polybags and the 10-ounce boxes. I still do extremely well with them. But I am starting to see a lift in the category from these Create-A-Meals, the Pasta Accents, the Easy Recipes," Kemp said. "They are expanding quickly because of the consumers I have, many in households where both family members are working; they need to make a quick, healthy meal at home."

"I think the future of the industry is in these value-added items, as long as we answer the needs for easy meals in no time at all, and continue to create different combinations and educate the consumer on the convenience we have to offer," said Pruitt of Harris Teeter.

Mark Capicotto, director of frozen food and dairy at Big V Supermarkets, Florida, N.Y., a member of the Wakefern Food Corp. ShopRite cooperative, said efficient positioning of value-added frozen vegetables is a key.

"As for cross-selling other meal components, it would make sense supposedly to have, let's say, frozen shrimp right next to the stir-fry vegetables. Normally I don't seek to cross-merchandise that way, though it's not a bad idea," he said.

Tom Outlaw, director of frozen foods at Ingles Markets, Black Mountain, N.C., said the segment is doing well, but cited competition from meat suppliers offering similar products. At present, these kits enjoy sales through the meat department, not in frozens where their price points, at more than $6, and value perception are more compatible, retailers said.

Vendors told SN they expect the value-added segment to account for 10% of the $2.2 billion frozen vegetable pie in 1996, $1.7 billion of which is expected to be sold in supermarkets.

According to A.C. Nielsen, Schaumburg, Ill., sales of the Create-A-Meal stir-fry Oriental-style vegetables and sauce line from Pillsbury's Green Giant scored a 113% gain to $101 million for the 52-week period ended March 16.

Another popular line of single-skillet cut vegetable meals is Pasta Accents, also from Green Giant, running at the rate of more than $70 million.

The competition is becoming intense. Dean Foods has blanketed the United States with Pasta Secrets, the Birds Eye Easy Recipes meal starter line, which emphasizes pasta and Oriental noodles.

Variations on the theme are starting to appear. One, from Pictsweet, is an oversized 28-ounce item in a resealable bag complete with a zip-up dry seasoning packet allowing consumers to control usage.

In past months, several regional players have climbed aboard. However, retailers said vendor chances were limited due to a lack of room. With little or no extra space being allocated to vegetables, meal starters have tended to displace commodity vegetables, said Carl Murphy, vice president of grocery at Busch's Valu Land, Ann Arbor, Mich. "You used to have two rows of corn or peas. Now there's one row of those and a row of Create A Meal," Murphy said.

Private label is also expected to compete for freezer space, given stronger consumer demand for value-added kits on the branded side.

"If the stir-fry type is going to show staying power and get hotter, we might as well look to getting into it," said Dick Dorr, buyer at Eagle Food Centers, Milan, Ill.

Such a trend would help private label continue its dominance in the frozen vegetable arena. According to the 1995 numbers collected by Information Resources Inc., Chicago, private label accounted for $733 million of frozen vegetable sales, a 42.9% share .

While numbers from Nielsen show the mixed vegetable segment has grown in dollars by 30% over the past five years, retailers have not turned their backs on plain vegetables. Some reported significant gains in that area as well. For example, Pruitt at Harris Teeter recorded a 12% spike there in 1995.

"I think people are buying a bigger selection of vegetables," said Bill Campbell, frozen food buyer-merchandiser at Associated Food Stores, a Salt Lake City wholesaler servicing 700 independents. "Instead of just buying one package of peas, they are buying one package of corn and of mixed vegetables; they're adding to their intake."

There has been a trend "away from the high end, the peas prepared with butter sauce," Campbell added -- a fact corroborated by Nielsen research, which showed the $240 million in-sauce area was down by 13.8% in dollars and 8.1% in units over the five-year span ended Sept. 5, 1995.

Greater values, coupled with health appeals, have buoyed plain vegetables, retailers said.

"The main action we're taking with the basic vegetable lines is doing what everybody else is, price dealing. Any time you get out a 16-ounce polybag for 79 cents, 89 cents, it is going to spark volume for sure," said Bryan Ryckeley, frozen food manager at H.G. Hill Stores, Nashville, Tenn.

In terms of helping the vegetable category continue to grow, Outlaw of Ingles said, "Manufacturers would do well to provide materials for ad slicks that would emphasize convenience, such as easy preparation."

Outlaw, who also has experience in the produce section, added that the frozen food industry was "missing the boat" on getting behind the 5 a Day program that's done well for perishables.

"They've provided a tremendous amount of information, ad materials and advice. It's a good tool to sell vegetables. It's a great opportunity to persuade our consumers that frozens are just as fresh as fresh produce," the Ingles executive said. "To make 5 a Day go well, there would have to be a major push on it from the vegetable companies," noted Pruitt at Harris Teeter. "Some of them are putting [the 5 a Day symbol and message] on their labels now, and that's causing it to blip up a bit."