PASTA'S UPWARD SPIRAL

BOB BAUER

Supermarkets are stuffing more pasta products into their frozen-food cases, helping make the category one of the hottest growing in the department.

Frozen-food executives told SN they are promoting and, in some cases, expanding their frozen pasta sections to plug into what they are convinced is a natural extension of the success pasta continues to enjoy in dry grocery sections.

According to data compiled by Nielsen North America, Northbrook, Ill., unit volume of frozen plain pasta alone -- items with no sauce and not part of a dinner or entree -- jumped 13.5%, while dollar volume climbed 17.9% for the 52 weeks ended June 11, the latest period evaluated by the scanning data firm.

In spite of such hefty gains, the category is still a small one, accounting for $65 million in sales. That number becomes much more impressive, however, when compared with the $26 million the category recorded two years earlier.

Retailers told SN the growth has come relatively easily, thanks to aggressive action by the category's manufacturers.

A review of approximately 25 supermarket advertisements and circulars from around the country for the second week of December backs up that point. Nearly half the chains were offering a frozen pasta product at a sale price, including several buy-one-get-one-free offers.

For example, Jewel Food Stores, Melrose Park, Ill., was offering 13-ounce packages of Floresta pasta at 99 cents, half-price. One of its competitors, Treasure Island Foods, Chicago, was offering the items at the same price.

Bob Pitzer, frozen-food buyer for Roth's IGA Foodliner, Salem, Ore., is bullish on the category's future. "We've only got one brand available to us right now, and it seems to be doing well," he said. "I've got a second ad coming on it and sales are picking up. I think it's got some potential and it's going to start growing."

The buyer added that he'll expand the category as soon as another brand becomes available to him. He said frozen pasta may well be feeding off the success of refrigerated and dry grocery pasta products.

"Since the bagged [segment of dry pasta] has come in and the refrigerated pasta has picked up, that's been a plus for the frozen also," he said.

Val Vivenzio, director of frozen food and dairy for Big Y Foods, Springfield, Mass., shares Pitzer's optimism about the frozen pasta's future.

"The category will continue to grow because of good price and quality. The category is showing a growth in sales of about 30% in cases," he said.

Vivenzio said stuffed products are where the action is, and are the total focus of the category in his departments.

"All of our frozen pasta is stuffed -- ravioli, tortellini, stuffed shells. At one point, we did have a frozen fettuccini, but don't carry it any longer," he explained.

Big Y, he added, has developed three frozen pasta products of its own and has three more in development. The chain is also carrying a local brand. "We have a local pasta company called Angie's and their products are doing well."

Bob Tokar, frozen-food director for Supervalu's Pittsburgh division, New Stanton, Pa., said pasta is a proven commodity in frozens, as it is in all areas of the store.

"When you look at grocery, pasta is a big item; it indexes very high. We do very well with frozen pasta here too," he said.

"We're promoting it and seeing good sales from it. It is a category that should see some growth next year. There are more players getting into it and they're getting more aggressive as far as promotional activity is concerned," the Supervalu executive said.

Jim Delp, frozen-food buyer for Acme Markets of Virginia, North Tazewell, Va., is betting on the category's future.

"We have expanded the space we're giving it in anticipation of how we think the market is going, but it hasn't shown up in our sales figures yet," he said. "The Lean Cuisine and those kinds of items have started taking off for us, but not the pasta category in particular."

According to the Nielsen statistics, Celentano is the leader in the category with $16.4 million in sales, up 3.9% from the prior year. Italian Village, which experienced a 44.9% jump in sales volume, is next at $12.6 million. Private-label brands accounted for $10.5 million in sales, up 6.9%.

Supervalu's Tokar said stores have been adding space for frozen pasta products to meet the increased demand for the category.

"Anytime you get more people into a category, you have to look at the space you allocate to it, the sales you generate in it and the trend of the category and determine the space you need to give it at retail," he said.

A buyer with a division of one of the nation's major supermarket chains said his stores have about 12 stockkeeping units of frozen pasta today, double the six most carried last year.

"It's a hot area," he said. "Of course, it's still a small category and I don't think it's ever going to be a huge section. But it's got the potential to double its sales again over the next couple of years. After that, I think it might level off."

His chain, he added, regularly runs sales on frozen pasta products, thanks in part to aggressive activity by the category's manufacturers.

"They've been consistently pushing to get their products in the spotlight. We run sales at least once a month. It's created a great lift for the category."

The frozen-food buyer for a Midwest chain has also expanded space for frozen pasta because of high expectations for the category.

"We've added two more stockkeeping units to bring us up to six and I'm prepared to add more," he said. "We've only had the new SKUs for about two months, so it's too early to tell how they're doing. If things go well, we'll add two or three more SKUs within a couple of months."

Still, many chains are opting to take a relatively conservative approach to expansion in the category, given frozens' overall premium on in-store space. A New England area broker said it can be a tough sell, even with its impressive track record of growth over the last five years. Some retail sources said category sales can slow when items are not promoted.

"I really move the product when it's on sale, at half price or on a buy-one-get-one offer," said the Midwest retailer. "At other times, the movement can be kind of slow. Maybe it hasn't become a must-have item for people yet, so it only catches their attention when it's on sale," he said.

"Frozen pasta is very limited in section size, because of its price," said a spokeswoman for Baker's Supermarkets, Omaha, Neb., of the retailer's frozen pasta set. Baker's carries five SKUs and allots two feet of space for frozen pasta, the spokeswoman said.

The category also is apparently having less of an impact in stores that focus on upscale fare.

"With the advent of the deli pastas, the fresh, not frozen, segment has kind of taken over the marketplace," said Dick Yates, frozen-food buyer for Gelson's Markets, Encino, Calif. "With space being as valuable as it is in the frozen-food case, you can't have something just sitting there. There are some pasta items that move -- the entree-type things with the sauces. But the regular pasta really doesn't get the play the fresh stuff does."