HISTORIC OCCASIONS

ROBERT VOSBURGH

Annual trade shows help reflect the changes that an industry has made from year to year; they also assist retailers and manufacturers in staying ahead of the curve of consumer demand.

But, in some cases, a trade show serves a larger purpose -- it becomes a showcase for an entirely new entity that, before then, was often overlooked or largely ignored. Such is the case for the Private Label Manufacturers Association, New York.

The first exposition was held in the fall of 1980, a year after the association was founded by 20 store-brand manufacturers. The trade show featured 56 exhibitors at the Ramada Inn O'Hare, Chicago, along with about 100 retailers, though all of them were from the major chains. In three aisles, attendees found only the most basic items, like peanut butter, jams and detergents.

Still, it was the first time private label had been the subject of a single show, and it marked a new era for retailers looking for new ways to boost the profile and profits of their stores.

"Manufacturers did not have a show in which to display their goods, and retailers didn't have a place to go to help expand their generics or private-label programs," recalled Brian Sharoff, PLMA president. "All of the shows at that time were all branded shows."

The 1980 Fall Trade Show and Educational Conference was a three-day affair promoting the theme, "Freedom of Choice." Joseph Conte, vice president of Witco Chemical Corp., Oakland, N.J., and PLMA's first chairman, said, "We firmly believe that private labels offer consumers an important alternative in their buying decisions. This is especially critical during these inflationary times."

Seminars included an examination of how private label could fit into a marketplace dominated by national brands. Robert Steiner, an economist with the Federal Trade Commission, Washington, backed up that theme by expressing government support for the industry's goal of increasing private label's market share, saying the increased competition would benefit consumers.

The keynote speaker -- consumer advocate and perennial presidential candidate Ralph Nader -- also promoted the idea that private-label growth could only help promote the merits of a competitive marketplace.

"The organization early on decided that its membership would grow from trade shows," said Don Spellman, vice president, sales and marketing, J.L. Prescott Co., Passaic, N.J., and PLMA vice chairman. "The first show purposely featured a headline keynote speaker. He helped to draw a large audience."

Indeed, PLMA carefully planned its early shows, recruiting speakers who ranged from assistants to the president of the United States to top executives from major retail chains. Each one helped to add credibility to the fledgling organization and its role in the food industry. For retailers, merely having a solid group of vendors under a single roof was reason enough for them to express satisfaction with the first event.

"I was able to discover products or manufacturers of current lines which I didn't know about before," said Kenton Gast, director of grocery procurement for Kroger Co., Cincinnati, of the first show. "The trade show [gives] those manufacturers or brokers on their toes the opportunity to approach retailers they ordinarily wouldn't meet. It's a forum that allows for new contacts and new relationships."

Charlie "K" Kotsopoulos, private-label marketing manager for Stop & Shop, Quincy Mass., agreed, saying, "The trade show offers the opportunity to meet and discuss things, and more important, to get something started. The show made me more aware of sources of supply."

One year, early in the life of the annual show, George Gallup Jr. of the Gallup Organization, Washington, presented the first national survey gauging consumer attitudes toward private label. Market share during this time was not known, since research firms like Information Resources Inc. and ACNielsen did not track the category. But, according to Sharoff, the industry itself estimated that, in dollar terms, generics comprised up to 2% of total grocery sales; and private label was working in the 10% to 12% range.

If nothing else, that first show proved there was sufficient interest in private label to pursue growth, both inside and outside of the industry. In 1981, the show moved to the Chicago Marriott Downtown on Michigan Avenue, with some 125 exhibitors. More retailers attended the exposition and conference as the association continued to attract attention from all segments of the industry. Within a few short years, the number of exhibitors participating in the show swelled to 1,200.

And, though the first five years were marked by a continued concentration on very basic Center Store products, supermarket buyers saw these forums as a vehicle for new ideas and a practical way to investigate the growth potential in new categories that were soon to emerge, including beverages, salad dressings and snack foods -- items that in the first few years weren't in the private-label mainstream.

Almost immediately, major retailers participated in the shows, driven by need; they were looking for new avenues of growth that could also boost profits. By the mid-'80s, retailers like Jewel, Kroger and Safeway were leading the industry in changing the look and feel -- and credibility -- of private-label products.

Such activity on the retail side caught the attention of better-known manufacturers, who until then had been content running private-label operations quietly under a completely separate division. Now, the growing profile and success of the PLMA trade show brought increasing numbers of brand-name manufacturers into the organization, out of fear their competitors would gain a market edge.

By the 1990s, the floor included 1,300 exhibitors, and the aisles contained products that retailers would have never seen 10 years earlier, such as rice, teas and cookies.

Also, this phase of the show's evolution was marked by two key developments, both centered on retailer initiatives. Loblaw Cos., Toronto, Canada, demonstrated that private label did not have to be confined to basic products, and began aggressively marketing items like barbecue sauce and premium shampoos.

"This said to retailers that private label can not only create new and interesting products in categories where there is no well-known brand leader, it can also go head-to-head against top leading brands," Sharoff said.

Meanwhile, Wal-Mart embarked on its own major private-label program, with Sam's Choice (and later Ol' Roy and Equate). The importance of this development quickly became apparent to competing retailers, who discovered that private label could be one way to compete on price, since it was virtually impossible do that with Wal-Mart on national brands.

By the end of the 1990s, the show demonstrated the industry's shift from a focus on Center Store to other departments, including perishables, gourmet/specialty, housewares -- and beginning this year, wines & spirits. The event has also welcomed an increasing number of international manufacturers. At the 2002 show, there will be some 15 pavilions on the exhibition floor, grouping vendors by country.

Over the years, the trade show's New Product Expo has become a source of new ideas and routes to potential profits.

Unlike the "me too" knock-off strategy of the past, today's retailers are more willing to create the demand themselves, through more sophisticated, premium product lines -- especially in those categories where there is no leading, major brand.

PLMA Goes Colonial With Trade Show

The upcoming PLMA trade show reaches back into the past to illustrate the future of store-brand products.

The show, which is themed "Legend of Store Brands," evokes images of Sleepy Hollow and pre-Colonial times to show that private labels have, in reality, come full circle from the days when shopkeepers dipped into their best private stores of flour, sugar and tea to sell to their loyal customers.

To be held in Chicago from Nov. 17 to 20, the show will bring attendees up to date on the latest trends and give them a peek at the future of private label.

"We try to make it fun each year," said PLMA President Brian Sharoff. "This year we wanted to remind people that the current growth of private label is one more step on a path that started in Colonial times with a relationship between the retailer and the customer."

The trade show will feature 2,100 exhibitors showcasing a wide range of products including food, beverages, health and beauty aids, household and kitchen products, general merchandise, and personal and leisure items.

Also included is a New Product Expo that will enable retailers and wholesalers to see the innovations in products and packaging that will be available in the near future.

A new section devoted to wines and spirits will also be part of the mix. Wines, which recently generated sales of $3.6 billion in U.S. supermarkets, is quickly emerging as one of the next large-growth categories for private label, according to the PLMA.