WHEN OPPORTUNITY KNOCKS FOR FOOD RETAIL SUPPLIERS

David Orgel

Food suppliers spend a great deal of time trying to determine the needs of retailers so they can initiate new business arrangements. But in the wake of retail consolidation, suppliers sometimes feel they're in the dark about the strategies of their large customers. Some feel locked out by rigid category management planograms.

But every so often, there are reminders that good suppliers are really cherished. I found one such reminder was this month's National Deli Seminar presented by the Dairy Deli Bakery Council of Southern California. Top fresh-foods executives from Wal-Mart, Food 4 Less (a division of Kroger) and Albertsons came to Palm Desert to deliver speeches that urged suppliers to work with their chains. Those invitations came against the backdrop of massive transformation in the region's retail landscape as Wal-Mart prepares to open 40 supercenters in the state in the next few years. The welcome mat is being rolled out for any suppliers who can offer retailers a point of difference.

At the seminar, Albertsons' Tammy Langford, director of fresh foods for the 309-store Southern California division, told the supplier-heavy audience about the chain's plans to remodel units and unveil new stores in efforts to enhance fresh foods (see story, Page 30). She said Albertsons' goals include developing home meal replacement strategies, educating consumers about cooking and healthy lifestyles, and addressing varying customer bases with different store formats.

Langford said Albertsons would like to work with suppliers to address these and other challenges. "We want to build these partnerships," she said. "We want the right image in our stores. Think neighborhood marketing. Come to us with out-of-the-box ideas."

Food 4 Less' Tim Mulhall, group vice president, perishables, described to the DDBC audience the chain's local marketing strategies, including its extensive Hispanic marketing program, and its merchandising focus on full-palette displays at competitive prices. Mulhall encouraged suppliers to work with Food 4 Less to develop compelling deals for consumers. "We're all about palettes and truckload quantities, and we encourage manufacturers and brokers to bring deals to us," he said. He also urged suppliers to pursue programs with Food 4 Less' new Midwest operation, which so far consists of two stores south of Chicago and one in Indiana.

Suppliers also received a warm invitation from Wal-Mart's Bruce Peterson, senior vice president and general merchandise manager, perishables (see story, Page 1). "We don't have all the suppliers we need," he told the DDBC group, adding that he hopes to do business with them in the future.

Peterson said Wal-Mart's ballooning size makes it imperative that the retailer has suppliers that can sustain production.

Clearly, a lot of new opportunity exists for suppliers in Southern California. But that opportunity also exists in other markets jolted by intensified retail competition. At the end of the day, retailers will rely on whoever can help differentiate them from the competition. Good suppliers are in demand, even if it's not always apparent.