Avocados carry healthful category returns for retailers

11/04/2013 01:41:00 PM
Vicky Boyd

Vicky BoydDave Fausset, sales and category manager for Mission Produce Inc., shows off a portable tree display that can be used for bagged avocados in the produce department or other departments, such as deli or the chip aisle.Healthful messages about avocados have resonated well with consumers, spurring increased consumption and purchases.

By carrying a variety of sizes and packs, having multiple displays and devoting more space to the fruit, retailers can boost overall category sales even further, say importers, marketers and shippers of Mexican avocados.

“Avocados are very promotable, so it’s something that people like to see pushed, and they’re able to react,” said Rob Wedin, vice president of sales and fresh marketing for Santa Paula, Calf.-based Calavo Growers Inc. “You get significant increase in sales volume, so the retailers like to promote avocados.”

Marked growth

In 2012, total U.S. sales volumes of hass avocados grew by 35%, and total sales dollars rose by 10.2%, said Emiliano Escobedo, executive director of the Irvine, Calif.-based Hass Avocado Board.

“Price was only down an average of 18%,” he said. “Retailers should look at their 2012 results and compare them to the national average.”

Having production in Mexico that complements supplies from California, Peru and Chile, keeps avocados in the produce department and in front of consumers year round, said Gahl Crane, director of avocado sales for Green Earth Produce, Vernon, Calif.

“Retailers are able to get aggressive on pricing with the increased supplies,” he said. “There are a lot of opportunities. I think the No. 1 take-home message is just the reliable supply.”

Having a strong avocado program also enhances sales elsewhere in the store, said Dave Fausset, sales and category manager for Mission Produce Inc., Oxnard, Calif.

“The retail ring that you get with people purchasing avocados is much higher than if they’re not (purchasing them,)” he said. “When you’re buying avocados, you’re buying many other things to go with them.”

At the retail level, Wedin said he believed the best way to increase sales is to have ripe fruit available on a consistent basis. Applying stickers that say “ripe” also alerts consumers that the fruit is ready to use.

“That’s what people are really looking for,” Wedin said. “We find that some of our most successful retail customers are ones that are on a consistent 100% ripe program.”

To be able to provide that type of fruit to retailers, Calavo has several ripening facilities scattered throughout the country.

Variety of sizes, packs

Allotting more space to avocados also can boost sales.

“Certainly increasing the shelf space on the bulk displays can improve sales,” said Doug Meyer, vice president of sales and marketing for Murrieta, Calif.-based West Pak Avocado Inc. “But it’s really specific to the retailer.

“Across the U.S., when a retailer has looked at the size of the display and increased it, in general there has been a lift.”

Adding bags also can help overall category sales, but Meyer said retailers may have to experiment with the best location.

“They have to be willing to test the bags to find the right fit within the department or sometimes merchandised in other departments,” he said. “It does take commitment to try the bags.”

Bagged product comprised only 35% of distribution in 2012, which provides ample opportunities to grow sales of bags, according to a Hass Avocado Board study.

From 2010-2012, bagged sales dollars grew 80% compared with the sales growth of bulk at 17%. Nevertheless, bulk still account for 94% of total avocado category dollars.

The most popular count is four, according to the board survey.

Despite some beliefs, Escobedo said bags don’t cannibalize bulk sales but are complementary and can actually increase overall category sales.

Secondary displays

Using secondary displays in other locations, such as the potato chip aisle or by the deli, also can enhance avocado sales, Meyer said.

Phil Henry, president of Escondido, Calif.-based Henry Avocado, agreed.

“Any time you can have an impulse location, it’s a benefit and it increases sales,” he said. “In some cases, you can easily double sales, so having multiple displays is a benefit.

“Large displays are beneficial and, of course, appealing price points are beneficial,” Henry said.

He said he knows of several successful retailers who carry a couple of different sizes — small and large — for bulk displays as well as displays of bags elsewhere in the store.

Displaying avocados next to tomatoes and limes, for example, also lifts sales, he said.



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Sandy    
Redland, Fl  |  November, 06, 2013 at 02:30 PM

I'd rather wait and let it ripen on my kitchen shelf than the grocer to continue cooling and controlling the ripening process. When avocados are cooled before and after packing and shipped to distribution terminals and then to the grocer,sitting between with normal temperture and cooled again, the taste is distorted and diminishes the flavor.

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