Fresh-cut products are breathing new life into produce companies across the Midwest as the desire for convenience outpaces demand for organic fruits and vegetables and threatens to eclipse locally grown as consumers’ top demand in the heart of America.
Produce suppliers are expanding operations, and retailers are increasing shelf space for peeled and chopped items, according to industry insiders. Schools and other foodservice operators are also more frequently turning to fresh-cut suppliers to do time-consuming prep work as tighter budgets continue to reduce their staffs.
Gene Loffredo, president of Loffredo Fresh Produce, said his company has hired 50 people for its fresh-cut operations in Des Moines, Iowa, in recent months. He said at least 15% of the company’s business is in the fresh-cut sector. Demand is growing so much that additional square footage “is in the works” for Loffredo’s, he said.
“Sales are up across our entire region from Wisconsin to Wichita,” Loffredo said. “We are really seeing increases with our fresh-cut products in convenience stores — especially the single-serving items.”
Loffredo also said increased serving sizes as defined by the federal government are also helping his business, which is 50% contracted foodservice customers, including schools.
School customers also are giving a boost to Liberty Fruit Co., Kansas City, Kan. Reade Sievert, vice president of sales at Liberty, said federal funding has helped increase school districts’ use of fresh-cut fruits and vegetables.
“They are trying new things, too, like fresh-cut jicama, diakon coins and diced papaya,” Sievert said.
Loffredo and Sievert said they believe families’ busy schedules are one of the biggest factors contributing to the fresh-cut boon.
Nick Conforti, a co-owner of North Kansas City, Mo.-based C&C Produce and its fresh-cut sister company Cool Creations, agrees that convenience is a big factor, However, he said he has seen fresh-cut sales take off in recent months and he believes that is a reflection of America’s recovering economy.
Consequently, Cool Creations added 15,000 square feet to its fresh-cut operation. Conforti said the expansion is in direct response to increased demand, which already had the company operating two shifts of workers.
“I think the other driving force behind our fresh-cut growth is our flavor profile,” Conforti said. “It takes the risk out of it for the consumer because they know after they try our brand that they can count on consistency. When they buy a whole melon, for example, they don’t know until they cut it if it’s really good.”
In its third year, Cool Creations, based near downtown Kansas City, Mo., has expanded its fresh-cut line recently to include products with various berries. The company also added berry-only products to its product line at the request of customers.
Brent Bielski, general manager of Greenberg Fruit Co., said the Omaha, Neb., company also is fielding increased requests for berries in fresh-cut products. He credits commodity boards for part of that growth because of their efforts to educate the public about the nutritional benefits of berries.
Bielski said Greenberg is “pleased with the increases” in its fresh-cut business, especially in single-serve and specialty products.
“I think the perfection of the fresh-cut processes and offering a wider range of items is helping increase demand also,” Bielski said.
From the retail side, Mike Orf, assistant vice president of produce operations for Hy-Vee Stores Inc., said consumer demand for fresh-cut is far greater in the chain’s eight-state area than demand for organic fresh produce.
Headquartered in West Des Moines, Iowa, Hy-Vee’s 235 stores are mostly controlled by local managers and almost all of the stores have fresh-cut operations in-house.
“I think the growth in demand for fresh-cut fruits and vegetables is mainly lifestyle driven,” Orf said. “It varies from store to store, but overall we are increasing our efforts and expanding offerings.”