WEST DES MOINES, Iowa — With strange weather the rule in much of the U.S. this year, sourcing has been more complicated than usual for Hy-Vee Inc., said Ron Coles, the retail chain’s assistant vice president of produce purchasing.
Despite that, business has been good, Coles said.
“We have a really good year going.”
In addition to weather, Hy-Vee, which operates more than 230 stores in eight Midwestern states, also has been battling economic forces beyond its control, Coles said.
The recession may be officially over, but buyers of fresh fruits and vegetables are still feeling the pinch.
“Anytime the consumer is in turmoil, which you can say they are now, it’s not the best thing for business,” Coles said.
That said, post-recession, Hy-Vee has not seen a big shift away from more expensive produce items and significantly higher sales of cheaper staples, Coles said.
In fact, something close to the opposite is often the case.
Because of the depressed economy, many Americans are taking “staycations” instead of real vacations, Coles said.
To compensate for the money they save in travel and hotel costs, people spend more on the items they buy at grocery stores, including fresh fruits and vegetables, Coles said.
“They’re splurging more on the meals they’re having at home,” he said.
People may still be buying high-priced produce items, but one effect of the recession has been a decline in new SKUs in the produce department, Coles said.
“A lot of companies cut back on their R&D in the past couple of years and have focused on getting their product delivered at a good price,” he said.
“There’s not a whole lot new coming down the pipeline.”
In 2011, Hy-Vee is expanding, opening new stores in Sycamore, Ill., and Springfield, Mo., Coles said.
In 2012, the chain plans to open a large new store in Overland Park, Kan.
Many of its existing stores are getting remodels and other improvements, Coles said.
Hy-Vee has continued its push promoting locally grown fresh produce this year, Coles said.
“It’s been a major focus for two years, and we’re even expanding it,” he said.
The chain’s individual stores have “total autonomy” on their locally grown programs, Coles said. One trend common to many stores is the display of growers’ names and photos next to their produce.
“It gets the consumers to relate to who actually grew the product,” he said.
On the chain’s website, a link to its homegrown program features a map with the locations of the farms in Missouri, Arkansas, Illinois, Nebraska, Iowa and Minnesota where Hy-Vee sources its locally grown produce.
Cantaloupe, corn, cucumbers, tomatoes, watermelons, squash, pumpkins, peppers and cabbage are among the commodities Hy-Vee buys in season from local growers.
Another bandwagon that Hy-Vee has chosen not to get on with the same zeal is store-branding.
The chain’s leading store-brand items include potatoes and bagged salads, but the category is not a priority, Coles said.
“We tend to push the major labels,” he said.
“It’s not a huge focus in our stores.”