Retailers forgo field for hothouse tomatoes - The Packer

Retailers forgo field for hothouse tomatoes

05/24/2013 10:49:00 AM
Tom Burfield

Courtesy Deardorff Family FarmsDeardorff Family Farms, Oxnard, Calif., offers a cardboard display fixture to help retailers merchandise its proprietary Tasti-Lee tomatoes, president Tom Deardorff says.Tomatoes remain one of the best-selling items in the produce department, but the category is undergoing some changes at retail.

“Tomatoes are just as popular as lettuce, bananas and mangoes,” said Danny Uribe, sales manager for Pinos Produce, San Diego. “They’re a staple item.”

 

Retailers prefer hothouse

But while tomatoes remain popular, not all tomatoes are created equal in the eyes of U.S. retailers, said Jeff Dolan, field operations manager for The DiMare Co., Newman, Calif.

It seems many retailers are forgoing field-grown tomatoes.

“Tomato sales have not been strong in the U.S. in our (field-grown) category in quite a while,” he said. “They switched over to hothouse tomatoes, primarily, at retail in the U.S.”

Demand for field-grown tomatoes remains strong from Canadian supermarkets and U.S. foodservice accounts, but many U.S. retailers perceive hothouse tomatoes to be more profitable, he said.

“The traditional vine-ripe category is suffering considerably,” said Tom Deardorff, president of Deardorff Family Farms, Oxnard, Calif.

Shelf space for traditional varieties “has all but disappeared” as a result of demand for hothouse and other products, he said.

“Retailers believe they can charge a high retail price for hothouse tomatoes compared to mature-greens and get a larger gross margin on a per pound basis,” Dolan said.

They can get a good-tasting, field-grown tomato from farms in California, but the perception is that they can’t get as high a price, Dolan said, “So they don’t want to put them in their stores, which is a shame.”

To combat that trend, Deardorff Family Farms has shifted its attention to the proprietary Tasti-Lee tomato, which Deardorff said is doing “exceptionally well,” while other varieties are underperforming.

 

In-store merchandising

Since the Tasti-Lee comes in a consumer pack, it’s easy for produce managers to handle and merchandise in display-ready cases and on end caps, he said

“It has opened up a lot of opportunities for merchandising in-store.”

Andrew & Williamson Fresh Produce, San Diego, also tries to attract retailers by offering convenience, such as a 2-pound bagged roma.

“It is a convenient pack, and it can also be packed into a value-style format — perhaps a smaller-size roma to hit a price point,” said John King, vice president of marketing.

The gusseted bag can accommodate clear graphics and costs less than a clamshell container, he said.

Fresh Pac International, Oceanside, Calif., is focusing on flavor to help retailers drive the tomato category, said Brian Bernauer, sales director.

The company’s goal is to offer the “right varieties with the right flavor — something that will knock their socks off,” he said, and spark repeat purchases.

Offering the right high-quality varieties has resulted in “a significant increase percentage-wise in retail sales” for Fresh Pac, he said.

There are a couple of other changes taking place in the produce department, King said.

For one, shoppers are paying more attention to where their product came from, he said.

They also want to know that it’s grown and packed in a safe environment “with necessary controls in place.”

It’s a victory if you can trumpet local, but the industry today often touts “locale” instead, King said, to indicate “a world-class growing area” for a specific item, such as California’s Napa Valley and premium wines.

Over the past 25 years, Andrew & Williamson has searched out the best growing regions for its crops, he said.

“We identify the best regions for growing crops and focus on those areas as the finest locale.”



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