Retail trends include offering variety, skipping middlemen

08/20/2010 02:01:35 PM
Susie Cable

California and Baja California tomato grower-shippers said the retail market seemed steady in early August, and each mentioned different trends in the market.

Although it’s not a new trend, Jeff Dolan, field operations manager for DiMare Co., Newman, Calif., said he’s noticed continuing fragmentation in the types of tomatoes offered at retail.

“Instead of two or three types with big displays, there are multiple displays of every little niche tomato under the sun in there,” he said.

DiMare ships 25-pound bulk cartons of tomatoes. It grows mature-green, round yellow and red roma tomatoes in Baja California and California.

Brian Bernauer, sales director at Fresh Pac International, Oceanside, Calif., expressed frustration at seeing retail prices at $1-1.69 a pound for romas earlier in the summer when shippers were getting just $6 each for a 25-pound box.

“I don’t know if they are selling more,” he said when asked what retailers were doing to increase sales.

Fresh Pac sells to retailers, wholesalers and foodservice buyers, and about 90% is shipped in 25-pound boxes.

Grower-shipper Andrew & Williamson Fresh Produce, San Diego, continues to work more closely with retailer and foodservice customers, instead of selling to wholesalers and repackers as it used to, said Mark Munger, vice president of marketing. It operates now with a more consumer-centric strategy, placing top priority on providing high-quality and high-flavor tomatoes, he said.

Because about 85% of its tomato sales are pre-committed, the company grows the types of tomatoes that its customers request, Munger said.

Andrew & Williamson supports retailers by working with them on advertisements, helping them find ways to differentiate themselves within their markets, helping them promote when the competition is not promoting and helping establish aggressive pricing, Munger said.

Advertising gets the most immediate gains in tomato sales, Munger said, but merchandising is a long-term tool that can build sales over time.

“An effective ad can change volume by double or triple,” he said.

Andrew & Williamson also provides custom value-added packing to retailer customers, which can help a store distinguish itself from the competition. Andrew & Williamson offers about 20 different custom packs that can be sent directly to customers from the initial handling points in Baja California, Munger said.

Options include various sizes of clamshells, grab-and-go bags, cello packs and others.

“We have the equipment and expertise that we can pack any pack a customer wants,” Munger said.

Deardorff Family Farms, Oxnard, Calif., is expanding availability of a 5-pound family-size box for romas and vine-ripes that it test-marketed last year, said Scott Albertson, director of marketing.

The company has a mix of retailer and foodservice buyers, and it ships most of its tomatoes in 25-pound, two-layer flats, but sales manager David Cook said he encourages customers to use a one-layer tray instead. The trays can be packed better, and it’s easier on the fruit.

“It’s better for everybody,” Cook said. “The two-layer vine-ripe flat is a dinosaur designed for a smaller pallet.”

The two-layer flat doesn’t fit well on a 40- by 48-inch pallet. While Deardorff makes it work, but it leaves an empty space in the center of the pallet, so it’s not ideal, Cook said. The two-layer flat was designed for a 36- by 48-inch pallet, he said.

Albertson said the company is shipping more of the one-layer trays. In addition to being better for the fruit, it also makes a good merchandising tool, he said. In addition, for retailers who prefer to take the tomatoes out of the box and display them in bulk, it’s easier to remove tomatoes from it, instead of digging through a couple of layers.

Vine-ripe tomato buyers expect to see the tomatoes in two-layer flats, and they ask for them to be shipped that way, Cook said.

“Tomatoes stacked on top of tomatoes — that’s the problem,” he said.

A one-layer flat holds 15-18 pounds of tomatoes. On a per-pound basis, the prices are comparable, Albertson said.

The one-layer tray is more of a retailer-oriented pack than it is a foodservice or wholesale pack because retailers often repack tomatoes in custom boxes, Albertson said.

Deardorff also emphasizes flavor and eating quality in its tomatoes, Albertson said. It picks at high maturity levels and ensure uniform ripeness in a box. If a retailer prefers, Deardorff will ship tomatoes at two stages of maturity, so some are ready to buy, while others can be kept in the back for a couple of days.

“We’re hearing that customers are looking for a true tomato flavor and not excessive wateriness,” he said. “They want something they can bite into and slice and use.”

Deardorff’s tomatoes are field-grown, and Albertson said they offer the “true outdoor-grown tomato” that consumers are looking for. He cited research posted on the Fresno-based California Tomato Farmers’ website, www.californiatomatogrowers.org, that indicated that the majority of consumers prefer field-grown tomatoes, and most of them who purchase field-grown do so because of the flavor.

Albertson said Deardorff contracts a high percentage of its sales, but it is always looking for new customers. He said the company especially likes to build programs for in-store farmers markets for West Coast retailers that want to offer locally grown produce to their shoppers.



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