Value-added produce grows with consumers’ need for convenience and safety
Consumers and foodservice operators today are short on time.
They’re looking for produce that is more convenient, saving time in the kitchen. Value-added and fresh-cut items make life easier, faster and help cooks who might not have an expansive skill set.
Overall, produce companies are seeing value-added lines grow significantly.
Ocean Mist made its first foray into this category just before the pandemic with a line called Season & Steam, which offers vegetables such as artichokes, sweet baby broccoli and Brussels sprouts.
This required innovative packaging, says Mark Munger, senior director of marketing for the Castroville, Calif.-based company. The Steamfast microwavable pack “gives users the option to open the bag, pre-season the contents to their flavor preference, reseal with the zip lock and steam by microwave, all within the same bag,” he explained.
Around 18 months ago Ocean Mist launched another value-added line, “and that’s the line we’re a bit more competitive with,” Munger said. “Season & Steam was more of a niche package but was a great way to jump in.” The new value-added line, in form-and-fill packaging, includes 1 pound of halved Brussels sprouts or cauliflower florets, and the company added 2-pound bags last fall for the club channel.
Demand and sales have been “very strong” for value-added, he said.
“We recognized that while our Season & Steam pack fit a value niche for our longer-cook items, we needed to add a line of more simply packaged, washed-and-ready-to-prepare vegetables,” Munger said. “We launched the form-and-fill line in late 2022, and demand was instant. While both packs have grown in sales, our form-and-fill now represents more than 70% of our total value-added offerings.”
Related news: Mann Packing Co. launches air fryer veggie kits
Ocean Mist was admittedly late to this category, Munger said, but its niche is that it’s the grower as well as the processor.
“We’re diverting some of our product, so instead of going into commodity sales, it’s going into value-added,” he said.
The company is expanding the program with new products, is adding machines to its processing facility and is looking to increase capacity.
“We’re fortunate being late entrants to the marketplace. Sometimes that has some challenges because you have to go and earn some business. But it has some benefits in that we can bring in the latest and most up-to-date processing technology,” Munger said.
This technology, for example, allows things to happen at the fastest speed possible. “Milliseconds can make a difference when you’re running a plant for 16 hours,” said Munger.
Established players
Melissa’s Produce, Los Angeles, is an old hand at value-added produce, which represents about 10% of sales. Many of the company’s value-added products are among its top 25 items, such as steamed beets, steamed black-eyed peas and steamed organic chestnuts, said spokesperson Robert Schueller.
Melissa’s debuted value-added products about 17 years ago, beginning with steamed baby red beets — now available as organic and conventional — which are peeled, steamed and ready to use and still remain in the company’s top five products. Melissa’s will soon offer Pinkglow pineapple chunks in a plastic container.
Pompano Beach, Fla.-based Southern Specialties launched its Southern Selects value-added line in 2001, with washed and trimmed French beans being among its first products.
“This was the first produce you could call processed, though we didn’t have a processing plant and didn’t know it was processed,” said Charlie Eagle, vice president of business development.
The company initially launched the value-added line for restaurants and chefs, though it now includes around 20 items.
Southern Selects has grown to include a variety of bag styles, many of which are microwaveable and ready to eat.
“They streamline the cooking process for today’s consumer,” Eagle said. “We offer products that are trimmed, washed, ready to use. Some are cut products; they could be sliced or cubed.”
Trimmed items include asparagus and Brussels sprouts. Butternut squash comes cubed.
Southern Specialties also packages private-label value-added produce for a number of retailers.
High-tech packaging is what makes the value-added line work so well, Eagle said.
“We were one of the first companies to use micro-perf technology and a barrier film,” he said. “Today we rely on our packaging suppliers to provide us with packaging that creates the ideal environment for each of those products.”
Related news: The ‘Power of Produce’ prevails, annual FMI report finds
Business on the value-added side continues to grow for Southern Specialties.
“The range and volume of packaged products has increased in the past several years, and much of that is due to the private-label programs to retailers and foodservice distributors,” Eagle said. “We’ll be adding more private-label products, as well as more [general value-added] products and more volume.”
Morton Williams Supermarkets, Bronx, N.Y., does “tremendous” business with value-added produce, says Marc Goldman, director of produce and floral. Much of the product is washed, trimmed and cut in stores and merchandised in clamshells, but stores with labor shortages use more value-added products from manufacturers.
Bestsellers are pineapple, mango and watermelon in the fruit category and just about anything that goes in vegetables, Goldman said, from cubed butternut squash to chopped onions.
Value-added is a must for a busy city like New York, Goldman said.
“People don’t have time to do it themselves and have small kitchens, so they want to use it and not have to store it,” he said.
And for the stores, if it is prepared in-house, “it’s a very good source of margin,” he said.
Related news: Industry responds to how FDA redefines 'healthy' labeling
What’s driving sales?
The overall driving factor for value-added produce is convenience, Munger says. “Everyone is time-starved; so to have something that’s washed, prepped and ready to cook is the key driver.”
Safety is another aspect, he said, especially in post-COVID-19 years. “With these packaged products, you know no one is touching your produce.”
Fresh-cut produce also removes an obstacle for people who might not know how to cut certain vegetables, he said.
“A head of cauliflower can be daunting,” said Munger, adding that there’s also no waste within these packages. “When you buy broccoli florets, you’re getting 100% useable product.”
Melissa’s value-added line “is all about convenience,” Schueller said. “To prep and cook beets from scratch takes about 40 minutes.”
Consumer education
Ocean Mist features QR codes on packages that direct consumers to its website, where there are hundreds of recipes. It also features a biweekly blog with information, such as how to prepare an artichoke. Consumers can subscribe for recipes ranging from simple to advanced.
In stores, “from my experience, just providing generic POS is not really effective [so] we provide custom POS,” Munger said. “If it’s in their format and their marketing folks are helping drive decisions, it will get more utilized because they know their customers.”
Melissa’s provides POS and POP materials, signage and recipe cards to stores, primarily for grand openings or when adding items to the lineup. Otherwise, the company focuses on social media, which is all about recipes and how to find products, Schueller said.
Southern Specialties’ value-added line “offers convenience, reduced handling, extended shelf life and packaging that affords information for the consumer that can include nutritional benefits, cooking methods and links to recipes via QR codes,” Eagle said.
