Can Produce Become Proprietary? Ask Wegmans.

Articles
August 10, 2010

Can Produce Become Proprietary? Ask Wegmans.

Supermarkets that lead their traffic flow with produce (the vast majority) classically position produce as a price loss leader, health resource or tone setter for shoppers.

Supermarkets that lead their traffic flow with produce (the vast majority) classically position produce as a price loss leader, health resource or tone setter for shoppers. High-quality fruits and vegetables are a key determinant in where people decide to shop; 91% of consumers said so in the nationwide poll that SupermarketGuru.com conducted for the National Grocers Association 2010 Consumer Survey Report.

But that’s often as far as the romance goes.

What if a retailer could be a farmer too? Might it brand its produce as exclusive? Or raise temperatures in its hothouses to be first in the market with desired seasonal varieties, and extend their selling seasons? Or appeal to the people who prefer to buy local fruits and vegetables whenever they have the opportunity? 

Naturally, none of this would replace a store’s outside sourcing to be able to provide a bountiful, widely assorted produce department. Yet The Lempert Report believes certain harvests could be used to proprietary advantage to appeal to some of the more food-involved consumers that are health-driven and seek locally grown. These people could be among the store’s productive frequent cardholders – the ones who enjoy preparing meals with fresh ingredients from produce and other perimeter departments, who shop the full store.

For regionals and independents, this could be a differentiator. Wegmans, for example, got a jump on summertime merchandising of cherry and grape tomatoes, when it picked ripe ones from its Organic Research Farm in Canandaigua, NY just two months after planting, and distributed them to some of its upstate New York stores, reported Progressive Grocer. The secret: lots of compost to speed plant growth, and consistently high temperatures in the soil bed.

Besides this new venture, Wegmans for years has relied on literally hundreds of local grower partnerships throughout its five-state area to get produce directly from local farms to its Northeastern stores.

That is more akin to the latest Meijer “Home Grown” commitment to source 20% more fruits and vegetables from local growers this year. The program has expanded over the past five years to include more than 75 Midwest farms and farmers; a year ago the figure was 65. The chain estimates that “Home Grown” will steer more than $60 million back into local economies in five states in 2010, and that such harvests represent “nearly 27% of all the fruits and vegetables sold” chainwide during the peak growing season.

Supermarkets that farm too are rare because both professions are tough in their own right. It’s becoming more common for chains to source locally for the freshness and goodwill it creates – yet we really like the authenticity and accountability of the Wegmans approach.