September, 1996

Fruits of Thought

Keeping A Fresh Perspective

This month, the Food Marketing Institute is launching a new trade show. The show is called MealSolutions96 and the pertinent question may be: Is it or is it not a show for produce people? Put more to the point, what is the role of the produce department in winning the home meal replacement consumer?

Produce is an interesting area because many fruits and vegetables can be purchased elsewhere in the store. Do you like green beans? Buy them fresh in produce or canned in grocery or frozen in frozen foods. The continued strength of the produce department stands as testimony to the consumer’s abiding desire for fresh food. Consumers feel that technology, as in canning and freezing, has produced a more convenient product but not a superior one.

This trend has been furthered by the fact that “this isn’t your father’s fresh produce department.” Controlled-atmosphere technology, improved varieties, enhanced transportation and the growth of international trade have made produce departments more versatile, comprehensive and attractive than the departments of just a few years ago.

Yet supermarket industry executives are now trying to respond to a threat. For years, the consumer’s food spending has been shifting. A smaller and smaller percentage has been going to food bought at retail and a larger and larger percentage toward foodservice. In fact, today, over 50 percent of consumer food dollars are spent on meals away from home.

Now this statistic is far less threatening to supermarkets that it seems at first glance. First of all, consumer food spending does not measure volume. If you go out to eat once a week at a fancy restaurant and order a good bottle of wine, it can cost 50 percent of your weekly food expenditure. Most people still eat most of their meals at home or brown bag food bought at a retail store.

Besides, supermarkets can do very little to compete for most foodservice dollars. An awful lot of that money is spent in institutions — prisons, hospitals, schools — which are simply out of reach for retailers. Even more is spent buying atmosphere in restaurants.

But a part of the market is available and that is where retailers have decided to take their stand. It’s what this new trade show is about, meal solutions, home meal replacement, call it what you will. These terms refer to foods, consumed mostly at home, which people once prepared themselves from scratch but now are looking to buy fully prepared. The fear, of course, is that consumers will buy more fully prepared meals at restaurants, then take them home or have them home delivered.

Meal replacement is an area in which restaurants and supermarkets will do battle in years to come. It is also an area that will attract numerous hybrids, such as the now-famous Eatzis in Dallas.

What is not obvious, however, is what role, if any, the produce department can serve in helping the supermarket fight for the home meal replacement market. To some extent, the whole move toward fresh-cut is a part of the meal-solutions trend. After all, traditionally, you bought mostly bulk items in produce. Even if they were cut, they were one item, not like the mixed salads of today. In addition, some produce items, particularly snack fruits, are ready to eat with no further preparation required.

Yet thinking about the issue in this departmental way simply may not make sense. One thing we can be sure of is that, if we make consumers traipse through our stores to buy an entrée at the deli, drinks in grocery, salad in produce, dessert at the bakery, supermarkets will suffer defeat. This is a battle fought for weary, overworked people who want good food, fast and convenient, and who do not want to work anymore.

In fact, the big advantage a supermarket has in this battle is the diversity of its offerings. A restaurant may be Chinese, or Italian, but a supermarket can have both a pizza program and a wok station.

Produce will always be a meaningful, indeed vital, part of meal-replacement programs. These meal solutions will include Greek salads, cooked vegetables, stuffed cabbages, mashed potatoes, baked apples and a hundred other incarnations of prepared produce. So, I don’t think growers and shippers have to worry about this trend. If anything, I think more produce will be eaten than before as it becomes easier to purchase high quality prepared produce.

This may seem problematic for the fresh produce department, but it really is not. No evidence exists that fresh produce sales decline because a store offers good prepared foods, nor is there evidence that a good canned-food section or frozen-foods department causes decline in fresh produce sales. In fact, logic and our experience both point to the opposite being true. The better prepared foods section means the store is more attractive and comprehensive, which means more customers in the store, which means more fresh produce sold!

What we, as produce people, have to remember is that there are not distinct consumers who only buy prepared foods and never buy a banana. Nothing is wrong with the produce department and the industry working to make products more convenient. Where they can, there is nothing wrong with experimenting by mixing meat with a salad or some more complicated preparations. But, at base, ours are fresh produce departments and our mission must be to build on that considerable strength. We have to make people feel that it is worth it to make their own mashed potatoes, that fresh fruit is a delicious taste experience.

One long standing concern I’ve had about the 5 a Day program is that it has led to the abandonment of any industry-wide efforts to promote produce on any grounds but health. In fact, 5 a Day, by character, designed to promote canned and frozen product as well as juice.

I expect a continued development of more convenient produce items. We will, however, do ourselves and this industry a disservice if in the rush to capture this market, we allow our departments to fill up with prepared and semi-prepared foods. We need to redouble efforts to keep our fresh image, to promote fresh to consumers and to capitalize on the enormous strength that comes from representing fresh fruits and vegetables in the market.  pb