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How Consumer Trends in Grocery Shopping are Changing Retail

Wednesday, 6 September 2017 | Posted in Industry/Consumer Trends by Renee Harrison

For decades, shoppers were loyal to a single store that would fulfill all of their food and beverage needs. Today, they’re far more likely to embrace a variety of retail locations and formats to ensure they get exactly what they want, when they want it. What does this mean for retailers looking to stay one step ahead of consumer trends?

On average, consumers shop at two to three different retail channels to fulfill their grocery needs, according to the Food Marketing Institute — including supermarkets, supercenters, discount,How Consumer Trends in Grocery Shopping Are Changing Retail convenience, club, and e-commerce stores. Considering how shoppers feel about grocery shopping in general, that's more than a little surprising. Nearly half say grocery shopping is a chore they try to spend as little time on as possible, according to Nielsen’s Think Smaller for Big Growth study. If that’s true, then why are so many of them spreading their purchases across multiple retail formats?

First, it’s about priorities. High-quality produce (57%), convenient location (56%), and product availability (54%) are more important to today’s shopper than simply finding the lowest price, according to the Nielsen report. As far as products, 75 percent say produce is the most important, followed by fresh meat, poultry, and seafood (60%). And 67 percent of all shoppers say they actively seek products with healthful ingredients. Combine those preferences with easy access to technology, and you’ve got the most discerning consumer in economic history.

Secondly, it’s about options — and shoppers being overwhelmed by them. Today’s consumer has gotten more specific in their tastes, and they’re no longer impressed with quantity when they value quality much more. As a result, the average square footage of supermarkets has decreased since 2006, and smaller retail formats have begun to thrive, according to Packaged Facts. Large supermarkets and hypermarkets account for 51 percent of global sales, but smaller formats are growing at a faster rate, according to Nielsen’s The Future of Grocery report. In fact, smaller formats have been doubling or more than doubling large supermarkets’ rate of growth year over year.

“Perhaps the new retail mantra should be ‘go small or go home,’ as the ‘bigger is better’ paradigm has been challenged virtually everywhere,” said Steve Matthesen, global president of retail for Nielsen, in their 2016 Think Smaller for Big Growth study.

Lastly, but unsurprisingly, it’s about technology. About 25 percent of shoppers say they order grocery products online, and 55 percent are willing to do so in the future, according to The Future of Grocery report. AmazonFresh, Instacart, and Fresh Direct are just a few of the online grocery retailers capitalizing on shoppers’ desire for variety and convenience. They also have one distinct advantage over brick and mortar retailers: customizable communication. It’s far easier to tailor to customers’ preferences when they’re shopping in an online, data-driven environment. That’s a huge advantage when less than half of shoppers believe their main grocery retailer communicates with them in a relevant way.

But regardless of the format, the fact that high-quality fresh produce remains a top priority for shoppers, combined with the growing importance of quality and convenience presents produce marketers with an opportunity to make visits to the produce aisle more memorable and engaging by providing shoppers with support and guidance on how to incorporate more produce in their lives. 

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Webinar: Sanitation, your best crisis management tool

Monday, 14 August 2017 | Posted in Food Safety/Traceability by Renee Harrison

We all hear about recalls occurring in the food industry on an almost daily basis. But, how many of these recalls are caused by poor sanitation practices or sanitation practices that are not consistently performed on a daily basis? Are you confident that your sanitation program is working effectively to produce a safe product? Sanitation programs along with Good agricultural practices, Good manufacturing practices and HACCP based food safety principals are all tools in your toolbox in your food safety program and truly one of your best crisis management tools to minimizing food safety risks in your operation.

We know that if conditions are allowed to exist in a facility that promotes growth of bacteria like Salmonella or Listeria, that bacteria will ultimately find a way to migrate into your product or production facility. In order to control these kinds of conditions, a robust and thorough sanitation program along with a solid environmental monitoring program needs to be in place. 

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Safe washing and crisping of produce, Jim Gorny VP of Food Safety and Technology, PMA

Monday, 14 August 2017 | Posted in Food Safety/Traceability by Renee Harrison

Everyone in the farm to fork supply chain plays an important role in assuring the safety of fresh produce that consumers and their families enjoy. Importantly, this includes retail and food service point of service washing and crisping of fresh produce. Washing fresh produce at point of service is done during preparation, just before consumption and it can enhance the safety of fresh produce.

Crisping is a Safe Washing and Crisping of Produce method used to improve produce visual quality and texture that involves soaking fresh produce in tepid water followed by refrigeration, to restore water lost from produce items during post-harvest handling and distribution through the supply chain. However, if done incorrectly washing and crisping of produce can actually amplify a small microbial contamination problem into a big problem by spreading microbial contamination.

This short presentation by Dr. Jim Gorny PMA VP of Food Safety & Technology discusses how washing and crisping during produce preparation may occur and how to prevent it for occurring. 

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PMA Research: Who supplies the Middle East’s increasing demand for fresh produce

Monday, 14 August 2017 | Posted in Global Trade by Renee Harrison

According to The Economist, the growing populations of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE, also called the Gulf Cooperation Council (GCC), point to increased dependence on imported food staples. Food imports are projected to grow to US$53.1 billion by 2020. Major factors driving the GCC market include growing domestic and expat population, rising health consciousness among the population, changing tastes and preferences, and growing disposable income leading to higher consumption of nutritional foods as part of a stable diet. The United Nations’ figures reveal themiddle east imports population of GCC countries jumped by 18.9 percent in the last five years. In countries like Saudi Arabia the birth rate has topped 20 percent consistently in recent years. According to a report published by the Economist Intelligence Unit, by 2020 the GCC population is forecast to reach 53.5m, a 30 percent increase over the level in 2000.

PMA reports that consumers with changing tastes are willing to pay a premium for an assortment of produce offering freshness, quality, flavor, safety and convenience. “Young and affluent Western food-loving consumers are driving the growth and demand for imported goods and foods in the Middle East,” states an analyst from Mintel. In addition, there are healthy eating efforts toward purchasing more fruits and vegetables.

Falling groundwater and aquifer levels in the Arabian Peninsula, limited rainfall, arid climate, overreliance on imports and rising soil salinity are affecting the fruits and vegetables market. The region’s dependence on desalinated water means that meeting more of its food needs through domestic production is not an option in the long term.  

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PMA Research: How suppliers will capitalise on China’s small retail formats

Monday, 14 August 2017 | Posted in Global Trade by Renee Harrison

China’s retail environment is evolving as convenience, specialty, and online are growing by leaps and bounds. Hypermarkets, which redefined China’s retailing environment over the past decade, registered their first-ever drop in 2015, losing 0.2 percent value in the urban FMCG market as traffic dropped by 4.6 percent and volume per household sank by 4.7 percent (Bain Kantar Worldpanel 2016), due to competition and high market saturation in Tier 1 cities.

According to Euromonitor, a growing number of Chinese retailers are shifting away from large store formats such as hypermarkets andGrowth of Small Store Formats in China supermarkets to concentrate more on smaller store formats, like convenience stores. This move aims to not only meet consumers changing shopping emphasis on convenience, but to also follow an omnichannel strategy to maintain competitiveness. Convenience stores generated 13.2 percent growth in value in 2015 and had 8.5 percent penetration growth across all city tiers, catering to cash-rich, time-poor urban consumers (Bain Kantar Worldpanel 2016). Some of the leading players, such as Carrefour and Yonghui, aimed to segment the market even further, by launching Easy Carrefour and Yonghui Membership Stores, providing more premium products and in particular increasing the share of imported products.

Fruit specialty chains such as Pagoda are driving growth. This chain owns more than 1,000 outlets. It recently acquired Beijing-based Guoduomei’s share and is aggressively opening new stores in Beijing and Shanghai in 2017 (USDA FAS Annual Retail Foods Report – China).

Additionally, competition is increasing as China’s online sales continue to grow rapidly. China is the world’s largest e-commerce market, and online sales surpassed $670 billion in 2015. One of the main drivers of this exponential growth was sales of online fresh fruit. The online purchase of fresh produce is quickly becoming a preferred purchase channel for Chinese consumers, especially among young professionals in Tier I cities. 

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