Issue #10 of 24
May 21, 2022

Industry and Government News
‘World of Private Label’ Trade Show Opens Next Week

It is only a week until PLMA’s 2022 “World of Private Label” International Trade Show, May 31 – June 1, at the RAI Exhibition Centre in Amsterdam.

Products on display will include a wide array of many household staples like beverages and dry grocery products, frozen fresh, and refrigerated foods, in addition to many non-food categories, including cosmetics, health and beauty, household and kitchen products, and DIY items. The show floor is divided into separate food and non-food halls to help visitors optimize their time.

Store brands remain an important sector of the European and global retailing markets. Private label accounts for more than 40% of all products sold in seven European countries and for more than 30% in nine others.

“For more than 35 years, the World of Private Label Show has brought retailers, wholesalers, and other private label professionals together with manufacturers to help them find new products, make new contacts, and discover new ideas that will help their private label programs succeed and 2022 will continue that tradition,” said PLMA President Peggy Davies.

“The past two years have been exceptionally challenging for the industry but the need for new products, contacts and ideas has never been greater. Private label retains its strong marketplace position and the future promises even more private label as retailers expand internationally and take a larger role in marketing themselves and their own products,” Davies added.

For more information on attending, visit www.plmainternational.com

Industry Veteran Hosts New PLMA Video Program

In-the-Know industry journalist Carol Angrisani hosts a new PLMA video program called “What’s the Latest in Private Brands?” The program joins other exclusive content on plmalive.com from the PLMA Live! news team.

The info-packed new series goes beyond the headlines to provide a unique look at product trends, marketing and merchandising campaigns and industry buzz. The premiere episode includes private brand news from Costco, Foxtrot, Aldi and Hy-Vee.   Click here to watch.

 

Consumers Likely to Switch to Chicken as Beef Prices Soar

According to a study by CoBank, as beef prices continue to increase, consumers may begin to “trade down” when deciding which protein to purchase and chicken is most likely to benefit.

CoBank reported consumer demand for meat has continued to rise throughout the pandemic, despite higher prices. Beef consumption has grown 1.4% from 2019 to 2021 even as retail prices increased by more than 20%, the report found. Chicken sales saw growth as well and both consumption and prices hit record levels in 2021.

Inflation has had an outsized impact on the price consumers pay for meat as the consumer price index for the products rose 14.8% in the 12 months from March 2021 to 2022, according to the Bureau of Labor Statistics.

But while beef prices increased by 16% and pork by 15.3%, poultry’s increase was only 13.2%. As consumers look for ways to save money, the lower prices for chicken could be very tempting. The USDA has announced it is expecting a slight decline in beef consumption in 2022-23 as domestic supplies fall with shrinking cattle herds and growing exports.

However, the switch to chicken, and the consumption of meat in general, may also depend on how high prices eventually rise. A study by Ingredient Communications found there does appear to be a price ceiling at which some consumers will quit the products altogether. Their survey reported that three in 10 U.S. consumers said they would stop buying all meat if prices increased by one-third.

Publix Rolls Out 15-Minute Delivery with Instacart

Publix Super Markets has begun rapid grocery delivery in the Miami area using Instacart’s Carrot Warehouses nano-fulfillment solution.

Through this new service, Publix customers, via Instacart, can order from an assortment of thousands of products and have them delivered in as soon as 15 minutes to the grocer’s customers in the Brickell, Coral Gables and Wynwood, Fla., neighborhoods.

Using the Carrot Warehouse model, Publix can offer items ranging from fresh produce, dairy and meat to pantry staples, household goods and other products from nano-fulfillment centers for 15-minute delivery. Publix customers can access the 15 minute delivery service through Publix’s mobile app, website or via the Instacart App.

Publix and Instacart have a relationship dating to 2016, when the companies first started same-day Instacart delivery, then expanded the partnership to other stores by 2017. Publix also piloted Instacart curbside pickup in September 2017 before deploying it to nearly all of their stores.

Instacart reported the Carrot Warehouse solution enables the supermarket chain to provide a wider online selection to customers than “the industry standard” for rapid grocery delivery and ensure nearly 100% in-stock availability.

Publix, based in Lakeland, Florida, is the first grocer to develop new fulfillment models with Instacart using Carrot Warehouses. Through the end-to-end solution, Instacart works with retailers to enable customized, fast delivery service, and establish nano-fulfillment centers.

Publix operates 1,295 stores in Florida, Georgia, Alabama, Tennessee, and South Carolina.

BJ’s Small-Format Club Debuts

BJ’s Wholesale Club has unveiled its new smaller store design, which is half the size of a full-sized club store, with the opening of BJ’s Market in Warwick, R.I.

BJ’s noted members will find the same pack sizes and pricing as in full BJ’s clubs, as well as the same services, such as curbside pick-up, same-day delivery and Express Pay. In addition, BJ’s Market will include testing of new product assortments, displays, product sampling and demonstrations, and convenience initiatives, the company said. The product mix will also feature BJ’s Wellsley Farms and Berkley & Jensen own brands.

The new retail concept is designed to provide a “convenient, efficient shopping experience,” offering a mix of top-selling fresh foods, produce, sundries and seasonal products, among other items, according to the Westborough, Mass.-based warehouse club chain.

“BJ’s Market will serve as an exciting new innovation lab for BJ’s Wholesale Club,” Bill Werner, executive vice president of strategy and development at BJ’s, said. “We are bringing the same great savings and value our members know and love but delivering a convenient location closer to home.”

Albertsons & Uber Eats Expand Partnership

Albertsons Companies and Uber Eats are expanding their delivery partnership to include more than 2,000 of the grocer’s banner stores nationwide, including Albertsons, Safeway, Jewel-Osco, and Acme.

The new agreement will make Uber Eats available for customers at nearly 800 new Albertson banner locations for the first time in Rhode Island, Vermont, Connecticut, Indiana, New Hampshire, and Utah. Later this year, consumers can take advantage of Albertsons member pricing and promotions on grocery orders from the grocer’s banners around the country. In addition to stores being found within Uber Eats’ grocery category, consumers can order items for delivery through “express” lanes within the app’s convenience section.

“Our growing partnership with Uber Eats brings new convenience to shopping our stores,” Amber Kappa, VP of business development and innovation, digital at Albertsons said. “Our goal is to make it easier for people to get their groceries, so they can focus on the goodness of sharing a meal.”

“Together with Albertsons, we’re evolving the ways we can get groceries — and so much more — to people’s doorsteps across the country,” said. “Since launching our U.S. grocery category in 2020, we have seen a huge appetite for easy, fast delivery from trusted retailers,” said Oskar Hjertonsson, Uber’s head of its grocery division, “and with this expanded partnership, we’re excited to serve more people with even more choice and convenience on Uber Eats.”

Aldi Commits to Eliminate Plastic Bags by 2023

Jason Hart, the CEO of Aldi U.S., has issued an open letter on Aldi’s website announcing the company’s plan to eliminate plastic shopping bags from all stores by the end of 2023.

Hart explains that Aldi has already removed plastic bags from nearly 500 of its stores and the grocer’s retailer’s goal “is to phase them out from all 2,200 locations by the end of 2023. We are thrilled to make this monumental pledge in support of our planet, which will remove 4,400 tons of plastic from circulation each year.”

The CEO also cited highlights from the company’s first Corporate Responsibility Progress Report, which announced its goals for sustainability. The report outlined the progress Aldi has made reducing food waste, decreasing greenhouse gas emissions, and changes in packaging, as well as Aldi’s efforts to continue to responsibly source its products and give back to local communities. Hart explained Aldi’s plastic bag announcement is part of this wider company initiative to increase sustainability. 

Looking to further reduce its impact on the environment, the report said rooftop solar panels were installed on more buildings, bringing the grocer's total to "over 120 stores and 12 distribution centers producing and consuming green electricity from solar power.”

Batavia, Ill.-based Aldi opened in the U.S. in 1976, and now has more than 2,000 stores in 36 states. The chain plans to open approximately 150 new stores this year.

Kroger to Install Larger Self-Checkout Lanes

Kroger has announced plans to introduce new, larger self-checkout lanes in dozens of its stores in greater Cincinnati, Dayton and Northern Kentucky.

The new stations will operate much like regular self-checkout stations. Shoppers will scan their own purchases, but the difference is once an item is swiped a belt moves it directly to a bagging station, where a courtesy clerk will bag the groceries. The new checkout system is also seen as a way Kroger can help offset the nationwide labor shortage and help customers speed up their checkout times at stores.

Until this month, only two stores in the nation – both in the Columbus area – were testing the lanes. This spring, 42 stores or roughly a third of local Cincinnati region stores will get two lanes apiece. The first ones have already been installed in four stores. Kroger operates regional supermarket chains in 35 states, including Fred Meyer, Harris Teeter, Ralphs, Mariano's, Fry's, Smith's, King Soopers, QFC and others.

PLMA Live!
Private Brands Support Social Causes

Retailers recognize the importance of charitable giving. They are leveraging their private brands to partner on cause-specific initiatives that help the environment, the hungry, pet shelters and more. Click here for video.

Retailers Reveal New Product Trends

Executives from Whole Foods, Albertsons, Walgreens and Walmart discuss the product launch process for their award-winning store brands. Details in this special report by Maureen Donoghue. Click here for video.

In the stores

Dollar General is releasing a new selection of personal care products with the debut of Five Deep Breaths and Scent Happy, both retailer exclusives. The new products were developed by HatchBeauty Brands and consist of an assortment of items, including bath foam oil and body wash, body cream, whipped body scrub, mineral oil, and mineral bath and foot salts.

Walmart is introducing a new line of home goods into its stores with The Dave and Jenny Marrs Collection for their Better Homes & Gardens private brand. Outdoor planters and furniture, rugs, and lanterns will be among the 30 outdoor and home décor items in the collection.

Pet retailer PetSmart has agreed to sell an exclusive collection of dog toys, accessories and apparel from the hit Netflix show Stranger Things. The PetSmart products will consist of plush toys for dogs and cats, collars and leashes, logo tees and more. The launch coincides with the new season of Stranger Things, premiering on Netflix May 27.

A new collection of private label apparel is coming to Meijer with the introduction of Tranquil & True, an assortment of sleepwear and intimate apparel for women. The clothing features sizes from S to 3X, with bra sizes up to a 42 band-size and DDD cup size. Meijer says the Tranquil & True apparel line is designed for all women regardless of size.

Sally Beauty has expanded its assortment of private label hair care products by expanding its existing Strawberry Leopard collection. The line now includes products such as shampoo, conditioner, color sealing spray, and UV & heat protection cream to help the vibrancy and longevity of hair color. All Strawberry Leopard products are vegan, cruelty-free and gluten-free.

Crate & Barrel is adding products to its exclusive Leanne Ford home furnishings collection with the addition of several new items, bringing the line of products to more than 100 SKUs. The products will include office furniture, lighting, and products for interior décor. Presently, the Leanne Ford line has more than 50 home and outdoor products.

The veteran and Paralympic triathlete Melissa Stockwell will serve as the spokesperson for SpartanNash's most popular private label brand, Our Family. Stockwell is the first woman to lose a limb in combat in Iraq and is a three-time medal winning Paralympic triathlete. Her promotion for the Our Family brand will include both appearances and Facebook and Instagram presentations on grocery shopping, and food preparation tips.

Petco is partnering with outdoor specialty retailer Backcountry for the retailer’s newest store brand of exclusive pet gear. The new line, called Backcountry x Petco, will have everything from apparel such as dog t-shirts, and jackets to collar, harnesses, leashes, flotation devices, collapsible food, and water bowls.

Trader Joe’s has brought to market a new dairy-free, lactose-free, and gluten-free Non-Dairy Brown Sugar Oat Creamer. The milk alternative, plant-based creamer is intended for hot and cold teas and coffees.

Market research
Rising Grocery Prices Could Boost Store Brands

A survey by Vericast finds as rising grocery prices continue to put the squeeze on shoppers’ wallets, it is also increasing their stress levels and turning many of them to buying more store brands.

The survey found 50% of all consumers and 64% of millennials indicated making spending decisions as prices rise has taken a toll on their mental health. This comes from some tough decisions consumers must make in either cost cutting or choices on what is most important to them.

One of the decisions many have made is to buy store brand products. Vericast found that 72% of respondents report they are buying more store or private-label brand products to save money.

When it comes to grocer loyalty amidst the inflated cost of groceries, Vericast said 64% of respondents have not changed the grocery store they frequently shop at within the last six months, but 27% have changed grocery stores in the last six months to save money.

Dave Cesaro, Vericast’s retail and consumer behavior expert, said the finding that 27% have changed stores was surprising given how many continue to stay with the stores they have always visited.

“Chances are the new store they’ve chosen is not as close or convenient as the original, which means these consumers are shopping around, even for necessities, because saving money is that important to them.”

The study also reported that 88% of shoppers were turning to coupons or discounts that are motivating them to buy something from a brand or store they have not shopped at before. 

For the study, Vericast surveyed 1,000 U.S. adults to assess consumer behavior changes during inflationary times.

PLMA News
Executive Education Program Returns to Campus in June

After two years as an online event, PLMA’s Executive Education Program will take place live and in person on campus at St. Joseph’s University in Philadelphia June 21-22. Over two days, PLMA’s Executive Education Program will focus on current challenges, including supply chain issues, inflation, and what issues may develop as we move forward.

The theme of this year’s program is “Embrace the Change.” Unprecedented forces are impacting nearly every aspect of the grocery industry over the past two years. Product innovation and format development to online ordering and delivery options and pricing strategies have all changed. While better days seem to lie ahead, major transformation and the evolution of all aspects of retailing will remain.

Presenters will include Jac Ross, the Vice President for Own Brands at Sprouts Supermarkets, who will discuss innovations in products and packaging; and John Evans, the Director of Private Brands, GM, HBC, and Non-Foods at Weis Markets, who will examine the role of the retailer in the private label industry.

Since the program’s inception in 2001, more than 2,000 men and women have graduated from PLMA’s Executive Education programs. Classes are perfect for new hires, those who built their careers working for national brands, or any professional in the field who is looking to refresh their knowledge, broaden their focus and sharpen their ability to think and interact strategically.

To register or receive more information about the program, visit PLMA.com or contact Julia Meehan at education@plma.com

Tom’s Data Dive

In this monthly feature for PLMA’s e-Scanner, Editor-in-Chief Tom Prendergast examines PLMA’s exclusive IRI/Unify sales data. He compares the latest monthly sales figures vs results from the same month a year ago to see which categories and products are showing growth and opportunities for PLMA members and retailers. This month’s column looks at the latest IRI statistics as of April 17, 2022.

Categories with tens, or hundreds, of million dollars’ worth of store brand sales often grab the industry and media spotlight. Likewise, categories with sales of $5 million or less are often overlooked.

That could be a mistake, as private brand growth in some of these sections could be a leading indicator of growth and opportunity to come. Not to mention that one day they could become larger categories themselves, boasting tens, even hundreds of millions in store brand sales.

Let’s take a look at some of them.

For the four-week period ending April 17, vs the same period a year ago, a number of smaller categories are showing strong store brand gains, and they reflect a wide selection of products.

For instance, sales of hair appliances, like hair dryers and curling irons, have risen 347% in the latest four-week period and reached $1.2 million in dollar sales. This follows 786% category growth over the past 3 months alone.

There are other non-food categories worth a peek. Hair spray/spritz has growth 27% in the past 4 weeks and while sales are under $500K category sales are increasing. Deodorant climbed 29% in dollar sales during the same period and reached $1.3 million in sales. Given the overall size of these categories, it could offer an opportunity for room to grow for store brands.

In food, drinks and drink additives catch the eye. Powdered milk reached $3.3 million in sales with 81% growth; sports drinks increased 59% to reach sales just under $5 million and milk flavoring/cocoa mixes grew 37% and hit $2.9 million in sales.

Other food products in demand included frosting, which rose 53% and attained $1.2 million in sales while rice/popcorn cakes rose 25% and had $3.9 million in sales.

There are many other sectors showing private brand growth over the past month, this is just a sample.

If you want to dive in yourself, all these statistics and more are available to members through IRI’s Unify statistics section on www.plma.com.

PLMA is Open to New Membership

The Private Label Manufacturers Association is the only trade association devoted exclusively to the private label industry. Founded in 1979, PLMA currently has some 3,500 member companies. Membership is open to manufacturers, brokers, trade suppliers and other companies. PLMA members enjoy exclusive access and discounted pricing to PLMA events and services. For more information about membership, please visit www.plma.com  or contact Barbara Cruz at (212) 972-3131, EXT. 1225 or bcruz@plma.com.

Events

PLMA's Executive Education program discusses what's at stake for retailer brands among unprecedented challenges these past two years, and suggests strategies for you to prosper going forward. Embrace the change.