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PIZZA u ICE CREAM u BREAKFASTS u APPETIZERS u DIsplay CASES APRIL 2013 JOHNNy HARRIS ON NEW ITEM SUCCESS PAGE 12 PETER PENGUIN SHARES THE LATEST DATA PAGE 14 RHONDA RETAILER ON LOCO PROMOS PAGE 20 PRW PROFITS PROLIFERATE PAGE 62 www.frbuyer.com ADVERTORIAL Saving Companies $$$ for Over 45 Years Want to save as much as 20% on packaging and raw materials? Pittsburgh-based Summit GPO has an offer you added packaged goods recently. Actually, large vendors shouldn’t refuse. At no cost to you, it will scout for with strong purchasing power have been teaming up group purchasing deals that can save your company big for years. The buzzword is “horizontal collaboration.” money. We spoke with Joe Ford III, vp of procurement Nestlé and Ocean Spray, for example, collaborate on and supply chain management, and Jon Schlegel, vp and purchasing and warehousing. general manager. So why did you get into packaged goods? Because for mid-level producers, particularly in frozen and refrigerated foods, there’s been nobody working to find synergies and aggregating volume for better costs and terms. What are the names of some companies you’ve worked with in this industry? We’ve saved significant sums on packaging for Kahiki Foods and Jane’s Dough Foods, for example. And we’ve worked for many years with independent bottlers of Coca-Cola, saving them money on materials they buy. We provide all members with full-time employees who are experts in creative purchasing and contract negotiation. Do you displace the incumbent supplier? Jon Schlegel, left, and Joe Ford III at the American Our purpose is not to displace the incumbent supplier, Frozen Food Institute convention last month in Anaheim. although that may be the outcome. We don’t dictate anything. We call together vetted suppliers, including How does Summit GPO save money for mid-sized the incumbent, and get their best prices and terms on packaged goods companies? the specs. We explain to the suppliers how we can By aggregating purchases in key areas, we get them more bring them new customers without them having any buying power and better service from suppliers. This cost of sales. But it’s up to helps them compete with the member to choose which larger players who enjoy SAVINGS ON AVERAGE WITH SUMMIT GPO GPO vendor will be their a lower cost of goods. The supplier. money we save for them goes straight to the bottom How would you sum up your line. Members are often offering? surprised by how much We look for an unfair we can streamline their competitive advantage for purchasing and improve our members. Don’t get me their margins. It’s not wrong — we operate at the unusual to cut members’ highest ethical standards. costs by 10% to 20%. But in negotiation, you often hear “I can give you Members? a competitive price.” Well, The GPO in our name anyone can get a competitive stands for Group price. We want an unfair Purchasing Organization. competitive advantage — There’s no cost for members something that gives our to join, since we get our members a better chance revenue from supplier against the big players. If we companies. Suppliers pay can help members control costs, fend off price increases the GPO 4.75% on overall volume. So it’s a supplier- and compete better, we’re happy. Summit GPO is an paid service. Member customers get a guaranteed cost organization which enables its members to increase their reduction for all core consumable purchases, from competitive advantage. packaging to proteins to IQF veggies. Summit Group Purchasing Organization Has this concept been around awhile? Yes. We’ve been doing it for 45 years, starting out with Pittsburgh, Pa. • 412-968-1168 the soft drink and newspaper industries, but we just www.summitsave.com TABLE OF COnTEnTS COVER STORY PROMO MOJO 26 Here are benchmarks and insights you can use to add some magic to your promotions. T H E DATA B A n K Peter Penguin and Bessie 14 Bovine present the latest and greatest data, courtesy T H E F R O n T E n D of SymphonyIRI Group. 4 Out Warren’s Way If you do a better job with pro- motion, you’re likely to see a 5% CATEGORY SPOTLIGHTS increase in incremental dollars. 36 Pizza Shows ‘Signs of Life’ 6 new Products No, sales aren’t growing — yet — No animals were killed or but a turnaround seems likely, injured in the manufacture of thanks to a renewed focus any of these wonderful new on core brands by key products. (We’re lying.) players combined with better-for-you innovation 12 Johnny’s Awesome Column from category newcomers. Grandpa Harris discusses new item success. Have you done 44 Ice Cream Gains 1.6% your homework? Total units and volume also rise, while frozen yogurt skyrockets 36.8%. Novelties slide 1.1%. 20 Rhonda Retailer & Vinnie Vendor 48 Breakfast Jumps 6.6% Rhonda thinks Vinnie’s promos Up a whopping 19.1%, handheld sandwiches led are loco. Vinnie thinks Rhonda all gainers, but the biggest surprise was the ‘all is loco. other’ segment’s 4.8% advance. 22 Express Lane 52 Big Brands Drive Snack Gains Details on the upcoming IDDBA Ethnic flavors, better-for-you attributes and show; Costco and Walmart chat products that double as mini meals helped the with security analysts. category move closer to the half-billion-dollar mark. 24 Indian Foods Roll On 56 Dinners Fall 2.6% New items and flavors combine Hand-held varieties, better-for-you options with a healthy profile to build a and ethnic flavors may hold the key to a rapidly growing following. turnaround. LOGISTICS 60 Merchandising & Eenergy Spur Cases Display case makers focus on new refrigerants, 62 Hanson Logistics lighting and designs to entice shoppers and growing again; PRWs also cut costs for retailers. report higher profit; Millard turns 50; GCCA official wins honors; Henningsen GETTInG personAL wins NWFPA ‘premier employer award.’ Blue Bunny celebrates its 100 years by granting 100 wishes 66 through the Make-A-Wish Foundation; Tabatchnick donates 50,000 gallons of soup to NYC’s largest soup kitchen. APRIL 2013 www.frbuyer.com 3 14-4602_FDBAd2012_fp.pdf 1 September/21/12 2:11 PM OUT WARREn’S WAY talk about collaboration on promo- $2 BILLION, tion, a bevy of lawyers in the back of the room would jump up and VoLUME 4 ISSUE 8 shush them. I recall leading a dis- Warren Thayer AnYOnE? cussion once at a National Frozen Editor, Managing Partner & Refrigerated Foods Association [email protected] If you do a better job with pro- gathering and seeing their lawyer, 603-252-0507 motion, you’re likely to see a 5% pale as a sheet, standing back there Paul Chapa increase in incremental dollars. and waving his arms. I wondered Sales Director, Managing Partner if anyone in the room knew the [email protected] aniel Grubbs says in our Heimlich maneuver. 913-481-5060 cover story that more effi- But yes, collaboration with your Mike Barr Dcient promotion planning trading partners, at least as much Sales Manager and execution can likely produce a [email protected] as you dare, is a real key in making 331-999-4399 5% increase in incremental sales in your promotions more efficient and the frozen and refrigerated depart- profitable. That’s something you Janet Matz Art Director ments across the industry. That have to figure out for yourself, find- [email protected] translates to $700 million in incre- ing your own comfort level. Denise Leathers mental gains in frozen You also have to Executive Editor foods, and $1.2 billion figure out the role [email protected] in refrigerated foods. price plays in your 215-489-5090 Nothing to sneeze at. competitive strategy. Contributing Editors: Grubbs is a principal Deep discounts and Johnny Harris, Dan Raftery, Randal at Symphony Consult- BOGOs may ring Constant, Mike Friedman, Chef Rick C ing, an arm of Sympo- the register and help Tarantino, and Rhonda Retailer. M nyIRI Group, and he’s you meet short-term Editorial Advisory Board Y studied this thoroughly. numbers, but they’re Dan Raftery, CM He makes the case in part of a dangerous Raftery Resource Network detail in his story, and spiral that affects MY Todd Hale, Nielsen I don’t doubt him a bit. your profits and how CY Promotion planning, execution consumers perceive your stores. Bob Anderson, former vp of private label, Wal-Mart CMY and measurement have always Are you giving these activities too been the elephant in our industry’s much emphasis, or not choosing Johnny Harris, K Johnny L. Harris Consulting living room. the right products? Are you really Fact is, we’re in a low-growth in- differentiating your offering from Skip Shaw, National Frozen & Refrigerated Foods Association dustry with plenty of competition, the competitor down the street? including new channels of distribu- LOST In THE SHUFFLE Ellen Schmitz, tion. We’ve got the technological SymphonyIRI Group tools now to better determine what In fact, there are plenty of specific Kraig naasz, our shoppers want, but many of steps you can take to improve your American Frozen Food Institute those tools are like the treadmill we results, and our friends at Sympho- Bill Hudson, hang shirts on in the basement. ny Consulting, Nielsen and a couple Global Cold Chain Alliance Perhaps the reason we don’t exer- of consulting firms offer good, Mathew Mandeltort, cise more (on both counts) is a lack actionable ideas you can use. Often, Technomic of time. Lack of time is certainly a these good ideas get lost in the Published by CT Media Partners, nice-sounding excuse, and to a de- shuffle of the day-to-day madness Postmaster: Send address changes to CT Media gree it’s understandable.