Affiliated Foods Puts The Spotlight On Foodservice Division
by Terrie Ellerbee/associate editor
Affiliated Foods in Amarillo, Texas, would like to see its shareholders—grocery retailers—purchase products for their in-store bakeries/delis and sit-down restaurants from the cooperative. Grocers own the cooperative, so they would in effect be buying from themselves, just as they do when they buy for their retail stores.
The cooperative owns a separate foodservice company that serves hospitals, schools, restaurants, prisons and other accounts. Randy Arceneaux, president and CEO of Affiliated Foods, sees no reason why the subsidiary can’t also serve the grocery retailers who belong to and own the cooperative.
“If we can service a full-fledged steak restaurant that serves 400 to 500 patrons a day, we can service anything a bakery/deli has in a supermarket,” he says.
Arceneaux sat down with The Shelby Report’s Gordon Lowry to talk about the potential for retailers and the cooperative. Arceneaux was fresh off the Affiliated Spring Food Show, which this year spotlighted the company’s foodservice products and services. Affiliated is hoping to get retailers who already are members of the cooperative to use it for their foodservice needs.
“Everyone is starting to focus more on deli and foodservice-type businesses within their stores because the consumer is dictating it,” Arceneaux says.
Buying a meal at retail is appealing to younger consumers and empty nesters, he says.
“They are finding in most cases it’s more cost-effective to go pick up a meal already prepared than it is to prepare the meal,” he says. “So there are a lot of opportunities for the supermarkets to continue to develop and grow the bakery/deli, hot food line or bar, cold sandwiches and other offerings you’re putting out there for the consumer to purchase.”
Affiliated cooperative members can buy foodservice products at grocery markups vs. foodservice markups, Arceneaux says, calling the difference “very distinct.”
The cooperative has been working on getting more retailers to make the switch and use Affiliated Food Service for some time now. Executives would notice on visits to their members’ retail stores that trucks from other foodservice distributors were pulling up to unload.
“My belief is that we have anywhere from $15 million to $20 million of foodservice business on the retail side through Affiliated that we’re not tapping into because of competition,” he says.
Mike Snyder, director of Affiliated Food Service, believes the sticking point is department heads who continue to use other distributors. Retailers haven’t made foodservice a priority because they see departments doing well enough and leave decisions up to the department heads, so the key is to educate retailers, he says.
“They’ve got to do their homework and realize that they’re buying product from 10, 15 to 20 percent cheaper, because they’re buying it at member pricing,” Snyder says. “The people they’re taking orders from, from ‘Brand X,’ have their inside margin, plus their commission.”
Retailers are catching on as grab-and-go foods grow in popularity. Snyder sees increased interest on the part of retailers firsthand.
“At our show, many people walked up and said they want to expand their delis,” Snyder says. “This company hasn’t really put a huge push on seeking the foodservice business from its existing retailers. It’s overwhelming to me that our stockholders—retailers who own this company—don’t buy the entire package.”
Snyder says that along with better pricing, Affiliated can help cut and control food and labor costs thanks to the quality of pre-made offerings like pot roast, lasagna and meatloaf that are available.
It all comes back around to retailers saving money when they buy from Affiliated Food Service. Those purchases help strengthen the cooperative, which in turn helps the retailer, who is a shareholder in Affiliated Foods.
“Foodservice has the products that retail needs for the delis,” Arceneaux says. “Retail buys the product at the lowest price they can, plus it’s a rebate-able value to them at the end of the year, and their extra volume helps foodservice to be more competitive in the restaurant arena.”
Snyder is happy to see the attention being paid to foodservice.
“I’m excited about where Randy Arceneaux is taking our company and really working with our Affiliated Food Service division,” he says. “He loves foodservice, embraces it and understands it. It was his vision on this first show bringing the foodservice in, and I think this will do nothing but grow. This was our maiden voyage and the next one will be even better. We’re excited.”
McCormick Names Kurzius As President Of Global Consumer, CAO
McCormick & Co. Inc. has appointed Lawrence Kurzius to the role of president of global consumer and chief administrative officer, effective July 1.
In this role, Kurzius will have the responsibility for McCormick’s consumer business globally as well as several of the company’s corporate functions including IT, supply chain, R&D and quality assurance. Kurzius also will chair the Global Consumer Strategy Council in his new role.
Kurzius, who currently is president of McCormick International, joined McCormick in 2003 with the acquisition of Zatarain’s, where he was president and CEO. He also has served as president of the U.S. consumer products business, and president of Europe, Middle East and Africa (EMEA). Prior to joining Zatarain’s, Kurzius was a marketing executive with the Quaker Oats Co. and Mars Inc.’s Uncle Ben’s Co.
Kurzius graduated magna cum laude from Princeton University with a degree in economics. He is a trustee of Jacksonville University and a director of the Baltimore Council on Foreign Affairs. He is a former director of the Federal Reserve Bank of Atlanta’s New Orleans Branch.
TGI Fridays Introduces Two New Baked Snacks To Retail
Inventure Foods Inc. is introducing two baked snacks under its licensed partnership with TGI Fridays. Extreme Heat Crunchy Fries and Jalapeno Poppers Snack Sticks add substantial spice to a line of snacks inspired by the bar and casual dining restaurant menu.
Both snacks will begin to appear in stores and vending machines nationwide this summer. The Extreme Heat Crunchy Fries will be sold in 1.5-, 2.5- and 4.5-oz. bags; SRP $1.00, $1.99 and $2.49, respectively. Jalapeno Poppers Snack Sticks will be available in 1.25-, 2.25- and 3.5-oz. bags; SRP $1.00, $1.99 and $2.49, respectively.
The flavors reflect a consumer demand to turn up the heat, a trend also seen in Fridays restaurants with the recent introduction of its Taste & Share menu, a news release says.
According to Inventure Foods, Extreme Heat Crunchy Fries are exactly as the name implies, extremely spicy, and Jalapeno Poppers Snack Sticks offer a savory and spicy flare found in one of America’s favorite appetizer items.
Steve Sklar, SVP of marketing for Phoenix-based Inventure Foods, says, “With the addition of these new snacks, we’re not only offering the distinctive tastes consumers have grown to love from the brand, but we’ve rounded out the offerings by providing the extreme flavors consumers crave.”
Study Says QuikTrip Is Most Popular Convenience Store
QuikTrip—the convenience store chain found largely in the Midwest and East—is where consumers prefer to stop for gas, food and other conveniences, according to a new study by Market Force Information, a worldwide leader in customer intelligence solutions. QuikTrip was voted the most popular convenience store chain among the more than 7,600 study participants, followed by Wawa, RaceTrac, Speedway and Arco/ampm.
The study was designed to uncover which convenience store chains consumers frequent the most, as well as why they prefer one to another. Market Force first calculated the favorites based on total votes, and then factored in the number of locations for each chain for a weighted view of the results. Of the 45 chains studied, 7-Eleven and Shell initially amassed the highest number of votes, which can be attributed to the fact that they have more than 10,000 locations in North America. However, when viewed as a calculation of votes per location, QuikTrip ranked first.
Great customer experience is king in convenience
Market Force found that consumers place a high value on the customer experience—from appearance to amenities—when visiting a convenience store. Store cleanliness, in particular, plays an important role in their decision about where to stop and shop. When asked what they like most about their favorite convenience store chain, cleanliness was named more than any other factor. Friendly service ranked second, amenities ranked third, coffee quality was fourth and great service was fifth.
“The top-five factors relate to fundamental customer experience, and that’s no surprise to the best players in the industry,” said Janet Eden-Harris, CMO for Market Force. “Convenience store customers are on the go and in a hurry, but they will proactively drive to a store that provides a pleasant environment—clean, friendly, great food and service. The payoff for convenience store operators is that consumers shop longer and spend more. If stores can excel in these areas, they’ll see customers make a point to return again and again.”
QuikTrip and Wawa dominate in factors that matter most
Market Force also wanted to find out how the chains fared in the areas that matter most to consumers, and what drives them to frequent one convenience store over another. When it calculated the top chains according to attributes such as cleanliness, amenities and atmosphere, QuikTrip and Wawa dominated across the board, ranking first and second in every category.
Overall favorite QuikTrip, which invests in its employees and institutes creative customer service techniques, was the clear leader in the friendliness and great service categories. It also ranked first for cleanliness, amenities and atmosphere. Wawa was lauded for the quality of its coffee, and RaceTrac performed consistently well in all of the attributes, securing a third-place spot in four of the six categories. Speedway, Exxon Mobil and Casey’s General Store also outperformed many of the other chains studied in these key areas.
“QuikTrip has done an exceptional job differentiating itself in customer service. Its focus on delivering a welcoming and efficient customer experience led it to stand out in satisfaction-driven categories including friendly associates and great service,” said Eden-Harris. “Given its success in these areas, it was little surprise to see QuikTrip claim the title of most popular convenience store chain.”
Prepared- and fast-food sales are steadily increasing in convenience stores across the U.S. and Canada, and store operators are taking note by expanding their food and seating options. In addition, product selection and pricing are growing in importance and present a sizeable opportunity for store operators to stand apart from the pack.
When Market Force looked at food and product attributes for the top-rated convenience store chains, QuikTrip and Wawa ranked first and second in nearly every category, with Wawa only dropping in promotions. Speedtrac took the top spot in promotions with 36 percent followed by QuikTrip with 35 percent, RaceTrac with 26 percent and Wawa with 22 percent.
QuikTrip was a clear leader in merchandise selection (48 percent) and in and merchandise prices (35 per cent). It slightly edged out Wawa in food quality and fell second to Wawa in food selection.
Casey’s General Store and RaceTrac performed consistently well in most categories, with RaceTrac placing in the top five across the board. Exxon Mobile made a showing in the merchandise prices category, and BP for promotions.
Consumers willing to seek out preferred brand
More than a quarter of consumers are willing to drive past competitors to shop at their favorite convenience store brand, and 17 percent said that they always choose their favorite brand over other competitive brands, even if the competitor’s price is a little lower. This is all especially true for QuikTrip, Wawa, Speedway, RaceTrac and Arco/ampm. Forty-eight percent of survey respondents said they’d drive past a competitor to shop at QuikTrip, 46 percent said they’d do so for Wawa, 35 percent for Speedway, 34 percent for RaceTrac and 28 percent for Arco/ampm.
Avocados From Mexico Implements New $36M Marketing Strategy
Avocados from Mexico Inc. (AFM), the newly formed marketing agency dedicated to the Mexican avocado industry, is allocating $36 million to grow the category and propel the Avocados from Mexico brand. To implement this strategy, Tim O’Connor, CEO of AFM, will appoint Arnold Worldwide as integrated agency of record and Ketchum as PR agency of record. Launching nationally beginning in July, the organization’s first fully integrated campaign aims to move the avocado from exotic to every day.
Earlier this year, AFM announced the appointment of O’Connor, the former president and CEO of the U.S. Potato Board, to lead the newly formed marketing agency. Creating AFM is an important milestone for the Mexican avocado industry, according to a news release. The organization is the result of a collaboration by the Mexican Hass Avocado Importers Association (MHAIA) and the Mexican Avocado Producers and Packers (APEAM A.C.) to combine resources and develop and manage a common brand for the Mexican avocado industry.
“The selection of the best agencies to represent our brand was an intense process,” O’Connor said. “After narrowing 52 proposals down to 11 presenting agencies, Arnold and Ketchum were the definitive winners. They clearly understood our vision for the brand and demonstrated the strategic focus and creativity we need.”
“Winning Avocados from Mexico Inc. is a unique and compelling opportunity that doesn’t come along very often,” said Pam Hamlin, president of Arnold Boston. “Engaging the hearts and minds of people and inspiring them to use avocados every day is an incredible creative challenge. We’re thrilled to get started and channel our passion into fueling the growth of the avocado marketplace.”
Rob Flaherty, CEO of Ketchum, added, “We’re honored to continue our relationship with this rapidly growing, vibrant brand that has so much to offer health-conscious consumers and foodservice operators as a delicious addition to their meals.”
As the only avocados available year-round, Mexican avocados contribute more than 60 percent of the U.S. supply, and for the 2012-13 fiscal year, Mexican avocados surpassed 1 billion pounds in annual shipments.
The avocado industry has experienced steady growth over the past five years. From 2010-11 alone, avocado sales grew 11 percent to $2.9 billion. Despite this sales increase, there are still millions of consumers who don’t buy avocados, creating a significant opportunity for Denver, Colo.-based AFM Inc. and its new agencies to drive continued growth for the category and the Avocados from Mexico brand.
New CEO Named At Kettle Cuisine As Founder Transitions To Board Chair
Kettle Cuisine, a market leader in premium quality, all-natural soups for foodservice and grocery operators, says that Joe Rainert will take on the role of CEO of the Chelsea, Mass.-based company. Jerry Shafir, who founded Kettle Cuisine 27 years ago, will transition from CEO to chairman of the board of directors and continue to help the company navigate future opportunities.
Rainert first joined Kettle Cuisine in January as EVP of sales, marketing and innovation. Before joining Kettle Cuisine, he served as managing director of a $200 million fresh, chilled foods company in London. Rainert also boasts an 18-year career at Bakkavor in the U.K., where he ran soup, sauce and ready-meal businesses serving leading retailers such as Marks and Spencer, Waitrose, Sainsbury and Asda. Prior to his career in chilled foods, Rainert was a chef and restaurateur, running a Michelin-rated restaurant in England.
Shafir expressed his confidence that Rainert will bring outstanding leadership to Kettle Cuisine and carry the company on to much success while staying true to the core food values on which the company was built.
“I look forward to seeing Joe lead Kettle Cuisine into the future,” Shafir says. “Joe has an extraordinary background, combined with a passion and commitment to food quality and innovation. He is customer focused, results oriented and has a fantastic track record of developing high-performance senior teams. I am supremely confident in Joe and the excellent management team at Kettle Cuisine.”
Shafir will continue to stay active with the company as chairman of the board. He also plans to take more time for personal pursuits, including travel and philanthropy.
Both Shafir and Rainert will be in attendance at the National Restaurant Association (NRA) Show in Chicago that begins Saturday, May 18, as well as the International Dairy-Deli-Bakery Association (IDDBA) Seminar and Expo in Orlando in June.
In the featured photo at top is Jerry Shafir, left, and Joe Rainert.
Baskin-Robbins Launches First Retail Freezer Bar Product
Baskin-Robbins, the world’s largest chain of ice cream specialty shops, has launched a new line of shelf-stable sherbet flavored freezer bars, which are rolling out at major national retailers this spring. Baskin-Robbins’ Sherbet Flavored Freezer Bars are the first freezer bar treat from Baskin-Robbins that guests can purchase at participating supermarkets and drug stores nationwide. The company has partnered with Jel Sert, a leader in freezer bars, on the rollout of this new product as part of a licensing agreement.
“We are thrilled to bring the Baskin-Robbins brand to major retailers nationwide with the launch of our new Sherbet Flavored Freezer Bars,” said John Fassak, VP of business development for Dunkin’ Brands. “We look forward to introducing the Baskin-Robbins brand to even more people across the U.S. and giving our existing guests yet another way to enjoy our wide array of ice cream flavors and frozen treats.”
Each treat delivers two flavors in one freezer bar. Each box has 12 Sherbet Flavored Freezer Bars, which are available in two flavors—Rock ‘N Pop Swirl, a combination of grape and green apple flavors side-by-side; and Rainbow Sherbet, a combination of orange and raspberry flavors side-by-side. The freezer bars are shelf stable and meant to be frozen at home.
“At Baskin-Robbins, we are committed to product innovation and surprising our guests with delicious new creations that they can enjoy at our restaurants or at home,” said Stan Frankenthaler, Baskin-Robbins executive chef and VP of product innovation at Dunkin’ Brands. “Our Sherbet Flavored Freezer Bars are a new twist on two of our classic flavors and we’re so excited to introduce them to ice cream lovers nationwide.”
Baskin-Robbins’ Sherbet Flavored Freezer Bars will be available at a suggested retail price of $2.99 to $3.49.
La Brea Bakery Introduces Three New Ciabatta Breads
Artisan bread brand La Brea Bakery has introduced a new line of par baked Ciabatta breads that feature authentic recipes made from all-natural ingredients. The breads are available in three varieties: Ciabatta Loaf, Ciabatta Piccolo Loaf and Garlic Ciabatta Loaf.
La Brea Bakery’s Ciabatta breads include a tender interior and thin crusts. They are ideal for sandwiches, garlic bread or simply torn apart and dipped in fresh olive oil or olive tapenade.
“As a significant segment in the artisan bread category, Ciabatta has seen continued growth over the past year, which makes these three breads timely additions to our customers in-store bakery bread programs,” said Jennifer Johnson, brand manager for La Brea Bakery.
La Brea Bakery was founded by pastry chef Nancy Silverton in 1989. The bakery operates a flagship storefront in Los Angeles, in addition to a casual dining restaurant in Anaheim, Calif. La Brea Bakery is owned by Aryzta, a leading manufacturer and distributor of bread, buns, cookies, pizza and other premium baked goods.