Soaring Gas and Food Prices Hurt Wholesalers, Retailers
Motorists can expect prices at the pump to jump as dealers pass on a wholesale price spike caused by multiple refinery problems in the Midwest—a trickle-down affect that angers the retailers as much as the consumer.
“Our retailers make the same pennies on the gallon whether the gas costs $1 a gallon or $4,” said Ed Weglarz, VP of AFPD, a Michigan-based association representing more than 4,000 independent retailers including gas station owners. “When the gas prices spike that means the consumer has less money to spend inside the convenience stores often attached to the gas station because that is where the owner makes a profit. They do not make it on the gas.”
Weglarz explains that this is a significant problem.
In Michigan, the average price for regular is $3.82 per gallon comparing to the national average of $3.52, according to the AAA’s Fuel Gauge Report.
AFPD members want the public to understand that the independent retailers cannot control the gas prices and are at the mercy of the refineries like everyone else.
The gas price increases have a detrimental effect on business as well as the consumer. While you are paying more at the pump, retailers are also paying more at the grocery store.
As the drought that has affected two-thirds of the country continues, the cost of grain is surging because corn is becoming more expensive and it is all due to dry conditions.
The increase gas prices and drought translate to higher prices at the grocery store for just about everything.
“We not only see the price rise at the pump but the trickle down impact also has an impact on the cost to produce the items we are used to buying,” said Allan Girvin, director of sales and marketing for Heeren Brothers, wholesale distributor. “As fuel goes up at the pump it also goes up for the farmer for his fuel needs to produce, harvest and make ready to transport to market, a substantial cost even more so than the logistics from California to Michigan is the cost of fuel to grow and get to market the fresh items we are used to buying. Fuel costs have a substantial impact on the entire production to consumption formula with the pump price being just a part of the total impact.”
The price of fresh meats will increase as soon as this crop of protein is gone and the farmers aren’t left with much product—then they’re going to really raise the prices at the end of the summer. Buying Michigan products will help consumer save some money.
“In normal market conditions locally-grown products generally provide a savings to the consumer because of logistics. Less transportation time results in lower fuel surcharges added to the price and fresher products for the consumer,” said Mark Kassa, owner of Heartland Marketplace.
The Agriculture Department is reporting that grocery prices are expected to rise between 3 percent and 4 percent next year, which is slightly higher than normal.
Nestle USA Announces New Chairman and CEO to Join Company in October
Paul Grimwood, CEO of Nestlé U.K. and Ireland, has been appointed to the role of chairman and CEO of Nestlé USA following the retirement announcement by current Chairman and CEO Brad Alford, who is to leave in October.
Grimwood has been CEO of Nestlé U.K. and Ireland since January 2009, and headed the Nestlé U.K. Confectionery business for three years prior to that. During this period, despite the difficult economic environment, Nestlé’s business in the U.K. and Ireland delivered consistent growth in sales and profitability, and grew overall market share. Grimwood also led a major investment program to create Nestlé’s next generation of world-class manufacturing operations in the U.K. He joined Nestlé in 2001 in Nestlé Purina PetCare U.K. and Ireland.
Alford has been with Nestlé for 32 years, including nearly seven years as chairman & CEO of Nestlé USA. He was market head of Nestlé Oceania and in the U.S. led many businesses during his career, including Nestlé FoodServices, Confections & Snacks and Nestlé Brands before being named to his current role in late 2005. During his tenure, Nestlé USA has grown to sales of more than $10 billion by expanding into new categories and developing new distribution systems. Nestlé USA is one of the largest markets for Nestlé S.A., headquartered in Switzerland.
Acosta, Olean Celebrate Co-op’s 90th Anniversary With Luncheon
Representatives from Acosta Sales and Marketing paid a visit to Olean Wholesale Grocery Cooperative on July 20 and provided a luncheon for the entire office staff in celebration of the cooperative’s 90th anniversary.
“Acosta has never lost their focus on providing the highest level of service in our industry, they are a top quality business partner,” said Olean President and CEO Jim Ried.
In the featured photo at top, from left: John Bari, Acosta client team leader; Bob Haveron, Acosta business manager; Al Sapphire, Acosta VP of customer teams; Pete Telis, Acosta business manager; Sean Donavon, Olean Wholesale Grocery Cooperative director of center store sales; John Cleary, Acosta business manager; Scott McCann, Olean director of center store purchasing; and Roseanne Wagner, Acosta business manager.
Alabama Grocers Association Honors Industry Standouts
The Alabama Grocers Association held its annual convention earlier this week at the Sandestin in Destin, Fla. A number of awards were presented, including the 2012 Spirit of America Award, which went to Gerry Totoritis, president and CEO of Associated Grocers of the South.
Totoritis, who accepted the award from Tom Wenning of the National Grocers Association, recently announced his upcoming retirement from AG of the South. He has led the Birmingham-based cooperative for the past 12 years. He will retire Aug. 30.
Among the other awards presented during the convention:
Spirit of Alabama Award
Patrick McWhorter of The McWhorter Group
This award, presented by Alabama Grocers Association President Ellie Smotherman Taylor, was given in honor of McWhorter’s accomplishments to support the mission of the association by promoting the growth and success of the food industry by representing its members before legislative and regulatory bodies.
McWhorter has a vast background in politics and local home grown products. He grew up in Kentucky in the family farm store and farming operation and was heavily involved in the tobacco business. In Kentucky he held numerous political positions including being CEA in the Department for Local Government under Gov. John Y. Brown Jr. and Assistant Insurance Commissioner under Gov. Martha Layne Collins.
In June 1989, he went to work for The Tobacco Institute and was regional director sharing responsibility for all government relations on behalf of 13 major tobacco companies in the states of Alabama, Arkansas, Florida, Kentucky, Louisiana, Mississippi and Tennessee. After the Master Settlement Agreement, The Tobacco Institute was disbanded and he came to Montgomery as a legislative consultant. He has served under six governors including Guy Hunt, Jim Folsom, Fob James, Don Siegelman, Bob Riley and current governor, Robert Bentley. He has been the legislative consultant to the Alabama Grocers Association since 1993.
The Alabama Grocers Association Spirit of Alabama Award was established in 2006 to honor those that support the association and have commitment to the state of Alabama food industry.
Broker of the Year Award
Jeff Forman, Advantage Sales and Marketing
Jeff Forman of Advantage Sales and Marketing was presented with the Alabama Grocers Association Broker of the Year Award.
The award, presented by Taylor and Harold Garrett, association chairman, was given in recognition of Forman’s outstanding service and devotion to the Alabama Grocers Association and the grocery industry in the state of Alabama.
Forman started his career with Presto Products and moved from his hometown in Wisconsin to Dallas, Texas, to open its district office. He held various positions with Presto Products both in Dallas and in Atlanta, Ga. In 1980, he joined Welch Foods as its regional sales manager and in 1982 he moved into the food brokerage business in Oklahoma City as partner/GM of McVey-Henley Co.
In 1987, he and his wife Nancy moved to Birmingham to work for Marketing Specialists, which later became the Budd Mayer Co. and is now Advantage Sales and Marketing. Forman has held various positions with Advantage and has served the last 12 years as the sales manager in Alabama.
Forman is past president of the Food Sales Executive Club of Alabama and currently serves on the Alabama Grocers Association Board of Directors.
The Alabama Grocers Association Broker of the Year Award was established in 1996 to honor those that support the association and have commitment to the state of Alabama food industry.
Wholesaler of the Year
Frank D’Amico III, BTC Wholesale Distributors
Frank D’Amico III of BTC Wholesale Distributors was presented with the Alabama Grocers Association Wholesaler of the Year Award.
The award was presented by Taylor and Garrett and given to D’Amico in recognition of his outstanding service and devotion to the Alabama Grocers Association and the grocery industry in the state of Alabama.
D’Amico graduated from the University of Alabama in 1979 and in the same year joined BTC Wholesale Inc. BTC is a family owned business that was started in 1927 and is a wholesale distributor that services grocery stores, convenience stores and drugstores with items such as cigarettes, candy, tobacco, groceries and snacks. It services customers in nine states: Alabama, Florida, Georgia, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee. The company is headquartered in Shelby County and employs 110 people. During D’Amico’s 33 years with the company he has held many positions including sales representative, sales manager, VP of sales, EVP and currently serves as president.
D’Amico has served as president of the Alabama Wholesale Distributors Association and currently serves as treasurer. He also currently serves on the board of the Alabama Grocers Association and the Petroleum and Convenience Marketers Association. He is a member of the University of Alabama Alumni Association Commerce Executive Society and recently has been nominated to the University of Alabama Board of Visitors. In addition, D’Amico is vice chairman of the Regions Tradition, which has been an annual event in Birmingham for 21 years. He also is a founding board member of the Vestavia Hills School Foundation and is vice president of the Vestavia Hills Athletic Association.
The Alabama Grocers Association Wholesaler of the Year Award was established in 1996 to honor those who support the association and have commitment to the state of Alabama food industry.
Manufacturer of the Year
Phillip Ray, Wells Blue Bunny Dairy
Phillip Ray, Wells Blue Bunny Dairy, was presented with the Alabama Grocers Association Manufacturer of the Year Award.
The award was presented by Taylor and Garrett and given to Ray in recognition of his outstanding service and devotion to the Alabama Grocers Association and the grocery industry in the state of Alabama.
Ray has spent his entire career in the grocery industry. In the fall of 1962, at the age of 15, he starting working at Hills Grocery in Gardendale as a grocery bagger, produce clerk and stocker making 75 cents per hour. Winn-Dixie acquired Hills and he worked there until graduation from Mortimer Jordan High School in 1965. He started Jacksonville State University in the fall of 1965 and starting working at Western Supermarket in Gardendale until his graduation in 1970.
Following college, he served as a staff sergeant in the Alabama Army National Guard and began his early career at General Motors Acceptance Corp. and Ed Mollison Chevrolet. In 1973, he began working with Economic Laboratory Inc. as a sales representative and was later promoted to Alabama district manager. During his 21-year career with Ecolab/Benckiser Consumer Products, he received the District Manager of the Year Award several times. In addition, he was the recipient of the “Make a Difference Award” from Benckiser Consumer Products.
In 1995, he joined Wells Dairy as a sales representative for the Birmingham market. In 1996, he was promoted to Alabama/Georgia regional manager and in 1993 was promoted to Southeastern regional manager. In 2004, he received the Gallup Regional Manager of the Year Award and was the winner of Southeast Presidents Club in 2007. He managed the sales team that gained distribution for Wells in the following accounts: Food Lion, Harris Teeter, MDI, Ingles, Lowes Foods, Associated Grocers of the South, Mitchell Grocery, Supervalu, Piggly Wiggly Alabama Distributing, Piggly Wiggly Charleson, K-VAT, Winn-Dixie, Harvey’s, C&S Birmingham and Ira Higdon Grocery.
The Alabama Grocers Association Manufacturer of the Year Award was established in 1996 to honor those that support the Association and have commitment to the state of Alabama food industry.
Retailer of the Year Award
Robbie Norman, Norman Foods
Robbie Norman of Norman Foods was recognized as the Alabama Grocers Association Retailer of the Year. This award was given in recognition of Norman’s outstanding service and devotion to the Alabama Grocers Association and the grocery industry in the state of Alabama.
Norman began his retail career at age 18 working at Wyatts Supermarket in Ramer, Ala., while attending Troy State University. While at Wyatts, he learned a great deal about the grocery business, managing the front end of the store, and developed a passion for the retail business.
After graduating from Troy State in 1993 with a degree in accounting, he sent on to work for the grocery warehouse Scrivner. Three years later after more knowledge of the accounting of grocery stores he went to work for Taylor Chandler in Montgomery where he learned in depth about retail grocery accounts and was able to develop relationships with independent grocery store retailers.
After these years of training and gaining more experience he was looking forward to opening a store of his own and got that chance in Thomasville, Ala., when a landlord needed a tenant and was interested in helping someone young and eager be in the grocery business.
Norman opened his first store in Thomasville on Nov. 20, 2000. He spent many hours in the stores—generally staying at the store past 9 p.m., closing the store himself. After four years of continually learning more and developing a system that worked, he opened a second stores in Waynesboro, Miss. Since then he has opened four stores, including the Millbrook Food Outlet in Prattville.
The Alabama Grocers Association Retailer of the Year Award was established in 1996 to honor those that support the association and have commitment to the state of Alabama food industry.
The Alabama Grocers Association is a state trade association representing the grocery retail industry since 1990. It has more than 125 retail members operating nearly 1,000 stores nationwide, as well as more than 225 manufacturers, brokers, wholesalers and other members.
In the featured photo at top: Jeff Forman of Advantage Sales and Marketing, left, accepts the Alabama Grocers Association Broker of the Year Award from Harold Garrett, association chairman.
Stop & Shop Removes Calico Bean Salad After Recall
The Stop & Shop Supermarket Co. LLC, following a recall by Costa Fruit & Produce, has removed from sale Calico Bean Salad, sold on the salad bar, due to a possible health risk of listeria monocytogenes.
No illnesses have been reported to date. Customers who have purchased the product between July 18 and Jul 26 should discard any unused portions and bring their purchase receipt to Stop & Shop for a full refund.
Listeria is a common organism found in nature. Consumption of food contaminated with Listeria monocytogenes can cause listeriosis, an uncommon but potentially fatal disease. Healthy people rarely contract listeriosis. However, listeriosis can cause high fever, severe headache, neck stiffness and nausea. Listeriosis can also cause miscarriages and stillbirths, as well as serious and sometimes fatal infections in those with weakened immune systems, such as infants, the elderly and persons with HIV infection or undergoing chemotherapy.
Consumers in Massachusetts looking for additional information on the recall may call Costa Fruit & Produce at 1-800-322-1374; all other consumers may call 1-800-343-0836 or visit Costa Fruit & Produce’s website at www.freshideas.com. Customers also can call Stop & Shop customer service at 1-800-767-7772 or visit the Stop & Shop website at www.stopandshop.com.
Stater Bros. Opening New Hesperia Store On Aug. 1
San Bernardino, Calif.-based Stater Bros. will open its newest and most modern supermarket in Hesperia on Wednesday, Aug. 1. A ribbon cutting ceremony will be held in the parking lot at 8 a.m., and the new Stater Bros. Hesperia supermarket will open for business at 8:30 a.m. After Wednesday, the new Supermarket will be open daily from 6 a.m.-11 p.m.
Located at 16904 Main St. in the Mid Town Square Shopping Center, the new Hesperia supermarket will replace a smaller Stater Bros. Supermarket located nearby at 17255 Main Street, which will close July 31. By creating an additional 50 local store-level jobs, this new supermarket demonstrates Stater Bros.’ commitment to the Hesperia community it has served for over 35 years, since 1977, according to a news release.
In celebration of the grand opening, Stater Bros. Charities will make donations to the Hesperia Police Department for the Police Activities League, the Sultana High School Band, who will perform at the ribbon cutting ceremony, the Hesperia Library, and to Feed My Sheep community food pantry.
At 56,586 s.f., the new state-of-the-art and environmentally friendly Hesperia Stater Bros. Supermarket is more than twice the size of the current supermarket with wider aisles and nearly double the amount of parking spaces. Stater Bros. also operates two other supermarkets in Hesperia at 15757 Main St. and at 14466 Main St.
The new Hesperia Stater Bros. Supermarket will feature:
• Full Service Fresh Meat Department with Stater Bros. butchers to assists customers;
• Full Service Fresh Seafood Department with experts to help with selection plus capability to season and fry on the spot;
• Full Service Deli and Cafe including fried and baked chicken, stone fired pizzas, taco plates, salsa bar and more;
• Full Service Tortilleria featuring Manuela’s corn tortillas made fresh daily and freshly prepared tortilla chips;
• Full Service Hot Bakery with a full selection of Pan Dulce breads and rolls, plus Tres Leche and special occasion cakes;
• Full Service Floral Department for that special gift of fresh flowers, plants or floral arrangements; and
• Garden Fresh Produce Department featuring more than 800 items with expanded organic selections.
The new Stater Bros. Hesperia supermarket also will include environmentally friendly practices:
• Addition of LED lighting in building signage and refrigerated display cases plus use of glass doors and curtains in refrigerated cases that reduces energy usage by 60 percent;
• New lighting system that uses dimming ballasts, energy efficient lamps and occupancy sensors;
• Energy Management System that controls refrigeration, HVAC, Demand Response and lighting;
• Recycling Center located inside for customers to recycle paper and plastic grocery bags; and
• Earth-conscious alternatives such as large grocery bags made with 100 percent recycled paper and reusable bags for purchase.
Jack H. Brown, chairman and CEO of Stater Bros., said, “The Stater Bros. Supermarket family is especially proud to build this new, modern and environmentally friendly Stater Bros. Supermarket to better serve our long-time and valued Hesperia customers, who will be the first to experience Manuela’s fresh corn tortillas from our-first ever Tortilleria.”
Stater Bros. was founded in 1936 in Yucaipa and has grown steadily through the years to become the largest privately owned supermarket chain in Southern California and the largest private employer in both San Bernardino and Riverside counties. The company currently operates 167 supermarkets, and there are more than 18,000 members of the Stater Bros. Supermarket family.
AG New England Breaks Sales Record
Associated Grocers of New England held its 66th annual meeting last month and hallmarked a number of firsts for the company.
Mike Bourgoine, AG New England President and CEO, reported to those in attendance that the company ended its fiscal year with record-breaking sales of $458 million, representing a $76 million increase over the prior year. Returns to co-op members increased nearly $1 million over the prior year to $5,783,345.
The record-breaking increases were due in part to a large number of stores formerly supplied by AG of Maine that closed in 2011, as well as increased sales by many stores overall.
Associated Grocers of New England is owned entirely by independent retail grocers as members of a cooperative and is the largest retailer-owned, wholesale grocery distribution center in New England. The cooperative serves independent retail food stores in Maine, Connecticut, Rhode Island, Massachusetts, New Hampshire, Vermont and the Upstate New York Albany area.
In the featured photo at top: AG Retail Accounts Manager Ray Choate and SVP, treasurer and CFO Steve Murphy with Marty Beattie of Marty’s 1st Stop in Danville, Vt.
See the complete story in August edition of The Shelby Report of the Northeast.
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Save-A-Lot Opens Stores In Paris, Ky., And Atlanta
The new Paris store opened July 18 and is located at 2236 Martin Luther King Blvd. The Atlanta store opened July 26 and is located at 1901 Metropolitan Pkwy. SW.
“Save-A-Lot is committed to offering fresh produce, dairy and USDA-inspected meat, as well as other essential grocery and household items to shoppers at an affordable price—typically up to 40 percent less than traditional grocery stores,” a news release says. “We look forward to welcoming shoppers to our Paris and Atlanta stores.”
Each Save-A-Lot store carries a selected assortment of 1,200 to 1,500 of the most popular, in-demand every day grocery essentials, including farm-fresh fruits and vegetables, USDA-inspected meats, dairy products, bakery goods, shelf-ready and frozen foods, household goods, pet food, baby, and health and beauty care products. Save-A-Lot stores, which average about 15,000 s.f. feature a wide range of high-quality brands, including Save-A-Lot Today, Coburn Farms and Tipton Grove, produced exclusively for Save-A-Lot by many of the country’s leading food manufacturers.