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Rodale Institute moves Organic Field Day online

Rodale Institute Rodale Institute field days online

The Rodale Institute's annual Organic Field Day will be a week-long, on-demand, online event from July 13 to July 17 this year.

Fifteen recently recorded, in-field video presentations will be available upon registration. Each video is 15-20 minutes long. Live, interactive Q&A sessions with the presenters will be scheduled throughout the week.

Online attendance costs $25. Registration is available on Rodale's website.

The 15 presentations cover healthy soil, organic fruit, pollinators and more:

  • Intro to the principles of regenerative organic agriculture—Jeff Moyer, CEO, and Elizabeth Whitlow, executive director of the Regenerative Organic Alliance.
  • Cover crops and organic no-till—Andrew Smith, chief scientist and Yichao Rui, soil scientist at Rodale.
  • Soil health and water quality—JinJun Kan, associate research scientist at Stroud Water Research Center.
  • Organic apple orchards—Don Jantzi, field operations foreman at Rodale.
  • Pastured hog production—Sara Major, animal husbandry coordinator at Rodale.
  • Pollinator habitats—John Long, greenhouse/landscape specialist, and Ian Frederick, field technician at Rodale.

For more information, contact Maria Pop, director of education, at Maria.Pop@RodaleInstitute.org or 610-683-1481.

 

Source: Rodale Institute

Certified Seafood Collaborative takes ownership of RFM Certification program

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On July 1, 2020, the Certified Seafood Collaborative (CSC), a 501(c)(3) nonprofit foundation led by a diverse board of seafood and sustainability industry experts, became the owner of the Responsible Fisheries Management (RFM) Certification program, a third-party sustainable seafood certification program for wild capture fisheries. The Alaska Seafood Marketing Institute officially handed over ownership after a six-month period of transition following over ten years of dedication to developing the robust and independent certification for the industry. The transfer of RFM to the CSC presents new opportunity for cost savings, increased efficiencies and growth outside of Alaska fisheries. 

"Alaskans have always understood that sustainability is essential to a thriving environment, economy and communities. Since its inception, RFM has grown to be a globally recognized sustainable seafood certification program providing credible independent assurance that Alaska's fisheries are verified as sustainable," states Allen Kimball, EVP of international operations and sales for Trident Seafoods and CSC board member. "This new ownership by CSC represents a strategic milestone critical to supporting RFM's expansion to other fisheries and relevance in global markets." 

The CSC Foundation board has identified three key areas of focus as they take over management of the RFM certification program: decreasing assessment costs over the five-year fishery assessment cycle, expanding use of the program through increasing participation in chain of custody and use of the new RFM logo and certifying other high-performing fisheries outside of Alaska. 

RFM has certification standards for both fisheries and chain of custody (CoC). All current RFM fishery standards, certifications, audits and chain of custody certifications will remain intact and transfer to the CSC's purview without interruption. ASMI will continue to provide marketing and administrative support for the program. 

"It was always ASMI's vision to transfer the ownership to an outside entity once RFM had the infrastructure and matured into a globally accepted certification program," states Mark Fina, CSC interim board chair. "We are thankful to the ASMI board's vision and dedication in building such a viable program. We are proud to bring the ownership of RFM Certification to our foundation and to continue to offer such a credible choice to the marketplace." 

A versatile and modern new RFM logo launched last year and the program remained committed to not charging logo license fees; a major difference between RFM and other certification programs. The new logo also calls out product origin, as identifying connection to the source is key when it comes to purchasing food. The new RFM logo has been in use by customers with chain of custody certification since October 1, 2019, and is trademarked, registered, available in multiple languages and in rectangular and circular versions. Use of the old RFM logo will end by September 22, 2020. 

Source: RFM

Shoppers stock up on indulgent treats for comfort during COVID-19 crisis

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U.S. consumers have a tendency to turn to snack foods for comfort and enjoyment during trying tmes. Given both the economic and well-being stressors related to COVID-19, indulgent snacking is playing an even more important role right now. Snack food consumption has increased by 8% during the pandemic as consumers seek comfort through savory and sweet snacks, according to NPD's Snack Food Behaviors in Challenging Times study. During the Great Recession, between 2008 and 2010, snack food consumption increased by 4.8 billion eatings, a 1% increase. 

In April, when shelter-at-home orders were most strict, 37% of consumers told NPD they wanted to make sure they had sufficient snack foods on hand. They were well stocked on salty snacks and frozen sweets more than other items. Also, in many cases, the more snack food packages in the home, the more frequently the item is consumed; this tends to be especially true of certain types of snack foods. For example, consumers who have five or more packages of crackers or salty snacks consume those foods at higher rates than consumers with fewer packages in their homes. 

"We've seen consumers turn to indulgent snack foods in other challenging times, and although history isn't repeating itself during COVID, it is rhyming," says Darren Seifer, NPD's food and beverage industry analyst. "Although we can't predict what's going to happen in the future, I think it's safe to say snack food manufacturers and retailers can expect elevated snack food usage while COVID-19 restricts our restaurant usage and overall movement, in particular school closings and work from home orders."

Source: The NPD Group, Inc.

8 Earth Fare stores to reopen under new ownership

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Earth Fare's new leadership team plans to reopen eight locations of the natural grocery store over the next few months.

The Earth Fare retail banner lives to see another day.

The natural grocery chain, which filed for bankruptcy and shuttered operations in February, is being given a new lease on life through an investment from Hulsing Enterprises and its president and CEO, Dennis Hulsing, an Asheville, North Carolina, businessman with a number of interests in hotels and real estate.

Hulsing, along with the original Earth Fare founder Randy Talley and Mike Cianciarulo, a former president of Earth Fare, have joined together in the revitalization of the brand, with Talley now serving as the company’s chief sustainability officer.

Hulsing has also brought on David Isinghood as chief operating officer for Earth Fare. Isinghood spent 25 years of his career working for Whole Foods Market before joining the team.

“Our guests will recognize many friendly faces as we’ve hired previous Earth Fare team members back,” said Isinghood. “We are committed to taking care of our team members by treating them with respect and giving them a voice in our business.”

Westgate Earth Fare in Asheville, the first of the reopened stores, began welcoming customers on June 22. According to Hulsing, the Asheville location is the first of eight Earth Fare stores to open, with the new leadership team planning to open the remaining locations over the next few months. Hulsing intends to continue to grow the stores throughout the southeast region and keep its headquarters rooted in Asheville.

A location in Roanoke, Virginia, is scheduled for a “social distanced” grand reopening next week.

“We are looking forward to the reopening of stores in Boone, North Carolina.; Athens, Georgia; and Summerville, Charleston, Columbia and Rock Hill, South Carolina,” Hulsing said.

Upon filing for bankruptcy, Earth Fare had about 3,000 employees and 50 stores in 10 states, including Alabama, Florida, Georgia, Indiana, Michigan, North Carolina, Ohio, South Carolina, Tennessee and Virginia. More than half of the are in Florida (14) and North Carolina (13).

Most of the properties were sold during a bidding process in March and April, with former Earth Fare sites going to retailers such as Southeastern Grocers, Aldi and Whole Foods, in addition to those sold to Hulsing.

supermarket news logoThis piece originally appeared on Supermarket News, a New Hope Network sister website. Visit the site for more grocery trends and insights.

IdeaXchange

Natural products retailers open new stores during coronavirus crisis

Steven Hoffman, managing director, Compass Natural

As the coronavirus pandemic enters its fifth month, the United States is slowing re-opening for business. While many Americans are playing it safe and staying home, cases continue to surge in states and regions throughout the country.

Restaurants and bars are re-opening; however, with public health regulations limiting the number of patrons, food service businesses are taking in nowhere near what they once were. And, as the pandemic has shuttered day camps, benched Little League games, cancelled concerts and limited other warm-weather activities, families and kids are staying much closer to home this summer.

As such, grocery stores, including the nation’s natural foods stores, continue to play an essential role in feeding Americans. Several natural food retailers we talked to anticipate they will not see much of a traditional "summer slump” in sales this season.

In fact, a number of retailers are taking advantage of the moment to open new stores. Boulder, Colorado-based Alfalfa’s Market announced in mid-June it is taking over a former Lucky’s Market location in nearby Longmont—its third store on Colorado’s Front Range. In Los Angeles, California, Erewhon plans to add two new stores in the next 12 months to its five-store chain. PCC just opened its 14th natural foods store in the Seattle, Washington, area. And, although Natural Grocers postponed grand opening celebrations, the Lakewood, Colorado-based chain opened two new stores recently: One in far northeast Denver on May 20; the other in Cedar City, Utah, on June 10.

Publicly held natural products retailer Sprouts, which CEO Jack Sinclair recently described as "more of a farmers market than a grocer,” plans to open 20 stores in key markets across the country. Like many retailers, the Phoenix, Arizona-based chain has expanded at-home delivery and curbside pickup, as well as significantly increased its e-commerce sales.

Even conventional grocer Schnuck’s, which is based in St. Louis, Missouri, followed the natural retail trend and unveiled its new EatWell natural food concept store in Colombia, Missouri, on June 24.

To help reassure customers and workers, many of these retailers have enacted strict COVID-19 guidelines. Both Maryland-based MOMs Organic Market and Natural Grocers have posted on their websites their new cleaning procedures and safety policies.

Driving sales growth is a growing number of consumers seeking out healthier, more nutritious products to boost immunity and health.

'Grocery is the business to be in'

"Our comps are off the charts,” said Tony Antoci, CEO and owner of Erewhon. Antoci, a food service distribution veteran, purchased the original single Erewhon location in 2011 and self-financed the growth of the chain to five stores. "We’ve seen a 300%-400% increase in grocery and produce sales since the coronavirus crisis began," he said. "Protein sales grew four-fold until the end of May. Now we are starting to see a leveling off, but our deli and prepared-food sales are increasing as our customer base starts to get back to a new normal.

"We also ramped up our web ordering and delivery capabilities— something we were trying to engage but never got around to—and we had a healthy online business in a week. Now, we are averaging 200-250 online orders across five stores per day. If this was a restaurant, I would not open a new location, but grocery is the business to be in,” Antoci said.

At Jimbo’s Naturally, a five-store independently owned chain in San Diego, California, customer counts have decreased since the coronavirus crisis began, but they’re more than made up for in the increased average purchase, said founder and CEO Jimbo Someck.

"People don’t want to make as many trips if they can avoid it, but the average ticket is twice as high as it was before the pandemic,” Someck said. "It’s one thing to plan for increased demand; however, it’s another thing when the stores are doing two to three times the sales they were doing the day before. There were a lot of long days,” he said.

When asked about potentially opening a new store, Someck replied, "I don’t know if it’s a good time or not to open new stores. The challenge is to know where all this is going."

UNFI stock surges

In serving all this retail growth, leading natural foods distributor UNFI saw its stock price surge 45.8% in the past three months.

"Several food companies are benefiting from rising demand owing to increased at-home consumption and stockpiling trends amid coronavirus,” analysts at Zacks Equity Research wrote in late June. "The packaged food space is especially gaining on such trends as the lockdown has prompted shoppers to buy and hoard packaged food and beverages. This has boosted sales of several food players, including United Natural Foods Inc. (UNFI). United Natural’s ability to cater to the rising demand amid the pandemic reflects its robust market position and the important role it plays in North America’s food supply chain,” the analysts concluded.

In related news, Zacks Equity Research on June 18 ranked Sprouts Farmers Market a top growth stock, acknowledging that it, too, is a long-term beneficiary of the pandemic. Kroger also has been outperforming the stock market as a beneficiary of the eat at home trend driven by the pandemic, along with the company’s moves to cut $1 billion in costs and invest in digital growth. Bank of America Merrill Lynch analyst Robert Ohmes reiterated a "buy" rating on June 19, based on his belief that Kroger will continue to see strong sales even as coronavirus-related restrictions are lifted in many areas. Natural Grocers saw its stock price nearly triple—it closed at $14.87 on June 30—from a low of $5.80 on March 12 when the pandemic first struck the U.S.

Consumers are leaning in to a healthy lifestyle

Driving sales growth is a growing number of consumers seeking out healthier, more nutritious products to boost immunity and health.

"Far from abandoning their natural lifestyle during COVID-19, natural products shoppers are widening their preferences, seeking and avoiding various ingredients, label claims and certifications,” according to a May report from market and research firms SPINS and IRI titled COVID-19 and Navigating the Path Ahead: Supporting The Natural Products Consumer Leading the charge are paleo products, plant-based meat alternatives, baking products and pantry staples, household cleaning items, soap and bath preparations, natural remedies to help support immunity and reduce stress and anxiety, and value-based products as many people struggle through unprecedented economic times brought on by the COVID-19 crisis.

In addition, consumers are purchasing more organic products than ever, the Organic Trade Association reported in June. Organic products sales topped $55 billion in 2019, up 4.6% from the previous year. As health comes into focus, many organic categories have seen demand increase even further. Organic produce sales jumped 50% in the early days of the pandemic, and by spring 2020, sales were still up by more than 20%, the trade organization found.

"It’s hard to know what’s ahead of us, but consumers will continue to trust in and depend on the organic label,” CEO Laura Batcha said in a released statement. "Organic producers and processors—indeed the entire organic supply chain—have been working around the clock through this difficult time to keep our stores filled with healthy, toxic-free and sustainably produced organic food and products. Organic is going to be there for the consumer.”

Tonya Antle, cofounder of the Organic Produce Network, said in a recent United Fresh LIVE virtual conference that the latest retail scan data show that both volume and dollar sales of organic produce were up more than 16% during May. In addition, according to OTA data, organic staple categories including dairy, eggs, bread, pasta, rice, grains and baking supplies are expected to see increased growth in 2020, along with organic vitamins and immunity-related products.

Controversy over face masks

The surge in grocery and natural products sales has certainly not come without challenges. The wearing of face masks, required in many municipalities and public and commercial places, for instance, has become divisive and, in some cases, violent. More than 30 lawsuits have been filed against Giant Eagle, according to TribLive.com, the online version of the Tribune-Review. Some of those lawsuits claim the Pittsburgh, Pennsylvania-based grocery chain's no-exceptions mask policy violates the Americans with Disabilities Act. In June, a video posted to social media—and reported on by TMZ, the Orlando Sentinel and others—showed a man without a face mask trying to enter an Orlando, Florida, Walmart store. The man scuffled with a store employee, even falling to the floor, to get through the doors.

Similar incidents and worse have happened all over the country.

"It’s a very difficult position for us to put our staff in, whether it’s an 18-, 19-year-old college student working, or a single mom, a dad,” Bryan Neiman, operator of Neiman’s Family Market, a small Michigan grocery chain, told Time magazine regarding face-mask policies. Neiman’s posted signs asking customers to wear facial coverings, and shoppers can get a mask at customer service. But Neiman told his employees not to confront mask-less customers, for fear of triggering a confrontation.

Texas-based grocer H-E-B, which required customers to wear face masks beginning in mid-April, announced in early June a relaxed policy so that shoppers were no longer required to wear face masks in its stores, Grocery Dive reported.

H-E-B changed its policy again on June 30, however. More than 85% of its locations are subject to local mask requirements, but in stores that don't have those local ordinances, the company now requires the use of masks, according to its website.

Seasonal promotions affected in 2020

As retailers scrambled to respond to the tectonic shifts in consumer behavior, brands moved their focus away from seasonal sales and promotions for such holidays as Easter, Mother’s Day, Memorial Day, Father’s Day and more, said Donnie Baldwin. Baldwin is the senior director of conventional grocery for the Central and Western U.S. at natural products broker Presence Marketing/Dynamic Presence.

"For 2020, we are staying busy serving our retail partners’ immediate needs,” Baldwin said. "However, while retailers may miss the seasonal sales this year, they’ve got their hands full keeping the store shelves stocked as full as they can.

"The good news is the average dollar ring per basket is up, but while the head count of customers shopping in stores is down—or they are shopping quickly through the store—it has impacted sales of seasonal items and impulse items,” Baldwin said. "As we talk with account executives around the country, buyers are still focused on staple items. They want to make sure they’ve got control of the supply chain on staples. That’s been a priority, and the good news is we are starting to see them get a handle on that."

Baldwin’s counterpart, Jim Crotty, senior director of conventional grocery for the Eastern U.S. at Presence Marketing, added that retailers are looking at fall and the holidays, but many still are not ready to focus on new items.

"Operations and taking care of their people are coming first right now,” Crotty said. "Come September, they might start bringing new products in; it is just happening at a slower pace. We are presenting holiday items such as eggnog and pumpkin flavors now and will continue to do so. Hopefully, we will be able to see things open up in November/December."

Meanwhile, some of Baldwin's team members have been creative in developing YouTube video presentations for retail partners.

"I really feel that by late in the third quarter and early in the fourth quarter, things are going to start opening up and retailers will start getting back to the basics,” Baldwin predicted. "This industry is very adaptive and resilient and we always look to find a way to carry on.”

5@5: Senate extends Payment Protection Program | Beyond Meat enters China

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Senate approves extending Paycheck Protection Program

On Tuesday the Senate unanimously granted small businesses five additional weeks of federal aid via the Paycheck Protection Program; the application period has been extended until August 8. New outbreaks of the novel coronavirus have forced many states to scrap their reopening plans, leaving small businesses once again scrambling for both funds and guidance. Read more at The New York Times

 

Beyond Burger arrives at grocery stores in China 

China is the world's biggest market for meat consumption, which makes Beyond Meat's much-anticipated foray into the country's supermarkets especially significant. Beyond Meat faces competition from a plethora of local fake meat brands, however, including Hong Kong's Omnipork and Alpha Foods. Beyond Meat's retail success (or lack thereof) will serve as an example for other U.S.-based brands looking to capitalize on Chinese citizens' growing desire for safe, environmentally friendly meat alternatives. Read more at Tech Crunch

 

Amazon, Whole Foods says it's giving more than $500M in 'thank you' bonuses to workers

Amazon announced this week that it will be distributing over $500 million in bonuses for its frontline workers as a gesture of appreciation for their service in the face of COVID-19; employees will each receive anywhere from an extra $150 to $3,000. Amazon has faced criticism throughout the pandemic for failing to implement adequate safety precautions in its warehouses and ending its hourly pay increase for essential workers in May. Read more at WKYC

 

Bayer forges ahead with new crops resistant to 5 herbicides

Bayer is awaiting approval to bring a genetically engineered variety of corn to market that would be resistant to at least five herbicides at once, including dicamba. Herbicide-resistant crops tend to significantly increase the amount of chemicals farmers end up applying to these plants, and which eventually make their way onto consumers' plates. Read more at Civil Eats

 

The USDA's food box program is off to a rocky start

The Department of Agriculture fell more than 10 million food box deliveries short of its intended goal by the end of June. Meanwhile, lawmakers continue to push for an increase in SNAP benefits as a more effective and humane way to help America's struggling families. Read more at The Counter

10 preconceptions about selling online—and why they’re wrong

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Natural products entrepreneurs who’ve found some success at retail come up with all sorts of reasons why they don’t want to sell online. These are often based on their preconceptions about how much e-commerce will cost them to launch, what resources they’ll need to maintain it and how much business they can expect to generate. However, many of these preconceptions are misinformed—or just plain wrong—meaning brands are unnecessarily closing themselves off from excellent opportunities.

While it has always been wise for natural products companies to have an omnichannel strategy, the COVID-19 pandemic has made it imperative. Consumers are buying foods and beverages online like never before, and experts predict that plenty will stick with e-commerce long-term. Therefore, it’s high time to dissect those hang-ups and separate fact from fiction so that brands can start selling online with confidence.

Here are 10 common preconceptions natural products businesses have about e-commerce and why they’re not necessarily rooted in truth.

1. “You need to be a tech wizard to do e-commerce—and I’m not one.”  

“It is true you need to invest in some expertise to build a website with a functioning store and integrate it with a platform that works well with e-commerce, such as Shopify,” says Betsy McGinn, founder of online strategy consultancy McGinn eComm. “But in terms of needing ongoing expertise to managing the business, no. These platforms are designed to let you manage the business yourself internally.”

2. “It’ll cost too much.”

Building and operating an e-commerce platform will cost money, no question. But entrepreneurs shouldn’t think of it as a cost, says McGinn; they should view it as investment-spending in the future of their business.

“The resources you may need, such as third-party fulfillment, website development and marketing help, run the gamut from sole proprietors who are very affordable for natural brands to agencies that are extremely effective for larger brands and everything in between,” she explains. “So, yes, it’s an investment, but it doesn’t have to break a company. Everyone can find the right fit for their budget.”

3. “We want to take care of our retailers, which means not selling online.”

“Guess what? If you’re not selling your product online, it’s very likely that someone else is,” McGinn cautions. “Anyone could be buying your product—legitimately—and turning around and selling it on Amazon, which means you’re giving away your brand power to someone you may not even be able to identify as a living person. It is just not realistic to forgo e-commerce in the current environment.”

4. “It’s hard to be profitable online.”

“This couldn’t be further from the truth,” McGinn says. “But what is true is you need to do business entirely differentially.” For example, you may offer different pack sizes and prices online, and you must build other costs into your profitability models. Brands run into trouble, she adds, when they think they can sell a single unit on Amazon for $4.99 because they do so at retail, but they haven’t accounted for the costs of shipping or Amazon fees.

“If you approach it just like brick-and-mortar—if your strategy is just an online version of your brick-and-mortar strategy—it’s almost impossible to be profitable,” McGinn says. “But you can be profitable if you build your profitability model in a different way. E-commerce has different costs than brick-and-mortar, but in some cases, they are less than retail slotting fees or discounted products.”

5. “E-commerce is such a small part of our business.

This may be true, as it is for a lot of natural products companies—or was true before the pandemic sent droves of former brick-and-mortar shoppers online. The market has changed, says McGinn, and brands that don’t change their strategy along with it will be in trouble. 

“About 30% of the increase in [online grocery shopping] is from new users, and once they experience the convenience, selection and benefits of two-day shipping or click-and-collect, there is not a lot of incentive to go back in the other direction,” she says. “Many of these consumers are here to stay. So if you don’t invest in your e-commerce strategy, e-commerce will remain a small part of your business.” Coupled with a decline in retail sales, that is not something most natural products brands, especially startups, can afford.

6. “Our products aren’t right for e-commerce.”

Even if your goods are bulky, frozen or refrigerated, McGinn insists that you can still find success selling online. She points to Maine lobster and cauliflower pizza crusts as examples of fresh or frozen items that have been majorly successful in e-commerce. “Really, there isn’t a product that can’t be sold online these days,” she says.

7. “With no SPINS- or IRI-like date available, I’d have no way of knowing the size of our category or how our competition is doing.”

“I’ve always thought the lack-of-data concern is traditional-company thinking,” McGinn says. “Remember, no category in e-commerce is mature, so category size is irrelevant, as is the size of the competition.” She notes that countless small brands have found big-time success in e-commerce while some of the big national food and beverage brands haven’t historically done much business online.

In fact, McGinn believes the lack of visibility into other companies’ sales numbers can actually work in small natural producers’ favor. “Other brands don’t have access to your sales either, which is a beautiful thing,” she says. “It allows natural brands to break through because competitors can’t see how great they are doing and therefore can’t squash them in process.”

8. “Most of our online sales will come from our own website.”

Many entrepreneurs assume that if and when they build an e-commerce site, it will generate the majority of their online sales. But it rarely works that way for food and beverage companies. According to McGinn, the conversion rate for brands’ e-commerce sites is typically about 3.5%, so you’d have to drive an insane amount of volume to your site to land enough sales to be profitable. Not realistic.  

“Because we sell consumables—food, beverages, personal care, baby products, household products—people want to buy these items all in one place,” McGinn says. “They want to build a shopping cart, and they don’t have the same ability to do that at your direct-to-consumer site as they do on Amazon, Thrive Market or others. That’s why those websites will be your volume drivers while your e-commerce site is a place to connect with and gather information about consumers to use more broadly within Amazon and your overall digital strategy.”

9. “Amazon is very difficult to work with.

“There is some truth to this—I’ve heard all sorts of Amazon horror stories,” McGinn says. “But the reality is the platform is highly automatic, so relationships won’t get you far like they do in brick-and-mortar. Entrepreneurs run into glitches with their Amazon account, want to pick up the phone and talk to someone about it, and find it’s not that easy. But on the flipside, this has leveled the playing field. Because it’s all automated, nobody can get edge on you by knowing someone internally who can make a difference in their business.”

10. “If we’re on Amazon, it will ruin our pricing strategy in the market.

Most natural products brands don’t sell to Amazon—they use its third-party platform. “You set your own pricing, decide how much inventory to have and determine everything about how you’ll sell your brand, which means it’s incumbent upon you to have a pricing strategy that works for all your channels,” McGinn says.

“My parting words are it’s time to get going,” she adds. “Now is a great time to reimagine your business for how to be successful in brick-and-mortar and flourish in e-commerce. It is common sense to be diversified and well positioned in each channel.”

IRI reveals top trends in fresh for 2020 and beyond

IRI 2020 trends in fresh

In its fifth year, IRI's Top Trends in Fresh report, produced in partnership with FMI, recently reported that the concept of “fresh” at retail is more complex than ever before. Little did they know that it would get even more complicated in a post-COVID world. And while findings were based on 2019 over 2018 before the novel coronavirus rocked the world of retail, they remain pertinent with regard to the transforming retail landscape.

While conventional grocery stores and supermarkets still command 64% of fresh sales, outlets such as club and specialty stores that put an emphasis on fresh are gaining ground. The report’s authors noted that while fresh food drives grocery trips and sales, companies must be “forward-looking, data-driven and break from tradition to keep pace with the rate of change.” Again, this was all written before the pandemic occurred.

Below are six takeaways from the report.

1. Spending habits have changed.

Middle class families and metro singles have reduced their spending at grocery supermarkets; they are able to spend less on fresh items by shopping at venues like Walmart and Target.

2. Shopping channels are shifting.

While grocery still holds the largest portion of fresh sales, commanding 57% of them with 122 trips per buyer, other outlets are outpacing grocery in terms of growth. The biggest channels where dollars from fresh grocery or supermarket sales are expanding to include Walmart, specialty stores such as Trader Joe’s, Club, Target and online. Consumers shopping via these channels may be spending less at grocery stores because they aren't one-stop shops.

3. E-commerce is growing.

The e-commerce channel is driving significant growth for fresh foods with $5 billion in sales and 58% sales growth year over year. The key driver of this growth has been the advent of brick-and-mortar fulfillment, where people are ordering through their phone for pickup or having that order delivered to them by the likes of Instacart and Amazon. Last year 41% of online fresh food sales were click-and-collect. In Q4 2019, Amazon Fresh delivery doubled versus the prior year. Given the current COVID-19 situation, these numbers are expected to increase even more in 2020.

4. Deli is down, but prepackaged is up.

While Natural Foods Merchandiser recently reported that deli sales took a hit during COVID-19, FMI found that deli volume sales to be while at the same time the $5.8 billion refrigerated, prepackaged branded convenience meals were up 17% in volume sales and 27% in dollar sales. Convenience is still popular, but researchers say that with all of the challenges retailers are facing branded, prepackaged options are a great way to resolve the convenience need as opposed to trying to do everything in house. Again, this is a trend that is likely to stick throughout 2020.

5. Shoppers prize convenience, health and indulgence.

The top eight perimeter categories consistently reflect changing consumer preferences for convenience, health and indulgence. Produce, not surprisingly, continues to play a key role. The fastest-growing fresh categories include: lettuce, prepackaged refrigerated meat, fresh berries, packaged entrees, prepackaged refrigerated side dishes, celery, deli-prepared meals and refrigerated breakfast meats. Breakfast is one of the easiest meals consumers know how to make, say researchers, and bacon, sausage and other breakfast meats are performing well year over year.

6. Supply chain disruption, lack of consumer cooking experience leads to lost revenue.

Traditional commodity categories that lost dollars by the largest amount over the reported 52 weeks included deli-prepared entrees (as noted above, with growth increasing in prepackaged and branded entrees). Some traditional fruit categories, such as grapes, oranges, lemons and cherries, that had supply chain disruption with weather saw volume losses. Commodity fresh meat as well is poorly connecting with consumers who don’t know what to do with it. For instance, traditional pork loin that is unseasoned and marinated is down in sales. But at the same time prepackaged marinated value-add pork tenderloin is doing well. So, researchers pointed out, it’s not that people don’t like it, they just really like it when it’s made easy for them. Convenience, convenience, convenience.

When producing this report, researchers traditionally monitored macro trends year over year that took into account new supply chains, food transparency, convenience, holistic health, customization, the connected consumer, fresh prepared, social and cultural alignment, localization and the atomization of personalization.

But now they say the trends influencing consumer purchases are merging and becoming intertwined. Additionally, finding convenient meal solutions while retaining the ability for customization and new technology is the way of the future. A successful example of this is how Publix now offers customers the ability to order fresh sandwiches online to pick up in store. While in-store sandwich sales have stagnated, Publix saw phenomenal growth after adding the online ordering option. Talk about good timing! The report and its accompanying webinar offers many more examples of the evolution of fresh and illustrates what will continue to be relevant in the years ahead.

International Probiotics Association responds to '60 Minutes' exposé

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A widely viewed television program named “60 Minutes” recently posed the question “Do probiotics actually do anything?” The 13-minute piece which aired on June 28, 2020, can be viewed here.

The International Probiotics Association (IPA) immediately addressed the concerns and inconsistencies in the segment. See IPA’s official response below this short summary.

Several of the points refuted are in regards to:

  • Evidence for the benefit of probiotics in antibiotic-associated diarrhea.
  • Evidence for probiotics' ability to reduce allergy symptoms.
  • Differentiation with regard to the placebo effect.
  • Controversial results with a commercial product.
  • The efficacy and safety of probiotics in infant formula.

Regulation is also a controversial topic in the program. To refute the statement that probiotics are “not tightly regulated,” IPA discusses the regulatory models used in various countries.

In conclusion, IPA believes that the well-intended program falls short.

While some of the participants recognize the potential of probiotics and highlight challenges going forward, the IPA believes that “the consumer will need more balanced sources of information to be able to make an informed choice.”

The IPA is committed to provide fair and objective information on probiotics to the benefit of the consumer and the probiotic industry, globally.

Read IPA's response below:

The “60 Minutes” program by Dr. LaPook on the importance of the gut microbiome and probiotics for health highlights this fascinating field. For the International Probiotics Association (IPA), probiotics are well defined by the FAO/WHO as “micro-organisms, which when administered in adequate amounts confer a health benefit to the host.” A wide range of benefits of probiotics are broadly recognized by the health community. Probiotic effects are usually strain-specific, and well-characterized probiotics are safe for the general healthy population. In the U.S., probiotics may be foods or supplements according to the Food and Drug Administration (FDA), unless they come with a drug registration. However, the program did not reflect all of these factors and creates more confusion and misimpressions for consumers by failing to present balanced information.

It is suggested, in the segment covering the interview with Dr. Hibberd, that there is no evidence for the benefit of probiotics in antibiotic-associated diarrhea. The IPA would like to remind the reader that independent clinical organizations, such as the WGO and the AGA recommend specific probiotics. For IBS, the WGO also recommends certain probiotics. For allergies, a meta-analysis on the topic suggests a reduction of 22%.

The so-called placebo effect is mentioned in relation to probiotics; this effect is not specific to just probiotics, as users of pharmaceuticals may experience this as well. Studies conducted according to accepted scientific standards, including those conducted on many probiotics, are usually able to differentiate positive outcomes from a placebo effect through the randomization and blinding process. It should be also noted that there are different types of clinical studies: some investigate efficacy, some safety and some explore different methods of action of the product.

The results from one undocumented product in an exploratory study from the Weizmann Institute are presented in the segment. While the study is technologically advanced, it included only a small number of subjects and was not investigating any clinical endpoints. Just because the intervention did not recover the microbiota under the study conditions, does not mean that probiotics as a whole are ineffective. While the researchers were "surprised" that the probiotics did not ‘"settle," it is important to understand that the scientific community widely acknowledges that probiotics do not colonize.

Finally the conclusion, in recommending caution with prescribing probiotics, is based on controversial results with a commercial product that is hardly documented as a probiotic.

In another interview, the efficacy and safety of probiotics in infant formula are questioned. In 2011, The European Society for Paediatric Gastroenterology Hepatology and Nutrition (ESPGHAN) concluded that there were no safety concerns in these populations. It is always difficult to document a benefit in a generally healthy population, and this is also true for probiotic infant formulas. A further comment is made on the absence of long-term studies. One can discuss what long-term is, but the IPA would like to remind the reader that there are several longitudinal studies that have followed children from birth for 11 years or more and cancer patients for more than 20 years, none of which have raised safety concerns over these extensive periods.

It is stated in the program that probiotics are “not tightly regulated,” and thus implies that they submit to somehow “lower standards.” This is not the view of the IPA. In the US, depending on the intended use or category i.e. food, medical food, dietary supplement, or as a drug, each category has different regulatory requirements matched to the target consumer group. The Food and Drug Administration (FDA) has written and enforced regulations associated with the intended use.

GRAS in the US is the standard by which Foods are regulated and likewise dietary supplements by the Dietary Supplement Health and Education Act (DSHEA). Other countries such as Canada, Australia, Japan, South Korea or Brazil use different regulatory models with a different approach to premarket oversight for probiotic products. For probiotics to be featured on approved lists, most of these countries require manufacturers to submit data on GMP manufacturing, long-term ICH stability under standard ICH conditions, safety data and analyses for microbiological or chemical contaminants. The underlying theme in all categories is that probiotics are regulated in all cases.

Dr. Gordon is right, the microbiota is a fascinating study topic, and we are indeed only now starting to understand what the microbiota means for us and the role probiotics can play. Probiotics can be, and are already, a part of health for many consumers. Dr. Merenstein, who is positive about the potential of probiotics, acknowledges the challenge for consumers to make sense of all the data presented to them. Unfortunately, the well-intended program by Dr. LaPook does not make this easier. The consumer will need more balanced sources of information to be able to make an informed choice. The IPA is committed to provide fair and objective information on probiotics to the benefit of the consumer and the probiotic industry, globally.

Source: The International Probiotics Association