Effective merchandising can be a profit-driver throughout the year.
Sweet onions remain a highly important category for retailers. The segment of the onion category that’s mild and sweet is versatile and offers many ways for shoppers to utilize them in recipes and dishes. Sweet onions account for nearly half of the overall onion category and are experiencing strong gains in sales.
According to Nielsen Perishables Group, sweet onions are the second-largest selling onion, trailing yellow onions. The overall onion category is second only to potatoes in produce department sales, accounting for $1,567 in weekly volume sales per store, according to the 2017 FreshFacts on Retail, published by Nielsen and the United Fresh Produce Association.
Proper merchandising can create excitement and foster higher volume of sales.
“Sweet onions continue to drive overall onion category sales,” says John Shuman, president of Shuman Produce, headquartered in Reidsville, GA. Demand continues to increase as consumers discover their great flavor and health benefits. Consumers have come to expect a sweet onion year-round in their stores.”
Sweet onions retain a critical position in the produce aisle. “For us, sweet onions are important,” observes Joseph Bunting, director of produce for Lubbock, TX-based United Supermarkets. “The onion category overall is critical. Sweet onions are a big part of it for us.”
Sweet onions, particularly Vidalias, are an item shoppers seek. “It’s a high-value item,” says Steve Roberson, president of Roberson Onion Corp., based in Hazlehurst, GA. “Vidalias are the first and the most-popular sweet onion. People still look for and ask for the Vidalia onion. They prefer them above all others.”
The category is increasing in popularity. “Sweet onions always have a good ring and a big ring,” says Barry Rogers, president Sweet Onion Trading in Grant, FL. “Sweet onions are displacing other onions every year.”
Sweet onions are grown throughout the United States. The domestic season typically begins in mid- to late March when Texas ships sweet onions through May.
As Vidalias ship through the summer, they hit all the major holidays, including Cinco de Mayo, Memorial Day and July 4, says Jarrod Snider, director of sales for Richter and Co., based in Charlotte, NC. “When you start looking at the promotional windows that occur during the Vidalia season, it’s optimum,” he says. “Memorial Day is key because Vidalias are at their peak during the fresh season before they go into storage.”
Promote Early and Often
Although the overall onion category is a staple, sweets help make it a destination category, he says. “The early season volume usually represents an opportunity for retailers to promote,” says Snider. “That not only allows retailers to capitalize on the promotional opportunities during that early season volume due to quality and volume, but usually the market pricing is favorable to help with competitive retail price points.”
The category continues to climb, says Jimmy Bassetti, president of J&D Produce in Edinburg, TX. “Retailers should know they have a tremendous opportunity in terms of potential growth for the sweet onion category,” he says. “Educating consumers and creating in-store experiences where customers can taste the superiority of a good sweet onion is the key to boosting sales. They can be a very profitable item and very popular with customers as long as they can deliver a consistently mild sweet onion year-round. Consistency of taste and availability is crucial to having a successful in-store program.”
The diverse geographic growing regions require different promotional programs. East Coast retailers should promote Vidalias from May through August, while West Coast supermarkets should promote Walla Walla sweet onions in July and August, says Mike Blume, director of sales and marketing for Keystone Fruit Marketing, headquartered in Greencastle, PA. Peak times to promote imported sweet onions are November through January, he says.
The Honduras deal is relatively new and experiencing success, says Rogers. “That deal is growing every year. The weather in Honduras is much more predictable than Mexico. The quality is excellent and there’s eye appeal.”
The attraction of sweet onions is important for retail store customers. “Depending on a retailer’s core customer base, retail stores catering to middle income and up, sweets can account for 30 to 35 percent of sales,” says Derrell Kelso Jr., president of Stockton, CA-based Onions Etc., a division of Farmington Fresh Sales LLC.
Different merchandising techniques must be employed; domestic sweet onions are merchandised differently from imports, says Lauren Dees, marketing manager of Lake Park, GA-based Generation Farms. “It’s rare to see import onions merchandised as anything other than a sweet onion,” she says. “This may commoditize the sweet onion category, as consumers may be led to think all sweet onions are from the same region. Educating consumers by highlighting seasonality can drive sales during the slower months as well as peak Vidalia season.”
Successful merchandising of sweet onions requires pointing out the differences between the sweeter variety and traditional storage onions. “They have to be merchandised differently,” says Delbert Bland, president of Bland Farms, headquartered in Glennville, GA. “You have to make people understand sweet onions are a different type of onion. They’re a gourmet onion. You can do so many things with a sweet onion that you can’t do with hot onions.”
When a retailer offers yellow and sweet onions in bulk, 85 percent of the time register clerks will recognize the sweet onion as a yellow onion, which may be priced differently, says Bland. That also causes ordering problems because the store’s inventory system thinks the shopper purchased a storage onion. Many chains are beginning to offer sweet in bulk, particularly during the summer, and sell yellows in 3-pound bags, which can help solve the misidentification problem, he says. “The adage about having to have a western hot onion in your store all the time is beginning to go by the wayside,” says Bland. “You don’t have to have a bulk hot onion.”
Sweet onions should be set aside from the regular onions, says Mark Breimeister, president of AAA Produce Exchange, Waterford, MI. “One thing I’ve learned over the years is the sale for a sweet onion is a completely different sale than a regular cooking onion,” he says. “It’s an additional sale at retail. It doesn’t take away from a cooking onion to sell a sweet onion. That education is critical.”
As many consumers still don’t know what a sweet onion is and how it’s different from other onions, differentiating can help with sales. “There is a tremendous difference in taste and pungency,” says Bassetti. “Proper merchandising is a critical component of strengthening the sweet onion category. Retailers really need to wow the customer to draw them in, and done correctly, it will increase sales and keep customers happy.”
A difference in merchandising sweet onions versus regular onions is their seasonality. Promotions touting regions and the timeliness of production are important, says Kelso. Retailers should announce “seasons” in their sweet onion promotions, he says. “Time of the year is key,” says Kelso. “Promotions aligned with proper intel of where and when the onions were harvested are important. Promote them with big displays and point-of-purchase cards.”
The production timing and different growing regions are among the category’s benefits, says Teri Gibson, director of marketing and customer relations for Peri & Sons Farms, based in Yerington, NV. “With all the seasonal and regional sweet onion variations available to retailers throughout the year, such as Vidalias in the spring and Sweetie Sweeties in the fall, there’s a wonderful opportunity for retailers to highlight each region and each onion’s attributes with clear, distinguishing signage,” she says.
Growers continue to maintain their onion’s reputation through improvements. “Every year, we put a lot of money into research to produce a sweeter onion that capitalizes on the taste and shelf life, the big things,” says Bob Stafford, manager of the Vidalia Onion Committee, in Vidalia, GA. “When the product goes on the shelf and consumers buy and take it home, all you have is the product, your final and most important test because if that onion is good, they will want to buy more. We are very interested in satisfying the consumer.”
Effective signage helps sales. Promoting the onions’ origin can help spark shopper interest. “Rather than a static display of sweet onions in general, highlighting the farm and growing location of sweet onions will help them stand out,” says Gibson. “In-store branding standards can impede the produce team’s ability to share the grower information that makes each variety so interesting.”
Stores should consider their signage requirements, as some chains maintain many restrictions that prevent signage from effectively communicating with shoppers, says Bland. “Oftentimes, retailers throw onions on the shelf but then don’t go into any detail in merchandising, which is a big downfall,” he says. “The biggest challenge is identifying the product,” says Bland. “Signage is the biggest thing. Unless you’re an onion expert, there’s no way a consumer can tell the difference between a regular everyday hot onion from the West or a sweet onion from the South.”
Displaying for Success
To attract attention to sweet onions, J&D’s Bassetti recommends positioning displays in end caps or in different locations away from other yellow Spanish onions. “Merchandising correctly is extremely important,” he says. “Done correctly, it will increase sales and consumption.”
Merchandising ties into ad promotions, says Shuman. He recommends retailers display sweet onions in bins, host display contests and and use point-of-sale material. “You can get better results for promotions when you increase the size of the display to drive sales during ads,” he says. “Seasonal items promote excitement. Vidalia onions are anticipated all year.”
Sweet onions should be prominently displayed, says Brent Bryson, salesman with Roberson Onion. “Put them in [the regular displays] and in extra displays. Keep them in your regular onion displays with added extra display featuring the sweet onions on a front table for consumers to see.”
Large displays with strong signage are paramount, notes Stafford. “I like the idea of large displays,” he says. “It’s one of the best ways to merchandise Vidalias. When a consumer visits a store and sees a nice display of beautiful onions with good signage, it attracts them. You’re seeing more and more large displays because it’s paying off for the stores.”
Merchandise the Distinctiveness
The differentiation is paramount. “Utilizing retail display cases and/or attractive consumer packaging separate from the general onion category creates a greater opportunity to catch the attention of consumers and increase sales,” says Generation Farms’ Dees.
Retailers should pay closer attention to the sweet onions when erecting large displays, cautions Keystone’s Blume. “Although large displays work best, sweet onions will not hold up as well as hybrid or hot onions,” he explains. “So, make sure displays are selling through daily. You have to be careful you’re not leaving them up there for days on end.”
Display care is critical, says Onions Etc.’s Kelso. “It’s important to ensure store merchandisers take out and beautify their displays,” he says. “Sweets are not as attractive, as they are harvested in hotter weather.” Sweet onions should be displayed in the onion section but separated from the other storage onions, says Kelso.
Location is key for effective displays. “You have to put them in a featured spot because sweet onions are an important produce item,” says Sweet Onion Trading’s Rogers. “If you want to enhance your gross profits in produce, make sure you put them in a prominent spot in the produce department and put them on sale every once in a while.”
Some retailers, particularly the smaller ones, tend to erect small displays. Smaller displays often result in small sales, says AAA Produce Exchange’s Breimeister. “In order to really sell sweet onions, you have to make an effort,” he says. “The smaller displays don’t get you the bang-for-the-buck. As an industry, we need to take time with independent retailers and educate them a little more on the category, so they know how to build an effective display.”
Sweet onions easily tie into ad promotions, particularly those involving other vegetables and other grocery store items. Sweet onions do well with barbecue-themed promotions, says Kelso. Display size and the other items married with sweet onions are also factors, he says.
Cross merchandising with summer grilling accessories, including tongs and charcoal, works well, recommends Roberson Onion’s Bryson. The best time for those displays is ahead of Memorial Day’s summer grilling and vacations’ kickoff. Many people enjoy “staycations,” where they swim in the pool and barbecue at home. Grilling hamburgers and hot dogs are a big part of that activity. “We have seen these kinds of displays do well,” says Bryson. “Sweet onions are one of the primary beginnings of summer food, a mainstay that people want. Vidalias are a super critical part of that.”