Originally printed in the November 2020 issue of Produce Business.
As we enter the month of November, our minds turn to the upcoming new year and the challenges and obstacles that it will present to our produce operation. Throughout the retail organization, all management, including upper management, begin to concern themselves with the final planning and execution of the sales and profit plan for the upcoming new year.
While it seems that these operations would be complementary to each other, in the case of produce as it relates to the rest of the retail store operation, it is a different story. We are all aware of the myriad of variables that must be considered when making a produce plan for the upcoming year while the rest of the operation has far fewer variable factors to consider.
Upper management tends to side with the planning done by the other departments as they don’t want to over-complicate their planning. This attitude by upper management of not recognizing the unique challenges of the produce operation shows once again that “they just don’t get it!”
While planning for the new year is always a challenge, planning for 2021 given our current pandemic makes it an exercise in planning for the unknown. The uncertainty of how long the pandemic will continue and what effects it will have on everyday life, financial uncertainty, and economic activity will continue to present unique challenges and situations.
A good retailer will look at this challenge and determine the proper and most affective plan to provide solutions for the normal hurdles of projecting sales and profits as well as the unknown crises that will be presented by the unique pressures the pandemic puts on our operations. A good plan with reasonable expectations and potential for success will look very different in 2021 than it has in any previous year.
The first step to take is to make a thorough and complete review of everything that has happened in 2020, especially during the months that have been affected by the pandemic. Upon examination of this information, conclusions can be drawn as to how some of the aspects of consumer behavior, economic reaction, and actual sales patterns have been affected by the new “normal”.
If there’s one thing our experience over the past few months has taught us is that we must be flexible in our operation. The amount of flexibility built into the 2021 plan must allow for the ability to change directions quickly to take advantage of, and serve, the changing needs of the marketplace and the consumer. It will not be enough to take into account seasonality, crop rotation, weather, transportation, and the other traditional factors that always play an important part in planning for the new year.
It will not be enough to take into account seasonality, crop rotation, weather, transportation, and the other traditional factors that always play an important part in planning for the new year.
We must plan for other variables to become critical factors, such as labor availability, absenteeism, safety procedures, cleaning schedules and new merchandising strategies. While not forgetting or ignoring the normal guiding principles of planning, we need to incorporate these new variables into the plan to be sure we have the proper direction and flexibility in operations to meet these new challenges. This will include examining all the aspects for not only the merchandising and operation of the individual department, but also the need to install flexibility in the supply chain that brings the product to the store.
The key part in the planning for 2021 will be how we utilize labor in the store to present our products in their best possible light while highlighting their health and nutrition and their positive effects to the immune system. Merchandising schematics should be flexible enough to be simple to maintain and easy to transition into promotional activity. The ease of which labor can be used to initiate and complete these tasks will be critical to the success of the department. This flexible use of labor in terms of activity and scheduling will allow for variances in terms of product supply and labor availability.
We must be certain that our plans allow for shortages of labor as well as shortages of products at critical times that we will have no control over. We must also keep the positive mindset that we need to be able to move quickly to overcome the challenges and unique situations that will be occurring during the time the pandemic is still in effect.
While gazing into a “crystal ball” of uncertainty, formulating a flexible plan that will handle all the variations to come may seem to be a daunting task. But it is critical that a successful produce retailer take on this challenge and formulate such a plan to ensure that the operation can “survive” and continue to grow during this unique period created by COVID-19.
The alternative move is to do nothing and ride out this pandemic to its conclusion facing each unprecedented challenge without a plan. We all recognize that this strategy is doomed to fail and result in irreparable damage to the industry. In order to save our industry, it is vital that each operation do its best to formulate a sound, flexible strategic plan for 2021.
Don Harris is a 41-year veteran of the produce industry, with most of that time spent in retail. He worked in every aspect of the industry, from “field-to-fork” in both the conventional and organic arenas. Harris is presently consulting. Comments can be directed to [email protected].