Balancing freshness and convenience can increase sales.
Companion products can increase sales if merchandised correctly — and distract if they aren’t.
The resounding argument for why produce departments should carry non-produce tie-ins, or non-produce items in general, is because they make money.
“Cross-merchandising with non-produce products is an effective vehicle to increase a shopper’s basket size, and in turn, grow profitable sales for your produce department and store,” says Brian Haaraoja, vice president of fresh merchandising for SpartanNash in Grand Rapids, MI. The company operates 160 grocery stores under banners such as Family Fare Supermarkets, No Frills, Econofoods and Dan’s Supermarket.
Companion products, as they’re also known, can also make the shopping experience more convenient for consumers and introduce them to new foods. But Haaraoja cautions that they can also distract from the department’s mission and appearance if not handled correctly.
“It can be easy to get carried away with the amount of tie-ins throughout a produce department, which can have a negative effect on your business,” he says. “A produce department with too many tie-ins will appear cluttered. That can take away from the ‘fresh’ perception of your customers, which is vitally important.”
“Keep in mind that we sell produce,” says Jay Schneider, produce sales manager with Acme Markets, a Malvern, PA-based chain with more than 110 stores throughout Pennsylvania, Delaware, New Jersey and Maryland. “Even though you can get some incremental sales, you still want to keep more of a fresh image with a balance of tie-ins.”
Common Companion Products
Beside salad dressings, some of the most popular non-produce tie-in products include croutons, salad toppers, fruit and vegetable dips, pre-made shortcakes, olives, cheeses and snack items. Some ready-to-eat products, including packaged soups, juices and smoothies, are also showing up in produce departments.
Tofu is another common tie-in product. House Foods America, a manufacturing company headquartered in Garden Grove, CA, sells water- and vacuum-packed tofu, plain and marinated tofu and tofu meal kits. The company’s Shirataki noodles (a thin, translucent noodle made from konjac yams), egg roll, and wonton wrappers are sometimes merchandised in produce as well.
Seasoning packets that can be used to create produce-centered dishes, such as guacamole, salsa, smoothies and banana bread, make good companion products. Departments also carry utensil merchandise such as melon ballers, vegetable peelers and sticks for making caramel apples.
Pros And Cons
Companion products are appropriate for produce, because they encourage consumers to buy more, says Mary Beth Cowardin, director of brand marketing for the T. Marzetti Company, a specialty foods company that was founded in 1896 and is based in Columbus, OH. Cowardin says salad greens can look more appetizing if consumers see interesting toppings or croutons to go along with them. A mother may be more inclined to purchase apples if she sees caramel dip, or strawberries if she can buy shortcakes instead of having to make them.
“The benefit for consumers is having meal solutions all in one location,” says Cowardin. “Everyone is time-pressed. Everyone wants to get in and out of the store.” If a shopper needs to make a veggie tray for a party, as an example, it helps to have the salad dressing in the same place as the carrots and broccoli.
Paul Eastman, House Foods America’s senior sales manager, says the advantage of carrying tofu in the produce department is that it offers a rare protein option. Consumers with plant-based diets — who are inclined to spend most of their time in produce anyway — will appreciate the convenience of having the tofu available.
“Many of our ShopRite stores have team meetings about their promotions, and they often talk to one another about ways to cross-merchandise with other departments. Management also often looks at the circular to determine the best tie-in opportunities.”
— Derrick Jenkins, Wakefern Food Corporation
“Non-produce tie-ins add interest and variety to the produce department,” says Samantha McCaul, marketing manager for Brockton, MA-based Concord Foods, which supplies retail food products and custom ingredients to supermarkets, manufacturers and foodservice operators. “Shoppers will spend more time in the produce department. As a result, more time and money is spent in the store.” In addition, there is little to no shrink with tie-in products.
The biggest risk with carrying non-produce items is they’ll become an eyesore, says Schneider. “If they’re not merchandised correctly, they can ‘junk up’ the department and take away from your fresh presentation.”
There may be times when merchandising companion products in produce will confuse consumers. Eastman points out many natural food stores merchandise tofu in dairy. Shoppers may expect to find other items, such as cheeses and olives, in the deli department.
With all the quality products competing for space in produce, it can be hard to choose the ones that will be the best fit. But non-produce items shouldn’t be added to a department willy-nilly. One of the keys to ensuring the right mix of tie-in products is to track how well they’re selling.
“These items should have assigned planograms to better ensure stock levels and the item mix are consistently maintained,” says Haaraoja of Spartan Nash. “Planograms will also allow for better tracking of item movement and known loss, and will help to maintain product space allocation and determine future SKU rationalizations.”
Two of the best resources for finding the right products are store and grocery managers. “Store managers are on the front lines and they understand what our customers want,” says Derrick Jenkins, vice president of the produce/floral division at the Wakefern Food Corporation, the largest retailer-owned cooperative in the United States. Stores in the Keasbey, NJ-based company are operated under the ShopRite name and located in nine East Coast states. “They can identify a sales lift very quickly on a non-produce tie-in.”
“Team meetings are a great way for department managers to share information and collaborate,” he says. “Many of our ShopRite stores have team meetings about their promotions, and they often talk to one another about ways to cross-merchandise with other departments. Management also often looks at the circular to determine the best tie-in opportunities.”
Haaraoja has a similar opinion about the value of collaboration with other departments. However, he shares this word of caution: “It should be understood throughout the store that the store manager and/or produce manager have the final say when determining the items and how many. That will prevent a ‘free-for-all’ of non-produce items being displayed throughout the department.”
Rotating tie-in products seasonally can help departments boost sales of produce and non-produce items. “We like to position fruit dips near the apples in the fall,” says Jenkins. “You might see a non-food item like a steamer being sold next to asparagus in early spring.”
When selecting tie-in products, “focus on items with high sales volume and velocity, such as bananas and avocados,” says McCaul. That increases the likelihood consumers will pick up extra items during shopping trips.
Displaying Tie-In Products
The size of displays varies depending on the size of the department and what products it carries. Eastman with House Foods America says 8-foot displays are ideal. Schneider gives a general guideline: “Make sure the produce does not looked overpowered by tie-in products.”
What matters more than the size of the display is how products are displayed. “We found the retailers with the best sales will merchandise the non-perishable tie-in and the relevant fresh produce item together,” says McCaul.
That’s the consensus among produce managers. “Refrigerated dressings and dips should be displayed in between the salad and cut vegetable sections,” says Haaraoja. “Croutons and other salad toppers should be displayed on the backs of tables near your packaged salads. Put guacamole and salsa mixes by your avocado display; powdered smoothies near fresh tropical fruits and berries; and hollandaise sauce kits next to asparagus.”
Similar products should be kept together as much as possible. “With regard to tofu specifically, we like it to be kept together to highlight the different varieties and flavors,” says Eastman.
That being said, “there are ways to cross-promote even if items can’t be physically located next to each other,” says Cowardin with the T. Marzetti Company. “We sometimes work with retail partners to offer discounts; for example, a free bag of lettuce if you buy one or two jars of dressing.”
In terms of the actual displays, “we do not recommend displaying any of the tie-ins on top of produce display tables or bins,” says Haaraoja. “Shippers and/or side-stacks next to your fresh produce displays are encouraged if shelving is not available. Clip strips can be very useful when displaying different seasonings and baking mixes.”
“I find that having a shipper tastefully displaying products on the side of your fresh display, rather than on the display itself, works better,” says Acme Markets’ Schneider. “You get to keep the fresh look of the display without having any of the product on it. I find with berry displays, bakery products can easily overtake the display, because the products are large.”
No matter what options a produce department chooses for displays, “make sure you stick to the planned merchandising layout, and keep the displays full,” says SpartanNash’s Haaraoja. “It doesn’t take long for a produce department to become cluttered with half-empty displays of kitchen gadgets and grocery products unless you have the proper planning and execution in place.”
Opportunities for cross-promotion between produce and non-produce items abound. “It can help with sales while also helping customers by giving them a practical meal solution or recipe idea,” says Wakefern’s Jenkins. “Our produce manager might, for example, position Mozzarella cheese between tomatoes and fresh basil in our produce aisle. Shoppers see that, and they get an idea for serving fresh Mozzarella and basil with some wonderful Jersey Fresh tomatoes.”
Eastman offers another suggestion for cross-merchandising: “We recommend displaying tofu with a packaged stir-fry vegetable medley to make a complete meal.”
Developing a quarterly promotional calendar that includes ways to connect companion products with seasonal produce promotions will help increase sales. “Promotions are a great way to let your customers know what you have to offer,” says Haaraoja. “After a promotional plan is assembled, put together your merchandising plan for the department, and be sure to update it on a monthly basis.”
“We’ve done successful promotions such as coupon offers, demos and contests with fresh items,” says Concord Foods’ McCaul. “In particular, instantly redeemable coupons work very well for our products. When we launched a blueberry muffin mix, we gave a discount on the purchase of fresh blueberries and our mix. This offer encouraged product trial for our new item and also sold a lot of blueberries.”
Another important opportunity for promoting non-produce tie-ins is to let foodies know when the department is carrying something really different. “People are looking for new flavors and new items, so having a balance of the tried and true with new and unique flavors gives consumers an opportunity to mix up the products they’re using,” says T. Marzetti’s Cowardin.
“My advice to managers is to get to know the non-produce tie-in products on their shelves,” says Eastman. “Try them at home, so when their customers are looking for recommendations, they can offer suggestions based on their experience.”