Originally printed in the May 2018 issue of Produce Business.
Robust consumer interest bodes well for summer.
After the Chilean cherries leave supermarkets at the end of January, and before the first of the California crops arrive in mid- to late April, consumers have grown restless for the red, yellow-hued and dark-sweet treats. “I’ve had a couple of customers who have sent me emails asking, ‘What’s the deal with cherries? When are they going to be back in the store?’” says Keith Cox, produce category manager for K-VA-T Food Stores. “I said, ‘Hang on just a few months…’”
The stone fruit’s celebrated season, a combined seven months between domestic and imports, heightens anticipation and offers produce retailers a prime opportunity to maximize sales and profits. Rich Sambado, president of Primavera Marketing Inc. in Linden, CA, where cherry season is about six weeks, knows the imperative well: “You want to take advantage of the seasonality of the cherry, the freshness, and promote the heck out of it. You want large displays offering top-notch quality.”
And with bags of domestically grown cherries returning to produce departments for their seasonal run, which wraps up in early September with Washington-grown crops, growers, shippers and retailers are preparing to do just that.
“We’re on board as soon as we can get on, and go the whole distance with them,” says Cox, whose produce responsibility for K-VA-T includes oversight of the 122 stores under the Food City banner. Food City’s cherry season starts in December with Chilean fruit. “We carry them as long as we can. Then we’ll look forward to the California season starting, and we follow that until Washington starts. We’ll go through that season and if there’s some Canadian product at the tail end of the Washington, we’ll do that. We do the whole gamut.”
Sambado says Primavera is first out of the gate, offering cherries in late April and running through mid-June. “There will likely be some overlap with our final week or so and Washington State starting. That’s always a negative.” He says a warm winter, frost, and rain — has been a challenge to cherries and other California commodities this growing cycle.
Primavera now has 100 lanes of optic sizers after recently adding 16 lanes for Rainier cherries. “That allows us to run a lot of volume of fruit each day and crank out a tremendous number of packages,” says Sambado.
California projects this year’s crop will be down from prior year, but 2017 was the state’s best cherry year ever, says Sambado. “The past five years’ average for the state of California was 6.7 million boxes of cherries. Last year was 9.6 million. We probably will be lucky to be 7 million or 7.5 million; 25 percent less.”
Still, Sambado is optimistic about harvest conditions. “Last year we had terrific weather during harvest time,” he says. “Maybe the crop will be down 25 percent, but we’ll have a quality and good size that will drive sales.”
“It seems like the average start date is the thing we never have any more,” says Roger Pepperl, marketing director for Stemilt Growers Inc. in Wenatchee, WA. “It’s either super early or super late.” The company’s season generally begins around the first of May with cherries from its California groves, and ends in early September with its “late cherries,” the Glory and the Staccato. Stemilt owns the U.S. growing rights for the dark-sweet Staccato.
“We’re very optimistic about the 2018 cherry crop,” says Catherine Gipe-Stewart, communications manager for Domex Superfresh Growers in Yakima, WA. “We have had a smooth and gradual transition to spring, which means bloom, and therefore the crop should be temporally spaced across our growing regions. This means we could have a nice, long cherry season At this point, it looks like our harvest will run from early June to the end of August. Whether the crop ends up at 20 million boxes or 26 million boxes, there should be good promotional opportunities all summer.”
“We begin small, slow and build to volume,” says George Harter, vice president of marketing for CMI Orchards in Wenatchee, WA. “We want to be there all along that curve, pushing as hard as we can during the peak demand times.” CMI ships its red cherries from June to August, Rainiers in July and August, and imports from Chile in November and December.
Harter anticipates another strong season for Washington cherries. “If you go back and take a look at the number of cartons boxed up, in 2001 there were 9.7 million 20-pound cartons produced. Last year, there were 26.4 million. There’s been massive growth,” says Harter, citing figures from the Northwest Cherry Growers. “Cherries are usually the biggest item in the produce department during the month of July in dollar volume. Sales have just done really well,” says Pepperl. “Retailers jump up and pay attention to cherries when they come in.”
“The basics of merchandising work well for cherries,” says Gipe-Stewart. “Carve out as much primary and secondary space as possible and use refrigerated displays where feasible. Bring cherries to the front of the department. Promote at least every other week for the entire summer.”
Because cherries have one of the highest sales-to-space ratios, they “warrant the best spot in produce,” says Pepperl.
Cox agrees: “If you’re going to be in the cherry business, get in the cherry business. I will tell you that no matter what the price point is, you’ve got to get a nice representation. Let’s say you’re at the high side of retail. You can go out there and put out a couple rows of cherries, but guess what? You’re not going to sell any cherries. Widen your display, get five to eight rows … Even at the high side of the retail, you’re going to sell cherries.”
Pepperl says Stemilt’s research confirms just that: “Sales go up as size increases. We’ve done some display size studies. They won’t surprise you. They always say location is really important. And square footage. The display should be 6-12 feet, depending on your store volume. Regardless of display size, you have to turn that supply. You want to see it turned three times a day.”
What smaller stores such as the 12 Morton Williams Supermarkets in Manhattan, lack in display space, they make up in frequent turn.
“We’re not like the suburban store; we can’t make a big spread,” says Marc Goldman, produce and floral director for the 15-store, family-owned chain. “We turn everything over really quickly. Our issue is more just packing enough and having enough to keep the shelves full consistently.”
“Being able to get cherries in a high traffic area and still maintain turns on the product … is the key to success in maximizing their sales,” says Harter.
“We don’t like to pile them out,” says Cox. “They will bruise if you start piling bags on top of one another. We try to keep a nice layer in refrigeration and refill it often to keep them nice and fresh. Once the cherry starts to age, especially when it’s off refrigeration, it starts to get soft. Consumers like a cherry to almost crunch when they bite into it.”
Harter adds, “You want to have it in the cooler, with the cold chain never broken so the customer can have that maximum amount of shelf life at home.”
Once in stores, Cox says retailers have about two days to move the product. “If it’s a really good, strong fruit that’s at the top of the tier on quality, you might get three days. By the third day, the consumer’s going to be able to look at it and say that’s old. It’s a very short window.”
On the shelves, the pouch is the current gold standard for packaging, and for good reason, says Primavera’s Sambado. “It’s a rigid bag with nice artwork and stands up on display. We do some clamshells for the club stores. A major player is trying the half-pint.”
The late Tom Mathison, Stemilt’s founder, pioneered shipping cherries in bags — one of the significant game-changers in the industry, says Pepperl. “We were the first ones to bag cherries in the country. He mechanized the process. He was a brilliant man.” Pepperl says the company has some new packaging in the works, but nothing to announce yet.
Stemilt packages its signature Skylar Rae cherries in a dome. “It’s an upside down, inverted package, where the lid is the bottom. It pushes the cherries up in the air.,” he says. Stemilt owns the marketing rights to the Skylar Rae, a “super sweet, super firm” cherry, and this, the young varietal’s fourth year, will be its biggest yet, says Pepperl.
Sambado says with a shorter California crop this year, “you need to sell two pounds of cherries at retail. That’s kind of the sweet spot if you’re $4 a pound. You’re not going to move the volume at 1 pound.”
But even for cherry loyalists, Cox says “price is always the key. The days are gone for most retailers when you can do a 99-cent deal. That used to be the magic price to sell tons and tons of cherries. If you can do $3.99 or lower, you’re still going to sell a lot of cherries. As the season goes on, if you can pop it in on a front-page ad, especially at $1.99, it really drives consumers in.”
“It’s a great item, but the retails aren’t as cheap as they used to be,” says Goldman, of Morton Williams. “Because of its smaller markets, Morton Williams doesn’t buy direct and faces higher prices, especially with rising trucking costs. Manhattan’s smaller retailers face a unique situation. “Another thing we deal with that a lot of people don’t is we have a lot of street vendors in the city who sell stuff for next to nothing,” says Goldman. “If I put cherries out for $1.99 they’re putting it out for 99 cents. It can be a little frustrating.”
The Northwest Cherry Growers (NCG) association has identified a group it’s dubbed “cherry super consumers.” These shoppers buy cherries on multiple occasions throughout the season and are among the 70 million U.S. cherry consumers. One in three consumers buy cherries, the majority “once or twice,” according to NCG data Harter provided.
“The best market for cherries is empty-nesters, or parents with older kids. Boomers,” says Pepperl. “They do well with people with higher income levels. They’re all tied into the same reason: They aren’t the cheapest item in the produce department and they never will be.”
“Cherries are a lot of fun because they really do appeal to all demographics,” says Gipe-Stewart. “Due to the natural mobility of pouch and clamshells, we see consumers of all ages and demographics bringing cherries with them on their summer adventures.”
To capture peak sales during the short season, and perhaps nudge more consumers toward “super” status, Harter recommends retailers adopt “a seasonlong retail price strategy that works for their supplier, the buyers and for their stores, to be able to maximize sales and create a consistent volume through season.”
“We try to line up a promotional period, and line up package prices,” says Pepperl. “We often have display contests, where we’re incentivizing the produce managers with fun prizes for their teams. We help them with digital ads, with social media and with demos. We’ll create point-of-sale for them. Whatever they need. We’ve done quite a few of these cherry festivals. Often the store will tie in cherry items — something from the bakery, and center store.”
Ads are as always key to successful promotions, and Cox says Food City will do as many as it can, especially during the California and Washington seasons. “That drives a lot of dollars for us. Consumers really, really love it. It’s also a good impulse item. Occasionally … when we know there’s going to be a good crop of the Rainier cherries, we will do a tag line, and also advertise those too in conjunction with the red cherry, just to drive a little bit more awareness to that cherry too.”
Cross merchandising is another effective way to promote, says Domex’s Gipe-Stewart. “Place cherries next to yogurt and suggest it as an antioxidant and protein-rich breakfast. Or place cherries next to protein powder and suggest adding fresh fruit to smoothies.”
To further promote cherries to consumers, recipes “are a great support mechanism,” says Pepperl. “We do a lot of it at Stemilt.” The company’s website features recipes like Cherry Dump Cake, and a salad of mixed greens, cherries and Feta cheese.
“Creating kitchen inspiration through recipes and beautiful meal preparation keeps cherries at the front of mind as shoppers head to the produce section,” says Gipe-Stewart.
Websites for the California Cherry Board in Sacramento, CA, and the Northwest Cherry Growers in Yakima, WA, are filled with recipes, facts (“At one time it was against the law to serve ice cream on cherry pie in Kansas.”) and nutritional and health information. The California Cherry Board has the results of more than 10 years of scientific research on its website, including colorful fliers to download.
“Cherries are an absolute superfood,” says Pepperl. “Yet, the recognition for all the good they do is nowhere near where it should be.”
“Produce in general has a much greater magnifying glass as it relates to health benefits,” says CMI’s Harter. “We haven’t really played that up [with cherries].”
“Cherries are known for being rich in antioxidants, but they also help fight inflammation, help fight cancer, lower blood sugar levels and boost your fiber quota,” says Gipe-Stewart. “The healthful properties of cherries are also great reminders to consumers about what sets cherries apart.
CHILE IN THE SPOTLIGHT
When Chilean imports return to the stage in November, a new round of promotion is in order.
“By the time Chile enters the U.S. market, domestic cherries have been out of the market for several months, so it’s important for us to let shoppers know that cherries are back,” says Karen Brux, managing director of North America for the Chilean Fresh Fruit Association.
Chile ships cherries to the United States from early November through late January, offering promotional opportunities over the holiday season. Brux says Tops Markets, with stores in New York, Pennsylvania and Vermont, have featured point of sale cards that read: “Sweet Cherries. One Resolution That’s Easy To Keep.” Buehler’s, a chain of Ohio supermarkets, shared a similar holiday-themed message: “Peace. Joy. Cherries.”
“Through in-store display contests, sampling and numerous Facebook promotions, both on the Fruits from Chile Facebook page as well as retail Facebook pages, we reach consumers/shoppers with the message of Chilean cherries,” says Brux.