TAMPA, FL — While inflation in the fresh produce category may be lower than the rest of grocery, consumers are still feeling the pinch.
Retailers are responding with strategic promotions, though they may not be getting the message across.
Anne-Marie Roerink, president of 210 Analytics, and Rick Stein, vice president of fresh foods for FMI, The Food Industry Association, presented the latest findings at the Southeast Produce Council’s Southern Exposure convention on March 8.
Presenters were joined by an industry panel including A&M Consumer and Retail Group’s senior director John Clear; Jon Greco, senior director of produce sourcing for Sysco Corp.; and Melissa Thrasher, procurement team leader for Whole Foods Market.
Recent government inflation numbers say rising prices are flat, but consumers aren’t comparing year-over-year. Instead, they are seeing prices up more than 30 percent over 2019, Roerink says.
“Certain categories have moved past the stupid expensive line,” she says.
Grocery sales dollars have been mostly steady, bolstered by more trips, but units are a problem.
“Pricing is extremely important,” Clear said. “It’s not just the cost – it’s the value they’re gaining. People are still willing to spend on produce, but they’re a lot more discerning about what they’re getting.”
Clear stressed that getting it right the first time is more important than ever.
“They need value for everything they pay for,” he said. “We don’t get a lot of second chances. If we don’t fulfill that value proposition for them, they’re going to go somewhere else.”
The Power of Produce report continues to indicate consumers are looking for items sold on promotion, but the promotions are lagging behind pre-pandemic numbers.
In 2019, 47.9 percent of fruit was sold on promotion, but in 2023, that number was only 38 percent, Roerink said. Vegetables lag as well, with 25.9 percent sold on promotion compared to 32.2 percent in 2019.
“Customers are going toward the yellow signs, going toward promotions,” Thrasher said. “There’s been a shift in sales across categories based on these promotions. The goal is more units, more items on sale.”
For more information about the full results of the Power of Produce, visit here.
