DECEMBER 2018• COUNTRY LIFE IN BC


45


Producers need to think like grocery retailers Aligning farm interests with those of retailers can boost revenues


by MYRNA STARK LEADER ABBOTSFORD – The


marketplace is changing faster than ever, and producers need to find ways to stay relevant and ensure that what they grow makes it into the shopping cart. “It’s not about making


great products to sell, it’s about selling the great products you make,” says Peter Chapman, a food industry expert, author and partner at the Nova Scotia food industry consulting firm SKUFood.


Chapman provided four


ingredients to success to a full house as keynote speaker at last January’s Pacific Agriculture Show in Abbotsford. He summarizes them in the acronym CART, which stands for consumers, alignment, retail plan and trust. “It’s really a passion for helping producers and retailers understand each other a little better,” says Chapman, who advises businesses how to navigate the retail sector. He spent 19 years with Loblaws Companies Ltd., Canada's largest food retailer, in merchandising, marketing, advertising and real estate. On consumers, Chapman


shared there are 35,000 SKUs (stock keeping units, each identified by a barcode) in the average grocery store and, as creatures of habit, the average household buys about 260 of them annually. “We find something we like


and we go back to it. It’s your role to figure out how to change their minds and get them to buy your product,” he told producers.


Chapman points to the


requirement for innovative product development as consumers change the way


they buy. Online grocery shopping with delivery is an example, something facilitated by Flipp, an application that searches any flyer for sale products. He says Amazon Dash and meal kits like Hello Fresh are meeting consumer needs in this area, too. “If you’re not selling into a


meal kit bag, you’re missing an opportunity,” he says. “Consumers have a lot of options to buy products. Farmers should think about where the consumer is buying the product and how.” Big box retailers have


grown, too. Discounts are the norm. He pointed to a laundry detergent that comes with a sensor that you press when you’re running out. The replacement is automatically shipped to your home. Although this is convenient, it also takes that consumer out of the marketplace. Chapman says these trends are going to impact the food industry. Drawing on his long-time experience working with Loblaws, Chapman encourages growers to visit local grocery stores and retailers when they travel to generate new ideas to bring back to their own consumers. Producers also need to be able to view stores through the retailer’s eye. Wise producers figure out how to meet retailers’ needs. Challenges like shrink, supply continuity, buying local and sales can be opportunities for producers. He claims discussions with retailers need to be approached more collaboratively, with both sides attempting to understand the other’s challenges and speaking a common language. This may not be the language of on- farm production. “I would have producers


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What’s in the cart? Producers need to be able to view stores through the retailer’s eye. FILE PHOTO


come in and talk to me and not even really know what they were telling me or how it was relevant to what I was trying to do,” says Chapman. He pointed out that


retailers’ margins are not as big as many believe. Profit is about 1.5% after costs such as


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