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advertising, labour, fixed and variable expenses and distribution are factored in. “It’s trying to find where we can find middle ground,” he explains. A grower, for example, may see that a retailer cares about service levels, and then explain what the farm is doing to support those service levels. This may go further toward achieving a grower’s desired outcome than just pitching the retailer on what the grower has to offer.
Chapman tells how a
grocer was about to terminate its relationship with a greenhouse but the owners came up with a convincing plan and presented distribution maps that showed how they were serving the chain’s needs. They became the grocer’s primary vendor and have been able to expand their business.
Chapman says grocery
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chains want to innovate because customers like new things, such as fish sold on a cedar plank.
He encourages on-going communication as part of relationship building with regular farm-gate customers and also with retailers. “When we’re producing
things, it may not always go the way we want. We don’t control everything. And we go, ‘Well, maybe we can just sneak it in, or maybe we can ship it anyway,’” says Chapman. It’s far better to be up-front with customers, explains Chapman, because then everyone knows what to expect. There are no surprises and a lower risk of lost business.
Retail plan, trust required
Producers who don’t take time to think out a retail plan and cultivate it may be left behind. Retailers are focused on filling shoppers’ carts, says Chapman. It’s simple economics. If a consumer has nine items and they add one more to their cart, the retailer sees a 10% sales increase, which is significant. Producers need to take the same approach with retailers and customers that they would with kids, appealing to their values and motivation to build sales. “What’s going on in the
marketplace? If consumers want demos, do demos. Find different packaging so consumers can’t easily compare products and price. What can you package together?” he asks. Could a beef producer and
One-to-one relationships between growers and retailers are worthwhile. FILE PHOTO
a vegetable producer come together to produce a fresh chili package which would include all the ingredients? The label could tell customers what to do with the product, or offer alternative uses for the contents. Strong retail brands also need a strong brand promise. When he asked the audience what their brand promise was, not many could say, which speaks to his last CART ingredient: trust. “It’s about quality, price and experience. If you can do all three, you can build trust with your customer,” says Chapman. On this front, those in the
food retail sector may have an edge, according to Canada's
first annual Social License to Operate report, released in January 2018. Conducted by the Faculty of Management at Dalhousie University, the study asked Canadians how they view organizations they interact with most frequently. In the food retail sector, local food suppliers ranked as most trustworthy, socially responsible, environmentally friendly and ethical. Loblaws ranked second, and Sobeys – which owns several Safeway stores in BC – ranked third. While trust is high for local
food suppliers, the study found Canadians nevertheless tend to patronize a Loblaws grocery outlet such as Superstore or No Frills over a local supplier. (Research occurred prior to Loblaws being implicated in the price- fixing scandal over bread so
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public response to that issue didn’t factor into the results.) “I encourage people to think about what level of trust your customers – direct, wholesalers or retailers – have in your business,” says Chapman, pointing to Fresh Direct, a New York company that sells food online. Because they have built such brand loyalty, they’re able to introduce a new product and consumers automatically trust that it will be good. “It’s our responsibility to help people understand the change and where it’s going, so, yes, today it’s less than 5% but if you want to get into these new channels where perhaps there’s a better return or a better customer to deal with, then you need to get on it now and not wait,” says Chapman.
COUNTRY LIFE IN BC • DECEMBER 2018
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