Are your produce sales vs. a year ago kind of flat? If so, then it may be time to take a good wise look at where your operation has been for the past five years and where it now needs to start heading. After doing that, plan on how you will start turning those flat sales around.
The past few years have been an experience of dramatic changes for the majority of businesses. The retail supermarket activity was no exception, as it went through multiple stages of cost-cutting, including some unpleasant labor losses. Emphasis was placed on trying to salvage the business rather than expand it.
Now that most grocery stores have pulled through the financial crisis and business has started on an upward swing, it’s a good time to start focusing on moving produce sales from a survival mode to a growth mode once again.
There are several sales-boosting strategies that can be applied, but it should always be for profitability purposes other than just sales. Always remember that sales without a profit is like eating soup with a fork.
Much of the grocery store advertising programs have been to promote popular items at rock bottom prices to protect the customer base and also keep the company from declining during the weak economic period. Those attractive low retails may have accomplished that urgent need, but it managed to just about even out sales while reducing the profit in the long run.
Normally, produce retailers often look at the gross profit percentage of an item first, while the more important aspect is the gross profit dollars. Obviously, the more product that is sold, the more gross profit dollars are generated. Those valuable profit dollars are mainly built from high-volume items.
Promoting the key drivers in the produce department will make the difference in boosting sales levels and profit dollars faster than the less-demanding items. Therefore, putting a heavy emphasis on the major items throughout the produce department will get companies back to building that profit growth again.
Concentrate on these volume items to drive sales and turn faster profit dollars: Berries, grapes, bananas, apples, stone fruit, melons, citrus, cherries, tomatoes, Iceberg lettuce, packaged salad mixes, asparagus, potatoes, onions, peppers, carrots, cucumbers and mushrooms.
When setting displays, expand the space allocation of these listed items whether advertised or unadvertised. Build some massive waterfall displays to create a visual impact in attracting shoppers. Set up wing displays alongside table endcaps and auxiliary displays for incremental sales.
Nothing captures customers more during this time of the season than a very attractive berry display. A front entrance display of California strawberries along with red raspberries, blackberries, blueberries and other varieties will surely score big in sales and pump up those profit dollars.
Summer stone fruit, grapes, cherries and melons are all huge sales generators. Asparagus, tomatoes, peppers, potatoes and lettuce should also be planned for display space expansion. Large-scale commodities like these deserve massive displays on table endcaps and entrance locations in order to capture customers’ attention and draw them over to make ample purchases.
Just consider that the vast choices of tomatoes and peppers made available to consumers today are bringing in some hefty supplemental sales. Recognize also that most of the red, orange and yellow peppers are retailing at an average of a dollar each in most markets. Those dollar sales add up fast and return more profit to a company.
The other area to look at is the case retail of each item. For example, while an 18-pound case of grapes at $1.99 per pound generates $35.82 worth of sales, a case of 14 one-pound bag radishes selling for $1.49 will return $20.86. When planning your merchandising, make sure to calculate the dollar value of each display.
In other words, if it takes 15 cases of grapes at $1.99 per pound to set up a nice massive display, then the value of that display is $537.30. Always know how much in sales each display will be contributing to your overall department sales. Make the labor effort you put into each display pay off.
It’s time now to think bigger and expand on the top items that drive most of the sales dollar volume. High-volume strategy is the key to produce growth. Always measure your key drivers to find out how they are performing. It will tell you where and how to focus your efforts for increasing sales.