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What's in Store - Retailers’ resourceful New Year resolutions

Seafood departments lean on promotions, proficiency to drive sales

Retailers like Monahan’s Seafood Market face continually rising prices. - Photo courtesy of Monahan’s Seafood Market
By Christine Blank
January 01, 2014

In nearly every fish market and supermarket perishable purchasing department, the cry rang out loud and clear in 2013: High prices on shrimp and fish are hurting business and smarter ways of sourcing, utilizing and selling seafood are needed to remain competitive. 

As a result, many stores are implementing new promotional programs and sourcing initiatives in an effort to boost sales in 2014.

“The biggest challenges we faced were rising prices — but not availability of good, quality fish — and competition,” says Mike Monahan, owner of Monahan’s Seafood Market in Ann Arbor, Mich. “For a town of this size, it is surprising that we have two Whole Foods Markets and a couple of new high-end grocery stores. They sell a lot of fish out of those two Whole Foods stores.”

Executives at Lakeland, Fla.-based Publix Super Markets, which operates 1,080 stores, say product cost and availability, along with their consumers’ concerns about imported products, were the top operating challenges they faced in 2013.

While shrimp supply and pricing was the biggest thorn in Publix’s side last year, the company ran into “general supply issues, especially getting quantity to our specifications,” says Maria Brous, a spokesperson for Publix. However, the Southeastern retailer implemented several programs to boost efficiencies and reduce shrink in 2013 that it will carry into 2014. 

“We work more directly with suppliers, which reduces costs. We have increased delivery frequency and we have reduced [some] pack sizes from 5-pound trays to 2.5-pound trays,” Brous says. Publix has also boosted its prepared seafood meals offerings over the past year.

Surprisingly, Monahan’s didn’t experience much of a spike in shrimp prices in 2013, probably because the upscale market has always carried only wild Gulf shrimp. However, wholesale prices on wild fish and other shellfish are a different story. “We try to deal with all domestic, wild seafood. Wild, domestic [seafood] prices are getting to a point that people are not necessarily willing to pay for it for a Tuesday night dinner,” Monahan says. 

For example, dry-pack North Atlantic sea scallops are becoming price-prohibitive for some customers, retailing for around $20 a pound in December because of the wholesale price of between $12 and $13 a pound, Monahan says.

As a result, Monahan’s will continue to focus on getting more value out of the wild fish it buys and run promotions on wild fish when it is most available. When swordfish from New England and Canada is running in the fall — and costs around $7 to $8 a pound wholesale — Monahan’s runs a big special on the fish. 

Likewise, Groomer Seafood in San Antonio, Texas, a wholesaler and retailer, plans to continue with shrimp festivals and other special events. Its Lobstermania sale, held every August and September, is Groomer’s most successful promotion. 

Because of aggressive social media and email marketing, the store sold 13,000 lobsters in six hours last August. The price of each lobster goes down with a pre-designated number of “likes” on Groomer’s Facebook page, so the store’s Facebook fans last August whittled the price down to $6.95 a pound for each 1- to 1.5-pound lobster. 

This year, co-owner Rick Groomer hopes to break a world record for the most lobsters sold in a 24-hour period. “People will be able to keep track of our truck going up to Boston [to pick up the lobsters], and track our truck coming back,” Groomer says. 

Groomer will have a new sourcing avenue in place later this year, after it purchases five to eight boats to supply its wholesale and retail operation — and potentially other retailers. “Fishermen have given up on the industry in South Texas, so we are going to invest money in it. The big thing we will do is develop sustainable species and underutilized species,” Groomer says.

Contributing Editor Christine Blank lives in Lake Mary, Fla.

  January 2014 - SeaFood Business

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