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What's in Store: Green list a go

Sustainable seafood strategy boosts New Leaf's sales

By Christine Blank
March 01, 2009

Differentiating itself from local grocery stores is paying off for one natural seafood retailer, despite the recession. While profits at many retailers are suffering in this economy, sales are steadily rising at New Leaf Community Markets, a six-store natural foods chain based in Santa Cruz, Calif.

The primary reason for the retail chain's continued popularity, says Meat and Seafood Coordinator Chris Farotte, is that customers appreciate that New Leaf purchases only sustainable foods, and those with all-natural ingredients.

For New Leaf's organic and natural food shoppers, the way seafood is farmed or harvested in the wild is somewhat more important t h an other product attributes, such as fresh or local, 
says Farotte.

"We spend a lot of time on sustainability issues, such as providing 100 percent natural and organic meat and sourcing all clean ingredients," says Farotte.

To that end, New Leaf sources natural seafood, species that are not overfished and species and catch methods that have minimal impact on the marine environment. As a member of FishWise, a retail sourcing and labeling program, New Leaf also identifies species that have low levels of mercury and PCBs (polychlorinated biphenyls).

Each seafood item in the case is labeled with the exact species name, the location where the fish was caught, how it was caught and a red, yellow or green label. In the FishWise program, which New Leaf has used since 2003, a green label means the seafood is sustainable based on four different factors: fish populations, bycatch, habitat destruction and pollution levels.

A yellow label means FishWise has some concerns about the species, and a red label means the organization deems the fish unsustainable. Examples of fish that are currently on FishWise's red list are shark and Chilean 
sea bass.

"Having this merchandising and labeling program makes it so simple for the customers to make sustainable choices," 
says Farotte.

In addition to providing education, the labels are boosting sales. For example, after New Leaf removed all red list items from its seafood case in December 2005, customers appreciated its sustainability efforts, and seafood 
sales increased.

"Our sales increased about 10 percent that first year," says Farotte. In 2007, sales rose about 5 percent and in 2008, they increased about 2 percent.

Despite the difficult economy, its core natural food shoppers are still buying premium seafood.

"Our customers would rather eat the way they want to eat, but cut back a little on the amount per serving," says Farotte.

At the same time, New Leaf has implemented several sourcing and promotion programs to provide a value for customers on an ongoing basis. For example, for the three-day Valentine's/President's Day weekend this year, New Leaf's Surf & Turf promotion featured Blue Horizon sustainable prawns, regularly $12.99 a pound, for $9.99 a pound. The featured "turf" item was Natural Choice "never ever" (the cattle is never given antibiotics or hormones) filet mignon for $12.99 a pound, discounted from $18.99 a pound.

In addition, New Leaf's purchasers consistently work with their meat and seafood vendors to keep prices competitive.

"Our job is to bring as much value as we can to the customer. We work with vendors to get the best price possible," says Farotte.

In addition, New Leaf is focusing on a program that features low-price products on a daily basis. "We are offering value on certain items, by taking a lower 
margin on everyday-priced items," says Farotte.

Every two weeks, the seafood department, which consists of an 8-foot full-service case in most New Leaf stores, promotes sale items in its in-store flyers.

The seafood departments' sustainability efforts are also highlighted for the customer 
several times a year in New Leaf's monthly newsletter.

Food retailers that run a sustainable-product only program know that sourcing is a constant challenge. New Leaf's customers are primarily interested in sustainable salmon, halibut, tuna, tilapia and catfish, but Farotte is steadily adding new seafood products as they are deemed or certified sustainable.

For example, New Leaf recently added sustainable red snapper from Morro Bay, Calif., through distributor Central Coast Seafood in Atascadero, Calif. The fish is line caught and is on the FishWise and Monterey Bay Aquarium Seafood Watch 
yellow list.

There are some challenges, though. In order to offer a complete sustainable seafood program - about 30 different items on a daily basis - Farotte spends a lot of time talking with new vendors and checking on current suppliers, including Central Coast; Pacific Harvest Seafoods in San Juan Batista, Calif.; and Exclusive Fresh in Princeton-by-the-Sea, Calif.

One of the most difficult species for Farotte to source was sustainable shrimp. Farotte found that a few suppliers were providing what FishWise considers to be sustainable shrimp. In order to provide something different than most stores, Farotte started carrying organic prawns from Ecuador supplied by Blue Horizon Organic Seafood. California law prohibits the retailer from marketing any seafood as organic until standards are finalized for the protein by the U.S. Department of Agriculture's National Organic Standards Program. However, Blue Horizon's product is certified organic by German certifier Natürland.

Despite sourcing challenges and the current economic environment, New Leaf continues to prosper from its focus on natural and sustainable food offerings. In early March, it is moving one of its stores in Santa Cruz, Calif., which was 7,600 square feet, to a new location and tripling its footprint to 20,000 square feet.


Contributing Editor Christine Blank lives in Lake Mary, Fla.


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