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What's in Store: New Year's revolutions

Retailers go in new directions to boost sales in 2011

By Christine Blank
January 01, 2011

Carl Fantasia, owner of family-operated New Deal Fish Market in Cambridge, Mass., is always thinking of ways to attract new customers and change with the times. Fantasia realizes that willingness to try new ventures - such as adding prepared seafood items and holding cooking classes - is vital to thrive in today's economic climate.

Most retailers face a difficult year, as the United States climbs its way out of a recession and unemployment 
numbers remain high compared to previous years. Fantasia and other seafood retailers say that they must add new recipes and different species to their offerings, while controlling seafood purchasing costs and sometimes reducing SKUs to compete in the market in 2011.

Supermarket operators recently surveyed by the Food Marketing Institute (FMI) said that the economy is 
currently their top concern, followed by competition 
and healthcare costs.

"Shoppers' overwhelming focus on price and value had led to fierce competition among food retailers. Supermarkets are trying to distinguish themselves from the competition by fine-tuning their private-label strategies, SKU [stock-keeping unit] reduction and price differentiation," says Leslie Sarasin, FMI's president and CEO.

Retailers like Minneapolis-based Wedge Co-op have reduced their seafood department SKUs over the past year. "Seafood sales have gone down [in the past year], so we sell the stuff that works and is inexpensive. We have cut down on variety," says Andrew Silbernagel, seafood buyer for the single-store company.

Over the past year, more Wedge shoppers are buying poultry than seafood, says Silbernagel, so the store is hesitant to try out new or unusual species.

"It is hard to get people to spend money on something new when they are on a budget," says Silbernagel. Instead, Wedge focuses on buying the freshest and most sustainable seafood they can and selling only the items that have been proven to be popular among its shoppers: smoked fish, salmon and tilapia. The retailer displays between 15 and 20 fresh seafood items daily.

Despite the economic challenges facing them, seafood retailers remain optimistic that they can outsell their competition by offering something new and different to customers. New Deal Fish Market, which caters to gourmands from the Harvard community and the surrounding area, plans to hold cooking classes in 2011 and offer value-added products for the first time.

"We will offer classes on the basics, such as 'how to fillet a fish,' up to more advanced classes such as 'how to prepare gourmet seafood meals.' I am going to teach some and will hire my chef friends in the area to teach some," says Fantasia.

New Deal is also developing refrigerated seafood stocks and chowders in 2011. "We have to be looking at value-added right now. At the same time, we have to be busy and move a lot of fish, so a lot of successful restaurateurs have said not to turn the fish market into a restaurant," says Fantasia.

New Deal has already separated itself from its competitors by fashioning the fish market into a specialty shop that is frequented by higher-end clientele.

"Our main demographic is foodies: They watch the cooking shows, they read about cooking and they love to cook at home. A portion of our customers are Japanese, so we know all the 
fish names in Japanese and other languages," says Fantasia.

New Deal's gourmet offerings include imported cheeses and olive oils, salted anchovies from Sicily, dried figs from Turkey and all the ingredients for making sushi at home.

"We also carry a lot of whole fish, and a lot of fish markets don't do that," says Fantasia.

Despite the difficult economic climate over the past two years, 2009 was a record year for sales at New Deal. "I think we do a very good job at separating ourselves from the competition and people were not eating at restaurants as much. They like buying healthy food, and cooking it at home," says Fantasia. Consumers are also more aware of the health benefits of seafood, he adds.

Seafood sales at PCC Natural Markets, a chain of nine natural and organic stores in Seattle, were also strong throughout 2009 and 2010, as shoppers continued to be interested in sustainable and natural food, according to Russ Ruby, director of merchandising at PCC.

"While the local economy is struggling to return to its pre-recession strength, this has not affected our sales and pricing, nor created any difficult challenges for our seafood program," says Ruby. PCC's success mimics a national trend. Around 74 percent of supermarkets said that their health and wellness initiatives were one of the primary ways they differentiated themselves in 
the marketplace in 2010, according to the FMI survey.

This year, PCC plans to expand its private label Natural Express line of pre-seasoned meats and seafood to include more varieties of grill-ready salmon, halibut, fish kabobs and other seafood entrées. The line already includes Teriyaki & Kalbi (a Korean preparation) and Lemon Pepper & Garlic Herb varieties of salmon fillets, halibut fillets and halibut kabobs. PCC this year is also adding more wild domestic shrimp, along with additional varieties of crab and lobster.

 

Contributing Editor Christine Blank lives in Lake Mary, Fla.

January 2011 - SeaFood Business 

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