Louisiana State University

Transcription

1 Louisiana State University National Grocers Association University Case Study 2014 Michael Bass, Brittany Doise, Robert Selders II, Arielle Sutton

2 Fresh Encounters, Inc. Fourth-generation family owned and operated 31 locations: 29 in Ohio, 2 in Indiana Values and business strategy reflect those of many independent grocers. Customer Service Quality Products Community Involvement Incorporating sustainable practices

3 Integrating Sustainability Grow For It Fresh Encounters, Inc. s Community Supported Agriculture (CSA) program Community involvement Teaches self-sustainability Accomplishments

4 So What s Next? Continue community sustainability efforts Differentiate from competitors Provide value-added and specialty products Enhance customer s shopping experience Increase community participation How will Fresh Encounters achieve this while peeking consumer interest, maintaining competitive prices, and remaining profitable?

5 Strengths: superior customer service, specialty departments, value-added products, in-store customer education, nurturing community relationships Weaknesses: modest social media presence, limited budget Opportunities: strengthen partnerships with local suppliers, increase variety of local products in stores Threats: farmers markets, specialty stores, price competitiveness for local foods

6 Who We Target: Customers looking for: An alternative shopping experience Competitive prices Quality fresh products Stores engaging in sustainable practices If displayed more prominently 39% will buy more local 41% would pay more if store displayed food s origin 2/3 consider buying local important More food bought in grocery store vs. restaurants 63% of low income will pay more for local food Consumers trust independent grocers

7 Agora Fresh Encounters new initiative to unify the store under one private label that encompasses their local products. Agora s Benefits Agora s Obstacles Competitive substitute Redesign existing store labels to brand names Expensive to develop Local appeal Removed from the Grow For It campaign Brand recognition for Lose store s farmers local recognition products Availability of local suppliers

8 Tapping Into Sustainability Economically sustainable efforts, through the promotion of local craft breweries, complements the Grow For It campaign s environmental sustainability efforts The Benefits of Craft Breweries are: Increasing & promising trends for craft beer market Expected positive growth for craft beer consumption Complements existing Grow For It programs Highlights local production However Excludes non-drinkers Difficulty identifying farm of origin

9 Local and Fresh: It s What s for Dinner The Grow For It program can be extended by redesigning the deli department to promote and offer fresh meals that are crafted with local products Benefits: Value-added products Cost-efficient implementation Efficient in utilizing Disadvantages: local foods Satisfies the increasing Supply demand of produce for is low in prepared meals winter 16.5% increase in Additional sales last year expense for adding and training employees

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11 What s on the Menu? Use local foods to prepare deli offerings and daily specials Seasonally based Cooking tutorials In-season recipes Customer Incentives: Integrate local deli purchased with existing Fuel Perks Catering

12 Let s Get Crafty at Fresh Encounters, Inc. During those months when local produce isn t as abundant, Fresh Encounters, Inc. should focus their Grow For It marketing efforts on Ohio craft beers Dinner combos QR Codes Tailgating specials Make your own 6-pack

13 Social Media Improvements Improve social media link accessibility Integrate Grow For It campaign with company s existing social media Promote Grow For It campaign Recipes Specials Videos Tweek or Tweet button for recipes Pinterest

14 Implementation Phase I March 2014 April May & June July August Strengthen relationships with local suppliers Solidify contracts with craft brewers Social media improvements Customer surveys Analyze results Employee education & training Hire marketing firm Design new deli display Continue Grow for It Program & Local Produce Section

15 Implementation Phase II September October December January 2015 Customer education Begin signage Finalize new menu items & construct displays Utilize media outlets to promote changes Reveal improved deli and craft beer design Continue Grow for It Program & Local Produce Section

16 Cost Analysis $3, $60,500 $50,500 $40,500 $30,500 $20,500 $10,500 $3, $2, $2, $1, $1, $ All Stores Per Store $500 Deli Upgrades Additional Marketing Promotion Additional Employee Training Customer Surveys $0.00

17 Forecasting: Growth in Local Demand Increase in Farmer s Markets Consumer demand for fresh local foods is increasing Deli prepared foods is a key way to capitalize on fresh opportunities

18 Growing Forward Reconfiguration of the deli will achieve customer satisfaction and Grow For It s goal to implement sustainable efforts. In the future, this can be continued by introducing Wine Honey Ice Cream This strategy will give Fresh Encounters edge it needs to thrive among competitors.

19 Fresh Encounters, Inc. It s more than a name; it s a philosophy, Mike Needler, president and CEO of Fresh Encounters, Inc.

20 References "Can Grocery Chains Capture The Local Food Movement Momentum?" Food Institute Report, n.d. Web Christie, Lorna. "Building Loyalty Through Your Story." Progressive Grocer 91.4 (2012): 110. Business Source Complete. Web. 6 Feb Davis, Noah. "The Craft Beer Market Has Exploded, And Now Brewers Are Worried About A Collapse." Business Insider. Business Insider, Inc, 14 Dec Web. 06 Feb "Facts." Brewers Association. N.p., 8 Mar Web. 05 Feb Lempert, Phil. "Can Grocery Chains Capture The Local Food Movement Momentum?" Can Grocery Chains Capture The Local Food Movement Momentum? Supermarket Guru, 14 Feb Web. 06 Feb

21 References Orgel, David. "Independents Urged to Embrace Prepared Foods." Supermarket News Home Page. Supermarket News, 13 Jan Web. 06 Feb "Print: Shoppers Diversify Stores, Add Trips As Food Costs Climb: Study." Print: Shoppers Diversify Stores, Add Trips As Food Costs Climb: Study. Progressive Grocer, 2 May Web. 06 Feb Numainville, Brian. "Staying on Top Means Always Looking Ahead." The Shelby Report of the Southwest, Web. 6 Feb State of the Craft Beer Indsutry. Rep. Demeter Group Investment Bank, Web. 05 Feb

22 Appendix Supporting Information: Private Label 46% of consumers will shop for private label brands as food prices rise. 62% of consumer believe there is no difference brand quality when purchasing dairy. 61% saw no difference for canned or shelf products. Perception of private labels has increase in trust. 77% of CPG executives and 90% of retail executive indicate that market share for store brands will increase. 44% of shoppers believe stores private labels have improved over the past 5 years.

23 Appendix Supporting Information: Craft Beer Craft beer is 10.2% of the beer market. Production up 71% (13 million barrels) from In ,400 breweries opened and 1,500 are planning to open; this is equal to the new breweries that have opened since 1996 (3,900). In 2013 craft beer sales increased by 15%. 4 th straight year of doubledigit growth. Sales for craft beer are increasing nearly 4% annually.

24 Appendix Supporting Information: Deli Prepared foods account for more than 52% of the deli department s revenue. 83% of households have bought something prepared from the deli within the past year. 75% of grocers are increasing their samplings at the deli. 10% growth in the next decade for the prepared foods section. Restaurants poised to increase 4%.