Ron Says It
We all know that the food industry is a very high-velocity business with competition getting tougher and tougher. Whether you are a grower, shipper, wholesaler, broker or retailer, everybody’s customers are insisting on higher valued product along with more service today. Operating costs continue to outpace revenues, budget demands are at all-time highs, and our workloads are getting heavier each day.
Grocery company mergers, increased operating expenses, labor cuts, management restructuring, higher gross profit margins, and other stressful demands have made this a new food industry of strategies and challenges. This has become a customer-focused business like never before.
We are experiencing a new generation of food industry people, especially in the fresh produce business. Everyone from the farmer working in the field to the shopper rushing through the supermarket, we’re living in a world of lightning speed transformation.
As everyone in the produce operation presses on with their daily duties, there are still many changes that are influencing business decisions. Some companies are simply coping with the earth-quaking shocks that keep rising to the surface. Others fear the unexpected end results that could occur from not knowing what role they must play in all these variable changes to the system.
What are some of the concerns among produce industry growers, shippers, wholesalers and retailers? I had conversations with some well-respected company leaders on the subject.
One individual told me their biggest concern is competition today. Both have a certain amount of budgeted money to spend. The concern takes place when they start outspending each other. But what can they do? Less customers means less business.
A crop grower mentioned about the substantial increased expenses of fertilizer, fuel, seed, equipment, and labor. The profitability squeeze is making it more difficult and challenging in operating farms these days. Production costs are chopping away at the profit margins.
So, the raging battle continues and will undoubtedly always be forcing concerns about the ever-changing methods of doing business. The major formula for success will be to stay on pace with trends and progress. Create a positive workplace to increase productivity and profits.
This can still be a fun business. There are many areas of produce that are really riding high these days. I have seen some very aggressive marketing and merchandising in the supermarket produce departments recently along with very exciting sales promotion programs.
Despite a tougher competitive environment, many produce departments continue to move forward by setting new sales records many people once thought were impossible to reach. They’re doing it with enthusiasm and pride. Produce people always want to be the best.
Yes, there are many concerns in this business today, but those who push forward aggressively will come out on top. All we have to do is keep in touch with what consumers want and then give it to them.
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About the Author
Ron Pelger
Ron Pelger is a former director of produce merchandising and procurement for a major supermarket retail chain. He is currently a free-lance writer for the produce industry supporting growers, shippers, and retailers. He can be contacted at 775-843-2394 or by e-mail at ronprocon@gmail.com.
