Local product, convenience drive produce sales in Ohio

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The key to produce sales in Ohio continues to be — Ohio.

The Buckeye State is known for its annual bounty of homegrown fruits and vegetables, and each year consumers ask for more, suppliers say.

“Obviously, not just in Ohio, but I’m sure nationwide, the homegrown deal is certainly something the chain stores are obviously pushing, and we’re fortunate in Ohio and Michigan that the chain stores, from Meijers, Kroger, Giant Eagle and Walmart do a great job of supporting homegrown,” said Chadd Buurma, president of Willard, Ohio-based Buurma Farms Inc.

Buurma Farms itself grows 35 items on an aggregate of about 5,000 acres in Ohio and Michigan and, with a network of affiliated growers, markets a total of 50-55 local fruits and vegetables, he said.

“They lean on us, and it’s great for our business,” Buurma said of retailer demand for locally grown produce.

The weather this year has been challenging, but that hasn’t dampened shoppers’ appetites for the product, Buurma said.

“We have had a fair amount of rain and hot, humid weather, which is typical in Ohio,” he said. 

“Crops look very good, considering what they’ve went through. We’ve been doing this for 123 years or whatever and seen about everything, and this year is no exception.”

Alex Buck, new president of the Fruit Growers Marketing Association, said he also is seeing first-hand how important the local deal is across Ohio.

“Food miles — that’s becoming very important to our retailers and foodservice-institution sales,” said Buck, whose organization includes 14 growers. 

“They’re starting to care a lot where (products) come from. They want information on local growers, who the families are and sustainability. That’s been the biggest issue on institution sales to us.”

That’s a positive reflection on Ohio products, Buck said.

“We love that our customers are now vetting our customers and farmers in respecting resources,” he said.

Auctions play role

Ohio’s produce auctions give buyers a chance to see a lot of product up close at one time, Buck said.

“It’s awesome because it’s an easy way for our local distributors and retailers to be able to access this product and for farmers to be able to sell to them,” he said. 

“One auction has 50-60 farmers. It’s all aggregated in one option, one access point for local fruits and vegetables.”
The only possible concern is occasional short breaks in the cold chain, Buck said.

“For instance, zucchini and all the veg transferred from Amish farms are not on reefer trailers,” he said. 

“Fortunately, for Ohio ag, it hasn’t become an issue. It’s picked that day and they’re right there; you cannot get fresher than that.”

Convenience

Convenience also is a major sales channel for suppliers, said Alex DiNovo, president and COO of the Columbus-based DNO Group of Cos.

“For us, we’re a fresh-cut processor and distributor, and the trend we’ve been seeing specifically on the fresh-cut side in retail and foodservice is convenience,” he said. 

“At retail, we’ve seen more demand for grab-and-go items, such as fruit cups at grocery stores and C-stores. That’s where our company has seen a big emphasis.”

Convenience is a popular in school foodservice, too, DiNovo said.

“We’ve seen grab-and-go convenience in that segment, specifically 2- to 4-ounce single-serve cups and bags for use in schools,” he said. 

“We’ve seen high demand from other distributors who are looking to fill that category for that demographic of customers.” 

Fresh-cut is a healthy segment across foodservice in general, DiNovo said.

“We get a lot of calls for custom-type blends,” he said, noting that his company sells to intermediaries, who, in turn distribute to foodservice outlets. 

“It might be a local blend or an organic blend of some sort. We’re big enough to be able to answer the demands of regional broadline distributors but we’re small enough to bob and weave and do things bigger companies can’t do.”
Ravenna, Ohio-based Sirna & Sons Produce also has enjoyed success with its fresh-cut processing arm, said Tom Sirna, president.

He said “convenience, variety, and healthy, local, new variety of products and anything including processed products to help their labor” are the major drivers of produce sales in the state. 

However, success in produce in Ohio isn’t limited to the value-added segment, said Jamie Sanfillipo, partner at Columbus-based Sanfillipo Produce Co. Inc.

“In a nutshell, I think business is pretty strong,” he said. “People are out spending money. We do a lot of restaurants and have seen a steady growth in business and volume.”

All of that is happening in spite of the “most volatile market in quite some time” for numerous items, Sanfillipo said.

“People have got to have head lettuce, got to have lemons,” he said, adding that items like celery and avocados continue to sell, as well, despite higher prices.

Fewer Suppliers

The produce business is less fragmented than it had been in the past, and that might have something to do with the success of individual suppliers, Sanfillipo said.

“Now, the business has consolidated, and that’s a factor, too,” he said. “In Columbus, 20 years ago, there were 30 places they could buy produce from, and now there’s about seven or eight.”

At retail, big chains — with their own distribution centers — tend to dominate across Ohio, suppliers said.

“They’ve cut most of the shorts out,” Sanfillipo said. “Now, most of that has to go through distribution centers, so that isn’t around like it was for years.”

According to the latest Shelby Report, which tracks the retail business, Giant Eagle continued to hold the No. 1 position in the portion of Ohio that includes Cleveland, Akron, Canton and Youngstown, with a 38.8% market share across 124 stores in the region.

Walmart, with 35 units in the state, was second, with a 17.3% market share. Marc’s, with 56 stores, was third, at 11.3%.

Costco, with three stores (and a newcomer in the report), held a 6.9% share.

Coming in at 5.10% or below were Supervalu (5.1% share), SpartanNash (5%), Aldi (4.7%), Save-A-Lot (4.3%), Heinen’s (4%), Buehler Food Markets (3.5%), Dave’s Supermarkets (2.5%), Whole Foods (2.5%), AWG (1.3%), and Laurel Grocery (1.1%).

In the region including the Cincinnati, Dayton, Columbus and Toledo markets, as well as Huntington, W.Va., Kroger, with 262 stores, set the pace with a 48.6% market share, followed by Walmart, at 122 units and a 21.2% share; Meijer, 41 and 7.4%; and Costco, three, 5%.

Giant Eagle (4.7%), Supervalu (3.4)%, SpartanNash (3.1%), Aldi (2.8%), AWG (1.3%), Fresh Encounter (1.2%), Save-A-Lot (1.2%), Remke’s (1.1%) and Whole Foods (1.1%) followed.