Nonfoods Talk: Taking ownership

To thrive in supermarkets, nonfoods needs cheerleaders. Right now, the category has few outspoken leaders and that is hurting its performance.

By Seth Mendelson

Where are the advocates for nonfoods among supermarket exec­­utives?

When I first got into this business more than 25 years ago, there were a bunch of grocery store nonfoods buyers who actively touted the benefits of the various general merchandise and health and beauty care categories. Some aggressively spoke up about the benefits of nonfoods for such obvious reasons as trying to keep their own jobs or looking to make the categories they championed more powerful than others in the store.

Others simply saw the silver lining of nonfoods, particularly the high margins many products carried and the opportunity to grab business from drug stores and mass merchandisers. Whatever the reason, these individuals were often speaking out about how nonfoods could help supermarkets make more money and attract more shoppers.

Today, with few exceptions, those voices have disappeared. Many have retired or left the industry and, unfortunately, some have passed away. As we discuss in our cover story about the state of nonfoods, the category remains under heavy pressure from inside and outside the grocery store industry. Frankly, many nonfoods categories—especially a number of general merchandise segments—have failed to perform at satisfactory rates over the last decade. Some retailers have eliminated some of these categories, including automotive supplies, lighting and, most notably, the photo/film category.

Even the more stable health and beauty care segments have come under fire in recent years. Many grocery chain executives are questioning the amount of space given to the HBC category and some are even taking a deeper look into the costs of running a proper pharmacy even as the pharmacy counter becomes a huge magnet for consumers.

So the forces are lining up against nonfoods and they are gaining steam in their desire to take at least some of the room devoted to nonfoods and give it to other areas of the store.

Who is out there trumpeting the category’s many virtues? Outside of the Global Market Development Center (GMDC)—the Colorado Springs, Colo.-based trade association that has long stressed that nonfoods has an important role in any grocery store’s merchandise mix—there are few advocates for the category in supermarkets. From this angle, most nonfoods buyers and merchandise managers appear to be either too stunned or too concerned about rocking the boat to speak up about their category’s many attributes.
Someone has to. Nonfoods needs to be an important cog of any supermarket merchandise strategy. As we document in our cover story, the category has had its share of tough moments in recent years. This trend has not been helped by the fact that the people who are supposed to be its biggest supporters stay on the sidelines.

This trend is not limited to retailers. While such companies as Kraft, General Mills, Nestlé Purina and Hershey, to name a few, actively call attention to their products, promotions, overall departments and other activities to the trade, many of the leading nonfoods suppliers have little to say.

Where are they and why are they not stepping up and actively introducing programs to the trade that will make a difference?

“I go to the key shows and I see all of these executives there,” says a nonfoods buyer for a major grocery chain. “But that’s really it. They are there and they are attending all the functions but they are not bringing anything new to the table. In fact, I find that the mid-size players and the smaller guys are the most aggressive suppliers in this market.”

So there you have it. Nonfoods is struggling in supermarkets and the only way to alter this trend is by everyone involved getting together and coming up with sound solutions to entice consumers to purchase more of these products at the food store. Is this sinking in?

Seth Mendelson can be reached at 212-979-4879 or at smendelson@groceryheadquarters.com.

This entry was posted in 2010 02 Article Archives, Columns, Nonfoods for Profit. Bookmark the permalink.