Thursday, November 20, 2014 by Lee Mannering
One of the many reasons I look forward to October (besides Fresh Summit, of course) is the annual release of Progressive Grocer’s Produce Operations Review. I always like to see how the industry is doing at retail and this year’s review provides some great snapshots of how produce departments are performing. (Pro-tip: While at Fresh Summit, you can pick up a free copy of this review from the publication bins as it is part of the October issue of Progressive Grocer.)
The 2014 review found that total produce department sales are $56.2 billion, up from $53.8 billion a year ago. Produce department share of supermarket sales increased slightly to 12.1 percent as opposed to 12 percent in 2013, as did average weekly sales per store: up to $28,852 in 2014 from $27,978 in 2013.
In terms of average department size and sales per square foot, both grew slightly with a produce department currently occupying 2,880 square feet and weekly sales per square foot of $10.02 – up from 2,865 square feet a year ago and weekly sales of $9.77.
The top five produce items that drove department sales were random-weight vegetables (28.5 percent of total, was 28.2 percent last year), random-weight fruit (28.2 percent of total, was 27.8 percent last year), packaged salads (9.6 percent of total, was 9.7 percent), organic produce (7.2 percent of total, was 7.4 percent), and local produce (5.5 percent of total, was 5.3 percent). Floral sales represented 2.1 percent of total produce department sales.
Not surprisingly, a challenge that has accompanied the increased produce sales is produce shrink. Currently produce shrink is estimated at 5.4 percent, up from 5.1 percent a year ago. Seventy-five percent of retailers who responded to the survey indicated their shrink has either stayed the same or increased.
Respondents also shared the produce department areas where they planned to invest in the next one to two years. Energy-efficient lighting and chill cases shared the top spots, followed by signage, mobile merchandisers, and portable bins. Floral displays/bins were also mentioned as investment areas in the near- and long-term.
Though the entire produce operations review isn’t online, you can get a glimpse of it by visiting the Progressive Grocer website.