Jump to content
  • SFA Blog

    George Hajjar
    The most popular articles with SFA News Daily readers in January focused on outlooks on industry trends, retailer-brand relationships, and the Red Sea conflict.
    In case you missed it, the following were the five most read stories in November.
    1. Danone to Sell Horizon Organic, Wallaby to Private Equity Firm
    French food producer Danone signed an agreement to sell its U.S. organic dairy brands Horizon Organic and Wallaby to private equity firm Platinum Equity.
    2. Targeted Strike Escalates Shipment Conflict in Red Sea
    After Houthi members defied an ultimatum to halt their attacks on ships transiting the Red Sea, a U.S.-led coalition launched more than a dozen strikes on the Yemeni force.
    3. Supermarket Giant Drops Pepsi, Lay’s
    Price increases from global brands PepsiCo and Lay’s compelled one of the biggest supermarket chains in the world, French-owned Carrefour, to stop merchandising the brands throughout France, Italy, Spain, and Belgium. The conflict arose after more than two years of price increases from both brands.
    4. Report Reveals Nuanced Packaging Insights
    For generic brand products, simplicity does not sell; however, for most other food offerings, minimalist packaging tends to increase the item’s perceived purity, show the findings of a Neeley School of Business at Texas Christian University study.
    5. Trends on the Radar: Winter Fancy Food Show Preview
    Denise Purcell, VP of resource development at Specialty Food Association, and Jen Cohan, PR consultant, previewed for attendees the categories, flavors, and ingredients likely to be displayed at the Show. 

    George Hajjar
    The most popular articles with SFA News Daily readers in November focused on retail executives’ outlooks on the current economic environment, industry trends, and the closing of a special grocery store.
    In case you missed it, the following were the top five most read stories in November.
    1. Target CEO: Grocery Shoppers Pull Back
    Stressed budgets going into the holiday season have caused shoppers to pull back on all goods, including groceries, shared Target CEO Brian Cornell in an interview with CNBC.
    2. Grocers Adjust Self-Checkout Strategies
    As backlash against self-checkouts continues to grow, retailers are responding by adjusting their approach.
    3. PCC to Close Seattle Store
    PCC Community Markets, a community-owned grocery cooperative in Washington, said that its store in Downtown Seattle will close permanently on January 31, 2024.
    4. Walmart CEO Expects Holiday Deflation
    Walmart CEO Doug McMillon said deflation could be coming in time for the holiday season as key grocery items like eggs, chicken, and seafood get cheaper. He added that general merchandise items are also feeling economic relief.
    5. KeHE Unveils 2024 Macro Trends
    KeHE Distributors said that it has identified the top macro trends in the food and beverage industry to inform retailers’ product selections for 2024. Experts from KeHE identified seven predicted trends for the coming year.

    George Hajjar
    The most popular articles with SFA News Daily readers in October focused on consumer trends, inflation, and the Kroger-Albertsons merger. In case you missed it, the following were the top five most read stories in October:
    1. Slideshow: Whole Foods Forecasts 2023 Trends
    Whole Foods Market unveiled anticipated food trends for 2023. The company is also making a Trends Discovery Box available, featuring 10 items that allow consumers to sample the trends.
    2. SFA Trendspotters Name 2023 Specialty Food Trends
    Alternative seafood, nuanced heat, and naturally occurring sweeteners are among next year’s specialty food trends, according to the Specialty Food Association’s Trendspotter Panel.
    3. Perceived Food Inflation Rate Outpaces Reality
    Americans believe inflation for food-at-home has hit 22.8 percent, 9.7 points higher than the U.S. Bureau of Labor Statistics annual rate of 13.1 percent.
    4. Regulators Seen Studying Kroger-Albertsons Merger
    Cincinnati-based Kroger Co. will likely face market-by-market scrutiny from federal regulators in its proposed merger with Boise-based Albertsons Cos., as the two companies have significant overlap and would gain considerable clout in the market.
    5. Vongerichten Brings Global Influences to NYC Food Hall
    Chef Jean-Georges Vongerichten has opened a multi-restaurant culinary marketplace/food hall at the Seaport on Pier 17 in Manhattan, the former home of the Fulton Fish Market.

    George Hajjar
    The most-read SFA News Daily articles in September explored mergers and acquisitions between top retailers, retailers’ efforts to combat theft, and state legislation on food.
    In case you missed it, the following were the most popular stories last month.
    1. Kroger, Albertsons to Sell Stores to C&S
    Kroger and Albertsons entered into an agreement with C&S Wholesale Grocers to sell select stores, banners, distribution centers, offices, and private label brands in connection with their proposed merger for $1.9 billion.
    2. California Advances Bill to Ban Four Food Additives
    The California Legislature passed a bill, titled Assembly Bill 418, to ban four food additives that have been linked to adverse health outcomes.
    3. Target to Close Nine Stores Due to Theft
    Target shared that it will close nine stores across four states on October 21, citing theft as the main driver of the decision. Stores in Manhattan, San Francisco, Seattle, and Portland, Oregon are slated to close.
    4. Retailers Employ Radical Tactics to Deter Theft
    Some stores have become the target of shoplifting, flash-mob robberies, break-ins, and thefts mid-supply chain, compelling retailers to take a radical approach to product shrink.
    5. Boozy Versions of Beverages Blur Lines
    Brands such as Mountain Dew, SunnyD, Simply Orange Juice, and Eggo are marketing spiked beverages that some regulators fear have the potential to create consumer confusion and lead to inadvertent underage drinking.

    George Hajjar
    The most-read SFA News Daily articles in August explored topics including mergers and acquisitions between big-name brands and retailers alike, retailers’ strategic efforts, and a shortage of rice that can have global consequences.
    In case you missed it, the following were the most popular stories last month.
    1. Campbell Soup to Acquire Rao's Parent
    Campbell Soup and Sovos Brands, Inc., the parent company of soup and sauce brand Rao’s, shared that Campbell will acquire the premium brand for $23 per share in cash, representing a total value of approximately $2.7 billion. Sovos Brands specializes in premium pasta sauces, dry pasta, soups, frozen entrées, frozen pizza, and yogurts marketed under the Rao’s, Michael Angelo’s, and Noosa brands.
    2. Giant Food Eliminates Fulfillment Centers
    Giant Food is closing its fulfillment centers, which facilitate home grocery delivery, in Hannover, Maryland; Manassas, Virginia; and Milford, Delaware. The 80,000-square-foot location in Manassas opened three months ago.
    3. Aldi to Acquire Winn-Dixie, Harveys Supermarket
    Aldi shared that it has entered into an agreement to acquire Winn-Dixie and Harveys Supermarket as part of a larger divestiture of Southeastern Grocers.
    4. India’s Rice Ban Could Provoke Global Food Crisis
    On July 20, India banned exports of non-basmati white rice to quell domestic inflation; however, the removal of the food staple’s supply from international markets could trigger a global food crisis.
    5. Whole Foods Accelerator Cohorts Announced
    Whole Foods Market has shared the participants in its two tracks of the Local and Emerging Accelerator Program LEAP: Early Growth and On the Verge. The LEAP initiative launched in 2022 with the inaugural Early Growth cohort and continues to advance Whole Foods’ core value of seeking win-win partnerships with suppliers, according to the company.

    George Hajjar
    The most-read SFA News Daily articles in July explored topics including a retailer’s battle against labor unions, the economics of supermarkets and pricing, and inclement weather affecting states and crops. In case you missed it, the following were the most popular stories last month.
    1. NLRB Files Complaint Against Trader Joe's
    The National Labor Relations Board alleged in an unfair labor practices complaint against Trader Joe’s, that the retailer retaliated against workers attempting to organize a union. The NLRB also said the grocer threatened workers with frozen wages and more.
    2. Sugar Shortage Puts Candy Production at Risk
    Tight sugar supplies are edging up candy companies’ costs and cutting into confectionary production months before the Halloween season.
    3. Supermarkets Lose Share to Other Channels
    In 1997, supermarkets and small-format grocers held 37 percent share of American’s total food spending; as of 2022, that share had fallen to one quarter, according to data from the USDA. On the other hand, warehouse clubs and supercenters, like Walmart and Costco, increased their share of food spending from 4 to 10 percent over the same period.
    4. Flooding Impacts Food Companies in Vermont
    Specialty food makers, retailers, and consumers in Vermont braced for more rainfall after heavy downpours earlier in the month caused widespread flooding and damage.
    5. Big Brands Continue Raising Prices
    While making record profits, large consumer brands have continued to raise prices as the Federal Reserve works to stabilize inflation. Coca-Cola, Unilever, and PepsiCo all reported significant price hikes in the second quarter.

    George Hajjar
    The most-read SFA News Daily articles in June covered topics including sofi Award winners, the Summer Fancy Food Show, and retailers’ suppliers. In case you missed it, the following were the most popular stories last month.
    1. sofi Product of the Year, New Product of the Year Winners Named
    Top buyers named Lewis Road Creamery 10 Star Certified Salted Butter 2023 sofi Product of the Year and named Mochidoki Vegan Passionfruit Mochi Ice Cream sofi New Product of the Year at the Summer Fancy Food Show.
    2. Whole Foods Announces Supplier All-Stars
    Whole Foods announced the winners of its annual Supplier All-Star Awards, recognizing 15 brands that raise the industry bar for quality, innovation, value, and social responsibility, and are aligned with Whole Foods Market’s core values, such as caring for local communities and practicing win-win partnerships, according to the company.
    3. Wegmans to Shutter Multi-Level Store
    Wegmans will close its multi-level location in Natick, Massachusetts. The exact date has yet to be determined but will occur this summer.
    4. Giada De Laurentiis Shares High-Impact Food Trends
    Giada De Laurentiis, chef, TV personality, author of ten cookbooks, and founder of Giadzy, spoke about emerging trends that are shaping the specialty food industry, and facilitating the success of her brand, during her keynote presentation at the Summer Fancy Food Show.
    5. Albertsons Consolidates Private Labels
    Albertsons Companies, Inc. is rebranding its Signature Farms, Signature Care, and Signature Cafe products under Signature Select, featuring a new marketing campaign, logo, and updated packaging. The transition is expected to be complete in early 2024.

    George Hajjar
    The most-read SFA News Daily articles in May covered topics including the sofi Award winners, rising food prices, and retailers’ expansion plans. In case you missed it, the following were the most popular stories last month.
    1. Virginia Supreme Court Denies Wegmans' Request
    The Supreme Court of Virginia denied a request by Wegmans to reconsider a decision finding that neighbors could challenge local approvals of the grocer’s plans to build a distribution center in Hanover County, Virginia.
    2. Stew Leonard's Plans New Location
    Stew Leonard’s will open a new location in Clifton, New Jersey, next year as part of a plan that will integrate the nearby Stew Leonard’s Wine & Spirits store.
    3. SFA Announces 2023 sofi Award Winners
    Specialty Food Association revealed the winners of its 2023 sofi Awards. Short for specialty outstanding food innovation, the sofi Awards are a celebration of creativity and culinary excellence.
    4. KeHE Expands Distribution with DPI Acquisition
    KeHE Distributors said it had agreed to acquire DPI Specialty Foods, a major distributor of specialty food products with three distribution facilities in the Western U.S. offering frozen, refrigerated, and dry goods.
    5. Food Prices Rise, Consumers Resist
    Corporations that took advantage of inflation at grocery stores and restaurants by raising prices are reluctant to give up their margins, reports The New York Times. Evidence suggests, however, that consumers are retaliating by cutting back on high-priced items or trading down to less costly alternatives.

    George Hajjar
    The 2023 Summer Fancy Food Show, taking place June 25-27 at the Javits Center in New York, will feature a Diversity Pavilion of exhibitors with diverse ownership and focus on uplifting diverse voices in the specialty food industry. Aki Cipriani, VP of talent and culture at the Specialty Food Association spoke with SFA News Daily about what attendees can expect from some of these initiatives and look out for at the Show.
    What can attendees expect from the (included) partnership at the Summer Fancy Food Show?
    I’m thrilled to share that (included) will once again be featured at the Summer Fancy Food Show at the Javits Center. (included) is a membership collective of executives from underrepresented communities committed to amplifying BIPOC (Black, Indigenous, and People of Color) voices and brands in the specialty food industry. We will host ten new cohorts within our Diversity Pavilion: Down the Road Spice Co., Nowhere Bakery, Edie’s, Growee Foods, Yoro, Impact Food, Side Project Beef Jerky, Tochi Snacks, Uncle Waithley’s Beverage Company, and Jack & Friends.
    How do you feel the relationship with (included) has developed?
    SFA’s partnership with (included) is emblematic of our commitment to being an organization that champions Diversity, Inclusion, and Equity at our events and throughout the industry. In addition to participation in the Summer Fancy Food Show, (included) exhibitors receive SFA membership, promotion & marketing, and access to industry-related programming. But best of all, included members can establish meaningful and sometimes life-long connections with other BIPOC companies.   
    What other programs is the Specialty Food Association running at the Show?
    We will highlight several DEI exhibitors (non-included members) in our Summer Fancy Food Show Guide, mobile app, and on SFA’s website. Additionally, we will be offering an education session on “Diversity Buying: How it Works” at our Big Idea Stage and hosting a Diversity Reception for current and past (included) cohorts, (included) members, and current diversity pavilion exhibitors.

    George Hajjar
    The most-read SFA News Daily articles in April covered topics like legislation around the use of food additives, corporate restructuring, and recognition for the hard work that industry stakeholders put into their passions. In case you missed it, the following were the most popular articles last month.
    1. California May Ban Five Food Additives
    California may become the first state to ban the sale, manufacturing, and distribution of foods that contain the following chemicals linked to increased cancer risk, reproductive harm, and behavior issues: red dye number 3, titanium dioxide, potassium bromate, bromated vegetable oil, and propylparaben.
    2. Whole Foods Plans Layoffs, Restructure
    The memo said that the Amazon-owned grocer will operate across six regions, down from its current presence in nine. Among those laid off are three regional presidents.
    3. Trader Joe’s Tops Most-Loved Brand List on Yelp
    Grocery retailer Trader Joe’s topped Yelp’s first-ever list of the 50 most loved brands in the U.S., followed by bakery franchise Nothing Bundt Cakes, and bubble tea specialist Kung Fu Tea.
    4. SFA Announces 2023 Lifetime Achievement Award Winners, Hall of Fame Inductees
    Lifetime Achievement Award recipients are widely recognized as having grown the industry, improved the Association, inspired companies, and nurtured individuals.
    5. Boxed Files for Bankruptcy
    Boxed revealed that it, along with its subsidiaries, has initiated voluntary Chapter 11 proceedings. The company also announced it is looking to sell Spresso, its software business.

    George Hajjar
    The most popular articles with SFA News Daily readers in March focused on the tragic chocolate factory explosion in Pennsylvania, changes to grocers that impact their communities, and a company founder countersuing over wrongful termination. In case you missed it, the following were the top most read stories last month.
    1. Death Toll From Chocolate Factory Explosion Climbs
    Fatalities resulting from an explosion at the R.M. Palmer Company chocolate factory in West Reading, Pennsylvania on March 24, reached seven.
    2. Combined Kroger-Albertsons Could Change How Americans Shop
    If the proposed merger of Kroger and Albertsons is approved, the combined entity could redefine what consumers buy at the grocery store.
    3. Food Brands Affected By Silicon Valley Bank Crash
    Silicon Valley Bank, an institution with assets and liabilities totaling over $200 billion, crashed on March 10. Although the bank mostly catered to venture capitalist firms, many food and beverage startups and small brands also felt the ripple effects of its fall.
    4. Schinner Files Countersuit Alleging Discrimination, Wrongful Termination
    Miyoko Schinner, the founder of Miyoko’s Creamery who was ousted as CEO last year, filed a countersuit against the company alleging gender discrimination, wrongful termination, and other charges.
    5. Green Zebra Grocery Closed
    Green Zebra Grocery, the three-unit retailer in Portland, Oregon, offering healthy, grab-and-go prepared foods and CPG products in a convenience-store format, shut its doors on March 22.

    Andrew Lynch
    Stocked up on merchandise in response to red-hot consumer demand throughout the COVID-19 pandemic, big box retailers are drowning in insane amounts of overstock as demand for goods like electronics and home goods has dropped significantly. Consumers are reverting back to their pre-pandemic buying patterns, leaving retail giants buried in merchandise and declining sales. Fused with U.S. inflation rates at their highest since 1981 and the price of diesel reaching record prices, retailers have been forced to get creative to offset the costs.
    Cut to new pickup, fuel, and late fees.
    The Increasing Cost of CPU
    Suppliers in business with big box retailers are now at the mercy of paying more for pickup, fuel, and late fees. Shipments will be fined if they are subpar, like defective or miscounted products, and received late. Vendors are also being charged a fuel surcharge based on daily fuel price changes that are matched against the location and shipment, and a “collect pickup charge” calculated as a percentage of the cost of goods received. Now, manufacturers and brands who have already entered into product order agreements must shift their own budget to account for these unforeseen charges.
    But is a customer pickup (CPU) service the only option for shippers? No. Nor is it the best.
    Suppliers opt into a CPU service initially thinking they’ve escaped the headache that comes with coordinating shipping and logistics. However, that’s not the case. CPU arrangements mean brands surrender control over logistics operations, lose visibility over freight that can cause service failures and incur extra fines and fees. These partnerships that are supposed to help alleviate stressors can actually tank a brand’s gross profit.
    Why CPU Arrangements Don’t Benefit CPG Brands
    In a CPU arrangement with big retailers, service is bound to fail. Pickups are scheduled according to the convenience of their own transportation network, not necessarily what works for the brand. Without brands being able to set the appointment themselves, they lose the ability to set and monitor when a truck will arrive for their order. This can cause a chain of unfortunate events: not having enough lead time to prepare a smooth delivery could force the carrier to leave the product and require a reschedule, resulting in missed appointment times. These appointment misfires are always the vendor’s responsibility when working with a distributor, even in CPU arrangements. Companies will be fined by the distributor as well as tasked with finding a delivery alternative.
    Consistently missing appointments, even as a result of poorly coordinated customer pickups, can also jeopardize a brand’s shelf space on store shelves. Consider the direct hit a brand’s gross margin takes when their product is out-of-stock and replaced by a competitor.
    On top of that, brands will need to pay for warehousing space while waiting for a new pickup. This can sometimes take weeks or even months before a new pickup is arranged, which can throw production facilities and supply chain flow into misalignment.
    How to Preserve and Improve Relationships With Retail Partners
    It’s important to strategize for the inevitable: fees upon fees will continue to increase as long as big box retailers have the upper hand. To set your brand up for success and avoid ruining retail relationships and losing contracts, consider the following options to own your logistics efforts and get your product on the shelves efficiently:
    ·       Work with a third-party logistics (3PL) provider that specializes in retail logistics solutions and consumer packaged goods (CPG) brand shipping exclusively
    ·       Deliver on schedule for must-arrive-by-dates (MABDs) and appointments
    ·       Over-communicate with any partners in your supply chain of command
    ·       Meet retail compliance expectations
    Why a 3PL?
    In today’s world, forward-thinking retailers and brands need to look at optimizing their supply chains differently. No longer can logistics be looked at as an expense. Vendors that view logistics as an investment, on which they can eventually see a return, stand to fare better. They can expect to improve organizational performance and subsequently their retail relationships, which can be vital in unlocking untapped growth.
    Brands need to consider logistics providers that take a consultative approach to service. This looks like locating improvement areas and making suggestions that can increase performance, lowering costs in the process. With a deep understanding of complex supply chain functions and specialized industry knowledge, the best providers can help enterprises better understand how their operation needs to perform to meet customer demand and cut costs in the process.
    A logistics provider equipped with the latest shipping technology can make distribution network suggestions that can reduce overall spending and improve on-time percentages, like consolidation programs or warehouse reconfigurations.
    As the retail industry continues to evolve and react to economic issues, it’s important that brands and manufacturers evolve and react alongside it. Taking ownership of logistics means companies can eliminate unnecessary fines, lost shelf space and sweeping reactionary changes, and shift their focus to continue driving results and accelerating growth.
    Dominate Your Category with Zipline Logistics
    Looking for a logistics partner to help you do that? Look no further. Zipline is here to help you take your logistics strategy to the next level.
    Our stats:
    ·       15 years exclusively serving CPG brands
    ·       95 percent on-time in-full (OTIF) average for appointment
    ·       97 percent of our shipments are destined to land on a retail shelf
    ·       Customer satisfaction score ranking 5x the industry average
    ·       Top shipping locations: Walmart, Costco, Bath & Body Works, Whole Foods, and Best Buy
    This article was originally published on Supply & Demand Chain Executive.
    GIVE ZIPLINE A TRY
    Andrew Lynch is President and co-founder of Zipline Logistics, an award-winning North American 3PL that specializes exclusively in the transportation of retail consumer goods. He works alongside clients ranging from some of the largest food and beverage businesses in the world to the brightest up-and-coming CPG brands in North America. Lynch and his team leverage data intelligence and strong industry relationships to help clients uncover transportation savings, build scalable supply chain strategies, and ace retailer compliance programs. Starting his career in carrier procurement and management within a Fortune 100 logistics company, Lynch has held positions of responsibility in all areas of third party logistics. 

    George Hajjar
    Specialty Food makers and buyers have had to navigate dramatic changes in the specialty food industry and the U.S. economy while continuing to produce and sell products. We interviewed several industry professionals as part of the recently released annual research, State of the Specialty Food Industry + 10-Year Category Tracking and Forecasts. You can find full video interviews when purchasing this year’s report.
    Following is advice from makers and buyers to help members of the specialty food industry stay afloat and thrive.
    · “People’s  budgets are going to get tight. So, [brands] need to make sure they have an offering for those folks that might be looking for a more economical choice.”—Beth Haley, VP of vendor relations, DPI
    · “There is a real opportunity to rethink how you’re differentiated… You can look at that from a whole new lens now in terms of behaviors [and] new normals.”—Patti Doyle, CEO, Rumi Spice
    · “There are important things that are becoming table stakes like sustainability [and] making sure that products aren’t doing more harm than good for the environment. I do think that’s important as people develop products and take them to market. It’s just an expectation for certain generations.”—Cassy Kehoe, senior fresh category manager, KeHE
    · “I joke to people all the time that food people are the best people. We’re reasonable and understanding, and the instinct is to be helpful. If we can lean in on that, we’ll get through the nonsense.”—Kate Harper, chief brand curator, Hive Brands
    · “Consumers are looking for brands that resonate with them and their core values… Make sure that you are connecting with your consumer base in a way that is authentic to you.”—Jeremy Adams, senior center store category manager, KeHE

    Andrew Lynch
    What a whirlwind the 2022 Freight Market was – we saw inflation, fuel prices, and freight rates hit record highs. As we begin the first quarter of the new year, the market is softening and offering shippers relief.
    Economic Factors
    Inflation
    According to Forbes, many inflated costs finally began declining in November 2022 like the price of energy, medical costs, airfares, and used cars. The U.S. inflation rate is sitting at 7.1 percent as we close out Q4 — which is quite an improvement from the peak 9.1% we faced in June of 2022.
    Fuel Prices
    Prices were up and down throughout Q4, peaking at $5.341 towards the end of October. As of December 26, 2022, the average price of diesel is $4.537, the lowest since February 2022.
    COVID-19
    Following November protests against strict COVID-19 policies, the Chinese government relaxed many of its restrictions like mass testing, quarantining in state-sanctioned facilities, and electronic contact tracing and surveillance. 
    Now there is a giant wave of a COVID subvariant sweeping China. Experts predict hundreds of millions are infected and more than one million have died.
    China is the world’s largest producer and exporter of consumer goods. Disruptions across the Chinese manufacturing sector are likely to impact the global supply chain of goods and the world’s economy.
    Russian-Ukrainian War
    The Russian-Ukrainian War continues to rage on 10 months later. 
    American businesses depend on Russia and Ukraine for a plethora of commodities. According to data from the Observatory of Economic Complexity, four critical commodities — neon gas, palladium, platinum, and pig iron — are in short supply.
    An analysis by SupplyChainBrain estimates these shortages will have a direct impact on approximately 12% of the U.S. economy.
    Freight Market
    California’s AB5
    AB5 has the potential to destabilize the trucking market in California, which can create a variety of issues for shippers moving freight in and out of the state. Capacity could suffer a blow if a significant number of truckers decide to leave California. Rates could also rise if carrier expenses increase to compensate drivers as full-time employees. 
    Most recently, a federal district court in California announced it won’t hold a hearing to block AB5 until May. In other words, enforcement of AB5 will remain in effect until then.
    Learn more.
    NMFC Changes
    The NMFTA issued several NMFC changes in August 2022. It’s super important to communicate NMFC updates with your organization and prepare accordingly, as these changes affect your shipping class and therefore, your less-than-truckload (LTL) rates. 
    Learn more.
    Railroad Strike
    For the last several months, large railroad labor unions were poised to go on strike in order to be granted better quality of life conditions, mainly more time off. Some railroads use a points-based attendance system that puts workers on call for 12 hours a day and penalizes them for sick or vacation days. 
    A rail strike could have frozen almost 30% of U.S. cargo shipments by weight, stoked already surging inflation, cost the American economy as much as $2 billion per day, and stranded millions of rail passengers. On December 2, 2022, President Biden signed a bill that blocked a strike from happening.
    Ports
    Ocean shipping rates have cooled from record highs hit during the pandemic. At its peak in mid-September 2021, the average rate to secure a container on a ship from Asia to the U.S. West Coast reached $20,586. By contrast, the average price for a freight container in mid-December 2022 was $2,127.
    LTL
    Carriers will be soon be releasing their first general rate increases (GRIs) of the year. This means they will apply an even percentage uplift to blanket rates to match their increased operating costs. Zipline experts predict GRIs will not be significant as last year’s increases due to the market softening.
    Volumes, Rejections, and Rates
    As volumes decline leading up to the holidays, carriers are rejecting less tenders in order to keep freight moving before much of the industry shuts their doors for Christmas and the New Year.


     
    The charts above depict national average outbound tender volumes and rejections in the United States. Derived from FreightWaves SONAR.
    Both dry van spot rates and contract rates seem to have stabilized after a turbulent year. Closing out 2022, dry van spot rates are sitting right below $2.50 per mile and contract rates are just above $3.00 per mile.

    The chart above depicts national average line haul rates and fuel surcharges for vans in the past 13 months. Derived from DAT RateView.
    We’re seeing a similar story with reefer rates. Closing out 2022, reefer spot rates are sitting right below $3.00 per mile and contract rates are just above $3.00 per mile.

    The chart above depicts national average line haul rates and fuel surcharges for reefers in the past 13 months. Derived from DAT RateView.
    Retailers
    Out-of-Stocks
    Based on IRI data, the beverage industry was out-of-stock on average 11 percent in December 2022. In just one category – we’ll use juice as an example – that equates to $52.76 Million in revenue opportunity cost left on the shelf in just ONE week.  
    Similarly, the packaged food industry was out-of-stock on average 18% in December 2022. In just one category – we’ll use candy as an example – that equates to $618.58 Million in revenue opportunity cost left on the shelf in just ONE week.  
    Learn more. 
    Retail Buyer Data
    Even in a soft freight market, retailers are being picky with the brands they choose to work with. In a survey of retail buyers, 90 percent said a supplier’s ability to deliver on time impacts their purchasing behavior of that brand and 66 percent have ended relationships with suppliers over delivery issues.
    Learn more.  
    Navigating the Freight Market
    Regardless of an always changing freight market, CPG suppliers focused on logistics partnerships rather than freight transactions will be the real winners in 2023. Believe it or not, there are still many aspects of your supply chain that you can control with industry experts on your side.   
    At Zipline Logistics, we care about each CPG brand’s unique business needs and tailor strategies to reduce overall logistics spend, optimize retail performance, and beat out the competition for shelf space. Zipline processes were built specifically to resolve the most critical logistics challenges faced by consumer goods brands shipping into retail.  
    We tailor strategies to reduce overall transportation spend, optimize retail performance, and beat out the competition for shelf space. 97 percent of our orders end up on retailer’s shelves such as Walmart, Costco, Bath & Body Works, Whole Foods, and Best Buy.  
    Don’t Miss the Next Freight Market Update  
    Want the inside scoop on breaking news and trends? Sign up for Zipline’s monthly e-newsletter so you don’t miss the next freight market update!  
    SIGN UP NOW
    Andrew Lynch is President and co-founder of Zipline Logistics, an award-winning North American 3PL that specializes exclusively in the transportation of retail consumer goods. He works alongside clients ranging from some of the largest food and beverage businesses in the world to the brightest up-and-coming CPG brands in North America. Lynch and his team leverage data intelligence and strong industry relationships to help clients uncover transportation savings, build scalable supply chain strategies, and ace retailer compliance programs. Starting his career in carrier procurement and management within a Fortune 100 logistics company, Lynch has held positions of responsibility in all areas of third party logistics. 

    George Hajjar
    Specialty food makers have recently seen many opportunities to innovate their products or operations, and buyers continue to capitalize on innovative trends. We interviewed several industry professionals as part of the recently released annual research, State of the Specialty Food Industry + 10-Year Category Tracking and Forecasts. You can find full video interviews when purchasing this year’s report.
    Following are responses from makers and buyers regarding innovations businesses seek to explore and capitalize on.
    · “We’re really focused on tapping into the new usage occasions when we think of consumer behavior and consumer needs.”—Patti Doyle, CEO, Rumi Spice
    · “From a category management perspective, innovation is a top priority…[One example] is blurred diet lines. Two or three years ago, it was specifically vegan or paleo or keto, but now it has become consumers generally trying to eat healthier. There are so many different ways to do that now.”—Jeremy Adams, senior center store category manager, KeHE
    · “I am curious to see how [innovation] will look in light of what’s going on with the economy. Are people going to start trading down a little bit and will that have an impact on innovation or is that just going to create a different type of innovation?”—Beth Haley, VP vendor relations, DPI
    · “There’s a lot of innovation in food right now around form and format, and how people are consuming. When I think about alternative meat, we are seeing so many new things hitting the marketplace, like chicken. There are so many opportunities to be eating a plant-based product that feels like a chicken nugget, or feels like a patty.”—Cassy Kehoe, senior fresh category manager, KeHE
    · “People are really leaning in, and more open-minded to the innovation in the hemp side than I thought they would be. And buyers love it… Our innovation right now outside of product innovation is how do we get creative about communicating it to the customer, and really deepening relationships with the customer so that we can find out what flavors they want.”—Tonia Farman, co-founder/CEO, Queen of Hearts

    George Hajjar
    The most popular articles with SFA News Daily readers in December focused on store openings, forward-looking trends, and retrospective consumer behavior reports. In case you missed it, the following were the top five most read stories in December:
    1. Whole Foods Plans NYC Opening
    The store is located in New York City’s Financial District and will feature more than 1,000 local items from the city and surrounding area.
    2. KeHE Releases 2023 Trend Report
    The company identified a shift toward consumers seeking a sustainable lifestyle, finding that 68 percent of consumers agree that taking measures to help the environment makes them feel happy. They also found that consumers are becoming more conscious of what they put in their bodies.
    3. FreshDirect Shares 2023 Food Trends
    The company has found that DIY experiences have resonated with consumers and will continue to do so into the new year. Social media has increased the popularity of do-it-yourself items such as butter boards, which have given way to artistically decorated breakfast and dessert boards.
    4. The Fresh Market Unveils 2023 Food Trends
    The company spotted food trends involved with the following: new global flavors, plant-based eating, natural and functional foods, Mexican cuisine, and climatarian eating.
    5. Grubhub Reveals Ordering Trends
    Burritos were the most ordered item on the platform, jumping from the eighth most ordered in 2021. Over four million orders including burritos were filled throughout the year. They were followed in popularity by cheeseburgers, cheese pizzas, pad Thai, chicken quesadillas, California rolls, fried chicken sandwiches, Caesar salads, chicken tikka masala, and boneless wings.

    Andrew Lynch
    It’s the most wonderful time of the year!
    . . . But maybe not always for shippers.
    During the holiday season, we usually see tighter capacity and slightly higher rates as shipping volumes increase. This can lead to service failures, lost sales, and retailer chargebacks.
    Service Failures Abound During Holiday Shipping
    Heading into this holiday season, consumer demand has softened and inventory levels are higher than they’ve been in years. However, many consumers have cash to spend and are eager to splurge, despite their concerns about inflation. McKinsey’s latest Consumer Pulse Survey indicates 55 percent of Americans are excited to shop for the holidays and that 56 percent already started shopping in October.
    Many consumer-packaged goods (CPG) brands rely on the holiday season for a decent chunk of their revenue. In turn, most ramp up their production and supply efforts during this time of year, meaning more freight orders will need to be fulfilled.
    Because carriers limit their hours to accommodate drivers and families around the holidays, they must complete more hauls with less available service days. Most are also closed for Thanksgiving and operate on reduced hours the day before and after. The same goes for Christmas, which noticeably shrinks available capacity for your freight.  To complicate the situation further, increased demand for freight services and increased orders during peak means carriers often overcommit.
    This can lead to service failures as they scramble to cover the increased volume, which equals freight left on the dock, missed deliveries, lost sales, and retailer chargebacks. This is rather problematic when it comes to fulfilling POs, particularly during the busiest shopping season of the year.
    Prepare Your Supply Chain for the Holidays
    To combat peak disruption, we’ve put together six ways to prepare your supply chain for peak holiday disruption.
    1. Overcommunicate
    This is a major key to thriving during the holiday season. Understand your freight needs and determine the amount of freight you plan to ship. Then share that information with your transportation partners far in advance. This will allow you to lock in capacity and properly schedule freight pickups and deliveries.
    2. Build in Extra Time
    Waiting until the last minute is never a sound decision in the world of logistics, but it’s an even worse one during a holiday season facing limited capacity, weather delays, carrier issues, and other unforeseen seasonal events.
    There’s nothing worse than having empty shelves leading up to Christmas. Zipline’s less-than-truckload experts recommend building in an additional two days of transit around your key dates in the holiday season. This provides an adequate buffer for problem-solving, if needed. 
    Additionally, if you fail to give your transportation partner ample lead time, you are bound to pay for it. Urgent holiday deliveries come with a substantial spike in rates and scarce capacity. Working ahead is one of the most important things you can do to keep costs down and hit delivery standards.
    3. Know Carrier Holiday Service Schedules
    Every carrier sets their own holiday schedule. Don’t get caught assuming a carrier is up and running when they may be taking time off. Many have limited operations leading up to and following a major holiday, meaning they may perform minimal line-haul services and very limited pickup and delivery services. A 3PL partner should help gather and share these operational deadlines on your behalf.
    4. Prepare for Known Holiday Surcharges
    Because of increased volumes and demand for quick turnaround, many parcel carriers automatically increase their rates during the holidays. This is particularly true for UPS and FedEx, who add peak charges from October to January. Budget for slightly higher parcel shipping costs to match the influx of holiday demand. Or like many shippers choose to do, move your larger volumes prior to the holiday peak.
    If you have enough volume, you can also opt to move your parcel shipments over to LTL during holiday peak and surpass the increase in rates. Depending on your minimum order quantities, this could help you lock in savings.
    5. Ensure Order Visibility
    Track your shipments so you always know where your orders are during the hectic holiday shipping season.
    Luckily, in today’s technology rich freight environment, you have numerous options:
    ·       Add a pallet tracker to your shipments and follow along with updates.
    ·       Request that drivers use GPS tracking.
    ·       Ask your 3PL partner what visibility tools they have available. Zipline Logistics’ Summit platform shows you real-time updates from GPS trackers and communication with carriers.
    6. Work with Retail Logistics Experts
    Partnering with a logistics firm that understands the complex, nuanced world of retail shipping will drastically improve your chances of success during the holidays. A retail-specialized transportation partner can pair your freight with a vast network of preferred carriers that understand the delivery needs of the nation’s most challenging receivers.
    Trusting Zipline Logistics = Holiday Shipping Success
    Zipline Logistics is comprised of retail logistics experts who help CPG shippers master transportation into retail locations during the holidays. Our retail-trained operations teams and people-first culture help CPG shippers hit on-time delivery standards and achieve optimal outcomes.
    Need help with your holiday shipping?
    Win The Holidays With Zipline 🎁
    Andrew Lynch is President and co-founder of Zipline Logistics, an award-winning North American 3PL that specializes exclusively in the transportation of retail consumer goods. He works alongside clients ranging from some of the largest food and beverage businesses in the world to the brightest up-and-coming CPG brands in North America. Lynch and his team leverage data intelligence and strong industry relationships to help clients uncover transportation savings, build scalable supply chain strategies, and ace retailer compliance programs. Starting his career in carrier procurement and management within a Fortune 100 logistics company, Lynch has held positions of responsibility in all areas of third party logistics. 

    George Hajjar
    SFA’s Spill & Dish: A Specialty Food Association podcast features the stories of SFA members: the entrepreneurs, makers, and buyers behind specialty foods and beverages. Listeners can discover the inspiration, recipe, craft, culture, ingredients, and production methods that make specialty food special and get a deeper understanding of the people and motivation behind the products.
    During the podcast, the SFA asks its guests how the SFA helps benefit their business. Following are some replies.
    “The ability to connect with other brands, with suppliers, with customers. We were really struggling during COVID…[the SFA] facilitates those connections and its invaluable for growing our brand.”—Henry Kasindorf, co-founder, Remedy Organics
    “My favorite thing has to be the food shows…We have met some really great retailers and other founders here. I am super excited to continue doing Fancy Food Shows.”—Lin Jiang, founder, Yishi Foods
    “There are so many benefits. Even just displaying products at the Fancy Food Show, you get so much exposure, and we get a lot of support from Specialty Food [Association] as well. Specialty Food [Association] has built this community, basically, so we are very thankful to be a part of it.”—Chitra Agrawal, founder, Brooklyn Delhi
    “Making connections. We made a connection at the Winter Fancy Food Show that ended up [leading to] a wonderful connection with a retailer that is now starting to bring in our products. It’s an opportunity to meet with other like-minded businesses and help each other out.”—Kristie Middleton, founder, Rebellyous
    “The resources that the SFA provides. There is a lot more than there used to be, which we really appreciate as manufacturers.”—Alexandra Groezinger, president, Alexian Pate
    “I like the opportunity to network. It seems like an endless opportunity.”—Ray Dukes, co-founder, Rosella Bakes Goods
    “The SFA provided a platform for minority-owned businesses at their show, and we had a center platform. It was the opportunity of a lifetime because I got to meet hundreds and thousands of buyers. That’s not just something you get on a regular day."—Thereasa Black, founder, Bon Appésweet
    “The Specialty Food Association allows companies to post press releases. It’s been a really great way for us to get our brand out there and raise awareness about what we’re doing on a limited budget.”—Caroline Cotto, co-founder and COO, Renewal Mill

    Andrew Lynch
    Another dynamic quarter in the freight market has come and gone. In Q3, CPG brands and their supply chains have been impacted by an extremely inflated economy, newly implemented bills and freight regulations, and shifts in retailer requirements.
    Here’s a recap of the quarter broken down by these factors and what shippers should expect in the final quarter of 2022.
    Economic Factors
    Inflation
    The U.S. inflation rate is ever-so-slowly starting to fall after it reached a record high of 9.1 percent at the end of Q2. Now closing out Q3, the rate is sitting at 8.3 percent. The OECD predicts inflation may fall to as low as 4.4 percent by 2023.
    Fuel Prices
    The average price of diesel in the U.S. peaked in June 2022 at $5.750 per gallon. At the time of writing, it is sitting around $4.889/gal.
    COVID-19
    Experts estimate that nearly the entire U.S. population now has at least some immunity through vaccination, previous infection, or both. In turn, the CDC has ended social distancing and quarantine recommendations.
    Although we’ve said goodbye to these precautions (hopefully) for good, there are still lasting effects on the global supply chain. While there has certainly been improvement in each area, neither labor force shortages, nor port backlogs, nor inflation have returned to pre-pandemic levels.
    Russian-Ukrainian War
    As the war continues to rage on nearly 7 months in, the latest update is that Russia is losing heavily and unexpectedly. Ukrainian forces have recaptured 6,000 square kilometers in the country’s south and east. The big concern is that Russia recently threatened to use nuclear weapons in the fight.
    At the beginning of the war, the global economy suffered a knee-jerk reaction that impeded the flow of goods, fueling dramatic cost increases and product shortages. Today, those initial effects are subsiding greatly in the U.S.
    Freight Market
    California’s AB5  
    AB5 has the potential to destabilize the trucking market in California, which can create a variety of issues for shippers moving freight in and out of the state. Capacity could suffer a blow if a significant number of truckers decide to leave California. Rates could also rise if carrier expenses increase to compensate drivers as full-time employees.
    There were owner-operator protests against AB5 in early July, which halted operations at the ports of Los Angeles and Long Beach. There is a strong likelihood that protests of this nature will continue and cause additional supply chain disruptions in the future. 
    Some experts predict that the major, lasting effects of AB5 will become more apparent in early 2023.
    Learn more.
    NMFC Changes
    The NMFTA has issued several NMFC changes that went into effect on August 13, 2022. It’s super important to communicate NMFC updates with your organization and prepare accordingly, as these changes affect your shipping class and therefore, your less-than-truckload (LTL) rates.
    Learn more.
    Railroad Strike
    Large railroad labor unions were poised to go on strike in order to be granted better quality of life conditions, mainly more time off. Some railroads use a points-based attendance system that puts workers on call for 12 hours a day and penalizes them for sick or vacation days.
    A strike would have shut down 7,000 daily trains and cause shortages, shutdowns, and price hikes across sectors. This would ultimately cost the economy about $2 billion per day.
    At the time of writing, the strike has been held at bay after a five-year deal was announced. Under these terms, which is retroactive to 2020, workers will receive a 24 percent pay increase and $5,000 in bonuses. Railroads also promised to ease scheduling policies, but have not offered paid sick leave or more time off.
    Ports
    Ocean shipping rates on major trade routes have fallen by more than half since the beginning of 2022. This is a potential sign of easing inflation pressures and alleviated supply chain backlogs.
    Hurricane Season
    Hurricanes are another thing that can affect your supply chain this quarter, especially now as we enter peak months of the Atlantic Hurricane Season. 
    Although the season was originally off to a slow start, major hurricanes are now beginning to roll in. Hurricane Fiona recently wreaked havoc in the Caribbean, namely in Puerto Rico and the Dominican Republic. Not long after, Hurricane Ian hit Cuba and mandatory evacuations took place in Florida.
     
    Regardless of what happens next, it’s critical to explore how you can prepare your supply chain to brace for incoming hurricanes.
    Learn more.
    Volumes, Rejections, and Rates

     
    Volumes and rejections are both down year over year. Dry van spot rates are flat month over month but down 22 percent year over year. Volumes are near 2018 levels, which is the lowest they have been since they shot up in 2020 due to the pandemic. Due to strong inventories and a lack of demand, volume is predicted to fall another 5-10 percent in Q4.

    The average rate per mile (RPM) peaked in early 2022 and has been steadily declining since. Heading into Q4, the dry van RPM is sitting around $2.62 and the reefer RPM is about $3.06.
    Hot markets include SoCal, the Northeast, and Central Ohio. As Christmas tree season approaches, inbound rates in Washington and Oregon will likely go down as outbound rates go up.
    Retailers
    Out-of-Stocks
    Based on IRI data, the beverage industry was out of stock an average of 12 percent in August 2022. In just one category– we’ll use carbonated beverages as an example–that equates to $340.41 Million in revenue opportunity cost left on the shelf in just ONE week. 
    Similarly, the packaged food industry was out of stock an average of 10 percent in August. In just one category–we’ll use candy as an example–that equates to $343.65 Million in revenue opportunity cost left on the shelf in just ONE week. 
    Learn more.
    New Walmart Customer Pick-Up (CPU) Fees
    Walmart recently began charging some suppliers new pickup and fuel fees, starting August 1, 2022.
    Some shippers who already have product order agreements in place with Walmart are frustrated by this change. However, the good news is that CPU is not the only (nor the best) option for shippers anyway. Switching to delivered pricing will be the lowest effort and highest return adjustment you make in 2022.
    Learn more.
    Retail Buyers & Holiday Shopping
    Especially as the holiday season is approaching, retailers are being picky with the brands they choose to work with. In a survey of retail buyers, 90 percent said a supplier’s ability to deliver on time impacts their purchasing behavior of that brand and 66 percent have ended relationships with suppliers over delivery issues.
    Learn more.
    Navigate the Freight Market with the Best in the Biz
    Regardless of an always changing freight market, CPG suppliers focused on logistics partnerships rather than freight transactions will be the real winners in 2022. Believe it or not, there are still many aspects of your supply chain that you can control with industry experts on your side.  
    At Zipline Logistics, we care about each CPG brand’s unique business needs and tailor strategies to reduce overall logistics spend, optimize retail performance, and beat out the competition for shelf space. Zipline processes were built specifically to resolve the most critical logistics challenges faced by consumer goods brands shipping into retail. 
    We tailor strategies to reduce overall transportation spend, optimize retail performance, and beat out the competition for shelf space. 97 percent of our orders end up on retailer’s shelves such as Walmart, Costco, Bath & Body Works, Whole Foods, and Best Buy. 
    Don’t Miss the Next Freight Market Update 
    Want the inside scoop on breaking news and trends? Sign up for Zipline’s monthly e-newsletter so you don’t miss the next freight market update! 
    SIGN UP NOW
    Andrew Lynch is President and co-founder of Zipline Logistics, an award-winning North American 3PL that specializes exclusively in the transportation of retail consumer goods. He works alongside clients ranging from some of the largest food and beverage businesses in the world to the brightest up-and-coming CPG brands in North America. Lynch and his team leverage data intelligence and strong industry relationships to help clients uncover transportation savings, build scalable supply chain strategies, and ace retailer compliance programs. Starting his career in carrier procurement and management within a Fortune 100 logistics company, Lynch has held positions of responsibility in all areas of third party logistics. 

    George Hajjar
    The most popular articles with SFA News Daily readers in October focused on consumer trends, inflation, and the Kroger-Albertsons merger. In case you missed it, the following were the top five most read stories in October:
    1. Slideshow: Whole Foods Forecasts 2023 Trends
    Whole Foods Market unveiled anticipated food trends for 2023. The company is also making a Trends Discovery Box available, featuring 10 items that allow consumers to sample the trends.
    2. SFA Trendspotters Name 2023 Specialty Food Trends
    Alternative seafood, nuanced heat, and naturally occurring sweeteners are among next year’s specialty food trends, according to the Specialty Food Association’s Trendspotter Panel.
    3. Perceived Food Inflation Rate Outpaces Reality
    Americans believe inflation for food-at-home has hit 22.8 percent, 9.7 points higher than the U.S. Bureau of Labor Statistics annual rate of 13.1 percent.
    4. Regulators Seen Studying Kroger-Albertsons Merger
    Cincinnati-based Kroger Co. will likely face market-by-market scrutiny from federal regulators in its proposed merger with Boise-based Albertsons Cos., as the two companies have significant overlap and would gain considerable clout in the market.
    5. Vongerichten Brings Global Influences to NYC Food Hall
    Chef Jean-Georges Vongerichten has opened a multi-restaurant culinary marketplace/food hall at the Seaport on Pier 17 in Manhattan, the former home of the Fulton Fish Market.

    George Hajjar
    Attorney, naval officer, and founder of Bon Appésweet Thereasa Black created the brand for her toddler daughter who fell in love with dessert while Black was deployed. Since many sweets contain allergens that Black’s daughter needed to avoid, she set out to create a better-for-you chocolate bar and brand. In this episode, George Hajjar, associate editor at SFA, talks with Black about her journey as a Black, veteran, specialty food business owner and her recent successes.

    George Hajjar
    Specialty food makers and buyers are uniquely positioned to notice and understand shifting consumer behavior elicited by the COVID pandemic. We interviewed several industry professionals as part of the recently released annual research, State of the Specialty Food Industry + 10-Year Category Tracking and Forecasts. You can find full video interviews when purchasing this year’s report.
    Following is a list of responses from makers and buyers regarding the effects that the pandemic has had on consumer behavior and purchasing patterns.
    “People have definitely started looking at food as medicine more.”—Tonia Farman, co-founder/CEO, Queen of Hearts
    “It has opened the door for natural organic specialty products…we’re seeing much more educated shoppers from that perspective. Beyond health, they’re looking for more personalized choices. If you think about taste, lifestyle convenience, there are so many things going on since COVID that are driving some of that consumer behavior.”—Jeremy Adams, senior center store category manager, KeHE
    “What we’re seeing is a high comfort level with experimentation [in the kitchen], whether it comes to techniques, flavors, and even maybe types of food they may have not had. We are seeing that theme of experimentation as a big trend in consumer behavior.”—Patti Doyle, CEO, Rumi Spice
    “I look at center store as wanting to create a destination that brings people back to the table, so…we build our curated offering around that. There are certain impulse categories—snacks, beverages, bars, yogurt—that tie into that shopping experience. Those areas are all starting to come back up.”—Dwight Richard, director of center store, Town & Country
    “Indulgence is king. It’s one of those things that’s pandemic-proof and inflation-proof. People are always going to want to be surprised and delighted…So I think meeting that need is very important for us. There’s just a lot more curiosity coming from consumers when it comes to food or ingredients.”—Pierre Jamet, chief sales officer, Petit Pot
    “Charcuterie and entertaining will come back on the scene pretty strong because it obviously took a little bit of a dip as people weren’t entertaining as much….We’re also seeing a lot of spices and worldly kind of recipes where people are trying and tapping into different ethnic types of foods.”—Cassy Kehoe, senior fresh category manager, KeHE
    “We want what we want and we want it now, and we don’t want to have to go out and get it, so services like DoorDash and grocery delivery we find to be very convenient and we want to continue doing those things.”—Alexandra Groezinger, president, Alexian Pate

    Julie Gallagher
    Learn more about the people and products in these Q&As with Specialty Food Association member companies.
    What does your company produce? 
    We manufacture Mediterranean condiments with a focus on savory, zesty, and ethnic flavors. We offer savory olive relish, spicy olive medley, lemon & herbs dried black olives, savory berry compote, plant-based Italianaise (a mayonnaise), Taste of Tuscany (dried herbs), puttanesca, and more under development. 
    Did you have a food background before launching your company? 
    No preparation other than learning from my mother and taking various hobby classes. I spent 30 years in public and private K-12 and university education, was a governor's appointee to the State Board of Education, and have a doctorate in leadership. That knowledge will now be used to help me in my business. 
    How did the idea for your product/company come about? 
    It evolved after my retirement from education. 
    Why did you get involved in specialty foods? 
    I’m passionate about food, preparation, entertaining, and the creativity of developing recipes. 
    What is your favorite thing about the specialty food industry? 
    Like-minded people striving hard to create their dreams, sharing similar problems, and having people who walked the walk at my fingertips through the Specialty Food Association. 
    What’s the one piece of advice you’d give a new specialty food business? 
    Never give up! Have perseverance, determination, go beyond expectations, and surround yourself with positive people. Be kind to yourself in your words and actions. Celebrate even the smaller accomplishment. 
    If you weren’t running a food business, what would you be doing? 
    Creating artistic textile quilts ... that I still do in the wee hours of the night. 
    What does specialty mean to you? 
    I see specialty food as dreams of entrepreneurs who created unique foods and beverages that will bring unusual flavors, textures, combinations, immersions, and these products make life deliciously entertaining, just like Calizo. 
     

    Andrew Lynch
    Scored a purchased order from Aldi? Congratulations!
    You must be super excited. But you may also be wondering how you’ll get the shipment there, what you can expect along the way, or how to maximize your success at this retailer.
    Don’t worry. We’ve outlined everything you need to know about shipping to Aldi below.
    Aldi is Not Your Traditional Retailer
    You might be enticed to shop at Aldi if you don’t mind cheaper prices, non-name brand products, and a smaller selection of goods. In order to offer savings to its customers, Aldi uses strategy and innovation to control costs. This approach also applies to its  transportation and supply chain network.
    Whereas most retailers leave it up to suppliers to coordinate transportation with carriers, Aldi is completely different. It actually owns the relationship with third-party logistics (3PL) companies entirely and use the 3PLs in a customer pick-up (CPU) model to collect its suppliers’ shipments for them.
    Aldi has found this to be a cost-effective set up that ultimately gives it the most control of its supply chain. Whereas we would normally discourage a CPU arrangement with a retailer, Aldi suppliers really aren’t given a choice. 
    Purchase Orders
    If Aldi decides it wants your product in its stores, they will send both you and their 3PL of choice a PO. While you’re preparing the order, the 3PL will reach out to your transportation manager (or whoever coordinates shipping) to schedule all the details of a pick-up.
    Aldi will usually send the PO three to five days before its preferred delivery date. We say “preferred” because it really is just a preferred date and is not set in stone. Aldi is super lenient when it comes to meeting due dates and is willing to reschedule if shippers simply cannot meet the date requested.
    This is extremely different from most big-box retailers who will penalize shippers for not meeting on-time in-full requirements and even cut off the relationship when suppliers can’t meet expectations.
    Communication With Aldi
    On the logistics side of things, Aldi’s 3PL partners will handle most communication with the receiver before, during, and after pickup. During transit, any issues or delays will be communicated between the 3PL and Aldi Distribution Center Coordinator.
    On the Aldi side of things, your brand will be given a DC Retail Buyer contact. This will be the person you can direct your non-logistics Aldi questions to. 
    Incorrect Packaging
    Your Aldi contact should go over packaging expectations for your specific product when you first get an order.
    Whereas other retailers may not even accept freight that is damaged, late, or incorrectly packaged, Aldi will. This is not to say shippers won’t be charged for incorrectly packaged freight or pallets that need to be restacked. We’ve seen fines such as $40 per restacked pallet, but charges will vary depending on the offence. 
    Aldi heavily relies on its 3PL partners and their carriers to make sure freight is packaged correctly upon pick-up. If it is not, the 3PL has the right to refuse pick-up or delay transit until the problem has been rectified. 
    If it continues to be an issue and you can’t follow packaging requirements, the 3PL will inform Aldi what’s going on so they don’t take the fall for your errors. After a certain point it won’t be worth it for Aldi to work with you anymore and you will mess up your chances of getting another PO.
    Packaging is arguably the one thing shippers have control over when shipping to Aldi, so make sure you get this step down.
    All in all, Aldi has it set up so that most logistics coordination is totally not your responsibility. That’s a pretty sweet set up if you ask us. It also sounds familiar…
    Why Choose Zipline as Your 3PL?
    Most retailers do not function like Aldi does in any way, especially when it comes to logistics. If you enjoy the hands-off approach they offer shippers, you’re going to love using a 3PL for all your retail shipments.
    If you expand to other retailers after your start at Aldi, consider choosing Zipline Logistics as your transportation partner.
    You might be wondering how we know so much about retailers and how they operate. It’s because we pride ourselves in being a retail-specialized 3PL. While most logistics brokers move everything from scrap metal to machinery, we exclusively ship finished retail goods that need to meet strict delivery requirements. 
    Like we said, other retailers aren’t as forgiving as Aldi. But don’t worry, partnering with a retail-specialized 3PL makes everything easier, way less stressful, and positions you brand to succeed. 
    It’s like the difference between a flashlight and a laser beam. Our specialization allows us to strategically elevate and empower CPG brands to dominate their categories.
    Interested?
    LEARN MORE
     
    Andrew Lynch is President and co-founder of Zipline Logistics, an award-winning North American 3PL that specializes exclusively in the transportation of retail consumer goods. He works alongside clients ranging from some of the largest food and beverage businesses in the world to the brightest up-and-coming CPG brands in North America. Lynch and his team leverage data intelligence and strong industry relationships to help clients uncover transportation savings, build scalable supply chain strategies, and ace retailer compliance programs. Starting his career in carrier procurement and management within a Fortune 100 logistics company, Lynch has held positions of responsibility in all areas of third party logistics. 
     

    Denise Purcell
    The specialty food industry remains resilient despite three years of upheaval, according to the SFA’s just-released research, Today’s Specialty Food Consumer. Consumers reporting specialty food purchase likelihood hit a record-breaking 76 percent. People continue to care more about what they eat, how it is made, where it comes from, who is making it, and how it impacts local and global communities and the environment. 
    Here, we outline the highlights of the report—the who, what, where, when, and why you need to know about specialty food consumers, their drivers, and motivations.
    Who are they? Millennials and Gen-Xs are the core generations, in part because they have the largest family households. Millennials have seen the biggest gains in specialty food purchase likelihood since 2018. Gen-Z is a rising generation and with most now ages 18+, is equal to Gen-X in specialty food purchase likelihood, at 78 percent. Baby boomers are still engaged but show the least purchase likelihood as they ease out of the workforce.
    What do they buy? Last year’s report noted that the supply chain has growth opportunities with specialty beverages, and the sector could be a gateway for consumers, especially Gen-Zs, to broader usage of specialty products. In 2022, we see this happening in beverages and now in the rise of fresh foods (sandwiches, salads, meals) also. The 10 beverage categories saw an increase in in-store purchase likelihood of 4.2 percent during 2020-2022. That’s compared to 0 percent in the 28 food categories. Gen-Zs and Millennials led the charge here. Fresh foods sold in grocery outlets continue to see big gains. People buying these products in-store rose 10 percent during 2020-2022 to 33 percent of SFCs, while the number of online purchasers doubled to 21 percent of SFCs.
    Where do they shop? We know from SFA’s The State of the Specialty Food Industry report, released in June, that about 86 percent of specialty foods are sold in mainstream outlets, such as grocery stores, mass, club, and discounters. The main change in 2022 is that more of the business has shifted away from grocery stores and natural food stores and towards mass, club, and convenience stores. Online shopping continues to soar. Shopping for groceries online flipped from 33 percent of all consumers in January 2020 to 66 percent in July 2022.
    When do they use specialty foods? Use of specialty foods for dinner peaked in 2019 and fell each year to 2022. Breakfast and lunch usage rebounded in 2022 to equal or exceed the 2019 highs. The fact that there is a net decline in usage at the three major mealtimes while purchases overall have grown substantially is evidence that snacks and treats or “non meals” are picking up the slack. Lifestyle changes are driving the shift and innovations in fresh and convenience products are spurring it on.
    Why do they purchase? The top-five purchase motivators remain consistent over the years: superior quality, superior flavor, interesting/unusual flavors, simple ingredients, and authentic global flavors. An additional one—better for the environment—gained the most ground in recent years and is now bumping up against the top five. SFCs care about attributes like organic, sustainable, and upcycled.
    For more highlights, takeaways, and insights from this year’s report, see the Fall issue of Specialty Food magazine. You can also purchase the full report in the Learning Center on specialtyfood.com.


×
×
  • Create New...