Fresh Squeeze: Packaged Goods Retreat at Retail

Wall Street Journal: “ShopRite and other grocery-store chains around the country are building new stores that have less space for traditional packaged foods in the center aisles and more for in-store restaurants and fresh meals shoppers can take home … That means less space for traditional packaged-food brands, which are also facing increased competition from store brands and smaller upstarts.”

“The shift in shopper preferences started several years ago, but its impact on big food makers is intensifying now because of added pressure from retailers. That has exacerbated what has been a drumbeat of bad news for packaged-goods companies grappling with American consumers’ sustained move toward natural, organic foods. A long stretch of falling food prices, fueled by excess supplies of staples like meat and dairy, have also lowered costs for consumers at supermarkets, giving them more reason to choose fresh food over boxed meals.”

“Some brands are seeking ways to get their products into the fresh and prepared foods section of the store … (however) retailers such as Wal-Mart Stores Inc. are pressuring big brands to lower their prices as a way to attract customers. Companies like Hershey and PepsiCo Inc. said they are working with retailers to be creative.” PepsiCo CEO Indra Nooyi comments: “That’s a conversation we’ve been having with some of the retailers, to say ‘how can we help you rethink the center store so that we can bring growth back … Our hope is that with the rejuvenation of the center store, our categories will grow, too.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Greats Sneakers Pop-Ups: All You Need is Wi-Fi

Wall Street Journal: “Greats, an online sneaker brand founded in 2013, plans to open at least 10 locations over the next two years by signing short-term leases ranging from three months to one year … The Brooklyn-based brand, which sells sneakers ranging from $50 to $200, manufactures most products in Italy and markets them directly to consumers online. It has tested three temporary stores since 2014, most recently a location in Williamsburg, Brooklyn, that was open for one year.”

“Greats is targeting locations between 700 to 1,000 square feet—about the size of a coffee shop—primarily in urban areas. One challenge for online brands is to ensure that new locations increase sales, rather than cannibalize existing business.” However: “Online apparel brands are finding that they don’t need much to set up a store. The evolution of point-of-sales technology means that transactions can now be made on phones and tablets. Some newer retailers don’t even keep much inventory.”

“Greats sells eight core styles of shoes in different colors and materials, making its business more mobile than that of a traditional retailer. At its new locations, the company plans to bring its own interior elements such as shelving, greenery and lighting.” Rachel Ulman of Greats comments: “You can do a lot within four walls. All we really need is some Wi-Fi.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail