The Friday Fishwrap

U.S. Family Dinner Day Celebration Monday, September 24

Monday, September 24 is "Family Day--A day to eat dinner with your children" in the U.S. The event is organized by The National Center on Addiction and Substance Abuse (CASA) at Columbia University in New York City.

First launched in 2001 the annual national Family Day event is designed to remind parents that what their kids really want at the dinner table is them, according to CASA. The celebration is to encourage parents to frequently eat dinner with their kids and be involved in their lives. Family dinners and conversations go hand-in-hand, and having dinner together as a family helps parents learn more about their kids' lives, and better understand the myriad challenges their children face.

Casa launched the Family Day event as a response to the center's research which consistantly found that the more often children eat dinner with their families, the less likely they are to smoke, drink and use drugs. Here are some facts from the center's research. Kids who have 5-7 family dinners with their parents per-week are:

>At a 70% lower risk for substance abuse

>Half as likely to try cigarettes or marijuana

>One-thrid less likely to try alchohol

>Half as likely to get drunk monthly

>Kids who have more frequent dinners with their parents tend to have better grades in school and to confide in their parents more often than those children who don't have frequent family dinners.

These positive findings regarding the importance of spending frequent family dinner time together are just some of the pro-social aspects of eating together as a family that CASA has discovered in their research. You can read about the center's research findings and discover additional information about Family Day here. You can also watch a video presentation of the center's latest study, "The Importance of Family Dinners IV Report" at the site.

Special Family (dinner) Day events are being planned throughout the U.S. for September 24. Additionally, supermarkets, restaurants and other food stores of all sizes are holding promotions for "Family Dinner Day," including sponsorships and donations to non-profit charities and groups.

One major event will be in California, where the state's First Lady Maria Shriver, is joining more than 300 families for dinner at the Tenderloin Community School in San Francisco on September 24. The Tenderloin is an impoverished area in the city where family dinner time can be the exception rather than the norm.

California-based Safeway Stores is the major sponsor of both the California First Lady's dinner with the Tenderloin families and of Family Day in general. The retailer is the "Family Day Research Sponsor," which is the top category of all of the event's major national sponsors. In addition the Safeway Foundation, the chain's philanthropic arm, also is a "Research Sponsor."

Other major food and grocery industry sponsors include: Clorox Company (and its MealsTogether.com program), Kroger Co., General Mills, McDonalds, Shop Rite Supermarkets, Del Monte Foods, The J.M. Smucker Company, Macy's Department Stores, Acosta Sales and Marketing (food broker) and SavingDinner.com. You can read more about the sponsors here.

Safeway is donating $100,000 to CASA to help with its research programs. Safeway also is donating all of the ingredients needed to prepare a complete family meal to all of the 300 families attending the prepared dinner with Ms Shriver. The families will get free take-home bags from the grocer following the dinner. The chain also is sponsoring similar events in Chicago and Washington D.C. This month Safeway launched "Connect Together" a major in-store and online program designed to urge families to connect over meals and activities in order to build stronger families and communities. (See the graphic at left) You can learn more about Safeway's "Connect Together" here.

Consumer packaged goods company Clorox Co. also is providing major support both in California and nationally for Family Day and CASA. The company, via its MealsTogether.com program, is the "Gold" sponsor of "Family Day," second only after Safeway. Clorox, maker of bleach, cleaning products and food brands like Hidden Valley, KC Masterpiece and others, is donating $90,000 to the national Family Day campaign. The company also has launched a program called MealsTogether.com , a website which offers families tips, ideas and resources on how to increase family meal time together. In California, where Clorox has its corporate headquarters, it's hosting the dinner (a BBQ) for the 300 families dining with Ms. Shriver on September 24th. Clorox also owns the Kingsford Charcoal brand.

There are a number of other corporations, businesses and non-profit groups supporting the event headed by California's First Lady Maria Shriver. You can read more about the event and about them here.

Supermarket chain Kroger Co. is a major sponsor of Family Day and CASA. Like Safeway the chain is making a donation to the center and sponsoring related events. Safeway and Kroger, as well as many other food retailers, are promoting family Day family dinners in their stores, in their weekly newspaper circulars and in other print and broadcast media formats. Displays feature all the ingredients to prepare a complete family meal including numerous recipe cards.

Retailers also are featuring lots of prepared foods in Family Day family dinner promotions. Raley's Superstores in California (Raley's Nob Hill Foods, Bel-Air banners) created a full-page insert in its weekly advertising circular devoted to the concept and event. The ad features research findings from CASA on the importance of families eating together along with a handful of prepared foods items, some grocery items on sale along with a couple of recipes using the featured items. The full page advertisement devoted half of its content to the public service aspect of the event and the other half to promoting items.

Ralph's Supermarkets, a Kroger banner, is promoting the event in its Southern California stores and via the media as well, with in-store displays, specials on prepared family meals and basic grocery items. Ralph's is using its weekly advertising circulars to print information from CASA about positive aspects of family meal time. "Sharing meals together as a family is a simple, powerful and effective tool to help children and teens make more positive choices," said Ralph's president Mike Donnelly, in explaining the retailer's support for the event and program.

Other supermarket operators participating and promoting Family Day include Florida-based Publix, Price Chopper Markets, Shop-Rite and Shaw's in the east and New England and others chains and independents throughout the U.S.

Price Chopper is participating with Clorox's MealsTogether.com and the TV Land television network in a multi-media promotion called "The Family Table." TV Land has put together all sorts of resources for families (see the graphic at left) and is conducting promotions with Clorox brands and retailers like Price Chopper an others. (You can get TV Land's Family Table information here. MealsTogether.com information is available here. Price Chopper stores are using the "Family Table" logo in-store to designate all the family meal specials they are featuring throughout the store.

We hope the food and grocery industry not only continues to support Family Day and CASA but also finds even more ways to encourage family mealtime. It is not only in the industry's economic interest to do so it's positive social, community and corporate behavior as well. As CASA's research demonstrates, something as simple as frequent family meal and discussion time can make the difference between a child's doing well, avoiding substance abuse, feeling wanted, and becoming vital member of society. Family Day is a great celebration and we share the goal of making as many days as possible family meal days during each and every week--not just the one beginning on September 24.

Note: Friday Fishwrap will be back to its regular format next week. We wanted to devote our space this week to writing about this important event today since it's on Monday.

Thursday Talking Points Memo

Talking Points Memo Sees Much Promise in Natural Vending

Natural and organic products vending machines offer manufacturers and marketers a retail distribution channel previously not in their arsenal. The channel allows for distribution right to consumers "point of activity." For example, at the office, school, shopping mall, golf course, gym--wherever people are engaged in day-to-day activities. In this lifestyle-sense it's the ultimate impulse channel for marketers who's natural and organic products fit the niche.

The vending machine channel of distribution in the U.S. has historically been primarily a market for what is called "junk food"--sugary sodas and candy bars, salty snacks, candy, cookies and related snack foods, which are tasty and satisfying but contain little or no nourishment.

The vending industry basically has two primary models of ownership and distribution in the U.S. The first is corporate-owned, such as the ubiquitous Coca Cola and Pepsi machines, and independently-owned. These independent owners and distributors are either large vending corporations or smaller, independent operators who can have thousands, hundreds or just a handful of machines and distribution points.

The U.S. vending machine distribution channel is huge. It's currently estimated at about $24 billion annually and growing. Convenience foods and beverages tend to be the most popular and largest segment of vending in the U.S. but numerous other categories and items also are sold via these automatic machines. These categories include cigarettes (a declining segment), toiletries, postage stamps, prepared foods and many others.

New categories also are being added to the vending channel of distribution. For example, a San Francisco, California-based company called ZoomSystems, Inc. has placed luxury vending machines in 20 supermarkets (including Safeway Stores' Vons stores in Southern, California) and a couple airports thus far in the U.S. These machines sell items such as the Apple ipods, digital camcorders and other high-end luxury items. Consumers can pay for the items using a credit card or ATM card.

In Japan consumers can buy a variety of goods in vending machines. Far left to right: A rice vending machine in Tokyo, a multi-variety beverage vending machine, and a vending machine offering Buddhist Amulets for sale.

In other countries such as Japan and parts of Europe the vending machine channel of distribution is ubiquitous, not only in terms of the number of machines but also in the number and types of categories and items sold via the machines. For example, there are vending units dedicated to selling rice in various packaged forms, ramon noodles, beer, wine and spirits, multi-assortments of condoms, electronic items and more. There even are vending machines that sell Buddhist amulets in Japan. Japan is the world's leader in automatic vending. We recently saw a ramon noodle vending machine in a Japantown in a large American city and expect to see more adoptions in the U.S. of Japanese vending methods.

This brief history of automatic vending and its current growth gets us to the focus of our piece, which is using the vending machine distribution channel for the sales of natural and organic products. To date the vending channel has been very minor for these categories not only in the U.S. but internationally. That's beginning to change however with a few recent major developments.

The first major development began about 5 years ago when smaller, independent vending machine distributors began offering selections of natural and organic beverages and snacks in some of their machines. Many did this because people in the places where their machines are located--gyms, offices and the like--began requesting healthier alternatives. Since these entrepreneurs are smaller and independent they could respond fast--and many did so adding some all-natural items to the selections.

We know of one such vending route owner who began doing this about four years ago on a limited scale and was amazed at the sales response. Today he stocks many of his machines, especially those in office buildings and gyms, with natural and organic beverages, snacks and related items. He tells us in many cases the natural items are outselling the more conventional ones.

The second major development towards what we see as just the beginnings of a potential major distribution channel in the making has been the marketing push by a couple of natural foods and beverage makers--yogurt-maker Stoneyfield Farms and White Wave, Inc., maker of Silk Soy Milk and other dairy products--to place all-natural and organic product vending machines in schools and other venues. Both companies began pilot programs about three years ago and continue today. A few others have followed their lead thus far.

Another development which we think holds much promise is the "Yo-Zone" all-natural snack and beverage vending machines recently introduced by San Diego, California-based YoNaturals. These attractive machines aggregate a variety of natural and organic beverages in them and offer consumers a large, varied selection merchandised in an eye catching point-of-purchase unit. It's a vending machine but we also think it looks like a mini retail natural foods store which is excellent merchandising.

The company currently offers over 150 natural and organic items in its inventory. Its selling the machines to individuals or companies in sort of a franchise arrangement in which YoNaturals acts as the marketer and supplier but the distributors are able to run their businesses independently.

In effect, the YoNaturals concept is one of a company acting as the developer, aggregator and marketer, while at the same time letting the actual distribution be done by independent operators. Its similar in many ways to a large, modern, full-service natural and specialty foods distributor who offers everything from mere product-order fullfillment to full-scale

merchandising and marketing programs to retailers.

It's also the historic and current primary model the vending machine industry operates on: Large, medium and small companies owning the vending machines and handling the distribution. Even in the case of Coca Cola and Pepsi the beverage vending machines are owned usually by local bottling companies (rather than the corporations themselves) who handle the product distribution and machine maintenance.

Putting on our industry futurist cap, NSFM's Talking Points Memo can see the natural and organic vending business growing in a number of ways and directions. First, we see consumer demand for natural and organic product vending growing. Consumers are buying natural and organic products in an increasingly voracious way. The industry has grown by about 25% each year for the past seven years. These consumers increasingly want healthy and organic alternatives not only at the grocery store but also at work and other business and leisure venues. Natural and organic food and beverage consumption is becoming part of their lifestyles and they want the products where they are, at the point of their given activity.

Second, we see companies like YoNaturals, who aggregate, market and supply, serving as the catalyst for the vending industry to increase its natural and organic products business and points of distribution. We also see entrepreneurs and existing vending companies partnering with YoNaturals resulting in new distribution.

Third, we see what we call "natural foods corporate partnering" as another way of growing the channel. For example, five or six (or more) natural foods manufacturing companies (a combination of beverage and snack firms for example) could partner together and create a vending machine mix (the machines can be bought) featuring their product lines. This would allow them to pool their resources and share related costs. They could create graphics for the outsides of the machines that not only sell the products inside but advertise their brands as well.

Finally, we see an opportunity for large. traditional natural foods distributors to get in on the vending distribution channel. Folks like United Natural Foods, Inc. and Tree of Life for example. These distribution companies already have the product selection and infrastructure to do so. They could either act as suppliers and marketers in a manner similar to the YoNaturals model (the likely scenario to us) or create their own natural vending divisions and either operate a full-blown natural and organic vending operation or some variant of that using independent distributors.

The primary market in the vending channel for natural and organic products is beverages and snacks, which when you add up all the beverage and snack types and varieties is huge. But we don't think it should (or has to be) limited to just those categories. Rather we see a huge opportunity for non-foods categories such as health & beauty care items, vitamins and supplements and related non-foods segments.

In the food category we also see opportunities for segments other than just snacks and beverages particularly in specific venues. For example, vending-machine size cereals, nut butters and jams and jellies for hotels, schools and offices. Various ready-to-eat items other than snacks also hold great potential in these particular venues and others. In fact as the market grows we see progressive companies even creating new items specifically for the vending channel as conventional food manufacturers currently do.

We like what we're currently seeing in the vending channel in terms of natural and organic products. However, its only the tip of the iceberg, and there are tens of thousands (or more) of venues in the U.S. where such vending machines would do well. Smart strategists, marketers, distributors and merchandisers who realize this growing, untapped market stand to profit from it, especially if they approach it correctly.

Weekly Green Report

Architects Design Vertical Urban Farm, Residencial Building
An urban design firm in Seattle has won a green building award for its combined urban farm and residential building (pictured below), where humans, plants and chickens would live in a combination of green commerce and eco-harmony.

A group of cutting-edge Seattle, Washington architects from the firm Mithun have designed a mixed-use, "eco-friendly" development that combines residential apartments with a vertical urban farm. The ambitious green development is designed for high density cities like Seattle, New York City, San Francisco and others where there is no place to go but up when it comes to residential and commercial development. The combination urban farm and residential building would be build on .72 of an acre of land. The building includes fields for growing vegetables and grains, greenhouses, rooftop gardens and a chicken farm. The building also would completely independent from municipal water according to the designers, providing its own drinking water in part by collecting rain from the building's 31,000 square-foot rooftop collection basin. The rainwater would be treated and recycled on sight. Solar panels and cutting-edge solar technology would be used to produce nearly all of the building's electricity.

The building would house humans along with the chickens and plants. The structure would contain 318 studio, one and two bedroom apartments to house all the potential urban farmers and others. The bottom, entry level of the building would feature a cafe serving organic foods grown on-site in the urban farm. The produce, grains and eggs produced on the would be marketed and sold to local retail foods stores which the designers say would save even more energy in addition to providing a very local food source to the community.

The innovative urban design recently won first prize in the Cascadia Region Green Building Council's Living Building Challenge. The group is a green building organization serving the Pacific Northwest region and British Columbia building design industries.

Bert Gregory, the CEO of the Mithun architecture firm, says "constantly developing creative and challenging ideas is the best way to uncover innovative solutions to today's problems." The ambitious goal of the design is to introduce and integrate crops and animals into an urban skyline as well as into the city itself.

The architects admit this isn't likely to be achieved anytime in the near future. However, the U.S. Census Bureau projects a world population of more than 9.4 billion by 2050, and the majority of these new arrivals will be living in cities. As such, the Mithun design for an integrated, vertical urban farm and residential building doesn't seem all that far-fetched. Nor does it need take decades to be tried in a city like Seattle, where the designers hope to build the first prototype.

More Than a Tree Grows in Brooklyn For This Family

While we're on the topic of urban "eco-farming" we want to introduce you to Manny Howard of Brooklyn, New York. Howard has embarked on an experiment to see if he can feed his family of four out of his backyard Brooklyn garden. Howard was reading various books and articles about the "locavore" (eating local) movement and decided he could do the "buy local" crowd one better--he would feed his family from his urban, backyard farm and reduce the miles his food traveled to just a few feet. A true experiment in green living from a couragous soul.

Howard (that's him pictured at left on his urban farm) describes his adventure in a witty article in New York magazine titled, "My Empire of Dirt." The urban farmer sums up his current experience as follows: "The locavore movement says we should eat what is grown within a few miles of where we live. How about a few feet? (Mine is) an experiment in Brooklyn-style subsistence farming , starring smelly chickens, an angry rabbit, a freak tornado, a vegetable garden to die for, two psyched kids, and a marriage in the weeds." You can read Howard's story here. There's also a link here where you can watch a video tour of Howard's backyard urban farm.

Adam Platt, food critic for New York magazine, has a humorous companion piece to Howard's article called "Local Smocal." It's well worth a read regardless of where you come down on the eating local issue. You can read his piece here.


Industry Green Briefs


Tesco Gets the Fresh & Easy Green Delivery Fleet Ready


The Tesco Fresh & Easy Neighborhood Markets distribution team says it will be using a fleet of green, "eco-friendly" delivery trucks to distribute products from its distribution center in Southern California to its Fresh & Easy stores in California, Nevada and Arizona. The first stores are slated to open in November.


Fresh & Easy Neighborhood Market CEO Tim Mason says the company has worked with the leading companies in green technology to develop and build from the ground-up "an entire fleet of aerodynamic, fuel efficient and neighborhood-conscious trailers in our first round of manufacturing."


The delivery trucks/trailers are designed with new technologies that reduce the use of diesel fuel. The units also are designed to be much quieter than the average delivery truck in order to minimize neighborhood noise. The delivery truck lift gates are designed so that they make very little noise during product unloading. You can read in more detail about the green Fresh & Easy delivery fleet here.


The green fleet is part of Tesco's program to make its entire supply chain--from warehouse and delivery to the stores--green. Their Southern California distribution center is built to strict green building standards and has a large solar power array on the roofs of its six buildings.


The stores currently under construction also are being built to strict green standards and a number of them are said to have solar panels on there roofs. In-store recycling and other environmental practices are detailed in the retailer's handbook which includes a complete green mission section.


Tully's Coffee Chain Switches to Green Paper Cups



Tully's Coffee has become the first retail coffee chain to introduce a fully renewable and compostable paper cup for its hot beverages. Tully's has just began using "Ecotainer Hot Cups," a new product made by International Paper Company. The "eco-cups" are lines with a bioplastic made from corn rather than petrochemicals. The cup is currently the only commercially available available 100% compostable hot cup certified by the Biodegradable Products Institute, an industry certification specialist.



Along with introducing the biodegradable and compostable cups the coffee chain has launched an in-store collection program to divert the used cups and other compostable food waste to organic composting facilities rather than disposing of them in landfills. The first customer for International Paper's "Ecotainer Hot Cup" was the U.S. Army and Navy. Go Army, Go Navy--green leaders.


Specialty Cookie Maker a Green Triple-Threat

The Liz Lovely brand of cookies has acheived a rare green triple-threat. The gourmet, all natural line of cookies has become not only certified organic but also vegan and Fair Trade certified, achieving a green trifecta. The cookie company says it has done its research and the nationally distributed cookie brand is the first of its kind to acquire all three certifications. The cookie line is 100% trans-fat free. You can read more about the triple-certified cookie line and the company here.

Study: Generation Y Shoppers Split on Green Importance

A new survey finds only 50% of generation Y shoppers say that retailers environmental policy and sustainability influence their shopping behavior. The survey by the Maritz market research firm found these young shoppers split right down the middle--half say retailer green policies influence where they shop and the other half says it doesn't matter. When asked to describe their attitude towards a retailers "eco-friendly" positioning , 46% said they'd shop at a retailer more if they were environmentally-friendly, while 54% said it wouldn't alter their behavior.

In terms of actually purchasing products, 47% of the respondents said they would be willing to pay more for "eco-friendly services, products or brands. While one might think the percentages are low for people in the Generation Y age bracket 50% still isn't bad in terms of green attributes having an influence on their shopping behaviors. Psychological studies show behaviors like "pro-environmental" tend to become more demonstrative as people get older, especially when they have children. So the results of the survey aren't a bad start for such a young age cohort.

Green Packaging: Plastic Shopping Bag Bans

The cities of San Francisco and Oakland in California, Baltimore, Maryland and a few others have enacted laws banning the use of plastic grocery or shopping bags in retail stores. Now the city of Louisville, Kentucky (hardly a left wing outpost) is considering such a ban. Metro Council Member Jim King wants a law against the use of all plastic bags unless they are biodegradable. You can read more about this proposed legislation and similar proposals across the country here in this recent (09-07-07) article from the Louisville Courier-Journal.

Outdoor Advertising: Billboards Getting Greener

The billboard industry is making new efforts to become more green and energy efficient. About 170,000 billboards line the freeways and roads across the U.S. And nearly all of these outdoor advertising signs are made out of PVC, which is less than environmentally friendly. An additional 200,000 billboards or more are made made from thick paper panels. Neither PVC or the paper panels are practical to reuse or recycle--hence the crux of the industry's environmental problem.

One company, CBS Outdoor, the second-largest outdoor advertising company in the U.S., plans to remove (and not replace) the PVC from 17,000 of its billboard faces by the end of next year. Another solution which a number of billboard companies are adopting, is a product called "Eco-Flexx," invented by a company called Circle Graphics. The reusable product is made from woven polyethylene and can replaced the one-time use PVC and cardboard. Other billboard companies are experimenting with using thin, light weight sheets of metal, which can be used to replace cardboard and paper.

Lastly, outdoor advertising companies are making a major push to reduce energy use for the billboards the industry lights up at night. They are purchasing more energy efficient lighting fixtures and lights and some companies are experimenting with using renewable solar and wind power to operate the lighted and electronic billboards.

Green Beer: Craft Brewery Goes Solar Powered

By early October Chico, California-based craft brewery Sierra Nevada hopes to be nearly off the power grid. The brewery currently has four high-powered solar cells providing 75% of its electricity and its installing more solar panels so the facility can be as close as possible to 100% solar-powered (and off the grid entirely) when the sun is at its peak. And that is fairly often in Chico, which is located north of Sacramento.

Cheri Chastain, the brewery's sustainability coordinator (yes the have one of those), says she expects the operation will be able to run on at least 80% renewable solar power even on non-peak sunny days, at night or on cloudy days. Chastain reports the brewery is becoming a model of sustainability. In addition to the solar energy program the green brewer focuses on comprehensive recycling, heat recovery, water conservation, carbon-dioxide recovery and more. That's impressive enough to raise a (green) glass of beer to. Salute!

Green Food Retailing Report

Breaking Story: Hannaford to Build New Green Supermarket

Northeastern chain Hannaford Bros. Co. announced today it plans to build the first supermarket in the U.S. that meets the U.S. Green Leadership Council's highest environmental standard. The council is a group that sets standards for green building in the U.S. Hannaford is pursuing the group's platinum designation for its new store, which is the green building organizations highest standard for environmental buildings.

Hanaford's plan calls for such green building concepts for the 49,000 square-foot store as a garden on the roof to add insulation and to be used to control stormwater. Other green features of the proposed new store include the expansive use of solar photovoltaic cells to provide electricity, geothermal (water) heating and cooling, high efficiency refrigeration, energy efficient lighting and a fully-integrated store recycling program in addition to the vegetation-topped roof which would be a part of the stores integrated water recovery and recycling system.

Hannaford is estimating the new store will be 40% more energy efficient than a standard supermarket, according to Megan Hellstedt, the chains sustainability manager.

Scarborough, Main-based Hannaford wants to build the "eco-store" on the former site of Cony High School in Augusta, Maine. The state court is challenging the decision to build on the site however saying the trust of Daniel Cony, the man who gave the land to the school district originally, specifies the site can only be used for education purposes. However, Maine's Governor John Baldacci joined Hannaford CEO Ronald Hodge, other company executives, community members and environmentalists Wednesday at the planned store site to make the announcement. As such it would appear the Governor supports building the green store on the school site.

"The proposed Hannaford market would be the U.S. Green Building Council's first platinum-certified 'green' grocery store in the world," said Hannaford CEO Hodge. The group's system includes ratings of silver, gold and platinum, which is the highest.

It's important to note the fact that the U.S. Green Building Council hasn't yet certified another gorcery store in the world as "platinum" doesn't mean other retailers in other countries aren't building equally green stores. For example, Marks & Spencer (as NSFM has reported) is opening two new "eco-stores" in Scotland next month. UK-based Tesco also has a green store in the works as does the Co-operative Supermarket Group in the UK. Western European and other developed countries have their own green building certification groups. Additionally in countries such as the UK, France and Germany the governments have much stricter green building standards and rules then in the U.S.

However, Hannaford's plans are major not just for green retail store building (and all commercial building) in the U.S. but globally as well. If they build the store the food retailer will be on the cutting edge of green store construction among retailers worldwide.

Hannaford currently operates 160 stores throughout the Northeastern U.S. The chain is owned by Brussels, Belgium-based Delhaize Group, a global retailer with current annual sales of 17.3 billion U.S. If built on the site of the former school the new green strore would replace an older, more conventional store just down the street.

Just last week in an article about the new Marks & Spencer "eco-stores" in Scotland NSFM was asking the question in our conclusion who the first U.S. supermarket chain would be to announce plans for a similarly comprehensive green store in the U.S. It looks like Hannaford Bros. heard us and is providing the answer with its announcement.

Resources: You can visit the Hannaford Bros. website here. You can visit the Delhaize Group website here. Natural~Specialty Foods memo (NSFM) will be covering Hannaford and this development closely and in-depth in the next few days.

Community: Wal-Mart Kicks-Off Kid's Recycling Challenge

Wal-Mart will kick-off its fourth annual "Kid's Recycling Challenge" on October 1rst. Started in 2004, the recycling challenge encourages kids in the communities where the retailer has stores (most of the country) to pick up plastic shopping bags, and turn them into cash as part of a recycling contest.

Wal-Mart partners with schools for the recycling challenge. Participating schools each receive $5.00 from the chain for each 60-gallon collection bag the students fill with plastic shopping and grocery bags and bring to their local Wal-Mart store by March 31, 2008. Additionally, schools are grouped into three regions in the U.S. for the contest part of the challenge. The three schools in each region to bring in the most collection bags full of the plastic shopping bags receive cash prizes. First place is $3,000, second place $2,000, and third place $1,000.

The challenge is designed to teach elementary school students about the importance of recycling while earning money for their schools, according to Wal-Mart. It's also a great opportunity for the chain to spread its green message, eliminate numerous plastic shopping bags with the Wal-Mart name on them from the roadsides, and to show its support for the communities the chain does business in.

Since the recycling challenge began in 2004 students at 2,800 U.S. schools have participated. These student recyclers have recycled more than 1,400 tons of plastic shopping and grocery bags, earning more than $1.2 million from Wal-Mart. Sign-ups for this year's recycling challenge are over but interested schools and others can find all the information on how to sign-up for next year's event here. Weekly Green Report tips its (post-consumer recycled) hat to all the kids participating in the program beginning next month.

Wal-Mart Introduces Private-Label Green Light Bulbs

Wal-Mart is introducing a line of energy efficient compact fluorescent light bulbs (CFL's) and is currently selling the line, branded under the chain's "Great Value" brand, in 3,000 stores nationwide in the U.S. The CFL's are being produced for Wal-Mart by General Electric Co. and Royal Philips.

CFL's normally have a tiny amount of Mercury in them but Wal-Mart says the retailer has worked with the manufacturers to eliminate the mercury in the "Great Value" brand CFL's because they feared consumers might dispose of the bulbs in the trash (which is common) rather than at a hazardous waste dump site or program. The chain says four of the private label CFL's will sell for the same retail price as three brand name CFL's, essentially offering shoppers a "buy three get one free" deal compared to most other brands on the market. You can read more about Wal-Mart's private-label CFL's introduction here. The U.S. Green Building Council site is here.

British Grocer Gets Greener With its Online Delivery Service

If done properly online grocery retailing can not only be convenient but also very "eco-friendly." For example, researchers in Britian have estimated that one grocery delivery van making multiple houshold deliveries can replace 20 car trips, resulting in the use of less fuel by consumers as well as a real reduction in C-02 emmissions. Others though say online grocery delivery services actually are less green than traditional brick and mortar grocers. With the use of electricity to order via the internet, the quantitites of packaging the delivery services use and the like, many environmental advocates have not been so keen on these E-grocers.

The facts, like they are most of the time, are somewhere in between--and the reality is that both online and brick and mortar grocers can be "eco-friendly" if they want to. One such online grocery delivery service in Britian is out to show it is green. Ocado, the E-grocery division of the Waitrose supermarket chain, has launched a major environmental initiative and marketing program to tout its green credentials. The online grocer has acquired new, more energy efficient delivery vans, launched a massive corporate recycling program, introduced resusable grocery bags and made numerous pro-green changes to its operations, from the distribution facility to the customers' door step.

To tell this story Ocado has made a huge TV advertising buy in Britian and is running commercials featuring its green team of delivery drivers in their new bright green and white delivery vans. The E-grocer also is running other spots, all of which tout its environmental policies and initiatives, and talk about how it fits in to its delivery service.

Green Notes

Green spirts brand a hit at the Emmy's: Last week Green Notes wrote about how TV's Emmy Awards (broadcast Sunday night) were featuring an "eco-friendly" green lounge backstage for VIP's and celebs. Our Emmy-insider tells us the green lounge was a big hit with award winners and others alike. Not only were the free designer "Nothing On Me Is Plastic" reusable shopping bags (which we reported were going to be given out for free) a huge hit but it appears a new green, alchoholic beverage was all the rage backstage in the "eco-lounge.

This cocktail beverage, called VeeV and produced by a company called VeeV acai spirits, was happily consumed in the form of "eco-mojitos" by actors James Spader and Jeremy Piven, music great Tony Bennett, director Rob Marshall and former Saturday Night Live and current TV Sitcom writer, producer and actress Tina Fey. VeeV is made using the acai berry, which is known for its healthy antioxitant properties. The company's ethics elements take on many forms. For example they donate $1 from the sale of every bottle of the spirits to environmental groups such as the Rainforest Action Network and the Sustainable Acai Project. The company also powers 25% of its distillery in Idaho using renewable wind power. You can learn more about the company and its VeeV acia berry spirits here.

Celebrities going green: Speaking of celebrities, this month's InStyle magazine interviews a few of them about becoming green consumers. A few snapshots: Actress (and camper) Charlize Theron buys Endstar brand camping gear because the company makes it in part out of recycled plastic bottles. Actress Alicia Silverstone doesn't use her fossil fuel-powered clothes dryer but rather drys her clothes on an old-fashion outdoor laundry line. "The sun does all the work and it makes me feel like I live in Italy," she tells InStyle.

Actress and mother Courtney Cox says she uses only Little Twig brand unscented soap on her three year old daughter. The soap line is sulfate and paraben-free. And when you return four of the recyclable soap packages you get 30% off on your next online purchase as a reward for keeping the planet clean, Cox tells the magazine. You can read about what other celebrities are doing to be green consumers in the article here. InStyle also has a piece on "eco-chic" product "hot finds." You can check out their green product discoveries here.

Hollywood goes green: Actor and green activist Ed Begley Jr. has organized a major environmental conference called "Hollywood Goes Green." The green event is scheduled for December 11-12 at the Hollywood Roosevelt Hotel in Hollywood, California. The event is a serious green business conference and Begley has lined up some heavy hitters including NBC-Universal, Inc. as a major corporate sponsor and a former movie actor who now makes his living as the Governor of Califronia as one of the many keynote speakers.

The conference includes dozens of speakers representing corporate America, the entertainment industry, environmental organizations and academia. There also will be educational seminars, break-out work sessions and other green educational programs during the two-day event. You can read more about the conference here. The food industry has considerable synergy with the media industry in the form of advertising, product placement and the like. For food industry companies going green there should be many joint-opportunities as the entertainment and related media industries follow the same green path.

The company farmers market: To busy at work to be able to shop at your local farmers' market. No problem if you work for Zutano, a maker of children's clothing in Babylon, New York. As a way to make their employees lifestyles easier--and healthier--the clothing-maker has created a farmer's market right on it property so workers can merely go outside on a break and do their organic fresh fruit and veggie shopping. "If you can't bring the company to the farm then bring the farm to the company," is the motto of Zutano founder and president Michael Belenky.

The farmers' market is held weekly in the company's parking lot and features a full selection of conventional and organic fresh fruits, vegetables and other delights. The company is promoting a green lifestyle for its workers as well since being able to do their shopping once a week at work allows them to cut-down on the nnumber of trips they need to make to the grocery store which conserves gasoline.

Commuter Creep: The newspaper USA Today has conducted a major study about commuting in the United States. In a series of articles in today's paper USA Today reports how commuting is changing peoples lives in the U.S. as well as having serious environmental implications. The average American now spends a full-week (total) per year in traffic getting to work. They also are getting up earlier.

In fact 15 million Americans are out the door before 6AM to commute to work today, up by 2.7 million in 2000. The report calls this concept "commuter creep" and says it's changing the lives of tens of millions of Americans in many ways. It's also changing industries ranging from breakfast food companies, fast food outlets, television, personal fitness and more. The increased commuting by automobile also is adding to amount of carbon in the air and having other negative environmental effects. You can read all about this comprehensive research and reporting project in today's USA Today here.

Weekly Green Report Ender

Shrimp You Can Trust: The Blue Horizon Organic Seafood Company, an organic seafood company based in Monterey County, California, is pulling out all the "green" stops and introducing a line of fresh, organic-certified shrimp, raised in ponds located north of Ecuador. The company calls the pure and tasty creatures "Shrimp you can trust."

The ponds where the shrimp are raised are certified by Naturland, an international aquaculture certification firm. In addition to being fed only organic feed, the company touts their shrimp's pond-raised upbringing as being much more "eco-friendly" than wild shrimp caught in ocean waters. To prove their point the company points to statistics which say in many cases up to 10 lbs. of fish and other seafood are killed by the process of ocean shrimp fishing. Additionally, preservatives and sulfites often are used to treat most wild-caught shrimp (especially in Asian waters) as soon as the sea creatures are brought onto the boat. Blue Horizon says it uses no preservatives, additives or artificial colorings in their "trustful" shrimp.

Fishwise, a non-profit fish-advocacy group based in the coastal city of Santa Cruz, California has rated the Blue Horizon shrimp "green" in its yellow-to-green seafood sustainability system. Green is the highest rating. Numerous retailers use the Fishwise rating system as a guideline for merchandising organic and sustainably-raised seafoods.

Shrimp is the most consumed seafood in the U.S. according to the National Fisheries Institute. Blue Horizon is introducing their new line of organic,"eco-friendly" and trustful shrimp at the Natural Products Expo-East, which runs from September 27-29 in Baltimore, Maryland. In addition to displaying the "green" delights the company will be offering show attendees shrimp ceviche and shrimp cocktails prepared with organic cocktail sauce. Since shrimp is the favorite seafood of Americans (and we assume food industry-employed Americans as well) we expect to see long lines at the Blue Horizon booth.

Mid-Week Roundup

Industry news, ideas and information you can use

Whole Foods Gets It Right With New San Francisco Store

Above is a photograph of Whole Food's new store located in the City's Potrero Hill neighborhood. The store is the anchor of a mixed-use development which includes upscale condominiums above and on the sides of the market.

Whole Foods Market, Inc. opened it's newest Northern California store last week in San Francisco's Potrero Hill neighborhood. The store is 42,000 square-feet and is the retail anchor of a mixed use development in the neighborhood. NSFM wrote about the store, which we call a hip, lifestyle neighborhood store, last week. You can read our piece here

John King, the urban design writer and critic for the San Francisco Chronicle, says in an article and review today that Whole Foods got the store just right, creating a retail marketplace that not only fits perfectly with the neighborhood but also is inviting and welcoming for shoppers. "The new Whole Foods Market in San Francisco shows with meticulous precision why upscale grocery stores are coveted by communities that want to see themselves as fully rounded or on the map," says King in his article in today's Chronicle.

King isn't as crazy about the condominium project located above and around the Whole Foods store but nearly waxes poetic about the store's design elements and architecture. "The new Whole Foods is the supermarket equivalent of an iphone or Mini Cooper (car)," he says in his review. "It's designed to send a message that anyone using it is on top of their game."

King loves the store's Market Bistro restaurant (a new feature for Whole Foods) which has a bar made of recycled glass and red bar stools crafted from recyclable leather scraps.

In the review article Whole Foods' regional president for northern California Anthony Gilmore tells King about the new store, "We want to evolve and give our customers a continual since of discovery. I'll sit down with consultants and review every color, every texture, every piece of the design. It's this attention to detail and openness to design that makes King like the store so much. It's also what makes NSFM, who has visited the store, love what Whole Foods as done with the store in terms of incorporating the Potrero neighborhoods industrial past with its more upscale present in creating not only a retail food store but a shopping and lifestyle experience.

Read John King's full review in today's edition of the San Francisco Chronicle here. The photograph at top is from the San Francisco Chronicle. You can view a mini slide-show of the new Potrero Hill district Whole Foods store here.

Shoppers Rate New San Francisco Whole Foods Store

For an interesting look at what shoppers think of the new Whole Foods Market in San Francisco's Potrero Hill neighborhood you can take a look at the yelp.com review site. The sites slogan is "real people real reviews." You can read reviews from real live customers about their experiences at the new store here. So far the store has 4 out of 5 stars with 31 shoppers reviewing. Five stars is the best.

An Urban Design Expert's Thoughts on Whole Foods

Washington, DC-based Historic preservation and urban revitalization consultant Richard Layman has a related story on his blog titled "The seduction of Whole Foods Market." In it he mentions the new Potrero Hill neighborhood Whole Foods and talks about Whole Foods from his perspective as an urban revitalization and historic preservation professional. You can read his thoughts here.

Breaking News: New Whole Foods Store to Open in Oakland

Whole Foods Markets has more retail tricks up its sleeves when next week (on Wednesday, September 26) it opens its newest San Francisco Bay Area store near downtown Oakland, across the Bay Bridge from San Francisco.

The new store is something very new in terms of design for Whole Foods. The store has been designed to resemble a European Food Hall. Whole Foods' northern region president Anthony

Gilmore says he studied food halls in various countries and ended up modeling the new Oakland Whole Foods store after the Galeries Lafayette market in Berlin, Germany. (Read about Europe's Galeries Lafayette chain, owners of the Berlin store Whole Foods is modeling its new Oakland food hall market after here.

Gilmore says the grocer wanted to design a food hall rather than a conventional grocery store to celebrate what he calls Oakland's and the surrounding area's rich, progressive food culture. He says the Oakland store/food hall is an international food market with an international flair.

It's interesting to note that many years ago there was a popular international-style food hall called "Housewives Market" right near the new Whole Foods store in downtown Oakland. By choosing an international food hall design for this new store Whole Foods is paying homage to the downtown's historic roots as well as offering residents a completely new shopping experience. This will be the first Whole Foods for Oakland, which has a population of about 450,000. The new store is located at 230 Bay Place on 27th and Harrison Streets near Oakland's popular Lake Merrit.

The new food hall-style store is designed so the first thing shoppers encounter when they enter the store is the produce department. The store's architect's have then designed the store in such a way that its flow leads the shopper to each in-store attraction in a lively manner. Unlike the traditional supermarket, which generally has its perishables departments around the store perimeter and its dry grocery area in the center or core-of-the-store, the new Oakland Whole

Foods reverses that design. The perishables departments are in the center of the store while dry groceries are located on the perimeter.

The store has an indoor restaurant with an outside dining patio, similar to the Market Bistro Whole Foods debuted last week at its new store in San Francisco's Potrero Hill neighborhood. Specialty, ethnic and natural foods from all over the world also will be merchandised in the store in keeping with its international food hall design and theme.

The store is about 50,000 square-feet and is built in what was once a large Cadillac dealership building which the grocer completely renovated to create its food hall market. The original structure dates back to 1890 when it was built and first used to house a power-generating station. The building was renovated three times before Whole Foods bought it, the last tenant being the car dealership. It had been vacant for some time prior to Whole Foods buying the property.

The property and site are important to Oakland's history and community so Whole Foods' type of community and local retailing should make it not only a popular retail store but a community focal point and gathering place as well.

Retail Briefing

Hypermarkets Booming in China

Hypermarkets, those huge combination supermarket-department stores, are taking hold in China thanks to the lure of low prices, convenient one-stop shopping, accessible locations and the integration of other retail facilities such as restaurants, cinemas and coffee houses that can turn a shopping trip into a full day outing for Chinese consumers, according to a new study conducted by China-based TNS Worldpanel, a market research firm. The research firm says the growing popularity of hypermart shopping is creating a new shopping culture in China. You can read a complete summary of the research report here.

Wal-Mart Canada Going Fresh, Local in New Supercenters

Tomorrow (September 19) Wal-Mart Canada Corp. is opening five new supercenter stores in Alberta. The stores, which will all have grand opening festivities tomorrow, are in Wainwright, Vegreville, Lethbridge, Pincher Creek and West Edmonton.

The stores range in size from 101,000 to 205,000 square-feet and all include a complete selection of fresh foods and groceries as well as other standard supercenter offerings including fashion, electronics, home goods and more. The stores are said to stock over 120,000 products and will be the largest retail stores in Canada, according to Wal-Mart Canada.

Wal-Mart Canada is going upscale and employing local marketing concepts with these new supercenters. For example, the stores will feature a "Your Fresh Market" concept which is exclusive to Wal-Mart's Canadian stores. The Fresh Market will feature ready-to-eat prepared foods, artisan baked breads and deserts, and other prepared foods selections, all of which will be prepared in store.

The five supercenters also have expanded natural, organic, ethnic and specialty foods selections including perishable products as well as groceries. Organic fresh produce will be merchandised in the produce departments right along-side conventionally-grown. The stores are putting an emphasis on "Fresh" and the produce, meat, deli and seafood departments will reflect that fresh emphasis in their size (large), decor (upscale) and selection (broad).

Wal-Mart Canada is putting a local merchandising touch on the stores as well as part of what the retailer says is a major effort to make the supercenters "community" stores. The supercenters will feature Canadian produced beef, veal, chicken and pork. Among the Canadian-produced meats will include Paradise Valley free-range pork and Diamond Willow certified organic beef, which are produced in the local Alberta cities of Wainright and Pincher Creek.

Wal-Mart Canada is expanding this upscale, fresh, natural, organic and specialty format to its other supercenters in Canada after the five new stores open. The retailer opened its first Canadian supercenter about one year ago. There currently are 17 supercenters in the country and the company plans to have 28 of the units open and operating in Canada by early 2008. In addition to the current 17 supercenters Wal-Mart Canada has 270 standard discount stores and six Sam's Club Warehouse stores. The supercenter, Fresh Market format is the retailer's major emphasis at present in Canada.

Wal-Mart Canada is much more popular in Canadian communities than it's U.S. counterpart division. More than 100 communities in Canada have lobbied or petitioned the company to have supercenters located in their towns. Wal-Mart Canada also scores high in annual ratings of the "best companies to work for in Canada" surveys. There also has been little if any opposition from communities in Canada when Wal-Mart announces its desire to build a supercenter, unlike the case in the U.S. where communities in many parts of the country are conducting efforts to prevent the chain from building supercenters in their towns and counties.

Tesco Says its 'Locked and Loaded' For Fresh & Easy Launch

Tesco CEO Sir Terry Leahy told a reporter for the Dow Jones News Service that the grocer is "locked and loaded" and ready for its November, 2007 launch of its Fresh & Easy Neighborhood Market upscale convenience-type stores. (NSFM reported here that the first store might open as early as next month in Las Vegas.)

Leahy told the Dow Jones reporter on the sidelines at a media conference late last week the retailer's three main priorities in the U.S. with the Fresh and Easy stores will be community,

environment and nutrition. You can read the full report from Dow Jones here.

Kroger Co. Second Quarter Profits Soar

Kroger Co., the largest U.S. supermarket chain, saw its second quarter profits soar by 28% from the same period in 2006. The mega-chain raked in profits of $267.3 million for the period ending August 18, which was 58.3 million more than its Q-2 profits of $209 million in 2006. You can read more here from Forbes.com. Last year Kroger launched as one of its major initiatives a dramatic increase in merchandising and selling higher margin natural and organic products in most of its many store banners. This initiative gained steam late last year and has picked up even more momentum this year. Kroger's CEO is a major force behind the initiative saying he wants Kroger to be the retailer who brings organics to the masses at reasonable prices. It looks like the chain is doing something right based on these second quarter profit numbers.

From Clerk to VP: Woman Grocer makes Good At Kroger

Although it's changing somewhat, the retail supermarket industry has long been "a man's world" when it comes to high-level management and executive positions at food retailing companies. However, it's also historically been an egalitarian industry from the standpoint of formal education, giving entry-level workers a chance to move-up based on their job performance. One hasn't traditionally needed an MBA, or even a BA in many cases, to climb the ranks and become an executive.

In the case of Pam Matthew's, vice president of merchandising and marketing for Kroger's Central Division in Indiana, she's proven that gender shouldn't matter when it comes to climbing the corporate ladder. In fact she was recruited to her current position at Kroger by a man, who picked her over all the other potential candidates--who were all male. (See it's changing.) Matthew's, who doesn't have a college degree, also took advantage of the industry's promote-from-within ethic, combining determination with hard work to get to her current position. you can read a feature profile about Pam Matthews in today's Indianapolis Star here.

Industry News and Information Briefing

Aussie Food in Big Demand Globally

Australia's clean, green image of its fine foods and wine is attracting buyers from the new middle classes in emerging economies worldwide in such countries as China, Indonesia, India and other emerging regions, according to an Australian government report detailed in an article in today's The Age, an Australian publication. "In terms of food (and wine) our markets have traditionally been in high income countries like Japan, the United States, the United Kingdom, New Zealand and Hong Kong," says Tim Harcourt, the chief economist for Austrade, the country's economic and trade organization. You can read more about the growing market for Australian foods and wines here.

New California Food Legislation Could Be Trend Setting

The California legislature has passed two new legislative bills in the area of food health and safety which could portend changes in other states as well. The first new law requires manufacturers to clearly label any food intended for human consumption that contains products from a cloned animal or its progeny. The second bill requires fast food chains with 15 or more outlets to provide nutrition information for their products served in the restaurants, including clearly posted information on trans-fat content, sodium, carbohydrates and more. The Governor still needs to sign both bills before they become law. You can read about the two bills in more detail here.

Consumer Behavior: Business By the Numbers

The Economist magazine (09-13-07 issue) has a fascinating article about how businesses are increasingly turning to the use of mathematical algorithms (they have nothing to do with how Al Gore moves) to track and analyze consumer and shopper behavior. At its core an algorithm is a step-by-step method for doing a job. For example, a recipe is an algorithm for preparing a meal. Also, those decision-tree posters that hang on doctors office walls which help them to work out what is wrong with a patient from his symptoms are called medical algorithms, step-by-step methodologies for pin-pointing a cause in this case.

In the business world companies are increasingly turning to the mathematical science of algorithms to learn more about their customers and consumers in general better. A case in point is the Tesco Supermarket chain. Tesco, with the help of a marketing consulting firm named Dunnhumby, has dumped all of the data from the chains loyalty card users into a huge database and is using algorithms to analyse these shoppers, learn more about them and develop ways to meet their every grocery shopping need. You can read the Economist article here. This information has great utility for all business sectors in the natural and specialty foods industries.

Confection Industry Giant Mars Says No to Vegetable Oil

NSFM has reported on the move by some major confection industry makers and industry trade groups to get the U.S. Governemnt to allow chocolate-makers to add up to 5% vegetable oil to their products rather than using 100% cocoa butter, which currently is the case, and still be able to call the confections product chocolate or pure chocolate. Yesterday confection industry giant Mars announced it's against this move by the other candy-makers and said it opposes any such legislation. "Today Mars U.S. chocolate products are pure, authentic chocolate and they are going to stay that way," said Todd Lachman, president of Mars Snackfoods USA. You can read more here.

The fastest growing segment in the confection industry is in high, quality premium chocolates and all-natural and organic varieties. Mars and others are going after that market via acquiring smaller, gourmet confection companies as well as creating new premium products. NSFM thinks Mars was smart to get out front and let consumers know the company is against any plans to "adulterate" chocolate quality. A nice way to differentiate themselves from the other large confections companies and to strike a blow in the effort to brand the company as premium. Mars CEO Lachman made this announcement yesterday at the "All Candy Expo" confections show in Chicago. We think that was a savvy move--making the announcement at the show with all the major confection industry players in attendance as well as the media.

New Categories: Yoplait's Fizzy, Carbonated Yogurt in a Tube

Yogurt maker Yoplait (owned by General Mills) has introduced a new carbonated, fizzy yogurt product that comes in a tube rather than a traditional plastic container. The product is named Fizzix. The company created the product for and is targeting it to the "Tween" demographic. This group consumes less yogurt than other demographics and is growing rapidly. Overall yogurt category sales are growing rapidly as well. Yogurt category sales more than doubled between 1998 and 2006. Health and convenience are the two primary factors attributed to this rapid growth in sales. You can read more about the new carbonated yogurt category and new Yoplait product here.

U.S. Department of Defense Grocers Go Organic

Sales of organic foods in the U.S. have grown by about 25% over the last seven years. And it hasn't just been the private sector food retailing industry that's taken notice and increased its organics product selections year after year. The grocers at the Defense Commissary Agency (DeCA), the U.S. Defense Department organization responsible for running the numerous supermarkets in the U.S. for members of the military, says it has more than tripled the number of organic products on its stores' shelves over the last few years.

"To ensure our patrons have available the products they want we keep an eye on trends," says DeCA CEO and director Patrick Nixon. "Because of this you will see organic selections on our store shelves. Organic alternatives are side-by-side with similar non-organic items (integration) throughout the commissary," Nixon says.

The Department of Defense-operated stores sell grocery products for about 30% less than the average for-profit supermarket, according to Nixon. This 30% price reduction applies to organic products as well making them relatively affordable for military customers.

The Defense Commissary Agency operates stores worldwide selling groceries to active-duty military members and retired veterans and their families. The agency doesn't make a profit on its products allowing it to price everything it sells in its stores at cost plus a 5% surcharge which goes to pay for building new commissaries and remodeling existing ones.

New Survey: Americans Prefer Domestic, Local Foods

A new survey conducted by the Leopold Center for Sustainable Agriculture at Iowa State University found that 85% of Americans have confidence in the safety of their local and regional food systems. However only 12% of those survyed expressed confidence in food produced and imported into the U.S. from anywhere else in the world. "American's remain extremely wary of foreign foods," says Richard Pirog, the deputy director of the Leopold Center and the co-author of a paper about the study's results and implications. "That was something that was very apparent (in the results).

These numbers are very stark." You can read a complete summary of the survey here. The survey's numbers are indeed very stark and if true--and varified by similar surverys--point to a particluarly troublesome situation for specialty and natural foods importers and for foreign food and beverage companies doing business in the U.S.

Unified Western Grocers to Acquire Seattle Wholesaler

Los Angeles, California-based Unified Western Grocers is acquiring Seattle, Washington-based wholesaler Associated Grocers. Associated Grocers shareholders approved the sale to Unified Western Grocers at a special meeting on September 14, 2007. Unified Western Grocers is the largest wholesale grocer in the Western United States and is member-owned. Associated Grocers has been selling groceries to independent retailers in the Pacific Northwest for almost 75 years.

Unified and Associated have been competitors in the Pacific Northwest market for a number of years. The acquisition makes sense for both companies since Unified is the larger of the two. Also the independent retail market in the region has consolidated considerably over the last 10 years and Unified is better able do its size and resources to provide not only the best wholesale cost of goods to independents but also provide the myriad of services they need to compete against the region's retail chains which include Safeway Stores, Kroger-owned Fred Meyer and numerous others.

Unified also has a large specialty and natural foods division called Market Centre Foods. The specialty & natural division serves Unified retail members and also chain operators including Raley's Superstores and Save Mart in California and Nevada as well as other chains throughout the Western U.S. You can read more details about the acquisition here.

Mid-Week Roundup Ender

Health and wellness is a growing movement among people of all ages. It's far more than even a trend. Rather, we see it as a movement that's here to stay--and will only get bigger as people continue to live longer and want to live healthier lives. The health and wellness movement offers huge opportunities for manufacturing, marketing and retailing companies as many have already discovered and others are beginning to. The wellness movement offers great opportunities for retailers and as an extension to their supplier companies. The current monthly issue of Grocery Headquarters magazine (Sept., 2007) has a cover story on health and wellness and the marketing opportunities it presents. You can read the story here.

Monday Marketing Memo

Does the Ethical Policy Paradigm Present a New Model For Food & Beverage Marketing and Retailing in the Coming Post-Organic Era?

Two new studies, one a major survery conducted by the market research firm Business Insight and the other a three month-long survey being conducted by UK retailer the Co-operative Supermarket Group, are bringing the concepts of "Ethical" food and beverage marketing and retailing to the front and center of the industries internationally.

Some Background

Ethical food and beverage marketing refers to a collection of practices expressed via a philosophy of what "good" food and beverage marketing is. These practices include the use of sustainable farming practices, Fair Trade agricultural systems, green packaging, nutritional and environmental certification, local food product sourcing/marketing and a few other concepts which when are taken as a whole make what is being referred to as ethical practices in the food and drink sector. These practices are premised on an ethical philosophy that embraces environmentalism, social justice issues, healthy foods and sustainable principles, in farming, food and drink manufacturing and marketing throughout the supply chain.

Ethical retailing is part and parcel of ethical marketing. They are sisters joined at the hip if you will. Its focus is on selected "ethical" food, beverage and related products (from these ethical growers and marketers) as a retailers product mix. The concept also involves all the behaviors and practices a retailer conducts in its day-to-day retail operations. These include environmental, economic (employee relations for example), store building and operating (green) procedures and a few other concepts which make up both ethical marketing and retailing. Not only is it a group of practices but a retailing ethic as well.

The Ethical Product Marketing Study

According to the study by Business Insight, the "ethical consumer market" is increasingly moving from its beginnings as a niche area catered to by a few specialized food and beverage brands, towards the mass market mainstream. As examples the study sights the fact that food certification and other ethical product labels are now an everyday feature of products sold across Europe and North America, popularized by greater consumer awareness and wider distribution.

The study also suggests the ethical model is growing in the areas of organic brands (becoming mainstream), more Fair Trade brands on the market (including by major packaged goods companies), a growing trend to use sustainable and recyclable packaging, the growing popularity of the grow and buy local movement (food miles) and the consumer rejection of GMO-grown foods and the use of additives in food and beverage products.

The report says the growing adoption of these ethical practices, not only by smaller and medium sized food and drink companies but by large multinational packaged goods corporations, is evidence of a growing movement towards such an ethical food and beverage ethic on the behalf of increasing numbers of consumers internationally.

Ethical Retailing: The Co-op Survey

The survey by the UK's Co-operative Supermarket Group, the largest Co-op retailing group in the world, is an attempt to aggregate the opinion of its members on the issue of ethical food and drink retailing in its stores. The Co-operative group has millions of members and operates 2,700 retail food stores in the UK.

The Co-op mailed survey questionnaires to one million its members on September 3 of this month. Shoppers also will be able to fill out the questionnaires which will be available in-store. Survey questions include food and beverage product, retail and related issues such as food quality, diet, health, animal welfare, community retailing, ethical product sourcing, climate change, green packaging and recycling.

You can read and review the Co-operative Supermarket Group's Ethical Food Policy questionnaire here. Also learn more about the co-ops various retail and other businesses here.

As part of this member-survey the Co-operative group is consulting its members in order to find out what is most important to them in terms of what kind of retailer the co-op becomes. They plan on using the survey data when tabulated as part of a process to create a new retail philosophy for the Co-op. The retailer makes it clear they aren't going to adopt all the recommendations ad-hoc but rather use the member input as part of a multi-level review process. The supermarket operator already is one of the leading "ethical" retailers in the world with extensive green, health and nutrition and related policies and programs.

Paul Monaghan, the Co-ops head of ethics, is leading the research project. He says "the consultation (with members) will be extensive. It will be a very interesting social experiment. the balloting will last for three months and the results will be known next year."

The results of the survey and how the Co-op implements them in its process should be interesting to watch. The retailer is an international leader in terms of how retailers should address ethical and environmental issues. For example, it was the first major retail chain to champion the Fair Trade label and programs when it merchandised the Fair Trade brand Cafe'direct coffee in all its stores in 1992. The Co-op also was the first major retailer to stock Fair Trade bananas in its store's produce departments in 2000. Since then major retailers throughout the world have merchandised Fair Trade coffees, chocolates, fresh produce and other food and beverage items, and it's becoming more common among mass market supermarket chains to offer a selection of Fair Trade items in various categories.

The Co-op also is a leader in using renewable energy in its stores. Its been far ahead of nearly every other retailer in the world in this area. Currently about 75-85% of all 2,700 Co-op stores are powered by a combination of renewable wind and hydroelectric power as opposed to fossil fuels.

The Ethical Policy as Models

The ethical policy paradigm is a way or model of lumping a variety of environmental, social, economic, agricultural, marketing and retailing principles together into a coherent whole. Today we are seeing numerous components or principles of this ethical paradigm being implements across food retail format channels. In the supermarket sector numerous chains such as Safeway Stores, Kroger, Publix, Wegmans and more are adopting many of these principals, especially the green or environmental elements of the ethical retailing policy. The same is true for many mass merchandisers such as Wal-Mart, Target, Macy's Department Stores and more. The natural foods channel (Whole Foods as the leader) is doing the same. Even the C-store channel is getting on-board.

In the food and beverage manufacturing and marketing sector the same is occurring. Food and drink producers are creating green standards for packaging, introducing more all-natural and organic foods, and paying closer attention to Fair Trade, sustainable growing practices and the like. Health and nutrition and the marketing of it is becoming nearly ubiquitous among food and beverage manufacturers of all sizes, especially those who are creating new products that allow for the telling (and labeling) of a positive health and nutrition marketing story.

The Developing Ethical Policy Paradigm

How do we see the ethical product marketing and retailing paradigm developing, especially as it relates to natural and specialty foods manufacturer's, marketers and retailers?

We see food retailers in general continuing to aggressively adopt numerous principles of the ethical policy whole for their stores on a regional and neighborhood basis. We also see more progressive food retailers--supernatural grocers,supermarkets and mass merchandisers like Whole Foods, Safeway Stores, Publix, Wegmans, Supervalu, Kroger, Raley's in California, Wal-Mart and some others--move further towards adopting a more corporate ethical retailing philosophy and policy. We're seeing this currently in the case of Wal-Mart, Whole Foods, Safeway, Publix, Wegmans and a few others.

We aren't suggesting food retailers will adopt an ethical retailing policy on the order that the Co-op Supermarket group is considering or even one like many "orthodox" natural foods stores currently have. These retailers--and to a lesser degree Whole Foods--have placed restrictions on the types of food and beverage products they will sell in their stores all together. For example, restricting foods and drinks that contain artificial coloring or food additives. These product ingredient restrictions fit these types of retailers philosophies and marketing niches which is well and good.

However, supermarkets and mass merchandisers' stock in trade is product variety and assortment and that isn't going to change--and it shouldn't. But that won't stop these retailers from further adopting a more comprehensive ethical retailing policy, focusing on areas like environmental or green practices and other principles of the overall ethical paradigm being crafted by the Co-operative Supermarket Group. We currently see an example of this in the UK where both Tesco and Marks & Spencer for example are crafting comprehensive ethical retailing corporate philosophies and practices but basing them on their own respective needs and niches as retailers.

The 'Post-Organic Era and Ethical Policies

In the title of this piece we ask: Does the ethical policy paradigm present a new model for food & beverage marketing and retailing in the coming post-organic era? Quite a mouth full. By this we mean a couple things. First, in terms of a post-organic world we don't mean to suggest in the least that retailing is nearing an end to the marketing and sales of organic products. Quit to the contrary--we're just seeing the beginning of what will eventually become a near norm.--widespread multi-format and channels organic products retailing.

Rather we use the phrase "post-organic" to mean we are coming to an end (because of the growing popularity of organics) of an era in which food manufacturers, marketers and retailers can continue to use organic foods as a major or primary marketing niche. We believe there are many years left for this niche to be effective. But with the mass-marketing and retail format explosion we're seeing in organics merchandising we're beginning to see a massification of the category which over time will result in it being less affective as a primary market niche. After all, today you can buy a decent selection of organic food products not only in natural foods stores and supermarkets but also in mass merchandisers, drug stores, dollar stores, food boutiques, farmers markets, online and more.

So this coming "post-organic" era merely means that food marketers and retailers need to look for more in terms of having a specialty/natural niche in the market. Additionally tomorrow's "post organic" era consumer also will be looking for more. And what we believe they will be looking for are manufacturers and retailers who have ethical type policies and can tell a story of who they are as a food manufacturing or retailing company based on their comprehensive ethical policy.

No one policy need be the same, although they will likely have similar elements. But we believe those progressive manufacturers and retailers who get out in front of this development--like many who already are--will reap the benefits as consumers continue to change and develop. Let's not forget it wasn't too many years ago when if you told a group of supermarket executives and food manufacturing CEO's they would soon need to be producing and selling a large selection of organic products, creating biodegradable and recyclable food packaging, selling reusable grocery bags, putting solar panels on their store roofs or distribution warehouses and other similar developments, most of them would have laughed at you. Not only aren't they laughing today, they're rushing and competing to see who can be the greenest food manufacturing and retailing company in the respe4ctive industries.

The future development and path to ethical product marketing and retailing policies will be varied and proceed at different paces depending on the region of the world and on a particular country's economic system, social composition and politics. The pace also will, like most developments, tend to lag a bit behind consumer demand for such policies as these type of initiatives require much thought and investment. However, we believe it's a real development, the empirical beginnings of which we've discussed above. Ethical policies also provide opportunities for committed and savvy food manufacturers, marketers and retailers who can get it right for their customers and other stakeholders.