Ultimately, food retailers compete on just four things – price, convenience, product assortment, and customer service. For most independent and ethnic marketers, it’s difficult to beat the price of Walmart and other giant chains. Convenience is also a challenge, as larger retailers and non-competing businesses like banks and gyms already take out many of the best locations. That leaves product assortment and customer service.
We’ll assume for this column that Hispanic food retailers are at least equal to other merchants when it comes to customer service (they are actually much better!), so that leaves product assortment as the key differentiator.
It’s clear that product mix has always distinguished ethnic food retailers from the more homogenous supermarket chains in North America. Kroger, Walmart, and even the more customer-focused chains like Publix didn’t include a wide variety of Hispanic food items until relatively recently and still limit their assortment to the lines that sell to both their traditional clientele and more recent Latin American immigrants.
At two recent trade shows, the International Fresh Produce Association (IFPA) conference in Orlando and the Private Label Manufacturers Association (PLMA) in Chicago, ideas for adjusting the product were everywhere.
Quality fruits and vegetables are table stakes at just about every food store, but the differentiation happens with expansion to new products like jackfruit and pitaya, and also processed items like salad kits and cut ingredients.
At the IFPA show, growers and other marketers were selling the latest crops and prepared foods, many of which had an ethnic spin. Packaged fresh pico de gallo could be found from at least ten vendors, and some form of ready-to-eat guacamole (think garlic, black bean, corn, even mango and chile lime) was being sampled by more than double that number.
For store brands, the PLMA conference featured new items like cheese made from oats and gluten-free sauces and Hispanic food line extensions for masa and different qualities of rice. Francisco Alonzo, New Business Development Manager at Alcsa, a grain marketer from Guatemala, told me his company is focused on creating store brands specifically for Hispanic markets and is working with wholesalers to offer varieties that compete directly with national brands and lines imported from Latin America and Spain.
Selling and promoting these new and refashioned fresh and store label items, products shoppers can’t get at the generic supermarket down the street, helps ethnic merchants create a point of differentiation that overpowers any perception of lower prices and will have shoppers spending more of their money at your stores.
One more point from the IFPA show. Chef José Andres, known for delivering hot meals to victims of natural and manmade disasters around the world, was a keynoter there and focused his discussion on using local infrastructure to solve food security problems, like making sure ingredients for the meals World Central Kitchen team prepares are sourced from nearby wholesalers. Chef Andres’ shared two mottos during his talk – “Food has the power to change the world” and “Take care of the few, take care of the many.” Great words from a great man.