How do retailers set their produce prices? Is there a way to know if stores will have specific items on special? Is there somewhere that shows all these specials in one place, with a price distribution list of produce items? Could a produce shipper capitalize on having this type of information?
The answer to all of these questions is yes. The U.S. Department of Agriculture (USDA) Specialty Crops Market News service provides this information to the public regularly through reporters who track over 400 supermarket chains with more than 30,000 individual stores.
The National Retail Report – Specialty Cropsis published weekly, giving buyers, sellers, and consumers access to the same information at the same time. Retail reporting completes the “third leg of the stool” for Market News, as the agency also tracks major wholesale terminal markets, and markets at shipping point for a wide range of specialty crops.
What Drives the Market?
Market News retail reporting focuses on advertised specials, not everyday prices. These ads are key drivers in the marketplace, particularly for highly perishable and seasonal specialty crops. This retail reporting has the added benefit of allowing users to look both forward and backward in time. You can see, for example, spikes in supply as product was shipped to cover the items promoted in ads.
Another view can be found by looking at archived records from previous years, showing how the market reacted to various changes in pricing or supply.
Since retail data is the closest link to the ultimate consumer in the marketing chain, Market News provides an invaluable tool for all sectors to measure, analyze, anticipate, and react to trends in consumer preferences.
For example, growers can better plan what, how much, and when to plant crops by following the consumer buying trends illuminated by the National Retail Report – Specialty Crops. Similarly, importers can study consumer trends to better predict the type and volume of produce they will need to meet demand during a given period of time (e.g., holidays and special promotions).
For shippers seeking the best time to promote product for the next season, they might research which items were competing for ad space during the past year as an indicator for the next. They can see how many stores featured these products in their advertising, and where the product came from. Transporters can then better map out their needs for personnel and vehicles, and try to predict the freight pricing the market will bear.
Honing Retail Buying & Selling Strategies
The National Retail Report – Specialty Crops can help retailers with both procurement and marketing strategies unique to their operations, based on their size and the demographics they serve. The report can also help retailers determine what price positions to take during negotiations with suppliers when buying produce for their ad specials.
Large, multistate retail chains often plan their ad flyers up to six months in advance, many with predetermined sale prices for specific items. Their buying costs are often fixed in long-term contracts with suppliers, and the ad prices are set firmly early in the process.
Smaller retailers may be more nimble and can take advantage of changes in supply. They can buy from a producer facing an oversupplied market, then offer a deeply discounted price to customers, undercutting larger retailers.
The National Retail Report – Specialty Crops can also help retailers gain a window into the marketing strategies of their competitors through detailed information about which items are being advertised and at what price. Retailers can take a quick look at the top ten fruits and vegetables advertised each week, as well as the weighted average price for all covered items.
Market News also issues a daily National Specialty Crops Organic Summary, which includes retail information for organic specialty crops, as well as wholesale prices, shipping point prices, and movement.
With access to all of this information, users can gain a sense of what their competitors are doing and better formulate their own strategies in response.
As consumer preferences and demand have grown and changed, the National Retail Report – Specialty Crops has expanded along with them. In the nearly ten years of the report’s existence, it has added specialized categories to enable retailers to pinpoint price and demand for newer categories like organics and locally grown produce. There is also a state-branded category and information on numerous new commodities is already in the works.
As the face of retailing changes, Market News will continue to be the ‘eyes and ears’ of the produce industry by providing timely and reliable information to provide market transparency for the benefit of everyone in the marketing chain.