In just a few days, the Food Marketing Institute (FMI) annual show will convene in Chicago…and expectations are that it will be a very different convention than in past year.
To get a sense of what’s planned for the show – scheduled for May 2-4 – we turned to Tim Hammonds, FMI’s president/CEO.
MNB: It’s big doings for the FMI Show this year in terms of incorporating a lot of new facets into the traditional mix. Is this a metaphor for how the industry in general is changing? And what does it tell you about the way supermarket retailers need to do to be more effective and competitive in 2004 and the years ahead?
Tim Hammonds: There are indeed substantial changes for this year's Convention with even more planned for 2005 and 2006. Our intent is to give the floor a new look every year by rotating spotlight categories in and out coupled with special pavilions on the floor targeted at each year's hot topics. This year, our pavilions are the new electronic product code and healthy living (diet and health).
We think this is a reflection of how the industry is changing. It isn't the same set of topics and issues year after year as it used to be. Our members and business partners face a rapidly changing industry and we need to have a format for the show that can keep out in front of those changes. That's why we feel it's time to keep a core focus on our key exhibitors that buyers need to see every year while rotating a changing mix of new categories from year to year. At the May show itself, we will be more specific on the rotation categories we plan for 2005 and 2006.
MNB: Food safety/security continues to be a hot topic. Is it your sense that while consumers remain confident in the food supply, the industry must continue to be vigilant to prevent future problems? And what steps do you think need to be taken in order to maintain the safety of the food supply?
Tim Hammonds: Let's take food safety first. Our focus has always been on three different, but interdependent levels: suppliers, store associates, and consumers. For suppliers, we have completed our formation of a new food safety standards and audit program for the industry's suppliers called SQF or Safe-Quality Food. This is a way for retailers to be sure their suppliers have food safety best practices in place and that these practices are really being implemented as verified by independent, third party audits. Different program levels are available for producers and processors with a major emphasis on our international fresh product suppliers. There are two workshop sessions at the May show specifically on this new service. It's our belief that government audits and inspections just can't keep up with the volume of commerce necessary in today's global economy. That means industry managed third-party standards will be a necessity.
For store associates, we have completed a specific training program for the supermarket industry called SuperSafeMark. It provides a full range of resources including on-line web-based training for basic skills all the way to classroom instruction for certifying safe food handlers. Once again, there are two specific workshops on this topic.
For consumers, our primary emphasis has been on the FightBAC (BAC for bacteria) to help train people on the important role they play in keeping food safe between the time they walk out of the store and the time they actually serve it at home. Information on this program is also available in the membership booth at the show.
We would urge everyone in the industry to familiarize themselves with these three programs so they will know how to use them inside their own companies.
MNB: Country of Origin Labeling (COOL) keeps popping back into the public consciousness, even when it seems that it’s been put to rest at least for the immediate future. What’s the current prognosis?
Tim Hammonds: We are quite optimistic, realizing that there is still a lot of work to be done. We're using the two-year delay to develop a substitute voluntary information program as an exchange for full repeal. The voluntary program is being drafted by a coalition of the key retailer and supplier associations representing the covered commodity groups. Winning a meaningful delay to give us time to do this was a major victory; now we have to craft a winning substitute. Fish remains a challenge since it was not included in the delay, but we do have an active strategy for including fish in the substitute proposal.
Everyone can take comfort in our progress, but everyone also needs to stay tuned and stay active when we ask for help.
MNB: What’s the current status of the estate tax? Is it your sense that its repeal will finally become permanent?
Tim Hammonds: Permanent repeal of the estate tax is a very high priority for FMI. We think it's essential for the ability of many of the industry's independent operators to keep the business in the family. It's hard to overstate how important this is for the future of the industry. Having said that, realistically this is likely to be a second-term issue for President Bush if he wins reelection. If we get a chance to move it in the next few months we will, of course, jump on it. But we believe the major push will come next year and if we get that opportunity we believe we will be successful.
MNB: What kind of role do you believe that food retailers should be playing in curing the obesity epidemic?
Tim Hammonds: Our industry's role in addressing obesity will be the focus of a special pavilion on the exhibit floor in May. Right now, the chances look very good that HHS Secretary Thompson will be with us to cut the ribbon on Sunday as we open the floor.
We need to do two things as an industry. The first is to provide the right products whether that means redesigning some of our traditional branded items or providing the right mix of categories in the store. The second is to remind people that addressing obesity involves both product choices and lifestyle choices. This means the answers will be different from person to person and family to family. Each of us has to find a solution that works in the real world. Solution options, information programs and innovative new products will all be on display in Chicago.
MNB: In your view, when retailers look to build sales over the next year, what do they need to do?
Tim Hammonds: This is a great topic. In my view, it's time for the entire industry to restart the conversation on targeting growth.
Over the last three years, everyone has been so focused on cost cutting, efficiency and survival that we have lost that focus. Those efforts have been essential and we can't abandon the lessons learned in the process. But we now need to refocus on the top line. This simple shift in top-of mind priorities would be a powerful statement to all of our trading partners that the industry is ready to reach out for new ideas and new opportunities. We have challenged all of our exhibitors to come to Chicago ready to have this new conversation with our retailers and wholesalers.
As part of this process, I think we also have to commit ourselves to reinventing the center store around our consumers of the future. The supermarket center store has seen an erosion of sales, even entire categories, to other formats for too long. We need to focus all of our energies on turning this slide around. This doesn't mean we turn away from our great success with perimeter departments.
Indeed, there is a lot of opportunity for innovative cross merchandising. What it does mean, however, is that we really need to rethink what we're offering and how we're offering it in the center store. Consumers have changed over the last decade and they're going to change even more over the next one. If we don't step away from the notion that all we have to do is fine tune our center store category management programs, we're not going to stay relevant to shoppers. We have to be willing to take a hard look at how we can really reinvent the core of our stores.
FMI plans to be an important part of this conversation.
For more about FMI 2004, go to:
http://fmi.org
To get a sense of what’s planned for the show – scheduled for May 2-4 – we turned to Tim Hammonds, FMI’s president/CEO.
MNB: It’s big doings for the FMI Show this year in terms of incorporating a lot of new facets into the traditional mix. Is this a metaphor for how the industry in general is changing? And what does it tell you about the way supermarket retailers need to do to be more effective and competitive in 2004 and the years ahead?
Tim Hammonds: There are indeed substantial changes for this year's Convention with even more planned for 2005 and 2006. Our intent is to give the floor a new look every year by rotating spotlight categories in and out coupled with special pavilions on the floor targeted at each year's hot topics. This year, our pavilions are the new electronic product code and healthy living (diet and health).
We think this is a reflection of how the industry is changing. It isn't the same set of topics and issues year after year as it used to be. Our members and business partners face a rapidly changing industry and we need to have a format for the show that can keep out in front of those changes. That's why we feel it's time to keep a core focus on our key exhibitors that buyers need to see every year while rotating a changing mix of new categories from year to year. At the May show itself, we will be more specific on the rotation categories we plan for 2005 and 2006.
MNB: Food safety/security continues to be a hot topic. Is it your sense that while consumers remain confident in the food supply, the industry must continue to be vigilant to prevent future problems? And what steps do you think need to be taken in order to maintain the safety of the food supply?
Tim Hammonds: Let's take food safety first. Our focus has always been on three different, but interdependent levels: suppliers, store associates, and consumers. For suppliers, we have completed our formation of a new food safety standards and audit program for the industry's suppliers called SQF or Safe-Quality Food. This is a way for retailers to be sure their suppliers have food safety best practices in place and that these practices are really being implemented as verified by independent, third party audits. Different program levels are available for producers and processors with a major emphasis on our international fresh product suppliers. There are two workshop sessions at the May show specifically on this new service. It's our belief that government audits and inspections just can't keep up with the volume of commerce necessary in today's global economy. That means industry managed third-party standards will be a necessity.
For store associates, we have completed a specific training program for the supermarket industry called SuperSafeMark. It provides a full range of resources including on-line web-based training for basic skills all the way to classroom instruction for certifying safe food handlers. Once again, there are two specific workshops on this topic.
For consumers, our primary emphasis has been on the FightBAC (BAC for bacteria) to help train people on the important role they play in keeping food safe between the time they walk out of the store and the time they actually serve it at home. Information on this program is also available in the membership booth at the show.
We would urge everyone in the industry to familiarize themselves with these three programs so they will know how to use them inside their own companies.
MNB: Country of Origin Labeling (COOL) keeps popping back into the public consciousness, even when it seems that it’s been put to rest at least for the immediate future. What’s the current prognosis?
Tim Hammonds: We are quite optimistic, realizing that there is still a lot of work to be done. We're using the two-year delay to develop a substitute voluntary information program as an exchange for full repeal. The voluntary program is being drafted by a coalition of the key retailer and supplier associations representing the covered commodity groups. Winning a meaningful delay to give us time to do this was a major victory; now we have to craft a winning substitute. Fish remains a challenge since it was not included in the delay, but we do have an active strategy for including fish in the substitute proposal.
Everyone can take comfort in our progress, but everyone also needs to stay tuned and stay active when we ask for help.
MNB: What’s the current status of the estate tax? Is it your sense that its repeal will finally become permanent?
Tim Hammonds: Permanent repeal of the estate tax is a very high priority for FMI. We think it's essential for the ability of many of the industry's independent operators to keep the business in the family. It's hard to overstate how important this is for the future of the industry. Having said that, realistically this is likely to be a second-term issue for President Bush if he wins reelection. If we get a chance to move it in the next few months we will, of course, jump on it. But we believe the major push will come next year and if we get that opportunity we believe we will be successful.
MNB: What kind of role do you believe that food retailers should be playing in curing the obesity epidemic?
Tim Hammonds: Our industry's role in addressing obesity will be the focus of a special pavilion on the exhibit floor in May. Right now, the chances look very good that HHS Secretary Thompson will be with us to cut the ribbon on Sunday as we open the floor.
We need to do two things as an industry. The first is to provide the right products whether that means redesigning some of our traditional branded items or providing the right mix of categories in the store. The second is to remind people that addressing obesity involves both product choices and lifestyle choices. This means the answers will be different from person to person and family to family. Each of us has to find a solution that works in the real world. Solution options, information programs and innovative new products will all be on display in Chicago.
MNB: In your view, when retailers look to build sales over the next year, what do they need to do?
Tim Hammonds: This is a great topic. In my view, it's time for the entire industry to restart the conversation on targeting growth.
Over the last three years, everyone has been so focused on cost cutting, efficiency and survival that we have lost that focus. Those efforts have been essential and we can't abandon the lessons learned in the process. But we now need to refocus on the top line. This simple shift in top-of mind priorities would be a powerful statement to all of our trading partners that the industry is ready to reach out for new ideas and new opportunities. We have challenged all of our exhibitors to come to Chicago ready to have this new conversation with our retailers and wholesalers.
As part of this process, I think we also have to commit ourselves to reinventing the center store around our consumers of the future. The supermarket center store has seen an erosion of sales, even entire categories, to other formats for too long. We need to focus all of our energies on turning this slide around. This doesn't mean we turn away from our great success with perimeter departments.
Indeed, there is a lot of opportunity for innovative cross merchandising. What it does mean, however, is that we really need to rethink what we're offering and how we're offering it in the center store. Consumers have changed over the last decade and they're going to change even more over the next one. If we don't step away from the notion that all we have to do is fine tune our center store category management programs, we're not going to stay relevant to shoppers. We have to be willing to take a hard look at how we can really reinvent the core of our stores.
FMI plans to be an important part of this conversation.
For more about FMI 2004, go to:
http://fmi.org
- KC's View:
