Operators are responsible for a lot - SKUFood
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Operators are responsible for a lot

Happy Thanksgiving to all of our Canadian readers. It is a special holiday for those of us in the food industry. People at every point in the value chain put a lot of work into producing food for Canadians. I do believe the average consumer puts more value in food these days which should be rewarding to people in our industry.

This year we are selecting a term to define each week. Recently we have been focused on different roles within the retailer’s structure. If there are positions with your customer you would like defined just let us know.

Operators are responsible for the store operations part of the business. They manage all of the controllable expenses required to run the stores. This would include labour, utilities, supplies and other store expenses. They are also responsible for delivering the sales, margin and execution in each store.

Operator’s structure is a senior person reporting into the business leader, with directors or district managers who each have their own group of store managers to manage. The store managers in turn manage the department managers. Their interaction is limited with suppliers but there are occasions where operators can provide valuable insights to suppliers.

Where suppliers can interact with the operations side of a retailer

I would always preface this section with the reminder suppliers need to negotiate and communicate with category managers. They are the key point of contact and should always be aware of what is happening with their suppliers. That being said it is possible to develop relationships with the operations side of the business.

Operators run the stores and that means they own what happens between those 4 walls. Execution can be the difference for many items. When suppliers develop relationships with department managers or even store managers you can influence execution. Visits to stores prior to promotions to ensure inventory has arrived and in some cases even assist in the display building can make the difference. Learn what the store manager is comfortable with. Some want to do it themselves and some will be excited to have help.

If you have new listings you need to get the inventory to the shelf as soon as possible. As soon as your item is in the plan o gram you should visit stores and confirm the changes have been made. If you cannot find the items start with the department manager and get an understanding of when they will get the inventory out.

Operators are in stores 52 weeks of the year. They interact with consumers every day. They will hear more about your items than many others in the industry. If you develop good relationships with a few store people they will tell you what consumers are saying about your products.

You should talk to the people in the store about how your item goes through the retailer’s store. That would include the case pack you ship in, your packaging on the shelf and your scanning at the front end. Ask how your items are working and don’t be defensive. Their insights are based on what they see every week. If they know how to contact you they might alert you to a problem before you hear about it from the category manager.

Building relationships with operators

There are two ways to develop relationships with operators, say thanks for what they do and/or find ways to save labour dollars.

Operators are judged as often for what they can save as opposed to what they accomplish. This can get frustrating. They appreciate a thanks every now and then. You can say thanks in person or find creative ways to do it. Sarah from the Hand Pie Co. in PEI wrote a message to store employees in her case pack. One retailer put it on social media and shared it with their followers. Some great public relations for saying ‘thanks for putting our product on the shelf’.

Operators have a tough job managing labour. Merchandisers (category managers) want great execution of their programs and store managers are criticized if they invest too many labour hours. Store staff usually want more hours to get the work done. Work schedules are built in advance, based on sales estimates. It is a tough job for sure. If you can find opportunities to reduce the labour required to put your product on the shelf or through their store they will appreciate it. Ideas such as tear away cases or pallet ready displays can save hours.

Remember your key point of contact is key

It is great if you can develop relationships with operators. Just remember to keep your category manager informed about the interactions you have. Do not assume because an operator likes your product that the merchandiser will. Do not assume because the store manager says the new labour-saving case pack is a great idea, that your category manager will.

You definitely want to build relationships with different people within the retailer. Just always circle back to the category manager. You do not have to tell them everything you are doing but share the important conversations.

If you have any questions or require help working with the operations side of the business, you can always send me an email peter@skufood.com or call me at (902) 489-2900.


Smore’s Pepsi requires some mixing from consumers

Brands continue to look for interesting twists to their products. Pepsi has introduced 3 new SKUS which are Pepsi ‘ingredients’ to smore’s in a glass. There is a marshmallow, chocolate and graham cracker Pepsi and consumers can mix them together to create their own version. If you like a little extra chocolate in your smore’s use more of the chocolate Pepsi.

These are only available to consumers who enter to win them. Not in stores yet but I would bet if it creates a stir retailers will be clamouring to get them into stores for next summer.

Not every item is increasing in price

Banana retail pricing has not experienced the increases we have seen in many other commodities. The attached article provides some insights into the reasons.

Produce is a lot about supply and demand. I would add that the supply and demand have stayed in sync through the pandemic. The growing areas for bananas have not been impacted by the war in Ukraine which has impacted items like wheat.

When you think about the effort required to grow bananas, harvest them, ship them to North America and then get them through the retailer’s system - .89 per pound is not much money!

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Food and Beverage Masterclass

Food and Beverage Atlantic is preparing a Business Building Masterclass this fall, starting November 9th. This virtual course (held one morning per week for 6 weeks) is designed to help business owners and leaders develop a roadmap for managing, improving and scaling their food & beverage business. The course covers all aspects of general business, from defining purpose and competitive strategy to building high performing teams and managing for profit. Attendees will work together in a workshop setting to learn techniques and skills using a case study and sharing their experiences.

There are only 15 spots available! For more information or to register, click the link below.