Q&A: Perishable profits
Drug Store News spoke with Greg Tradup, category manager of perishable, supplies and foodservice at McLane Co., about how chain drug retailers successfully can operate in the growing perishable foods space.
Drug Store News: Why have fresh and frozen food become such an attractive category for chain drug retailers?
Greg Tradup: Drug stores need to find new ways to cater to the needs of their core female shoppers. The channel is becoming widely recognized more as a destination for grocery take-home items than c-store instant consumable items.
Take-home fresh and frozen foods offer a wide variety of options for meal preparation both at home and at the office, so it appeals to the drug store female core. The category also appeals to non-typical drug consumers who recognize the value of foregoing a trip to a large grocery store when the local drug store offers the same or similar items in a quick, convenient format.
DSN: How can McLane help drug retailers overcome barriers that traditionally have prevented the channel from entering the perishable category?
Tradup: McLane constantly is changing the cold-chain distribution dynamic. The traditional distribution solution of offering items that have a long shelf life and strong resistance to temperature changes has been replaced with high-turn, short-coded items like fresh milk, multitemperature produce, and cut fruits and salads tailored to meet specific retailer needs. Through our wide assortment of suppliers and long-term experience in the industry, McLane can tailor a program to meet just about any need a drug chain may have.
DSN: How does McLane help retailers stock the right assortment of products and keep that stock replenished?
Tradup: By maintaining one of the largest databases in the industry, McLane can manage top items in every category, watch for new and emerging trends, and get a jump on industry changes so our customers stay ahead of the competition. Through McLane’s proprietary ordering system, drug retailers can order short-coded (shelf life) product through us and receive product with plenty of shelf life remaining. In most cases, the retailer will receive product within a day or two after it’s delivered to McLane, providing the best dating possible.
McLane’s Smart Handheld Ordering System allows retailers to place their common orders, as well as keep on top of new items, new promotions and special offers our suppliers may be providing. The Smart Handheld also offers suggested orders based on previous ordering history, so that if a store forgets to order a common item, the system orders it for [that store].
DSN: What kind of space commitment is needed to maximize sales in this category?
Tradup: While optimal space commitment depends on the size, location and scope of the store, most stores need a section for open-air coolers, freezer doors and produce. It’s important to gain consumer confidence in a category that isn’t traditionally associated with the drug channel. Space should always be clutter-free and clean, as consumers won’t trust fresh or perishable items if they feel the products have been mishandled or contaminated.
For retailers with limited space, McLane has a range of attractive equipment solutions featuring cutting-edge “air-curtain” technology that enhances the presentation of fresh product and promotes impulse purchases.
DSN: What new segments of the category should drug retailers be considering?
Tradup: Offerings in fresh fruit and salads give the one-stop shopper another reason to skip the large grocery store in favor of a more convenient drug store. New changes in packaging allow for longer shelf life of fresh sandwiches — another key category. While not a consumable, another segment for retailers to keep an eye on is floral. Many drug chains have been expanding into fresh flowers and potted plants with promising results.