CFA FOOD·4·THOUGHT
Friday, July 18, 2008
Stan Sorkin, Executive Director
195 Farmington Ave., Suite 200 · Farmington, CT 06032 · 860 677 8097 · Fax 860 677 8418 · www.ctfood.org
2nd Annual Summer Fun Picnic
Thursday, July 31 • 4:30-8:30 p.m. • High Meadow, Granby, CT
Call the CFA today for tickets!
$75 per person • $700 / 10-pack • $80 per person at the door
RACES FOR STATE LEGISLATURE TO BE SETTLED BY AUG. 12 PRIMARIES
It may be mid-summer, but primaries for major-party candidates seeking to run for the state legislature in
November are right around the corner. Connecticut’s election season kicks off on Tuesday, Aug. 12, when
party-registered voters in dozens of cities and towns will go to the polls to settle intraparty races. In some of
the contests, candidates are trying to unseat incumbent state legislators. Most of the primaries, however,
are for legislative seats that are now open because the incumbents have decided not to seek reelection.
Only voters registered with the political party holding the primary in their particular district may participate.
Currently, the Connecticut House of Representatives has 107 Democrats and 44 Republicans, and the state
Senate has 23 Democrats and 13 Republicans. However, 22 legislators will not be returning to their seats
this fall. Nine Democratic and 9 Republican state representatives are stepping down, and four senators (all
Republicans) are doing the same. Two of the incumbent Republican representatives stepping down are
seeking Senate seats. After the primary battles, however, there will be numerous uncontested seats for the
state legislature this year. According to the secretary of the state’s office, there are 41 uncontested House
races, including 29 Republican and 12 Democratic incumbents. (Still, this is an improvement over two years
ago, when there were 62 uncontested House contests.) The Senate has seven uncontested seats,
compared with nine in 2006. Under Connecticut law, there are three ways candidates can qualify for a
primary. Candidates can win the endorsement of their party convention for the seat or secure the support of
at least 15% of the convention delegates. Failing that, they can become petitioning candidates by collecting
signatures from a minimum of 2% of enrolled members of their party in the voting district. For the latest
listing of primary challenges for the state legislature on Aug. 12, visit CTbizVotes.com (CBIA.com).
For the current Primary list visit http://www.cbia.com/gov/gar/0608/primaries-08.htm
CFA AND CSFA HOLD SUCCESSFUL TRADE SHOW
On July 16, CFA and its sibling, the Connecticut Specialty Food Association, held the first trade show aimed at
spotlighting the specialty food products produced by CSFA members to buyers, merchandisers, and category
managers of CFA members under the premise that Connecticut specialty foods should be available in
Connecticut supermarkets and a trade show would help eliminate the barriers to achieving this goal. The show
was a great success with 25 CSFA members exhibiting and 35 representatives from CFA companies in
attendance. Our thanks goes out to CFA members in attendance—Big Y, Price Chopper, Bozzuto’s, ShopRite, C&S, White Rose, Geissler’s, Highland Park Market, Davidson’s, Adams, LaBonne’s, Tri-Town, and
Whole Foods. As a result of the show, 7 new members were added to the CSFA membership rolls.
THE ART OF FOOD LABELING
Today, food marketers need to understand not only which claims and wording are appropriate for their
products, but which resonate with distinct groups of consumers, says Ramin Ganeshram, director and
consumer strategist, food/beverage for trend-spotting/analysis firm Iconoculture. Since the "organic" term on
labels has become ubiquitous and therefore diluted, "mounds of new labels are popping up to take its place in
the 'notice-me' game," Ganeshram says. "Understanding your customer's specific informational cravings is
vital to making labels stand out and combating growing consumer skepticism. Consumers want even higher,
provable standards and labels that tell an appealing and truthful story." Most newer food and beverage labels
can be grouped into four categories, she explains: Safety, (non-GMO, rBGH-free and VeriPrime), heritage
(protected designation of origin, country of origin), sustainability (fair trade, sustainably farmed, Rainforest
Alliance, shade-grown, locally grown, protected harvest) and humane (Certified Humane Raised and Handled,
American Humane Certified, cage-free, pastured). But there are also four types of label-conscious shoppers,
and some are interested in multiple label categories. The first of these is safety shoppers, those who are
primarily concerned with knowing that foods are safe, pure and healthy. Gen-X parents are a demographic
"hot spot" within this segment. Label categories that resonate include "safety," "humane" (treatment of
livestock is often equated with safer meat) and "heritage" (country-of-origin may enhance safety perception.)
Examples of best labeling practices for safety shoppers include "rBGH-free" milk labels and "no antibiotics"
meat/poultry labels.
The second is taste shoppers. These consumers value freshness, artisanal quality and small-scale regional
production. Affluent Boomers are a demographic hot spot. Label categories that resonate with taste shoppers
"heritage" (implying authentic flavor) and "humane" (less-stressed animals produce tastier meat). Labeling
opportunities include calling out local sourcing (even on mass-market goods), telling a "story" around the
producer and enhancing premium image by associating the product with regional traditions. If some
ingredients are locally sourced, consider a farm-to-table chart or story about this on packaging, Ganeshram
suggests.
Third is eco shoppers. Hearing that a product isn't contributing to land, water and air resource problems isn't
enough for this group. They want a factual rationale for how it's protecting resources. Millennials and Boomers
are demographic hot spots. Resonant label categories for eco shoppers include "sustainability" and "humane."
Tesco's carbon miles labeling, being tested in the U.K., is a best-practice example. Ganeshram recommends
addressing not just a product's production, but its impact along the food chain. Consider carbon labeling,
participate in carbon-offset programs, and cite your carbon stats within the context of comparative ratings.
Lastly are ethical shoppers, who want to know that those producing the food get a fair wage within
sustainable local environments, and that animals in the food chain are being treated respectfully.
Millennials and Boomers are demographic hot spots. Resonant label categories for ethical shoppers
include "humane" and "sustainability." Best practice examples include Murray's Chicken's "Certified
Humane" labeling and Horizon Organics's dairy farmer profiles. Labeling opportunities include explaining
how animals are raised or telling a story about the local farmer/producer (Media Post).
RETAIL TOUCHPOINTS: RETAIL LOYALTY PROGRAMS LAG IN CUSTOMER METRICS
A new survey of retailers showcases the sophistication and diverse multi-channel approach best in class
companies are bringing to loyalty programs. At the same time, the report makes it all too obvious that many
retailers are still checking "don't know" and "don't measure" when it comes to key metrics around loyalty
programs like churn, retention, and customer satisfaction The results came from a new study from Retail
TouchPoints and The Aberdeen Group titled: Responsive Customer Loyalty: Creating Customer
Commitment in Retail. Among the signs of multi-channel loyalty management is the spread of data in
operationalizing member acquisition. Retailers submitted all applicable information to the questions asked
in the report and it found that 45 percent of retailers register customers via sales associate in the store, 41
percent at the point of sale, and 41 percent online. Twenty-one percent currently use "cross channel loyalty
tools that align with cross-channel customer demand," with 34 percent saying they plan to implement this
capability within the next year.
"Retailers are using multi-channel tools for loyalty programs and that's good news," said Sahir Anand, senior
research analyst, Retail and CPG Practice for Aberdeen Group. "In order for loyalty to work it has to be drawn
to multi-channel tools. It must be utilized in store and online. It's the only way for the customer that gets a
special offer at the POS to redeem it online or vice-versa. Multi-channel operations are the only way to
operationalize loyalty." Still, as Mr. Anand said, "There are gaps." Some key metrics in the report go
unmeasured by retailers. For example, year-over-year same-store performance was unknown by 35 percent
of respondents. Similar numbers were tracked for market basket size, customer retention and customer churn,
all key data points for any loyalty program. Other unknowns are more dramatic. When asked "what percentage
of your current customer base are promoters of your brand" only nine percent of the respondents said more
than half of their customer base promoted their brand. Forty-six percent of respondents did not measure
promotion among their customer base at all. "Very concerning," said Mr. Anand. "Not enough retailers equate
loyalty with data. It's an extremely fragmented industry in that regard. Retailers must understand the
importance of managing their knowledge development. Only after you manage knowledge can you manage
performance." (Retail Wire)
USDA TO UNMASK RETAILERS IN CLASS ONE RECALLS
After years of resisting the notion, beginning next month the U.S. Department of Agriculture will identify stores
selling meat and poultry products involved in Class I recalls, which are the recalls that the agency classifies as
of most serious concern to public health. Until now, USDA has publicly identified only the states where
recalled product was distributed, along with supplier lot numbers that critics have said means nothing to
shoppers. The agency said that for some recalls, specific product information useful to consumers has not
been made available to help identify recalled products that may still be in their home. "The identity of retail
stores with recalled meat and poultry from their suppliers has always been a missing piece of information for
the public during a recall," said Secretary of Agriculture Ed Schafer, explaining the policy change. "People
want to know if they need to be on the lookout for recalled meat and poultry from their local store, and by
providing lists of retail outlets during recalls, USDA's Food Safety Inspection Service will improve public health
protection by better informing consumers."
The American Meat Institute, however, is not convinced the rule is an improvement, and released a statement
expressing strong opposition to the move. “The most accurate way to make this determination is to rely upon
product identifiers like code dates, plant numbers, and brands announced by recalling companies,” said Mark
Dopp, AMI’s s.v.p., regulatory affairs and general counsel. “Although this rule seems consumer-friendly on its
face, it has the potential to mislead and confuse consumers.” Dopp said that during recalls, product
distribution information could expand over time. “A meat company may have sold a product to 10 distributors,
and each of those distributors may have sold some of the product to 10 brokers and each of those brokers
may have sold products to 20 retail stores,” Dopp said. “This complex shipping information is compiled and
updated over time. It is not typically available in a complete form when a recall is announced.” Dopp claimed
the proposed USDA rule was flawed because “if a consumer sees an early version of a list of businesses that
received recalled product, that consumer may conclude that he could not have purchased the product,” he
explained. “Three days later, the consumer’s local grocery store may appear on the list, but the consumer is
unlikely to check the list again and may consume recalled products.”
As expected, consumer groups cheered the news. "We're pleased that USDA will no longer keep consumers
in the dark about recalled meat," said the Consumers Union, which publishes Consumer Reports magazine.
"Up until now, when USDA announced a recall of contaminated meat, it would only tell the public the states
where the product was distributed. The specific names and locations of stores that got the product -- the
information that can actually help the consumer -- were kept confidential." The announcement provides a 30day notice after the rule is published in the Federal Register before the process of listing retail stores takes
effect (Progressive Grocer).
LEAN POCKETS RECALLS FROZEN STUFFED CHICKEN SANDWICHES THAT MAY
CONTAIN PIECES OF PLASTIC
Nestlé Prepared Foods Company, a Mt. Sterling, Ky., establishment, is recalling approximately 199,417
pounds of frozen stuffed chicken sandwich products that may contain pieces of plastic, the U.S. Department of
Agriculture's Food Safety and Inspection Service announced today.
The following products are subject to recall:
*9-ounce boxes of "Lean Pockets Spinach Artichoke Chicken - 2 sandwiches." Printed on the side of
each box is a "Best Before" date of "Nov 2009" followed by a package code beginning "8144 544616."
Also printed on the side of the package is the establishment number "P7721A."
The products were produced on May 23 and distributed to retail establishments nationwide. The problem
was discovered after the company received consumer complaints. FSIS has not received any consumer
complaints at this time. Two injuries have been reported to the company. Anyone concerned about an
injury from consumption of the products should contact a physician. Consumers with questions about the
recall should contact Nestlé Consumer Services Center at (800) 350-5016. Media with questions about the
recall should contact Company Marketing Communications Manager Roz O'Hearn at (440) 264-5170.
Consumers with food safety questions can "Ask Karen," the FSIS virtual representative available 24 hours
a day at AskKaren.gov. The toll-free USDA Meat and Poultry Hotline 1-888-MPHotline (1-888-674-6854) is
available in English and Spanish and can be reached from l0 a.m. to 4 p.m. (Eastern Time) Monday
through Friday. Recorded food safety messages are available 24 hours a day (USDA).
HIGH ENERGY PRICES, BUT IMPROVEMENTS IN STATE TO HELP
Although energy prices are high, an improving infrastructure in Connecticut and consumers’ increasing
power to control their use are starting to help matters. That was the consensus of energy experts at a recent
CBIA informational forum designed to help businesses understand and respond to rising energy costs.
Speakers were state Sen. John Fonfara (D-Hartford), co-chair of the legislature’s Energy and Technology
Committee; Commissioner Donald Downes, chairman of the state Department of Public Utility Control
(DPUC) and Chris Kallaher, director of government and regulatory affairs, Direct Energy (the event’s
sponsor).
First, the bad news: energy prices are high. And while the state’s goal is to move away from the use of fossil
fuels, our dependence on natural gas to power energy plants is still increasing, which will also put upward
pressure on costs.There is an upside, however. Energy consumers in Connecticut are gaining more ability
to monitor and control their costs. “What we measure,” said Kallaher, “we can change.” Businesses that
have done the most to become energy-efficient, he said, are using 30% less energy than comparable
companies that have not taken similar actions.There are a host of programs to help Connecticut businesses
become more aware of their energy use and make it more efficient. Information about many of these
programs can be found at http://ctsavesenergy.org, (a site set up by the Connecticut Energy Efficiency
Fund) and www.ctenergyinfo.com (produced by the DPUC and the Institute for Sustainable Energy).
Sen. Fonfara said the state’s Electric Efficiency Partners Program, part of the landmark legislation he cosponsored and lawmakers adopted in 2007, will help businesses control their energy costs. The program
helps companies buy and use new demand-side management technologies to better manage their energy
use and avoid the highest-demand, highest-cost times. That’s important, said Fonfara, because 20% of the
cost of electricity in Connecticut is incurred in a very small window of time. Hot summer afternoons, the
times of peak demand, are when Connecticut’s electric grid is stretched to the limit and prices are the
highest. Knowing how to spread out that energy use can save businesses on their power bills. Looking
ahead to what additional steps Connecticut can take to reduce power use and costs, Fonfara said that the
state welcomes good ideas. In fact, the General Assembly left the door open for the approval of new
technologies to help flatten Connecticut’s energy load demand and, in turn, stabilize or reduce costs (CBIA).
U.S. CONSUMER PRICES SURGED 1.1% IN JUNE, FASTEST PACE SINCE 1982
The U.S. consumer price index surged 1.1% in June, the largest monthly rise since June 1982. Excluding
food and energy, the CPI advanced 0.3%. Both readings exceeded economists’ forecasts. On a year-overyear basis, consumer prices swelled 5%, the highest rate since May 1991. The core CPI grew a more
modest 2.4% compared to June 2007, though that’s still well above the Fed’s long-term goal of 1.5% to
2%. The data tighten the screws on Federal Reserve officials as they balance a stagflationary mix of rising
unemployment, strained financial markets and rising inflation (Wall Street Journal).
BAGGING LUNCH: THE INFLATION EFFECT
A few months ago Jessie Snider, 23, began to feel the pinch of the rising cost of gasoline, food and, well,
everything. Then she realized the $75 to $80 she was spending each week on lunch was really cutting into her
paycheck. So in March she traded sit-down lunches of elaborate caprese salads and angel-hair pasta for
brown-bag lunches of leftover stir-fry and turkey sandwiches. "Lunch was the first thing I cut back on," says
Ms. Snider, who works as an assistant account executive for a public-relations firm in Atlanta. Make room for
another victim of the weak economy: lunch. Ms. Snider is part of a growing tide of midday restaurant regulars
who are changing their habits to save cash. Instead of indulging in a roasted portobello sandwich and gourmet
chips at a nearby bistro, many workers are now brown-bagging it. In fact, online bag retailer eBags.com saw
sales of lunch bags and coolers increase 39% in June over the year before. Other workers are turning to
cheaper alternatives -- like subsidized or free corporate cafeterias and cheaper fast-food spots. t's not just the
young, entry-level workers who are cutting back. In March, after price increases of 10% to 20% at his favorite
midtown Manhattan eateries, Marc Haskell gave up his gourmet spinach salads and turkey wraps and began
packing turkey sandwiches from home. The 47-year-old executive vice president of the Glazier Group, a
restaurant and hospitality company, says he now saves around $50 a week on lunch. Though he occasionally
misses getting out of the office and socializing with co-workers during lunch, he says eating at his desk has
made him more productive. "Instead of going out for an hour, walking to the place and waiting on line, I can
basically eat in 10 to 15 minutes and catch up on some news."
Restaurants Feel Squeeze
Popular lunch-hour restaurants say increases in both wholesale food prices and vendors' fuel surcharges are
putting a squeeze on their profits. Indeed, the consumer-price index for all food has risen 5.1% since May
2007 and is expected to rise even further. Then, after price jumps, come the cutbacks from consumers, which
further hurt restaurants. According to a Zogby International survey of 755 people conducted in May for Marlin
Co., a workplace communication firm, nearly half of employees surveyed had reduced their food purchases.
As a result, restaurateurs cite a decrease in lunchtime traffic -- and say existing customers now gravitate
toward lower-price items on the menu. Some are trying to adapt: In February, Costello Sandwich & Sides on
the North Side of Chicago, for example, added a less-costly half-sandwich option to its menu in response to
customer demand, says Chris Costello, the owner, who adds that this will be the first "no-growth year" in the
two-location restaurant's 10-year history. Lisa Hall, owner of Kitchenette, two home-style eateries in New York
City, recently added an incentive for frequent patrons: For every 10 sandwiches a customer buys, they get the
next one free. The goal is to boost revenue with additional sales. "We can charge an extra 25 to 50 cents, but
that doesn't even halfway cover the extra costs we are being charged," she says. Nick Liuzzi, owner of
Samantha's Trattoria in New York City's Battery Park, typically caters to brokers and banker-types. But, as
those industries suffer, Mr. Liuzzi estimates that the Italian delicatessen has seen a 15% to 20% drop in
lunchtime traffic since last year. "People are more conscientious of their spending; even corporate spending is
down," he says. Some former $50-a-week lunch patrons haven't fully abandoned lunches out, but have
instead traded in table service for standing in line for a cheaper kind of sandwich. Subway Restaurants says
its $5 footlong sandwiches are luring the lunch set away from pricier restaurants. A spokesman for the chain
says there has been an increase in customer count since implementing the $5 footlong nationally in late
March.
Jennifer Nichols, an account executive for a San Francisco public-relations firm, is one of those new
customers. She used to spend $10 a day on gourmet salads and ham-and-cheese sandwiches. About four
months ago, the restaurants started to eliminate the cheaper combos meals, and the cost of her lunch became
noticeably high. So Ms. Nichols headed to Subway. Now, she buys a footlong sandwich for $5 and saves the
second half of it for the next day's lunch. To further cut costs, Ms. Nichols now buys her drinks and chips at
supermarkets or convenience stores. Her new total tab for lunch: $15 to $20 a week.
The Company Kicks In
Some employees are discovering that there is such a thing as a free -- or subsidized -- lunch. Lawrence
Minicone, a financial consultant with FactSet Research Systems Inc., says that lately he's been heading to the
company cafeteria. FactSet, a financial-data provider based in Norwalk, Conn., has provided free lunch four
days a week to its 1,800 employees world-wide for years. However, in the past few months there has been a
10% to 15% increase in employees frequenting the cafeteria. "Because of the rise in food costs, FactSet's
policy really helps," Mr. Minicone says. In some cases, employers who didn't offer much in the way of lunch
fare are stepping in to alleviate rising food costs. At public-relations firm Weber Shandwick's Dallas office,
management has extended free lunches from the first Monday of each month to six or seven times a month
since January. Ken Luce, president of Weber Shandwick California and Southwest, says about 80% of the
firm's 102 employees take advantage of the lunches, up about 10% to 15% since last year. Mr. Luce finds that
when the food is brought in, employees eat as a group, which encourages collaboration and boosts morale.
He adds that while it may cost more to provide lunch, which ranges from $7 to $12 per person, it makes
employees happy. The meals also offset "the cost of turnover," he says, because it's cheaper to buy lunch and
retain valued employees than it is to hire and train new workers. GotVMail Communications, a
telecommunications company based in Needham, Mass., started subsidizing employee lunches last summer
to offset rising food and gas prices in the area. The company's 48 employees now get a $5 food credit each
day that offsets the cost of lunch at area vendors. David Hauser, GotVMail's co-founder and chief technology
officer, says it works out to an added benefit of $1,150 per year per employee, plus gas savings for employees
who no longer have to drive to eateries since food is now delivered. About half of GotVMail's employees take
advantage of the program.
FDA, CDC LIFT SALMONELLA WARNING FROM TOMATOES
The U.S. Food and Drug Administration and the Centers for Disease Control and Prevention yesterday lifted
their warning on fresh tomatoes implicated in the ongoing Salmonella Saintpaul outbreak that has sickened
more than 1,000 consumers. The agencies announced in a joint statement that “consumers may enjoy all
tomatoes that are available in the U.S. marketplace without regard for their origin.” FDA Associate
Commissioner for Foods David Acheson explained that all farms identified through the agency’s traceback
investigations are no longer shipping tomatoes. The agency also found no evidence of contamination along
the supply chains implicated in these investigations. In a release issued after the announcement yesterday,
the United Fresh Produce Association urged the CDC and FDA “to now complete their investigation of
Jalapeno and Serrano peppers quickly so that either the problem can be identified or, if not, these products
can be cleared as well.” (Supermarket News)
CFA UPCOMING:
Summer Fun Picnic
Thursday, July 31 • 4:30-8:30 p.m. • High Meadow, Granby, CT
 UConn Football Tailgating Party – Saturday, September 13 • Rentschler Field, East Hartford, CT
 Person of the Year Banquet – Saturday, October 11 • Hilton New York, New York City