Food Business News - July 15, 2014 - (Page 22)

Major C.P.G. manufacturers having trouble getting noticed ingredients custom blends innovation national distribution B.C. Williams Bakery Service BCW Food Products 1-800-527-4104 22 FOODBUSINESS NEWS ® KANSAS CITY - During this past month, both ConAgra Foods, Inc. and General Mills, Inc. issued their earnings for the fourth quarter and full year. Executives from neither company was satisfied with results, and both cited a reduction in promotional efficiency as a significant challenge. It would seem increased competition for promotional space at retail is resonating throughout the food and beverage industry, forcing consumer packaged goods companies to become more creative in their merchandising and promotional efforts. " ... It is not a question of price point erosion or more aggressive levels of promotion," said Don Mulligan, chief financial officer for General Mills, Inc., Minneapolis, during a conference call on June 25. "It really for us (is) related to execution. We just see more and more of the players interested in getting merchandising. There are a limited number of places in the store to get that high quality that we want, which is really good placement on end-aisle displays coupled with the feature support that we know drives efficient merchandising." Ken Powell, chairman and chief executive officer of General Mills, cited the yogurt category as an example. "(There are) just lots of people coming in with new items," he said. "So the competition for a limited number of quality display options, I would say, is increasing. So we continue to have very, very high confidence in our sales capability. We are really good at what we do there and we think we know the ingredients to successful execution. "It always boils down to getting the right category-driving products on display in the right way at the right price point ... So we know what to do. There is just more competition and demand, so we will have to up our executional game." Tom McGough, president of ConAgra Foods' Consumer Foods, segment, broke the issues his company had during the year into three pieces. "In frozen, there has been an increase of overall competitive activity," he said "We have bolstered our support. We've been competitive in our programs and our market share, primarily in the premium and value segments, with Marie Callender, Bertolli and Banquet, for the fiscal year is up both in terms of volume and dollar share. We feel like we've struck the right balance there and those (are) our businesses that we will continue to invest in." Secondly, Mr. McGough said in such a tough competitive environment companies have to identify ways to "break through." "There are two ways that we're doing that," he said. "On Chef Boyardee, we've seen a lot of concurrent merchandising. We've traditionally enjoyed exclusivity in our events. "Throughout the year, we've experimented with different approaches to get a higher lift. We had some very positive impact with that with some customers in Q4. We're going to be implementing that on a much broader basis throughout the fiscal year, and we will see a better impact from that." Finally, Mr. McGough said it is about ideas. "Where we do really, really well is when we bring those consumer insights, particularly around meal solution and easy-to-execute solutions for retailers, we win," he said. "We see that on Hunt's, Ro Tel, many items in our portfolio." Both Sam K. Reed, chairman, president and c.e.o. of TreeHouse Foods, Oak Brook, Ill., and Dennis Riordan, c.f.o., touched on this subject June 30 while discussing TreeHouse's pending acquisition of Flagstone Foods. Neither cited competition as a reason for the reduced promotional effectiveness, but pointed to the consumer and overall innovation. "From my perspective, as you look at the consumer sector of the economy, as the numbers for the first quarter have come out, and been substantially revised downward, and even when you take out the weather phenomenon and health care, what you come to is that the consumer segment of the economy continues to struggle," Mr. Reed said. "The outlook people have is very guarded and while the macro data improve, that shoppers are, as they seek the best value in basic commodities, the goods and services that July 15, 2014

Table of Contents for the Digital Edition of Food Business News - July 15, 2014

Food Business News - July 15, 2014
ADM betting billions on flavor category
Bumper corn, soybean crops on the way
Dairy Business News - Managing the mouthfeel of dairy products
Table of Contents
Web Contents
Editorial - Food as medicine trend gaining momentum
Bob Evans trying to capitalize on chicken
Protein, gluten-free products coming from General Mills
Mars accelerating health and wellness strategy
Path cleared for Tyson to acquire Hillshire Brands
Nestle sells Juicy Juice business to private equity firm
Five profiles for protein-rich product development
Hormel adding muscle to its Specialty Foods business
Major C.P.G. manufacturers having trouble getting noticed
CVS launches better-for-you snack line
Kroger makes move to bolster e-commerce presence
Raising the bar on sports nutrition
Making insects inviting to eat
What’s for dinner?
The case for insects
Washington - 'Nano' ingredients
Health and Wellness - Cost, ‘cleanliness’ and flavor innovation
Ingredient Innovations - Masking protein’s undesirable flavors
Highlights and Photos from I.F.T. 2014
New Food Products
Ingredient Market Trends - Spring wheat production forecast 6% higher than in 2013
Ingredient Markets
Supplier Innovations and News
Ad Index
Food Business in the News

Food Business News - July 15, 2014