Retail View: Los Angeles market registers strong produce sales growth
Retail View: Los Angeles market registers strong produce sales growth
The Los Angeles marketplace had very strong volume and dollar growth in fresh produce at retail over the last year, according to the latest Fresh Produce & Floral Council Market Report.
In the 12-month period ending July 1, retailers in the Los Angeles area (which includes Orange County and the Inland Empire) had an 8 percent gain in retail dollars and 3 percent gain in volume over the previous year's numbers. While retailers in California as a whole also had strong dollar growth (7 percent), the state registered only a 1 percent gain in sales. Los Angeles exhibited the greatest increase in volume and dollars of the four markets (San Diego, Los Angeles, San Francisco and Sacramento) compared in the report.
The FPFC Market Report is a member benefit produced each quarter by Fusion Marketing in Chatsworth, CA, and is designed to give retailers, wholesalers and shippers both a snapshot and comparison look at the California fresh produce retail scene.
The data presented come from many stores in each market. The Los Angeles information comes from four counties and includes 2,825 stores. More than 1,000 stores are surveyed in the San Francisco Bay Area, while over 500 stores provide information for both the San Diego and San Francisco markets.
The comparison data for California as a whole includes all of the stores in each of these individual markets as well as many stores in outlying areas. For the California data, 8,701 stores provide the scan data that is utilized in preparing the report.
FPFC members can look at the data and note growth or declines in many different commodities and the four markets to gauge against their own sales data.
For example, the report shows that pineapple dollar sales have grown for nine straight quarters. While this can partially be explained by a consistent increase in market price, volume growth is also on an upward trend.
The numbers show that for the 12-month period, fresh fruit in Los Angeles accounted for 52 percent of total produce sales while vegetables added 45 percent and the "other" category chipped in 3 percent. These percentages were fairly consistent across all four markets, though in Sacramento vegetable sales outpaced fruit by 49 to 48 percent.
Sales of organic produce in California continue to grow. The numbers for the state show an increase in dollar sales for fruit from 4.7 percent to 6.1 percent during the 12 months ending with the first day of July. Vegetables were even more impressive, jumping from a market share of 7.5 percent to 9.6 percent. Los Angeles trails the state a bit in this category, as organic vegetable dollar sales check in at 5.1 percent with fruit dollar sales being noted at 8.6 percent.
Not surprisingly, San Francisco is the most organic-friendly market in the state. Organic fruit sales account for 11.9 percent of that category while vegetables top 9 percent.
According to data in this latest FPFC Market Report, pineapple has seen a significant increase in volume sales in all four California markets despite higher prices.
Among some of the interesting data that surfaced while perusing the Los Angeles data is that bagged salads, though one of the more expensive vegetable items at an average of almost $4.40 per item, continue to show strong growth.
During the quarter that ended June 30, bagged salads accounted for 10 percent of fresh vegetable sales and about 3.5 percent of volume, reflecting the higher per-ounce cost of this value-added item. Those numbers represented a 16 percent increase in volume and a 23 percent increase in dollars over the previous year.
Sweet corn volume also grew in that quarter for the first time in two years. Corn sales are predictably on a roller coaster ride over the course of the year depending upon the season. But in quarter two of 2014, volume sales increased 5 percent over the previous year.
On the fruit side, grapes, melons, peaches, nectarines and pineapples also showed significant gains in quarter two of 2014 in the Los Angeles over the same period a year earlier.
According to the report, the Top 10 retail produce items for Q2 (quarter two) in the Los Angeles market, as determined by a combination of dollar sales, volume, sales, growth and seasonality, were grapes, melons, nectarines, peaches, pineapples, bagged salads, corn, cucumbers, lettuce and tomatoes.
These items were fairly consistent across the four markets surveyed, though there were a few differences. For example, in San Diego and Sacramento onions made the top 10 instead of lettuce. The San Francisco Top 10 included berries, melons, greens and kale.
As one can imagine the Top 10 lists are not just based on sales but a combination of all of the aforementioned factors.
Kale's inclusion in San Francisco is not just a bid to be trendy. Sales of this item continue to impress. In the 52-week period ending in late June, the volume of kale sales in San Francisco increased 72 percent while the dollar increase was 64 percent. As one might expect, the tremendous increase in kale volume has led to a small decline in the sales price. On average, the retail price shrunk 4.6 percent in those 12 months.
Kale's popularity was evident in each of the four markets with both dollar sales and volume up at least 59 percent in each market.
Sales data also confirmed that several other trendy items deserve their elevated spots in food magazines. In Los Angeles, both dollar sales and volume of beets were up close to 30 percent in the past year, while Brussels sprouts enjoyed a 22 percent increase in dollars and more than a 10 percent climb in volume.
California continues to be a market dominated by bulk sales, as exhibited by a closer look at the Los Angeles numbers.
Random weight (RW) made up the majority of fruit category sales, contributing more than two-thirds of dollars and 80 percent of volume. Fixed weight (FW) and RW dollars each grew at 7 percent, but RW volume growth of 3 percent outpaced FW by 2 points. RW vegetables contributed just over half of vegetable category dollars and 62 percent of volume. FW volume declined 1 percent, but dollars increased by 9 percent. RW vegetables exhibited growth in both dollars and volume, up 7 percent and 4 percent, respectively.
In terms of market share of dollars, the traditional items remain the most popular. During the 12 months ending June 30, bananas topped dollar sales in the fruit category, followed by melons, apples, nectarines, berries and grapes. The vegetable side was led by potatoes, tomatoes, onions and lettuce.
The detailed report is available through the FPFC website to members only.