Tuesday, June 1, 2010

Private Label brand managers need to come out swinging vs. lame slotting fees.

Diminished is the role of the legacy national brand manager in a world where private label is branded. When national brand manufactures continue paying slotting fee’s to grocery stores and supermarkets as the easiest way to reach the consumer. The slotting fee’s continue to go for space on the shelf but the key location End Caps are now being filled with the stores own private label products. If your paying a National Brand manager and your brand value is gone, fire the brand manager or pay higher slotting fees and fool some of the people some of the time.

Who likes slotting fee’s well for one wall street analyst love to see sales via pushing slotting fee’s at the end of a slow quarter to meet “goals”. Why they like it is beyond logical reason. Mediocre C-level grocery store chain managers like it better than being force to become merchants. They utilize slotting fee’s to supplement profits. It justifying being a poor merchant with rationalization. By the way wall street likes that too!

The brand managers of the private label products are utilizing a tool out of the National Brand Managers playbook to build loyalty, reinforce value and generate additional sales and profits for the store and their particular private label product. They are taking the end caps for themselves!

Price Chopper is utilizing what they call “power displays”. Wal-Mart is utilizing the end caps to reinforce value of their private label products and consumer is picking them up! Wegmans gets the customers coming and going utilizing the vestibules with the likes of Wegmans private label potato chips and the next week Wegmans own canned tuna and their own mayo for example. I say keep it up!

Deep in the store the private label battle continues with ready-to-eat and ready-to-heat portable food. All prepared fresh and in most cases right in front of the customer. Private Label Grocerant ready-to-eat and ready-to-heat food now has brand managers of their own and they are building sales not slotting fees. Think about it, building sales on demand from consumers? Novel ideation or business fundamentals, you chose.

Outside eyes can deliver top line insights and bottom line profits. Invite Foodservice Solutions to provide brand and product positioning assistance. Since 1991 Foodservice Solutions of Tacoma, WA has been the global leader in the Grocerant niche for more on Steven A. Johnson and Foodservice Solutions visit http://www.linkedin.com/in/grocerant or on Facebook at Steven Johnson

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