US fresh-cut fruit innovator, Ready Pac, has reported that impressive growth from perishable departments is helping fuel private-label brand momentum, with fresh produce ranking in the top ten major categories experiencing private-label dollar volume growth.
For the year ending 4 August 2012, private-label sales through all fresh produce outlets reached US$107.5bn, an increase of 5.1 per cent on the same time last year. By comparison, fresh produce brand sales reached US$518.6bn and also grew, but at a more modest 3.1 per cent.
The data, supplied by Nielsen ScanTrack, reveals that in value-added produce the momentum is even more apparent. In the previous six months, total private-label value-added produce grew 10 per cent in unit sales, achieving a 30 per cent share of the category. Whereas, branded value-added produce sales declined 3 per cent.
Value-added private-label salads and fruit selections unit sales grew 16 and 18 per cent, respectively, and currently account for roughly one-quarter of the sales in their segments.
This growth in private-label brands can be attributed, in part, to the condition of the economy – there are 14.4 per cent more of these brands on the market today compared to in 2009.
Other contributing factors to this growth include a strategic positioning of these brands to feature as equal or better in quality to standalone brands.
According to the Private Label Manufacturers Association (PLMA), almost one in four products sold in supermarkets is now a store brand and 65 per cent of consumers agree that these private-label brand's product quality ranks 'as good as', while 38 per cent say that some private-label brands have a higher quality, than national brands.
'Ready Pac was one of the first fresh-cut produce companies to embrace a dual-brand strategy with our own brands and producing for private labels,' said Tristan Simpson, director of marketing and corporate communications at Ready Pac. 'We offer private label programmes for select customers whose corporate strategy seeks tops quality store brand products.'
'We think that private-label growth and consumer acceptance is going to keep expanding because of the coming generations' attitudes,' said Simpson. 'Generation Xers outspend the US average on private-label brands and Millennials report the most positive attitudes toward private-label. We're ready.'
A recent Rabobank report mirrored this optimism, forecasting that own-label brands are on track to achieve market shares on a level with Europe over the next decade, with growth increasing from 20 per cent to 30 per cent.
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