Demand For Sweet Onions Still On Upward Trajectory

Originally printed in the April 2020 issue of Produce Business.

Distinctive, seasonal merchandising is key to robust sales growth.

After being produced in the United States for more than a century, additional varieties of sweet onions have been developed and imported to satisfy rising demand for their mild taste and versatility. Alongside Georgia and Texas, today sweets are grown in California, Washington, Nevada, Maui and even Alaska, as well as being imported from Central America, Chile and Peru. With varieties harvested at different times, and their flavor differentiated by the soils in which they are grown, retailers have ample opportunities to profit from year-round supply.

Essential Item

Of total onion dollar sales, sweet onions represent the largest share at 35%, according to data provided by the Vidalia Onion Committee. Vidalia onions account for 62% of sweet onions sales, and 22% of total onion sales.

With demand continuing to grow, sweet onions are a ‘must’ for retailers, notes Troy Bland, chief operating officer of Vidalia Brands & Bland Farms, Glennville, GA. “Since sweet onions are now available all year (versus the past when it was a seasonal onion), consumers look for and crave the sweet, mild flavor year-round; keeping demand high for retailers.”

Largely due to their 12-month availability, sweets have been gaining as much space in produce aisles as other onions, reports the National Onion Association (NOA), Greeley, CO. “Sweet onions do tend to be more profitable, our growers say, mainly because they are sweet, and considered more of a niche in the marketplace,” notes René Hardwick, director of public and industry relations.

For the past several years, Peri & Sons Farms, Yerington, NV, has witnessed a “steady increase” in demand for sweets, including organics. Cindy Elrod, sales and new business development, says consumers have shown they’re willing to pay a premium for a truly good sweet onion. “This gives retailers a lot of leeway for pricing sweets, and being creative with ads,” she explains.

K-Va-T Food Stores, Abingdon, VA, stocks sweets year-round; starting with Georgia, before transitioning to Peru, then Mexico and Texas, and back to Georgia. “Sweet onions are similar to other onions in profitability, however, certainly much more popular than any other onion we offer,” says Ryan Ellison, produce category manager. “Sales have been up continuously year over year.”

Sweets are considered to be the premium variety in the category at stores owned by Byron Center, MI-headquartered SpartanNash — including Family Fare, D&W Fresh Market, Martin’s Super Markets, VG’s Grocery and Dan’s Supermarket — as well as its independent retailers. “Sales of sweet onions really depend on the supply and market of the Vidalia sweet onion, which is the most popular,” says Vic Savanello, regional vice president, Produce & Floral.

Popularity

The great thing about sweets, says NOA’s Hardwick, is their year-round availability enables consumers to try all regional varieties during their seasons; from Vidalias (Georgia) and 1015s (Texas) to California Imperials (California), Walla Wallas (Washington), Sweetie Sweets (Nevada), Maui Sweets (Maui, HI) and Yensis (Alaska).

The most popular variety during early spring is the Texas 1015, says Peri & Sons’ Elrod, then Vidalias during spring and summer, before Walla Wallas take their popular spot in late June through early August, and not forgetting Maui Sweets.

Meanwhile, she claims Peri & Sons’ Sweetie Sweet variety has dominated the fall sweet onion slot for more than 10 years. Moreover, Elrod says Sunions (tearless sweets) are quickly becoming the most popular sweet onion during winter, which historically was dominated by Peruvian sweets.

The Vidalia Onion Committee (VOC), Vidalia, GA, continues to see strong demand, particularly the past season, according to manager Bob Stafford. “Data suggests Vidalia onions are among the country’s most popular, well-known and sought-after sweet onions … particularly in the South, the East and Midwest,” he says.

“When they are in season from mid-April until early September, they tend to drive the sweet onion category. Retailers can drive significant growth given the strength of the brand, particularly if they are merchandising Vidalias in a way that’s distinctive from the rest of the category during the season.”

Spotlight Seasons

There is “a ton” of potential for retailers to help grow the sweet onion category, according to NOA. When in season, Hardwick emphasizes that domestic onions could be placed at the very front of the produce section to grab consumers’ attention. “Pushing local sweets during their seasons would help show consumers not only the variety, but the local sourcing of onions,” she says.

Importantly, Elrod contends consumers tend to be partial to the sweet onions grown in their region. “Recently, an article stated that 84% of consumers prefer local/regional produce,” she says. “There’s great potential to grow the sweet onion category through something as simple as utilizing signs and POS materials throughout the year each time a new season begins. Onions are the most used vegetable for flavoring dishes, so call out the seasonal offering, and celebrate the newest variety as the seasons change.”

VOC notes marketing efforts in recent years have helped to build an appetite for Vidalias within their seasonal window. “Consumers know the Vidalia name and love the product, but to properly take advantage of the significant appeal they represent, we need to ensure consumers know something special has arrived in their produce aisle during the spring,” explains Stafford. “Merchandising plays an important role in that.”

With each new crop of Vidalia onions, SpartanNash plans in-store events to drive excitement and sales. “The attention pays off, and we see increased sales of sweet onions,” says Savanello.

Bland Farms encourages retailers to follow the seasons, and Bland says consumers rely on signage, packaging or pricing to identify sweets. “If retailers continue to promote sweet onions through display bins, packaging and signage, the category will continue to grow,” he predicts.

Clear Signage

Signage, in particular, is very important to distinguish sweets from other onions, as well as domestics from imported.

“Retailers could build consumer trust by clearly identifying sweet onions from regular yellows through signage, and not relying on or propagating the misconception that flat shape indicates sweetness,” suggests Elrod at Peri & Sons, who reminds that the newest varieties are round in shape, such as Sunions.

Additionally, Elrod says signage is key to satisfying consumers’ curiosity about provenance. “Consumers care whether their sweet onions, or any of the food they are purchasing, is pesticide residue free, non-GMO, sustainably and ethically grown, certified organic or food safety certified, so encourage signage, POS and packaging to include this information.”

K-Va-T likes to display domestic sweets with more POS material than for imported product. “Screaming ‘I’m from the USA’ is always a good merchandising plan,” says Ellison.

At Greencastle, PA-based Keystone Fruit Marketing, Marty Kamer, president, suggests displaying tips on how to use onions, including recipes, as well as featuring growers’ photos, biographies and histories to complement packaging.

Communicate Nutrition, Flavor

Effective POS materials and signage can highlight the healthfulness and flavor of sweets.

“Sweet onions present an opportunity for incremental produce sales if merchandised,” says Kamer. “Introduce new recipes, emphasize the quality, flavor, nutrition and food safety differences of authentic sweet onions over regular cooking onions. The health and flavor benefits are an easy sell for consumers looking to cook tasteful food without salt and cholesterol.”

Taste and shelf-life are the main differentiating factor for sweets, according to NOA. While they are sweeter than storage, red or white onions, they don’t last as long because of their high water content. “Retailers could help in this regard with displays highlighting recipes sweet onions could be used in, the differences between them and other onions, or even cooking techniques, such as caramelizing,” says Hardwick. “Few know just how great the onion’s nutritional value is, so the more we can educate people about it, the better.”

Savanello of SpartanNash says recipe suggestions are “very valuable,” while VOC says that leaning in on texture and taste, and emphasizing sweetness tends to increase purchase likelihood across the board. “We have also found telling consumers about the popularity of the onion plays a positive role in driving purchase intent,” notes Stafford.

Consider Demonstrations

Overall, education is vital and product demonstrations can help to increase sales. “Demos with onions could potentially be very involved, but would most definitely send amazing scents throughout the store,” notes Hardwick.

VOC always considers demonstrations to be helpful because ‘tasting is believing.’ “Consumers will see for themselves how sweet the onions are, why they are popular and also get ideas for all the ways they can incorporate them into their cooking,” says Stafford. “We recommend doing frequent demonstrations, particularly at the beginning of the season.”

Sweet onions and Sunions can make for interesting demos, says Elrod of Peri & Sons. “People are amazed that a raw onion can be so sweet and have no bite or pungent aftertaste,” she says. “People are surprised how much little kids love raw, sweet onions.”

Market Widely

Demographically speaking, sweets should be marketed to everyone due to their versatility; either as raw, pickled or cooked in dips, soups, salads, sandwiches, stews, tacos and even desserts. Sweets are healthy too — packed with vitamins, minerals and antioxidants.

“Sweet onions are very profitable and popular amongst most demographics,” says Savanello. As such, Ellison at K-Va-T says merchandising typically should be “very similar regardless of who you are selling to.”

The appeal is broad because sweet onions complement a wide range of culinary genres; from paleo and keto, to vegan and vegetarian, says Elrod. Conversely, she says sweets are “less important or non-existent” in produce departments at Latino stores.

Bland concurs: “Whether it is trendy food Millennials are cooking, southern meals your Mama prepares, tacos or stir-fries, sweet onions are versatile and enhance any meal; making them popular with all demographics.”

For Vidalias specifically, VOC says older, educated and affluent consumers tend to have the strongest loyalty. “However, we see an opportunity with anyone and everyone who enjoys cooking,” notes Stafford.

NOA suggests the best way to reach every demographic is to have a variety of onions on display. For example, Bland Farms offers Lil’ O’s — a smaller, premium sweet onion ideal for Millennials. “They are perfect when cooking for one or two people, which reduces waste,” says Meg Robinson, marketing manager at Vidalia Brands and Bland Farms.

Pairing

Thanks to their pairing ability, sweet onions offer ample opportunity for promotion and cross merchandising in the produce and meat departments, according to Keystone’s Kamer. “The sweet, mild flavors make sweets fantastic on a hamburger or in a fresh salad, with steaks and kabobs,” he enthuses.

Indeed, Shuman Farms, based in Reidsville, GA, is seeing the topic of ‘meal planning’ driving consumer search inquiries. “We recommend retailers create meal solutions that include Vidalia onions and other items from the store, like peppers, mushrooms and tomatoes etc.,” suggests John Shuman, president and chief executive.

During the spring and summer, Peri & Sons advises retailers to build secondary displays and cross-merchandise sweets with produce that is prepared and eaten fresh, such as: avocados, Roma tomatoes, sweet peppers and fresh herbs.

“Additional cross-merchandising ideas would be in the meat department with grilling items, such as: kabobs, spices, shallots, foil and picnic supplies,” says Elrod. “During fall and winter, whole peel the sweet onion and merchandise with items for roasted veggies, including: sweet potatoes, varietal potatoes, beets, carrots, fresh herbs and even pine nuts.”

SpartanNash cross-promotes Vidalias with corn and other grilling vegetables throughout summer. “Sweets are very versatile and can be easily cross merchandised with any grilling-themed display or merchandising effort,” notes Savanello. “They’re also great in our pre-cut veggie mixes, which can be used for hamburgers (paired with tomatoes and lettuce), fajitas (paired with red and green peppers) and more.”

K-Va-T’s Ellison says he loves to merchandise sweets with tomatoes and avocados as often as possible. “They pair very well together, and hopefully it gets a few customers to think about fresh salsa or guacamole,” he says. “We always look to pair sweets (while on ad) with items that can help boost our profitability, such as tomatoes, fresh basil and garlic.”

Promote Regularly

When it comes to pricing, K-Va-T always prices per pound. “Sweet onions are a premium onion, and we prefer to charge a premium price per pound to reflect how good these onions are,” confirms Ellison.

Bland from Bland Farms agrees: “Sweet onions are priced a little higher than a yellow onion, because they are hand-planted and harvested.”

Sweets also represent a strong promotional item for retailers; whether via ads, social media, store apps, recipes, displays or signage.

“Sweet onions are promoted regularly in our company-owned stores — both in ads and online promotions — because they resonate very well with loyal shoppers,” says Savanello of SpartanNash.

Crucially, sweets will get the most traction from an ad when they are given “prime real estate” in the produce department, according to Peri & Sons. “Put them on the end caps and in the front part of the store, and you’ll see a measurable lift in sweet onion sales,” affirms Elrod. “Not every customer comes in looking for ad items, but when the item catches their eye and is placed in their path, they’re more likely to buy it.”

Tidy, Prominent Displays Drive Incremental Sales

For optimum sales, Cindy Elrod of Peri & Sons recommends displaying sweets at the front of the store, on end caps and in the meat department. Savanello of Spartan Nash concurs: “We have seen great success merchandising sweet onions in the most visible location on the hardware set.”

K-Va-T also prefers a central location. “We are more aggressive with sweet onions than we are with other onions,” notes Ryan Ellison. “Bigger, more prominent displays are common for us in the Southeast. Typically, the first positions are reserved for our weekly features, but right behind that we are likely to feature ‘grocery list’ items, such as sweet onions. If you can get shoppers to pick up a sweet onion, they are most definitely cooking, which means they are likely to be getting multiple items throughout the store.”

To drive incremental sales, Shuman Farms, Reidsville, GA, offers full-color, high-graphic display bins for the produce and meat departments. “Based on our consumer research, we know merchandising Vidalia onions throughout the produce department is important to maximize sales,” says president and chief executive, John Shuman. “We recommend retailers create secondary displays throughout the produce department and the store with complementary items such as: bagged salads, peppers, mushrooms and potatoes.”

Making it easy for consumers to find sweets is vital, says Meg Robinson, marketing manager at Vidalia Brands & Bland Farms. “Using our display bins, which hold 40 pounds of sweet onions in the produce department, really helps drive sales,” she affirms. “It is also beneficial to put our secondary display units in other areas of the store like the meat department.”

NOA recommends displaying all onions prominently and neatly. “Discard any skins that are coming off, and stack the onions neatly, instead of dumping them in a pile,” says René Hardwick.

Ellison notes K-Va-T likes to stick with the same supplier year-round to ensure on-pack labeling remains consistent. “Customers learn the package and know to look for it,” he notes.

As demand has risen, Marty Kamer, president of Keystone Fruit Marketing, Greencastle, PA, says many retailers have found it advantageous to carry bulk or loose jumbo sweet onions, as well as consumer bags of medium sweets. “End caps, standalones, value-added product offerings, multi-size strategies and consumer bagged displays offer consumers multiple buying options and ensure sales lift,” he explains.