New Sweet Spot For Retailers

Originally printed in the October 2018 issue of Produce Business.

Increased consumer awareness drives demand for these nutritionally packed potatoes.

In recent memory, the sweet potato was associated primarily with festive holiday spreads and less as an everyday staple. But this super tuber is making a comeback, thanks to three main factors that are driving demand.

1. High Health Profile

The secret is out about sweet potatoes. They really pack a punch, nutritionally speaking. “I think you’re seeing the consumption increase because of new information and education that’s coming out,” says Jeff Thomas, director of marketing for Scott Farms, in Lucama, NC. “That’s something we’ve seen in the past few years, the increase throughout what would be considered slower periods. Those are becoming more steady now.” The spikes in demand during the holiday season are still there, of course, but the lows during slower periods have been reduced thanks to consumer awareness about the nutritional value of sweet potatoes.

Sweet potatoes are a great s source of fiber and a good source of vitamins and minerals, including iron, calcium, selenium, potassium and vitamins A, B and C. They’re also high in beta-carotene, an antioxidant that gives orange fruits and vegetables their vibrant colors.

Charlotte Vick, partner, sales and marketing for Vick Family Farms, based in Wilson, NC, gets excited when she talks about the health benefits of sweet potatoes. “Sweet potatoes are a superfood,” says Vick. “They are the most versatile and healthy vegetable available.” Vick notes sales continue to rise along with awareness of the veggie’s healthful aspects. “In today’s world, more people are becoming more conscious of what they eat, and we as an industry are lucky to have all of these benefits on our side.”

Trey Boyette, sales manager and partner at Southeast SMP Marketing, Vardaman, MS, sees the trend toward healthy choices, as well. “Most retailers I deal with are promoting that in a big way. They’re bringing a lot of awareness to how sweet potatoes are one of the superfoods with signage in store, but primarily online with websites and social media,” says Boyette.

In addition to health, sweet potatoes have plenty of plate appeal too. According to George Wooten, president of the Wayne E. Bailey Produce Co. in Chadbourn, NC, sweet potatoes just look good. This fact has contributed to the vegetable’s surging popularity in foodservice, as well. “The flavor and the color — that orange up against asparagus or broccoli — makes a plate look good.”

2. Convenience Packaging

Convenience is a big sales booster across every aisle of the supermarket, but for produce, it combines well with the health appeal. According to Tami Long, director of marketing and business development for Nash Produce in Nashville, NC, “People want to eat better, so they are searching for healthier options. Sweet potatoes are cheap and easy. Eight minutes in the microwave, and you have a meal. With consumers’ extremely busy schedules, people need meal options that are quick to prepare.”

Kristi Hocutt, sales manager for Triple J Produce in Sims, NC, sees the value of offering convenient choices, as well. “We are dabbling in some different varieties to offer our customers some options. Packaging-wise we stick to bulk, microwaves and bags,” says Hocutt. “We also offer conventional and organic which helps our [retailers] supply their customers’ options.”

Microwavable bags and steamer pouches help consumers achieve the quick cooking times they’re looking for, usually less than 10 minutes, and smaller pack sizes make good meals for one or two people without having to worry about what to do with the leftovers.

Matt Garber, partner at Garber Farms based in Iota, LA, sees a trend in consumer preference for smaller pack sizes. “Some consumers want a smaller sweet potato, and these consumer packs give them that option,” says Garber. “That’s something that was mostly missing five years ago.” Garber leaves it up to individual retailers to decide how they cater to the needs of their shoppers. “If they do it all, it’s probably too much for the sweet potato category, but merchandisers can pick what they think consumers in their area will gravitate toward.”

“Customers want ease,” says Jacob Shafer, senior marketing and communications specialist at Mann Packing Co., based in Salinas, CA. “Getting back to their busy lives as fast as possible has never mattered more, and one of the biggest reasons for a consumer to be unsatisfied with a product is the amount of effort they have to put into it.”

Although the trend is toward smaller pack sizes, not all shoppers have the same buying needs. “What works for us is bulk display,” says Dan Dvor, store manager at A&N House of Produce in Philadelphia. “We work in volume. We buy a lot, we put a lot in the bag, and we sell it for a low price. We give them a good-looking sweet potato for a good price, and that’s what drives the sale.” In the neighborhood where the store is based, sweet potatoes are not a trend but always have been a consistent seller. “We sell more sweet potatoes than any kind of potato,” says Dvor.

3. New Varieties

Consumers not only gravitate toward convenience, they’re also interested in trying new things. Vick Family Farms, in addition to their mainstay varieties such as Covington and Beauregard, has seen increased sales with the Murasaki variety over the past year. “It is a purple-skinned Japanese sweet potato with a distinctive nutty flavor,” says Vick. “The purple beauty’s soft white flesh is loaded with vitamin C and dietary fiber.”

Much of this desire for new varieties is coming from younger people. “Millennials are the ones that are really pushing more than just the orange-flesh, orange-skin varieties,” according to Rene Simon, director of the Louisiana Sweet Potato Commission, based in Baton Rouge. “They’re pushing these new varieties you’re beginning to see in the marketplace.” Similar to the white potato growers’ move toward smaller sizes like fingerlings, Simon predicts consumers can expect to see similar offerings in sweet potatoes, as well.

Long at Nash Produce also sees the trend with Millennials. “Millennials want cheap, convenient, healthy and local. Since sweet potatoes can be stored for up to 18 months, they are not imported. U.S. sweet potatoes are homegrown, so, the guesswork on how the produce was handled before it reached the shelf is known.”

“Coming out of North Carolina, our main variety is the Covington, the orange-flesh variety,” says Scott Farms’ Thomas. “That’s still going to be the No. 1 seller among sweet potatoes, but I do see some of the other varietals, be it the Bonita or Murasaki, being utilized more because they each have a different color and flavor profile. They also have a different texture.”

Industry Efforts

In the earlier part of the last century, Americans consumed a lot of sweet potatoes. That number began to drop considerably after World War II. Why did sweet potatoes fall out of favor in the first place, and to what does the current health of the industry owe its success? Wooten of Wayne E. Bailey Produce Co. attributes a number of factors for this decline, including lack of innovation, changes in family and work life and the rise of fast food. He thinks the reverse of sweet potato fortunes is due in part to organized industry efforts.

“One of the major things that changed is we came together collectively as an industry.” says Wooten. “That’s a hard thing to do. Our sweet potato council came together, and you could feel the consumption rise. When people like Dr. Oz and Rachael Ray started talking about it, you began to see it on television every day.” Wooten sees no reason this growth can’t continue as sweet potatoes are enjoyed year-round. “We sell a lot of potatoes in July and August,” says Wooten. “That was unheard of 25 years ago.”

Challenges Ahead

Although business is good now, there are always challenges. New legislation and changes to immigration laws are cause for concern.

“As the laws change and costs increase, farmers will be hit hard,” says Long of Nash Produce. “Sweet potato prices are at an all-time low. If a farmer is not making money on a crop, then they will plant something else. So, if you start adding in additional costs just so farmers can hire workers, then they will explore other crop options.” Long says new tariffs have some in the industry concerned, but it is uncertain how this will affect business. “Since no one knows how this will play out, we are monitoring developments while creating alternative plans.”

As the boom in sales drives down the price, it can make the sweet potato crop seem like too much of a good thing at times. Increased production and a great crop has turned the market to the lower side, according to Boyette at Southeast SMP Marketing. “The demand is there,” he says, “but the supply has outdone the demand this year. It’s turned the market around, and it’s dropped to where it’s hit rock bottom. We’re paying almost double the freight rate we were paying last year at this time, and with the lower market prices, it’s kind of hitting home.”

On the brighter side, one avenue that is opening up for the sweet potato crop is processing, which has increased steadily year after year. “There are companies that produce sweet potato items like freeze-dried snacks, spiraled noodles, purees for beverage production and everything in between.” says Fookes, at A.V. Thomas Produce, Inc.

Innovation within a category often can present a challenge for produce executives. “With this in mind,” says Shafer, “Mann’s innovation team has been working hard to develop products that meet the demands of consumers. Value-added sweet potatoes make prepping and cooking easy for consumers.”

Foodservice also has been quick to capitalize on sweet potatoes. “Sweet potato fries are typically found on restaurant menus and can also be used as a pasta replacement,” says Shafer. Mann’s features sweet potatoes in products such as their sweet potato fettuccine.

Future Growth

When asked if the sweet potato category will continue to see growth, Hocutt at Triple J gives an enthusiastic, yes. “In the past six years, sweet potato sales have exploded domestically and internationally. We just need to get the pricing up, so every grower can continue to grow this awesome healthy vegetable.”

“I expect continued growth because of the health benefits of our product,” says Garber.He says he would like to see sweet potatoes used more as an ingredient in the future. “It doesn’t have to be the whole sweet potato on the plate. Using sweet potatoes as part of a recipe or to enhance a recipe is a way to keep the category growing. It blends well with meat and vegetables and a lot of things, and I believe that trend will continue.”

HURRICANE LOSSES LIKELY TO BE EXTENSIVE FOR INDUSTRY

Sweet potatoes are expected to take a big loss from Hurricane Florence, which flooded fields and caused extensive damage to North Carolina’s agriculture in mid-September. Damage estimates for sweet potatoes are $180 million, based on how much of the crop was left in the field, says Andrea Ashby, director of public affairs for the North Carolina Department of Agriculture and Consumer Services.

In early October, the agency was assessing farm damage and expects that to continue for some time. “Widespread flooding has made it difficult to get to some areas, which has delayed efforts to get into fields,” says Ashby. “We may find that some areas fared better than expected and won’t know the real impact on yield and quality until harvest time.”

The 35 most affected counties, east of Interstate 95, represent the state’s primary sweet potato production region. The losses are expected to be significant because the storm hit during harvest time for so many of the state’s major crops. Agriculture Commissioner Steve Troxler says Florence caused devastating damage and leveled a staggering blow to the state’s agriculture industry.
— Doug Ohlemeier

MERCHANDISING TRENDS

Given the recent trends in sweet potato consumption, retailers would be wise to focus on merchandising. Tami Long, director of marketing and business development for Nash Produce in Nashville, NC, thinks retailers would do well to educate their customers on ways to create quick, easy meals. “This needs to be done at store level because this is when the consumer tends to make most of their decisions.” Recipe cards are great, cooking demonstrations are even better, and Long says retailers should use signage to show shoppers how to eat vegetables such as sweet potatoes.

“Loose, yellow sweet potatoes will be 98 percent of sweet potato sales,” according to Keith Cox, category manager for Produce, K-VA-T Food Stores Inc. in Abingdon, VA. “We will promote in tote bags as a grab and go. We do offer loose, microwave-ready yellow sweet potatoes that sell very well.

“Sweet potatoes are displayed with other loose potatoes and are promoted often with secondary displays. During the holidays we will have large displays of loose and tote bags on promotion.”
Charlotte Vick, partner, sales and marketing at Vick Family Farms in Wilson, NC, advises retailers to keep shelves well-stocked and pair sweet potatoes with other healthy options. She recommends “adding them to grilling displays during the summer to educate the consumer on ways to prepare them for cookouts or summer dishes.”

Jacob Shafer, senior marketing and communications specialist at Mann Packing Co. in Salinas, CA, thinks the key to merchandising sweet potatoes is to display them with specialty fresh-cut veggies such as Brussels sprouts and butternut squash. “Based on the variety of offerings in cut veggies, the section would have defined separation between subcategories and vegetable types. It would be a clean, uncluttered, well-structured shelf set. This can significantly enhance the shopping experience.”

Jeremy Fookes, retail sales at A.V. Thomas Produce in Atwater, CA, says retailers should consider building a separate sweet potato category within their produce departments. “Sweet potatoes shouldn’t just be an item within another category,” he says. “There are many different packaging options, colors, flavors and textures within the sweet potato category. Stores that offer multiple varieties and colors of sweet potatoes have greater overall sweet potato sales.”

Jeff Thomas, director of marketing for Scott Farms, Lucama, NC, recognizes every retailer is different, and what works in some stores may not work in others. The introduction of foodservice to retail grocery stores is an opportunity to use sweet potatoes in healthy meal kits. Education is great too, but branding is also an important component in any merchandising strategy.

“We handle the product from the plant until the time our customers get the product.” says Thomas. “Everything we do is very consistent in our brand. It leads back to everything from our website to our point-of-sale materials, it’s all about the family and the process we go through. We really want to be a partner with retailers and not just sell and forget it.”

Although many shoppers prefer buying local, if that’s not an option they still like to know where their produce is grown, and emphasizing the brand is a way to achieve this.