Block cheese pricing is down 28% from a year ago. (You’re seeing some of that, right?) Also, a few
merchandising ideas for you.
BY JOHNNY HARRIS
With block cheese commodity prices down by about 28% from a year ago, right now is an excellent time to be paying particularly close attention. As I write this, pricing is at $1.61 a pound compared with $2.24 last year.
I strongly doubt your vendors have been reflecting this in their pricing to you. There may be good reasons for that, but it’s up to you to keep an eye on commodity prices and ask several different vendors about their pricing today and in the near-term future. You might find some bargains and you might not, but you won’t get anything unless you are an informed buyer who asks the right questions.
Keep in mind that while the commodity block market is a good rough barometer, it isn’t indicative of what is happening in all the categories and niches of cheese. If pricing reports aren’t delivered to you already, just go ahead and Google “commodity cheese prices” and you can get up to speed pretty quickly.
Some of the big branded companies will have had big inventories of cheese that they produced when pricing was higher. You can count on them to hold back on price reductions for awhile until they sell off what they’ve got. And they’ve had to hold onto sharps and extra sharps to age them properly, so they have costs for interest and storage as well.
Some branded players try to set a price for cheese and stick with it for a year, to protect their investment. Private label, of course, follows the commodity market much more quickly. No, none of this is simple.
But depending on the particular type of cheese, vendor inventory positions and competitive behavior, you ought to be seeing some softer pricing. Believe me, someone is making good money on cheese right now, and it might as well be you.
From what I can see, everyday low price on cheese has stayed pretty flat lately, although I am seeing hotter deals. I’d be pushing for both better pricing and better deals, and I’d also be knocking on new vendors’ doors to see what I could find.
Now let’s talk about what’s on the shelf, and how to move more cheese. I’m seeing more gusseted bags for shredded cheese, both among the brands and in private label. If you’re in a smaller chain where these bags haven’t yet been offered, knock on your vendor’s door and say “Why not me?”
Sargento and Kraft have also moved to great-looking narrower bags for shredded cheese. In a four-foot pegboard section you can get two more facings, and that’s really significant.
Also significant are the extra sales you can get from strong cross-promotion and merchandising. Why not put single-wrap cheese in the meat department beside hamburger when it is promoted? You’ll get a lot more impulse sales, and this time of year you should have multiple facings of single-wrap cheese anyway.
PAIR THEM UP!
The key is to know meat, and combine items that work well together. Parmesan with spaghetti and meatballs. Mozzarella with meat lasagna. Provolone with chicken breast. Swiss cheese with chicken cordon bleu. Don’t just put them side-by-side — have signage and recipes available to suggest meals to shoppers coming through before supper.
Meal deals are a no-brainer, and can involve all kinds of cheeses along with lasagna noodles, Texas toast, beverages and snacks of all kinds. If you haven’t yet broken down those walls separating dairy from deli and meat, get to work on it now. It could be the beginning of a beautiful, and very profitable, friendship.