Q&A: High Liner’s recipe for success

Keith Decker, president and COO of High Liner Foods USA in Danvers, Mass., talks to SeafoodSource about the recession’s effect on seafood sales at the foodservice and retail levels and the importance of product innovation. The company comprises a retail division that markets its products under the Sea Cuisine and Fisher Boy brands and a foodservice division, Fishery Products International.

This is part one of a two-part interview.

Hedlund: High Liner’s U.S. foodservice division achieved a 7.1 percent increase in sales volume in the first quarter of 2010, its first quarter of growth since the recession began. Is it evident that the U.S. foodservice industry is bouncing back?
Decker:
I’m cautiously optimistic about that. When I saw the Technomic report in late May [projecting nominal growth of 0.6 percent in the U.S. foodservice industry this year], I was heartened by the news. There are specific areas of the U.S. foodservice industry that are doing better than others. Areas that we’re involved in, [namely] education and healthcare, are doing well. Historically, we’ve had a strong business in those areas. But over the last few years we’ve done more segment-specific marketing, especially at K-12. It works for us because it aligns with what we’re doing with culinary and innovation — [getting] made-from-scratch, back-of-the-house [seafood products] into operations that don’t have the kitchens and/or culinary skill set for a nice, good-tasting piece of fish.

Late last year, the U.S. Department of Agriculture added pollock to its Commodity Processing Program. How has the move benefited High Liner?
We came out with the first product line specifically targeting the program, and we’ve seen a lot of initial success. It’s good to see that we’ve got healthy, good-tasting seafood products now going into the school systems. For years, the quality of the products and the price points that school-feeding programs were able to work with were just not good. Single-frozen Alaska pollock blocks with a good-tasting coating on them gives them the nutritional requirements that they need.

How are other segments of the U.S. foodservice industry performing?
QSR [quick-service restaurants] is doing well during the economic downturn. As for casual dining, it’s finally starting to improve. If you look at our sales numbers over the past two years, our business typically followed foot traffic. So we weren’t necessarily down because we were losing items with our customers. It was just that there weren’t as many diners going into restaurants. As foot traffic is improving, obviously our sales numbers are improving as well.

At the retail level, is the push toward convenient, ready-to-cook products benefiting High Liner?
The prepared-foods section of the seafood department is definitely growing. People may not be eating out as much, but they’re looking for a tasty piece of seafood to cook at home. There’s been a nice uptick this year in the breaded-and-battered category. That’s primarily due to people trading down due to the recession. Initially when the economy started going down in 2008 and 2009, we saw that the price points of USD 6.99, USD 7.99 and USD 8.99 for prepared foods were challenged. So we saw a shift over breaded-and-battered. Lately, though, we’ve seen an increased interest in the prepared-foods category.

How important is product innovation during a recession?
It’s absolutely critical. When you go into a recession, it’s important to make your name on product innovation. We have always tried to lead the industry through innovation. FPI’s UpperCrust® line [of top-crusted fillets] is one of our biggest innovations, and High Liner’s Pan-Sear Selects® line [of lightly coated fish fillets] recently won the 2010 Best New Product Award [in Canadian Living magazine].

We recently increased the size of our R&D department. I would say that [among seafood companies] we probably have the largest R&D department in the United States, and we just recently increased it again by 20 percent. Our focus is on R&D and innovation. It’s important that we continue to invest in that. The fact that we’re still adding head count to our R&D department during a recession is a testament to what our focus is.

Editor’s note: In part two of the two-part interview, which will run on Tuesday, Decker addresses High Liner’s sustainability initiatives, the challenges of sourcing seafood and the company’s safety record at its Portsmouth, N.H. processing plant, which was recently cited for safety violations.

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