Retailers worry about prices ahead of big holiday season

Published on
December 25, 2017

Starting in November and through to the New Year, shoppers are looking for entertaining and celebratory seafood items such as shrimp, crab, lobster, squid and scallops. However, strong prices on crab and lobster this year – as well as shrimp and other species – have some retailers concerned about this upcoming holiday season.

Still, conversations that began this spring between seafood suppliers, distributors and grocers are building up to some innovative promotions for the 2017 holiday season.

Strong prices so far this year on king crab, snow crab and lobster could limit some of the promotional activity leading into the holiday season — and has buyers looking for alternative species.

“Prices on those items [crab and lobster] have gone up and they continue to climb. It’s going to be a tough year for those items,” said Marty Gaul, director of seafood for the 22-store Heinen’s Fine Foods chain in Cleveland, Ohio. 

In fact, Maine lobstermen and suppliers expect strong prices throughout the summer and the rest of the year.  “All indications we are getting is that demand is very, very high,” said Patrice McCarron, executive director of the Maine Lobstermen’s Association in Portland, Maine. “Domestically, there is an expansion of food trucks, foodservice, and all the lobster roll businesses. And some of the markets in Asia seem to be doing well; we are seeing good numbers on export.”

“I don't see downward pressure now,” said Tom Keegan, who handles sales for Cozy Harbor Seafood in Portland, Maine, in May. “Demand is very strong and inventories are low right now. The prices will stay steady or go higher as the season goes.”

Plus, in Nova Scotia, lobstermen were fetching record ex-vessel prices of CAD 8.00 (USD 5.95, EUR 5.32) per pound on average in May, compared to CAD 5.25 (USD 3.90, EUR 3.49) at the height of the season last fall, noted Keegan. 

Maine lobster prices have been rising for the past two years, said Sam D’Angelo Jr., who specializes in retail and foodservice sales for Philadelphia, Pennsylvania-based distributor Samuels & Son Seafood. “The demand overseas has increased, which is driving up prices. We do not see that changing anytime soon.”

Because crab prices have skyrocketed, Samuels & Son is promoting rock crab and Jonah crab from the Atlantic as an alternative. “Another option is to promote the lower-priced claw and special blue crab meat,” D’Angelo said.

For the holiday selling season, “I think price will always affect how much retailers sell. We try to find alternative items that are in good supply, and promote those,” D’Angelo added.

Gaul began talking with lobster and crab suppliers this spring about amounts needed and potential prices. “It’s just staying on top of the market, and having great relationships with your suppliers. They will tell you when to buy,” she said.

All retailers want to promote shrimp for holiday entertaining but, with stronger prices on both the farmed and wild shrimp front over the past year, they are unsure what prices to plan for.

“I’ve already started the conversation with Manzetta about where shrimp prices will be for the holidays, so I can gauge what the prices will be,” Gaul said. “I’m hearing shrimp is high, but it is going to come down closer to the holidays.”

“Demand from China and Asia haven’t allowed for a price drop,” said Eric Bloom, president and CEO of Coral Springs, Florida-based importer Eastern Fish Company. While production typically peaks in June and July, which will allow for a price drop on certain sizes, Bloom is not optimistic about significantly lower prices on farmed shrimp for the holiday season.

“Prices should drop a bit, as product becomes more available, but I don’t think anyone is expecting massive price drops,” Bloom said.

Preparing for the festivities

Northeast U.S. grocery chains and markets that work with Samuels & Son primarily feature traditional seafood items such as smelts, live eels, Spanish octopus, squids, USA dry scallops and Canadian baccala, according to D’Angelo. The distributor starts discussing holiday ads and item placement with retail customers as early as August.

Samuels encourages supermarkets to roll out large-volume displays, “which puts consumers in a shopping-friendly atmosphere,” D’Angelo said. “If the produce department can pile it high, so can we!”

Throughout the holiday season, Heinen’s does just that. Its stores feature large displays of fresh crab, shrimp and other seafood in the seafood department, creating an “easy grab-and-go” atmosphere for busy customers, according to Gaul. 

Providing recipe cards, tastings and loss-leader ads will also help boost holiday sales. Samuels provides other retail support, such as cooked food demos, shellfish shucking stations and fish-cutting classes.

Retailers must first keep track of the pricing and availability trends, D’Angelo advised, especially regarding seafood species that they are not familiar with, but want to carry during the holiday season. “If it is an item you don’t buy all year long, stay in tune with the trends. Don’t wait until it’s time to buy to do your research. If you wait that long, the best price may already be gone,” he said.

Marketers getting creative for the holidays

While crab, lobster and other luxury items are sought after during the holiday season, they are not the only species that retailers will be featuring throughout the 2017 holiday season as the star of unique marketing campaigns.

For example, Miami, Florida-based Verlasso and Bonterra Organic Vineyards are partnering with a number of retailers and distributors on a “Feast of the Seven Salmon Fishes Dinner” campaign, a play on the traditional “Feast of the Seven Fishes” holiday feast. 

Held from 15 November through late December, the campaign highlights seven recipes that shoppers can cook for holiday entertaining, including a quick-marinated salmon with crackers as well as a salt-crusted whole salmon, which is meant to be prepared like a standing rib roast and paired with a yogurt sauce.

“This will be an elegant presentation. People don’t really think of salmon in terms of a beautiful presentation like a whole beef tenderloin,” said Jennifer Bushman, president of Route to Market, which oversees strategic business development and culinary for Verlasso.

Verlasso will provide recipes, videos, social media and other promotional materials to retailers such as Harmons, Heinen's, HEB’s Central Market, and Festival Foods. Participating distributors include Samuels & Son, Inland, Cantanese Classic, and Royal Hawaiian.

Similarly, Samuels is adding a “Seven Fish Retail Box To Go” this holiday season.  “The details are still being worked out, but it will have all-in-one package[ing]: shrimp, clams, mussels, squid, baccala, smelts and octopus. Each box will also include a recipe for each item,” D’Angelo said.

Other hot seafood items this holiday season will be products that are value-added, local, sustainable and organic, according to D’Angelo. “We are seeing many markets requesting that new products fit into one or more of these categories, but ready-to-eat meals continue to take market share at rapid pace.”

Grab-and-go seafood meal sales are expected to perform well again this year, after strong sales last holiday season. “Prepared offerings are always on trend and, as long as they are healthy and affordable, that is where we see future growth,” D’Angelo said. 

Many grocers are adding in-store eateries, a perfect opportunity to develop additional grab-and-go seafood items for consumers, D’Angelo concluded.

Contributing Editor

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