RET ROS PECT IV E
CRAIG CARLSON CITES INNOVATION,
COLLABORATION AND PLU CODES
AS INDUSTRY DRIVERS
BY CAROL BAREUTHER
I
ndependents ruled, communication meant
telephone, and deals were sealed with
your word when Craig Carlson began
his career as a produce manager with Cub
Foods. That was 1978, when the Stillwater,
MN-headquartered retailer had only five stores
compared to 77 today. Carlson worked in
produce even earlier as a stock boy, a position
he held from high school through graduation
from the University of St. Thomas. His bachelor’s degree in business prepared him for
an accounting career. However, Carlson took
a Cub-offered produce manager job instead.
Over the next three-plus decades, he has held
positions such as vice president of produce
operations and merchandising for Penn Traffic;
vice president of produce and floral merchandising at Pathmark stores; and senior director
of produce for Wal-Mart.
In 2011, Carlson became senior vice president and senior director of category management and sourcing for produce at US Foods.
Two years later, he left to start Carlson Produce
Consulting, LLC, based in Chicago, of which
he is president and chief executive. A project
that exemplifies his consulting work is the
successful rebranding and repositioning of
ONE BANANA. For 15 of these years, Carlson
held volunteer leadership positions with the
Produce for Better Health Foundation, Eastern
Produce Council and Produce Marketing
Association.
Where were you in 1985?
I was a produce buyer/merchandiser at Cub
Foods in Columbus, OH. I did all the buying
and merchandising for the new Columbus
division when it opened.
What was the produce department like
in 1985?
We were a trendsetter in produce. Many
departments then were located in the back
of stores, with limited SKUs and a lot of
packaged options. At Cub Foods, we moved
produce upfront, made it proportionally larger
than average, tried to have as many SKUs as
possible and focused primarily on bulk. Still,
the SKU count was only half what it is today.
That’s because imports and organics were
few, seasonality dictated what was available,
and fresh-cuts were either a thought of the
future or done at store level.
department to really expand in number of
SKUs. In turn, customers today want to eat
healthier, and they are looking for a large
variety of great tasting produce. The ability
to offer this has enabled retailers to capture
more customers and more shopping trips.
This is all because of PLUs.
How would you characterize the overall
retail environment back then?
There were a lot more of the smaller independents. Big box stores were just starting to
ramp up. Retailers such as Wal-Mart, Costco,
H-E-B, Meijer and Wegmans had yet to really
expand. It was a time, though, that the importance of produce was beginning to take root
with the more innovative retailers. That meant
mass displays, fixtures, signage and aggressive pricing and promotion.
How would you describe the produce department today compared to 30 years ago?
Then, the retail buying process involved
a combination of brokers, wholesalers and
growers; now it’s a grower focus. Then,
produce buyers came up within the organization. They were usually a long-term associate who worked 10 to 15 years before
moving into the buyer
position. Now, they
are people with
great knowledge but less
store experience. Then,
we talked on
the phone
When did things start to change and
what were the drivers of change?
For me, it was when I got involved with
the Produce Marketing Association. Everyone
at the conventions talked about how to move
the industry forward. There was a framework,
a collaborative environment. There was a
push for retailers as a whole to get better
and to work with the grower community to
accomplish this.
What innovation has changed the
produce industry over the past
30 years?
PLU codes. Before
these, there was no way
to compare an individual
chain’s performance to
its competitor or to the
industry as a whole.
Plus, PLUs gave us
an ability to sell more
than one item in each
category. That has
allowed every category in the produce
Craig Carlson
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when negotiating price and programs. Your
word was your bond and your signature that
signed the deal.
Today, it is much more difficult to talk
directly to buyers and most communication
is by email. Then, it was all about driving gross
profit dollars, gross margins were half what
they are today. Then, the focus was on driving
sales and volume. We had opportunity buys
where we’d grab the incremental volume at
a reduced price and pass the savings on to
the customers.
With retail chain execution nowadays, it is
hard to get the lift that generates the gross
profit dollars to offset the reduction on retail
price. However, today opportunity buys represent a huge potential for volume-oriented
formats, and many independents continue
to capitalize on this approach.
produce supply chain. There is a huge need for
growers to continually reposition and remarket
themselves to remain relevant to retail. The
world is much different now than 30 years
ago, and growers need to be prepared for
where they will have to be in the next 10 years.
What led you to the consulting side of the
industry? What insights have you gained on
the consulting side that you wish you had
known as a retailer?
I wanted to utilize my vast experience to
build high performance programs within the
What do you think was the greatest lessons
you learned about retailing over the past 30
years both as a retailer and as a consultant?
I learned the power of communication
between retailers and suppliers. It’s important
to partner and communicate with your supplier.
Every day the best customer gets the best
produce. In that way, growers take care of the
retailers they communicate best with. I live by
the 24-hour rule; that is to answer all voice
mail and email within 24 hours.
What do you think will drive the produce
industry in the next 10 to 20 years?
Millennials. They want to know about their
produce. Who grew it? Where was it grown?
How was it grown? Suppliers need to tell their
story. The avocado industry did this, and look
where consumption of this fruit is today. Social
media is an especially cost-effective means
to do this, plus this form of communication
resonates with Millennials. Today most companies are checking the box by providing social
media. In the future it will become an integral
part of driving consumption.
What are the challenges holding the industry back?
We are being out-marketed by snack and
fast food companies. They have more advertising dollars and are way more sophisticated
than us. As an industry, we need to do more
to assure fresh produce will gain a greater
share of stomach.
What are your thoughts on choosing produce as a career today?
There’s a tremendous career opportunity
in the produce industry today. This prospect
lies in helping suppliers market and position
themselves to Millennial customers in a cost
effective way that drives consumption and
performance.
What advice would you give young retailers
entering the produce industry?
Spend time working in a store. Know what
it’s like to work with customers from first-hand
experience. If you’re working for a retail chain,
ask for at least one month at store level to
touch, feel and see how it operates. It will
make a drastic difference in your career. pb
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