Last updated on March 25th, 2021
by Terrie Ellerbee/editor-Midwest
Editor’s note: The Shelby Report staff toured the Supervalu private brands facility in 2018, just before United Natural Food Inc.’s (UNFI) acquisition of the company. The staff again visited with private brands associates at this year’s UNFI National Expo and found that some of the products that the Shelby team had sampled in 2018 now are on store shelves.
A couple of things had changed when the Shelby team traveled to St. Paul, Minnesota, for the United Natural Foods Inc. (UNFI) National Expo this year.
For one, Supervalu had been acquired by UNFI.
For another, chips that the Shelby team had sampled in Supervalu’s private brands facility during a May 2018 tour had survived the rigorous development process and have joined the company’s Essential Everyday lineup.
The consensus around the sampling table last year was that the Maui sweet onion-flavored chips would be a best-seller if it met the private brands team’s exacting standards. What happens to products between ideation and shipping is the essence of private brands development.
“We have a team of about 35 folks who live and breathe private brands here,” said Bekah Swan, UNFI VP, during the 2018 tour. “We host, about every other week, a key customer or internal groups, whether it be new hires or our sales team. It is our favorite thing to do, to feed and host and drive brand awareness. We create brand ambassadors.”
The sampling on that day was of several varieties of chips manufactured by Shearer’s, an Ohio-based snack manufacturer with four plants in the U.S., including in Minnesota. The flavor profiles that were sampled ranged from Sweet Heat barbecue, to Hot Chili Lime, to the sweet Maui onion in rippled, wavy, and kettle varieties.
“We have a robust salty snack program,” said Matthew Albers, a UNFI brand manager. “We’ve got about 12 feet in aisle right now of our Essential Everyday salty snacks, and every 18 to 24 months, we like to keep the category fresh by adding new, innovative flavors.”
Alongside products that become core offerings, seasonal flavors—referred to as “in-and-outs” help with that goal. The last rotation of seasonal flavors included a rosemary-feta flavor, loaded cheeseburger, wasabi soy, and a Hot Italian Sausage potato chip that was an office favorite.
“You rip open the bag and it smells like Hot Italian sausage. You taste it and it delivers on the palate,” Albers said. “Chip flavors are fun to develop because you get to experiment with different seasonings on different chip styles.”
Sampling is just one step in the product development process. The initial review is mostly a sensory experience, Swan said. The UNFI private brands team first evaluates products on their merit. Then the team follows up with the manufacturer. Albers was with a CPG company for seven years before joining UNFI. His experience makes him the ideal person to source manufacturers and negotiate with suppliers.
“All of our suppliers need to have on record proper audit status,” Swan said. “We prefer SQF Level 3, but we do not do business with suppliers that do not meet our audit criteria.
That is table stakes. Our regulatory manager makes certain that we have a current audit on file. If there are changes in audit scores or concerns, those are vetted with the team. It goes back to our job being to keep our customers and our company safe.”
Once everyone is in agreement and homes in on the flavors that will be developed, more people are brought in for sampling.
“The larger group will also try them, and we will get their input and go from there if there is any final tweaking we need to do because it’s all about having the right balance of chip styles and flavor,” Albers said. “We have a specific number of the original thins. We have a specific number of wavy and kettle to make an optimal category. We need to be cognizant of that, too—that we have the right chips, we have the right flavors and that they’re not too close to something we already have out there.”
The larger group can include store directors or customers. For national brand equivalent products, members of the group, as many as 50 people, take part in blind sensory evaluations.
“Ideally what we want is for our product to perform on par with the national brand equivalent target. Those are fun ones to do,” Swan said. “Occasionally we’ll fall short. If we do, we take it back to the supplier and we reformulate, or we push ourselves to make sure that we’re hitting that mark.”
Reformulating could mean just giving a product a flavor boost and then sampling it again.
“When we’re developing flavors like our Sweet Maui Onion, it is very important that we’ve got the sweetness and onion flavor in there, and that it melds together so one doesn’t overpower the other,” Albers said.
Dede Cooke, a product development manager with UNFI, said once the chip flavors are locked in, work on the specifications begins.
“The vendor enters the specs and we make sure that they are entered correctly and reflect the attributes we have agreed upon,” Cooke said. “From those specs and nutrition facts and ingredients, we develop artwork. The artwork review process is web based which enables representatives from both our company and the supplier to review artwork and annotate any changes at the same time.”
Once the art is approved, then the supplier begins manufacturing the product. It won’t ship until the private brands crew reviews samples from the first production run to ensure that everything is just right.
“Typically, it is a six-month process from choosing to on-shelf,” Albers said.
If an agreement cannot be reached or the product is not up to UNFI’s standards, it will not be launched.
At this year’s UNFI National Expo, Essential Everyday Sweet Maui Onion chips were on display alongside Jalapeño Ripple, Sweet Heat Barbecue and Hot Chili Lime kettle chips. All the new flavors have been performing well out of the gate, Albers said. The four new varieties will be on the shelf for about 18 to 24 months and then UNFI will cycle in new flavors.
“Sweet Maui Onion could eventually become a core item and then we will evaluate the category,” Albers said. “People want to see new items.”
“Salty snacks is a fun category,” he added. “I’ve got a lot of other categories that require a lot of handholding, but this is fun.”
How about a story on how Supervalu stock lost half its value because of the excessive debt acquiring Albertson’s. Teetering on the edge of insolvency with missteps like the Hagan blunder. And now UNFI’s stock price following the same path as SuperValu, down by half in four years and 30% this year alone, because of the crippling debt purchasing Supervalu.
Give us the facts and be brutally honest, UNF I probably will go the same route as Supervalu after laying off tens of thousands of people, selling assets, shuttering warehouses, and teetering on the edge of insolvency because of the excessive debt.
UNFI is even suing the company that helped them put this deal together – why do you think they’re doing that? They’re in trouble big time.