Bananas Without the Bunch

Discussion
Feb 24, 2006
George Anderson

By George Anderson


Chiquita has announced that it will begin selling single-serve bananas through convenience store next month.


A new packaging system developed by Landec Corp. of Menlo Park, CA extends the shelf life of the bananas. Core-Mark International will handle distribution.


“Premium single-serve Chiquita bananas meet the consumer’s desire for quality and freshness in the convenience store channel,” said Fernando Aguirre, chairman/CEO of Chiquita, Cincinnati. “Retailers benefit by being able to offer ready-to-eat healthy snacks with better margins and a longer shelf life. Chiquita benefits because c-store sales provide incremental profitable growth.”


Chiquita said it expects to have the bananas, which will retail between 75 and 99 cents each, in more than 5,000 convenience stores in 12 states by the end of the year.


Moderator’s Comment: What impact do you think this new packaging technology will have on the banana business? Are there other product categories that
hold the promise of being transformed by new packaging innovations?

George Anderson – Moderator

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15 Comments on "Bananas Without the Bunch"


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Gene Hoffman
Guest
Gene Hoffman
15 years 11 days ago
Each single-serve banana that’s sold for 99 cents will be the equivalent of about 2 pounds of bulk bananas. Thus there is a big potential marketing opportunity in selling single-serve bananas in all stores not just convenience stores. I’ll leave it to other panelists to outline the nutritional benefits. Now equate this opportunity to coffee when it had reached a plateau on grocery shelves a few decades ago. Back then, a full pound of coffee (16 ounces) sold for anywhere from 29 to 45 cents. (You youngsters probably can’t fathom that happening.) Coffee was a commodity item. To make things worse, coffee drinkers were making more cups per pound in both homes and restaurants and the diluted product was losing some of its appeal. Then coffee marketers chose to convert the 16-ounce pound can into a 11 and 12 ounce “pound” can to save their margins. In the beginning, A&P coffees were the leading national sellers, then it was General Foods’ Maxwell House, then P&G’s Folgers. Finally a bright light went off in the head… Read more »
Christopher Fink, CMC
Guest
Christopher Fink, CMC
15 years 11 days ago

I’m with Gene: Single-serve banana packaging overcomes the leading impediment to perishable sales (we’ve all seen the sorry-looking bananas at retail).

Positioning the SS-bananas as ‘premium’ will be the key challenge given most consumers knowledge of prices (especially Moms). But, a convenient packaging of a wholesome snack that’s less than a small bag of chips is an on-trend winner.

Lisa Everitt
Guest
Lisa Everitt
15 years 11 days ago

Wait a minute. Every banana on the display in a grocery store has the potential to be sold as a single serving. You pick up the bunch, pull off one banana, and buy it. A banana, like an orange or a hard-boiled egg, comes individually wrapped. Why does it need more packaging? Am I missing something?

David Livingston
Guest
15 years 11 days ago

Kwik Trip in Wisconsin sells bananas every day for 29 cents a pound. If you want just one, just rip one off the bunch. It probably would come to about 10 cents.

Ben Ball
Guest
15 years 11 days ago

One quick note on the pricing concern expressed so far. The relevant price comparison in this environment will not be the food store price of a bunch of bananas. The relevant price will be the relative price of other single-serve foods. The consumer in this instance most likely won’t even know the price of a bunch of bananas at Safeway anyway.

Matt Werhner
Guest
Matt Werhner
15 years 11 days ago

This certainly is an interesting idea. It offers a healthy alternative and it should add moderate gains both as an impulse buy and as an add-on item to breakfast and lunch offerings. Because people expect to pay a little more at the convenience store, the 75 to 99 cent price point will work, nevertheless, it would feel odd paying $4 for a few bananas.

Kai Clarke
Guest
15 years 11 days ago

This is a great idea and one which reflects Chiquita’s understanding of key markets which they are not currently serving. The C-store channel is an incredible distribution arm to market their products to impulse and low volume users, while retaining margins to pay for the cost of the single use product. Chiquita is maximizing its marketing and branding presence in this critical channel while developing a new way to ensure that their product meets the unique needs of their customers. They have aligned the 4 P’s of marketing and these efforts will certainly be successful. More companies need to listen to their customers and respond to their needs. Great job Chiquita!

Warren Thayer
Guest
15 years 11 days ago

I see a moderate boost. Price will hold back sales, but the impulse factor (from having more available or in stock) will drive up sales overall. Margins had better be good (!!!) for the retailer, with that price, and the lack of shrink (spoils) should combine to make this a worthwhile SKU.

Bernice Hurst
Guest
15 years 11 days ago

This is yet another story that makes me want to cry. Yes, there is a need for smaller portions, especially individual ones for the increasing number of single person households but if the price that you have to pay is that the food is treated and processed even more to give it an endless shelf life, then it really defeats the object of the exercise. Can’t single people have real food?

Mark Hunter
Guest
Mark Hunter
15 years 11 days ago

The idea will have a bigger boost on the c-store/convenience business than on the banana category. Overall, it will not dramatically increase the consumption of bananas but it will help bring new traffic into c-stores, etc. We have an ever growing segment of consumers who are driven by health oriented foods and the current perception/reality is c-stores do not carry items that fit this category. By selling single-serve bananas, c-stores now begin to attract these consumers. Look for other fruits and vegetables to follow suit if they begin to see bananas selling well.

Mark Lilien
Guest
15 years 11 days ago

Many convenience stores don’t stock fresh fruit, so if the bananas go to those locations, consumption will rise, although the price seems high. If the new packages primarily end up going to stores already selling bananas, sales will probably decline because of the price increase. Except for airports, people aren’t enthused about paying 99 cents for a banana.

David Zahn
Guest
15 years 11 days ago

I think it is a terrific idea. While I do not ordinarily associate C-Stores with fresh produce, this may be a way to begin to make that transition (healthy snack angle).

Other products that may fit the bill would be other fruits, perhaps even smaller sized egg cartons (only 1 or 2 eggs as opposed to the 6 or 12 we commonly see in other outlets).

I still have some concerns about the upkeep and maintenance of the fruits…but it is worth looking closely at, seems like a good idea and a way to differentiate and target the consumer on a specific shopping trip.

Arthur Rosenberg
Guest
Arthur Rosenberg
15 years 8 days ago

In various business districts in New York City licensed street vendors sell fruits among other quick foods. Bananas typically run twenty-five cents apiece or five for a dollar. This includes locations such as Park, Madison and Fifth Avenues; some of the highest rent districts in the nation. In Florida, I hear supermarket shoppers complaining about the high price of bananas at 49 cents a pound. How many people will happily pay a dollar for the privilege of eating a banana which has been treated so that it can maintain a longer shelf life? This is doubly bad if one is hungry and wants to eat two. Imagine buying for the whole family. Also, it seems I recently read that the competitive pressure is on C-stores to reduce prices.

Daryle Hier
Guest
Daryle Hier
15 years 8 days ago

It will be interesting to see if this works because on the surface, it sounds like the right idea. But, this is not a health-oriented food if it’s “treated.” Why are organics booming? On the other hand, convenience is just that, as most consumers don’t expect food that’s good for you in a C-store. There are conflicts here but let’s see what happens.

s sarkauskas
Guest
15 years 8 days ago

In the Chicago suburbs I’m familiar with, convenience stores already have fresh fruit, and they don’t charge 99 cents for a banana. Even the mom-and-pop doughnut shop I frequent sells bananas and apples. I believe the proprietors simply go to a nearby grocery store, buy a bunch of bananas, then charge 50 cents apiece for them, a pretty decent markup. (Going rate here is about 49 cents a pound for full price.)

As for the packaging, I think bananas’ natural packaging is safe, sturdy and attractive enough. With proper inventory management and ordering, shouldn’t a store owner be able to keep good-looking bananas in stock pretty easily?

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