Dairy Products Make The Most Profit For Grocers
ROSEMONT, 111. January is
the month when supermarket
executives around the country will
receive the positive word on the
Pigh profitability of dairy
products.
A four-page advertising supple
ment and a 15-minute video from
American Dairy Association high
light topline findings of the
National Dairy Case Management
Study: Directions for the 1990 s
just completed by Willard Bishop
Consulting, Ltd. and Ernst &
Young. Funded cooperatively by
both the processing and producer
segments of the dairy industry, the
study includes consumer shopping
pattern studies, direct product pro
fit analyses, space elasticity
research and labor productivity
analyses.
The advertising supplement
will be inserted in the January
usue of Progressive Grocer, a
fading trade publication. The vid
eo will be distributed to the offices
of 600 supermarket and wholesal
er executives. Both communica
tions programs summarize the
study findings;
* Profitability is significantly
higher for the refrigerated dairy
department than for other
major supermarket depart
ments. This study compared, for
the first time, the dairy department
to other interior store departments.
The average square foot of space
in the dairy department produces
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twice the dollar profit generated
by frozen food and nearly five
times the profit generated by dry
grocery.
• Within the dairy case, milk
based products provide the
majority of profit dollars. Of the
top seven performers in terms of
Direct Product Profit (DPP) per
square foot, six are milk products
butter, sour cream, milk, cot
tage cheese, cream and cheese.
Eggs are in seventh place.
• The dairy department deliv
ers positive space elasticity. Lar
ger dairy departments develop sig
nificantly higher sales per custom
er than do smaller departments.
These sales translate into higher
profit dollars, providing solid rea
sons for enlarging the refrigerated
dairy department.
“Retailers know the dairy
department is profitable,” said
Grover B. Simpson, vice president
of Marketing Services for Ameri
can Dairy Association. “Now this
study provides the information
they need to tailor dairy depart
ments for their specific opera
tions.” End products of the study
will include both cost components
that can be loaded directly into the
DPP model and national category
merchandising standards that have
been previously unavailable.
Following initial publicity
efforts this January, the dairy
industry will extend programs to
communicate the study findings
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through seminars, ongoing state ment that will detail study results Industry Association (UDIA .
and regional retail programs in this spring. UDIA is a member-driven fedcra
supermarkets and a continuing American Dairy Association is tion which conducts a total prom
public relations outreach, includ- the advertising and marketing ser- otion program for U.S.-produced
ing a 12-page advertising supple- vices division of United Dairy milk and other real dairy foods.
YORK (York Co.)— The 20
York County 4-H Capon members
recently held their annual Round
up and Sale on November 9 at
Rentzel’s Auction Barn. The
judge for the event was Herb Jor
don, PSU Extension poultry
specialist.
The 1988 champion and reserve
champion winners were repeat
winners at the 1989 York Co. 4-H
Dressed Capon Roundup. The
grand champion dressed capon
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York County 4-H
was shown by Doug Flemmens of
Glen Rock and the reserve was
shown by his brother Jason.
The 11-pound champion was
sold to Glen Rock State Bank for
$17.50 per pound and the
1114 -pound reserve champion
was sold to Brockmeyer Electrical
Wiring of Shrewsbury for $l2 per
pound. There was a total of 14
buyers with Carlos R. Leffler Inc.
of Richland, Pa., being the volume
buyer for the evening.
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The 20 dressed capons aver
aged $9.10 per pound with champ
ions and $8.47 per pound without
champions. The average weight of
the capons sold was 10.23 pounds
with the champions and 10.13
pounds without champions.
If anyone needs further infor
mation of where they may pur
chase a dressed capon in York
County, please contact Merrill
Crone at P.S.U. Extension Office,
York County, at 717/757-9657.