Private Label International - Full Steam Ahead

SPRING 2015

An upmarket approach

PLUSOverseas sourcing report

Baby care | Spain

Coffee and tea | Italy

Dairy and cheese | France

Household products | The Netherlands

Oils and vinegars | Germany

PL

Retail giant Carrefour has been upgrading and streamlining its private label lines, with the aim of creating a more upmarket feel and making the shopper choice easier.

26 PRIVATE LABEL INTERNATIONAL I Spring 2015

COffEE & TEA l Italy

The coffee market is

one of the most vi-

brant markets in Italy.

According to 2013-2014 data released

by COFFITALIA, a publication that an-

nually reviews the coffee supply chain

sector and is published by Milan-based

BEVERFOOD.com, Italians consume

almost 250,000 tons of coffee yearly,

generating a turnover of €3.7 billion.

And while tea is not as popular as

coffee in Italy, Italian tea lovers cur-

rently consume more than 4,500 tons

of tea annually, states the Italian web-

site www.teaway.it.

Private Label International visited

three stores in Italy to see how each

retailer was merchandising its pri-

vate label coffee and tea. We visited a

Coop store, operated by Casalecchio

di Reno (BO)-headquartered Coop

Italia S.c.a.r.l.; a Eurospin store, oper-

ated by San Pietro Vernotico-based

Eurospin Puglia SpA; and a Conad

store, operated by Bologna-based

Conad. All three stores are located

near the city of Perugia.

GROUND COffEE

Despite a small decrease in sales,

vacuum-packed ground coffee is still

the Italian market’s leader, according

to Information Resources Inc. (IRI)

data referenced in a 9 September 2013

article posted on beverfood.com.

The Coop store we visited offers a

wide selection of own-brand ground

coffee under its Coop and FiorFiore

brands. All of the store brand ground

coffee is placed at eye level, and con-

sumers may choose between single

250-gram packages and a bundled

option that offers two 250-gram pack-

ages sold together at a lower cost per

gram of coffee.

Conad’s selection of private label

ground coffee is almost as plentiful as

Coop’s selection. All of the retailer’s

own-brand ground coffee products are

sold under the Conad name, and pricing

of its store brand products is generally

30 to 40 per cent below that of the na-

tional brands. The retailer places its cof-

fee at eye level. It also offers store brand

Fairtrade-certified organic coffee from

South America in 250-gram packages.

The Eurospin store we visited sells

ground coffee under its own brand,

Don Jerez Caffé. The 100 percent ara-

bica coffee is packaged in a 250-gram

black jar and is placed at eye level.

Additionally, a good selection of store

brand 250-gram vacuum-packed cof-

fee is merchandised just below eye

level. The average price of Eurospin’s

store brand coffee is at least 40 per

cent lower than the prices of similar

Coop and Conad store brand coffees.

COffEE CAPSULES, PODS

During the first eight months of 2013,

the portioned coffee market increased

by 20 per cent, according to data from

Chicago-based IRI referenced in a 9

September 2013 article posted on bev-

erfood.com. Sales of coffee capsules

during that same timeframe added up

to €85 million. The data seem to sug-

gest that coffee capsules and pods are

winning over Italian hearts.

During our visit to Coop, we saw

it sells single-serve coffee capsules

under its FiorFiore brand. The packag-

ing is eye-catching and distinct; each

coffee variety comes in a bright colour,

from green to gold, and each varietal

is named after a famous Renaissance

Italian artist. Almost all of the FiorFiore

single-serve coffee capsules are made

with 100 per cent arabica beans. The

coffees come in packages containing

15 single-serve units, and each pack-

age costs about 30 per cent less than

the national brands. When it comes to

merchandising, FiorFiore coffee cap-

sules are sold at eye level. Displayed on

the top shelf at Coop are the less popu-

lar coffee pods. There were no store

brand coffee pods.

The Conad store does not sell

store brand coffee capsules or pods.

Eurospin does not sell coffee cap-

sules, but it does sell coffee pods un-

der its Don Jerez Caffé brand in pack-

ages containing 18 units.

OTHER COffEE

All of the stores we visited offer 100-

gram jars of instant coffee. The jars are

clear and the coffee comes in two vari-

eties: classic and decaffeinated. Coop’s

own-brand of instant coffee, sold under

the Coop name, takes up a small por-

tion of the coffee shelf. Coop also offers

customers Nescafé as an instant cof-

fee option. It is placed above the Coop

brand on the top shelf.

Conad sells instant coffee under its

Conad brand and under the Nescafé

brand. Both brands are displayed

on the top shelf next to each other.

Meanwhile, Eurospin offers instant

coffee under its Don Jerez Caffé brand.

When it comes to whole-bean cof-

fee, both Coop and Conad sell whole-

bean espresso bricks under only their

own brands, but both stores sell store

brand and national brand whole-bean

Full steam aheadWhile the Italian coffee market is mature,

the demand for teas – especially

premium teas – could present retailers

with an own-brand opportunity.

By Federica Tedeschi

t

NEAR RIGHT: Conad’s store brand tea costs about

50 per cent less than the national brands. FAR RIGHT:

Coop’s FiorFiore brand of tea is sold in silk pyramid tea

bags and is packaged in a distinctive square box.

continued on page 28

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28 PRIVATE LABEL INTERNATIONAL I Spring 2015

COffEE & TEA l Italy

coffees. In both stores, the whole-bean products take up

the lion’s share of the bottom shelf. Eurospin’s own brand of

whole-bean coffee is available in two varieties: classic and

espresso. On average, Eurospin’s store brand coffee is 50 per

cent less expensive than Conad and Coop’s own brands. At

all three stores, the coffee is sold in 1-kilogram packages.

TEA

“Italian consumers care about quality,” states Marco

Bertana, co-founder and president of ADeMaThè, the Ital-

ian Association of Tasters and the Masters of Tea. There-

fore, the number of Italian tea lovers looking for a more au-

thentic and refined product is increasing.

Not by chance, many Italian consumers opt for pyra-

mid tea bags; the shape is designed to make room for the

broken leaf tea, providing the consumer with an authentic

and less acidic taste, something one cannot get from the

rectangular bags, which contain tea dust, Bertana adds.

Coop’s in-house standard tea is sold under its Coop

brand; it takes up one-third of the shelf and is placed at

eye level. Customers may choose from classic English

Breakfast tea sold in packages containing 25 or 50 units or

decaffeinated English Breakfast tea sold in packages con-

taining 25 units, among others. There is a very small price

difference between the national and store brand teas.

At the Conad store, private label teas are placed on

shelves below eye level. The national brands Ati and Star

are displayed on the bottom shelf and cost about 50 per

cent more than the Conad private label options.

Lester House is Eurospin’s own brand of tea, which

is available in both classic and decaffeinated varieties in

packages containing 20 units. Its teas cost 60 per cent less,

on average, than both Coop’s and Conad’s own-brand teas.

All tea varieties in this store are displayed on the top shelf.

On the specialty tea side, Coop’s store brand flavoured

black tea selection is placed at eye-level. Its FiorFiore brand

offers Darjeeling Earl Grey tea and Mint Green tea, both in

silk pyramid bags and sold in distinctive box-shaped paper

packaging. Conad offers only one flavoured black tea vari-

ety, Earl Grey, under its Conad brand, while Eurospin offers

both Earl Grey and unflavoured green tea. All store brand

specialist teas are far cheaper than the national brand

Twining, especially Eurospin’s Lester House tea, which

costs just one-third of the Twining tea offering. n

NEAR RIGHT: Eurospin’s Don

Jerez Caffe ground

coffee is

packaged in a

distinctive black

jar. FAR RIGHT:

Coop sells single-

serve coffee

capsules named

after famous

Renaissance

Italian artists.

continued from page 26