1. Semi-Perishable Categories
April 27, 2017

2. DeCA STATE OF THE BUSINESS
PROVIDING INSIGHTS INTO DeCA SHOPPER BEHAVIOR
Jeff Roman
April 2017

3. AGENDA
INDUSTRY TRENDS
DECA PERFORMANCE
SHOPPER ENGAGEMENT

4. SUMMARY MARKET OVERVIEW Economy looking better but weakness remains
Retail store sales are soft and traffic is declining
Competition is heated and market is disrupted
Discount Grocery format looks ripe for growth
COMPETITIVE OPPORTUNITY
Overall, DeCA’s toughest competition is Walmart and Grocery
Grocery channel main competitor on Center Store; varies by region
SHOPPER OPPORTUNITY
Shopper loyalty to DeCA is eroding
Medium Shoppers, especially busy older families, are driving decline
This key demo values digital efficiency, social networking, convenient/easy shopping, and fast/simple meals and snacks
Maximize assortment opportunities against major discount competitors
Identify regional Grocery priorities and opportunities
Target “Bustling Older Families” with goal of increasing trips
Lean-into digital marketing efforts
Explore DIY and prepared-meal solutions to offer unique, healthy, time-saving snacks and meal options

5. UNDERSTANDING THE COMPETITIVE LANDSCAPE
INDUSTRY TRENDS
UNDERSTANDING THE COMPETITIVE LANDSCAPE

6. STORE GAINS ARE LESS THAN SPECTACULAR
Despite economic recovery, store dollars are soft and units are flat
All Departments
UPC Coded Items
In Billions
Across Nielsen-measured retail channels and categories, total store gains have been less than spectacular. Over the past four 52-week periods, dollar sales grew, on average, by 1.8%. Low unit sales growth has been more problematic with slow or no growth in the latest four 52-week periods. In an economic recovery, shouldn’t we expect more growth or is flat or slow growth the best we can expect?
52 weeks ending 1/5/13
52 weeks ending 1/4/14
52 weeks ending 1/3/15
52 weeks ending 1/2/16
52 weeks ending 12/31/16
Dollar
Trend
+1.8
+1.9
+2.7
+0.8
Unit
+0.5
+0.0
+0.4
Avg Unit
Price Trend
+1.2
+2.0
+2.3
+0.9
Source: Nielsen Answers, Total U.S. All Outlets Combined (plus Convenience), All Departments, All Brands, “trend” means % change 52 weeks vs. year ago

7. WHAT’S HAPPENING IN THE U.S. FMCG MARKET
FMCG SALES GROWTH
Narrative Notes: WITHIN GROCERY, FMCG GROWTH HAS SLOWED OVER THE LAST TWO YEARS, DECLINES ACCELERATED IN THE NEAR-TERM Manufacturers and retailers are witnessing accelerated slowdown in retail sales.
On the whole, $1.2B of expected sales growth has not materialized over the last year. And declines have accelerated over a more recent period.
Source: Nielsen Answers, January 2014 – March 2017, UPC-only sales

8. Increased ineffective Promotions Shifting Consumer Preferences
IMPEDIMENTS TO GROWTH
Headwinds prove challenging for traditional retailers
Aging
Population
U.S. Pop. Growing
at Slowest Rate
Since 1930’s
20% of Kids <18
Below Poverty
Level
Increased ineffective Promotions
Deflation
Stagnant
Wages
As consumer age they spend less on food and other consumables and more on health care.
While ethnical groups are forecasted to grow, the overall population growth is less than 1 % which doesn’t much help to fuel growth, given that the largest group, white population is forecasted to shrink, down to 58% by 2025
Poverty levels haven’t improved, and wages, while improved over 2015 vs 2014, are still lower than 2007 and 1990’s peak
Promotion activity has increased, but shoppers responded less to promotions (prices were less elastic)
Deflation (with particular concentration in dairy and meat) did it’s part to drive down $ sales, along with shifting consumer preferences who opt increasingly for convenience and healthier food choices, so many shop certain categories online and make trips to the store to shop just for the immediate need rather than stock up trips, which leads to smaller basket. Also the demographic shifts – more older and smaller households, and many Americans live by themselves and don’t have those big baskets anymore.
INCREASED INEFFECTIVE PROMOTION
The effects of deflation were amplified by more aggressive retail promotional efforts in 2H 2016, to which consumers were less responsive. Cuts in trade spend in 2017 have accelerated this further.
SHIFTING CONSUMER PREFERENCES
Across healthier fresh food options, the convenience of e-commerce and meal kits, generational shifts push America older, younger or more multiculturally diverse, America is changing and consumption is as well.
Talk about convenient consumer solutions on steroids, just look at the growth curve in U.S. retail e-commerce sales. While the e-commerce share of total retail sales was just around 8.3%, $102.7 billion in the 4th quarter of 2016 is a huge number and the growth trajectory is very promising. In the 4th quarter of 2015, U.S. retail e-commerce sales grew 2.6% versus the prior quarter and 15.5% versus the same quarter year ago. In the 4th quarter of 2016, U.S. retail e-commerce sales grew 1.9% versus the prior quarter and 14.3% versus the same quarter year ago. “Total e-commerce sales for 2016 were estimated at $394.9 billion, an increase of 15.1 percent from Total retail sales in 2016 increased 2.9 percent from E-commerce sales in 2016 accounted for 8.1 percent of total sales. E-commerce sales in 2015 accounted for 7.3 percent of total sales.“
And manufacturers are behind the shift to e-commerce as well. Campaignlive.com/uk reported, “Are FMCG giants trying to cut out the middleman? Unilever is on a mission to ramp up its direct-to-consumer platforms. Like many FMCG companies, this has become a priority for the business.“ How many other companies re going the direct-to-consumer route which is bypassing traditional measured-retail channels?
Are FMCG giants trying to cut out the middleman? Unilever is on a mission to ramp up its direct-to-consumer platforms. Like many FMCG companies, this has become a priority for the business. February 17, 2017: The strategy was detailed in a job ad posted by Unilever this month, asking for candidates with "entrepreneurial" spirit. The move follows Unilever’s acquisition last year of razor subscription service Dollar Shave Club. That business had enjoyed rapid growth following its 2011 launch and forced Procter & Gamble, the male-grooming market leader, to introduce its own subscription service, Gillette Shave Club, in P&G followed this last year with a platform in the US for its laundry brand Tide. The company’s marketing director in northern Europe, Stefan Feitoza, said P&G placed "a premium on innovation in all fields, including looking at new trends in shopping". He added: "We’re always looking to be available where and when consumers want to shop across our brands.“ The enthusiasm of big FMCG companies for new business models has three main causes, a former senior marketer at Unilever said: the shift of shoppers away from the major supermarkets to discounters, high-end retailers and online; the growth of brands perceived as authentic or having provenance; and "the old media model working less effectively – but the alternative model, switching investment into digital channels, is still unproven". Read more:
Google Home takes another swing at Amazon Alexa, adding voice-activated shopping, February 16, 2017:
Current e-commerce news release: Data Source: Time Series available in Excel Format: Adjusted Sales [42KB: Root directory: Release Schedule: Note: Online travel services, financial brokers and dealers, and ticket sales agencies are not classified as retail and are not included in either the total retail or retail e-commerce sales estimates.
Income, Poverty and Health Insurance Coverage in the U.S.: 2015: September 13, 2016—Real median household income increased by 5.2 percent between and 2015 while the official poverty rate decreased 1.2 percentage points…. Median household income in the United States in 2015 was $56,516, an increase in real terms of 5.2 percent from the 2014 median income of $53,718. This is the first annual increase in median household income since 2007, the year before the most recent recession. News Release: US Census Bureau: US Population by Year: US Resident population through July 1, 2016; Chart: US Census Bureau: Current US Population Growth Rate: 0.77% per year (US Population Growth Rate for Aug 2016); Chart:
In Income and Poverty in the United States: 2015, Table B-2 shows that 14,509,000 out of 73,647,000 children, or 19.7 percent, were reported as in poverty in 2015, and that 15,540,000 out of 73,556,000, or 21.1 percent, were in poverty in The apparent difference is 1.4 percent. Source:
Shifting Consumer Preferences
More but Smaller Trips
Source: U.S. Census; GreekWire.com; CampaignLive.com.uk

9. TRIPS INCREASED IN 2016 FOR FIRST TIME IN 10 YEARS BUT BASKETS SHRUNK
Meanwhile, store expansion continues, led by Convenience & Value formats
OVERALL TRIP AND BASKET GROWTH
U.S. Store Counts
74%+
of growth
from niche
formats
Convenience and value are winning in the marketplace as evidenced by increased store count. Since December 2005, most store expansion (in terms of percentage increase in store count) has come from channels outside of traditional Food, Drug & Mass- Merchandise formats. Convenience Stores, Dollar Stores, and Warehouse Clubs continue expansion of store count.
Supermarkets have grown by 2,524 stores since However, there has been a fair amount of store closings along with tear downs and re-builds in the channel and more than 74%* of the store growth has come from low- and high-end niche retailers such as Aldi, Save-A-Lot, Trader Joe’s, Fresh Market, Whole Foods, and Sprouts. 53% of the niche store growth from Aldi & Save-A-Lot; 47% from the natural, organic and specialty retailers mentioned above. These calculations do not include deep-discount grocery banners from HEB, Kroger, PriceRite or Spartan or any smaller natural/gourmet banners.
- Need for Speed: 56% of shoppers looking for stores in close proximity to them, 47% prefer to get in and out quickly % of the United States population is anticipated to be urbanized by Americans with driver’s licenses decreasing.
2016 vs. 2005
Source: Nielsen Account Shopper Profiler ; TDLinx for Store Counts

10. PRICE WAR IN THE GROCERY AISLE
New competitive environment disrupting Walmart, pushing down prices
“Amazon Wants Cheerios, Oreos and Other Brands to Bypass Wal-Mart”
“Amazon and Walmart are in an all-out price war that is terrifying America’s biggest brands”
“Walmart launches new front in U.S. price war, targets Aldi in grocery aisle”
“Supermarkets are losing the Grocery price war”
Bloomberg
March 30, 2017
ReCode
March 30, 2017
CNBC
Feb 27, 2017
Walmart and Amazon competitive news
Walmart wants to have the lowest price on 80% of sales - running new price test and squeezing CPG suppliers - aiming to close pricing gap with Aldi, Kroger, Lidl
Amazon invited Mondelez, General Mills and others to its headquarters to persuade them it's time to sell directly to online shoppers.
Online grocery sales set to surge, grabbing 20 percent of market by 2025
1/30/2017
oreos-and-other-brands-to-bypass-wal-mart
price-war
targets-aldi-in-grocery-aisle.html
USA Today
March 30, 2017

11. NO-FRILLS FORMAT EXPANSION?
Kroger aims to ”learn from or expand its hard discount chain” –Kroger SVP/CFO
H-E-B’s Joe V’s Smart Shop operates seven stores in TX
Wakefern’s Price Rite operates 63 stores in nine states
Kroger’s Ruler Foods operates approx. 50 stores in six states
Looking at the gains made by deep discount grocers like Aldi and Save-A-Lot, some grocers have rolled out their own no-frills formats.
Kroger anticipated discount store invasion for years — Nov 8, 2016, 2:52pm EST Updated Nov 8, 2016, 3:01pm EST — Vince Sinisi, a Morgan Stanley analyst, asked McMullen during the event how he viewed the discount grocery segment. Kroger, the nation's largest operator of traditional supermarkets, is expanding in that segment itself with its Ruler Foods brand. … McMullen said Kroger is taking proactive steps in anticipation of Lidl’s arrival in the U.S. He didn’t go into detail, but Ruler Foods is likely part of that.
Source:
Kroger stock could be a good buy if earnings are weak, analysts say — Aug 31, 2016, 2:37pm EDT Updated Aug 31, 2016, 4:28pm EDT — Wells Fargo analyst Zachary Fadem… also a fan of Kroger’s expanding high-growth concepts. Those include fresh format stores such as Main & Vine that it’s testing in the Tacoma, Wash., area and the steep discount formats it’s expanding under the Ruler Foods name.
Source:
Kroger to build 10 Ruler Foods stores — Apr 5, 2016 — While industry attention is focused on Kroger’s experiments in high-service fresh, the retailer is quietly expanding a nascent limited service, hard discount box. Kroger will open another 10 locations of its Ruler Foods concept in 2016, the company said in its annual report filed with federal securities regulators last week. The Cincinnati-based retailer currently operates 43 Ruler Foods stores in six Midwest states — Indiana, Illinois, Kentucky, Missouri, Ohio and Tennessee ...
Source:
Kroger in test mode — 5/14/2015 — NEW YORK — If it’s a way to sell groceries, chances are, the Kroger Co. is testing it. The Cincinnati-based supermarket chain is experimenting with several retail formats to maintain its robust momentum… “We’re not afraid to test, we’re not afraid to stop tests, we’re not afraid to expand tests,” said Mike Schlotman, senior vice-president and chief financial officer of Kroger, during a May 12 presentation at the Goldman Sachs Global Staples Forum in New York. “One of the things I’ve always said is, if there’s an iteration of retailing out there, you should assume that somewhere we’re testing it somehow… Kroger currently is testing a hard-discount store format, similar to Save-a-Lot and ALDI. The company acquired Ruler Foods as part of its merger with Jay C Foods Stores in 1999 and has expanded it to better understand how the model works.
“The jury is still out a little bit on if this is something we’re going to roll out,” Mr. Schlotman said. “We do have in the mid-30s of them now. We continue to push into some new geographies with it. The learnings are interesting. Whether it becomes a roll-out or we just understand the model better, it’s going to make us a better retailer ultimately, whichever way it winds up going.”
Source:
LOCATIONS:
Spartan’s Valu Land locations:
Joe V’s Smart Shop locations:
Ruler Foods ad & list of store locations:
Price Rite:
Slide updated: 2/16/2017
Spartan’s ValuLand operates five stores in MI
Source: Logo Base and company websites

12. DISCOUNT GROCERS STEPPING UP
“It is time that the U.S. food retailers wake up to this competitive threat”
“Lidl and Aldi’s Aggressive US Invasion Spells Trouble For Supermarkets”
Forbes
Sept 27, 2016
Lidl enters U.S. market
Aldi expands in U. S.
Opening first 20 stores in summer in VA, NC, and SC
Opening 100 stores along East Coast by mid-2018
Planning to open as many as 600 stores in the US
Operates more than 1,600 stores, reaching over 40MM customers
Spending $3B+ to expand store count to 2,000+ by end of 2018
Investing additional $1.6B to expand and remodel 1,300 stores
Aldi to invest extra $1.6bn in US expansion
ALDI__Growth_Strategy_Press_Release_ _FINAL.pdf
upscale-look-with-downscale-prices
Source: Business Insider (2/15/2017), HomeWorld Business (2/8/2017); Forbes (9/27/2016)

13. UNDERSTANDING DECA SHOPPER BEHAVIOR
SHOPPER PERFORMANCE
UNDERSTANDING DECA SHOPPER BEHAVIOR

14. TOP DESTINATIONS: GROCERY, BASE, & SUPERS
Grocery gained Share of Wallet while Base and Supercenters lost
*Total Food Departments
DeCA Shoppers
% Share of Wallet
Grocery Segments
Conventional: 28% (+0.6)
Value: % (+0.5)
Premier Fresh: 1% (+0.2)
+1.0 pts
+0.5 pt
-0.3 pt
-1.8 pts
*Food Departments include Bakery, Dairy, Deli, Frozen Foods , Grocery, Meat, & Produce
Source: Nielsen Homescan Explorer, 52 Weeks Ending 12/31/16, Total US, DeCA Shoppers

15. DeCA SHARE OF WALLET DECLINED
Walmart is DeCA’s #1 competitor while Grocery is #2 but fragmented
*Total Food Departments
DeCA Shoppers
% Share of Wallet
Share of
Wallet
Pt Chg
vs YA
Walmart
18.8
-0.7
Sam’s
6.4
+0.8
Costco
5.4
-0.4
Exchanges
0.9
+0.1
Target
2.1
-0.1
Kroger
3.5
-0.2
Publix
+0.4
Safeway
2.2
Food Lion
1.8
-0.0
Walgreens
0.5
All Other
32.8
+2.2
-1.8 pts
Grocery Military Supers Clubs Drug
*Food Departments include Bakery, Dairy, Deli, Frozen Foods , Grocery, Meat, & Produce
Source: Nielsen Homescan Explorer, 52 Weeks Ending 12/31/16, Total US, DeCA Shoppers

16. Buyer Conversion vs. Grocery
FOCUS ON GROCERY VS GROCERY CHANNEL
Significant upside and close conversion indicate increased value per shopper opportunity
Comm
issary
Grocery Channel
Upside
$(MM)
Buyer Conversion vs. Grocery
Meat 27 36 $4
-11
Frozen Foods 25 37
$12
-16
Dairy 23 42
$22
-13
Grocery
$21 -1
Deli 22 39 $3
-19
Pet Food & Access. 21 16 - +1
Bakery 18 41 $8
Produce 38
$13
Beauty Care 12 10
Health Care 11 13 $2 -9
Share of Wallet at…
Source: Nielsen Homescan Explorer, 52 Weeks Ending 12/31/16, Total US, DeCA Shoppers; Total Product Line; UPC Coded Items

17. IMPROVE CONVERSION ON THESE ITEMS
Encourage Stock Up through in-store merchandising or marketing programs
$ (MM)
SOW
Opportunity
% Buyer Conversion
Top 10 Categories by $ SOW Opportunity
$13.5
$11.9
$10.4
$8.7
$8.2
$8.1
$5.0
$4.3
$4.0
$3.7
Source: Nielsen Homescan Explorer, 52 Weeks Ending 12/31/16, Total US, DeCA Shoppers; Total Product Line; UPC Coded Items

18. TARGET SAFEWAY, KROGER, AND FOOD LION
Competitive opportunities differ by geography due to regional nature of Grocery
Top Grocery Competitor
by Region
Safeway in West
Kroger in Central
Top
Departments
Frozen Dairy Produce
Bakery Deli Meat
Food Lion in East
Bakery Frozen Dairy
*Total Food
DeCA Shoppers
% Share of Wallet
*Food Departments include Bakery, Dairy, Deli, Frozen Foods , Grocery, Meat, & Produce
Source: Nielsen Homescan XOF, 52 Weeks Ending 12/31/16, Total US, DeCA Shoppers, UPC Coded Items
RMS Maps

19. SHOPPER ACTIVITY AT DECA IS DOWN
Decline due to lost households, fewer trips, AND smaller baskets
DeCA Sales
2016 (Chg vs. YA)
Buyer Penetration
Dollars per HH per year
2.5% (-0.1)
$828 (-$51) X
Trips per HH
Dollars Per Trip
14 (-0.2)
$61 (-$2.7) X
Source: Nielsen Homescan XOF, 52 weeks ending 12/31/16, Total US, DeCA Shoppers, Total Product Line, UPC Coded Items

20. SHOPPER LOYALTY TO DECA IS ERODING
Sales are increasingly dependent on light spenders
DeCA Shopper
Buyer Distribution
DeCA
Segments
Light Shopper
Less than 10%
Share of Wallet
Medium Shopper
10 to 50%
Heavy Shopper
More than 50%
Source: Nielsen Homescan XOF, 52 weeks ending 12/31/16, Total US, DeCA Shoppers, Total Product Line, UPC Coded Items

21. LIGHT SHOPPERS ARE LESS VALUABLE
Light Shoppers contribute only 5% of Total Sales
Dollars per HH per year
in DeCA
$89
$682
$2,048
Light
Shopper
Medium
Heavy
Source: Nielsen Homescan XOF, 52 weeks ending 12/31/16, Total US, DeCA Shoppers, Total Product Line, UPC Coded Items

22. DECLINE DRIVEN BY MEDIUM SHOPPERS
Reduced Shopper Spend likely shifted some from Medium to Light status
Households % Chg vs YA
% Contribution
to DeCA Sales Decline
Dollars per HH % Chg vs YA
Medium
73%
Source: Nielsen Homescan XOF, 52 weeks ending 12/31/16, Total US, DeCA Shoppers, Total Product Line, UPC Coded Items

23. MEDIUM SHOPPERS: OLDER BUSTLING FAMILIES
Typically large and busy HHs with parents in mid-40s and teenage children
LifeStage Skew vs Average DeCA Shopper¹
Characteristics of Older Bustling Families¹
Children, especially older children
Larger household size
Head of household age 40+
Higher income
Older Bustling Families in DeCA²
Represent 10% of households and only 8% of dollars
Two thirds have Income over $70k
Over half have teenage children but very few with children under 6
Light
Shopper
None
Medium
Heavy
Older Bustling
Families
Senior
Couples
Young
Transitionals
¹Source: Spectra BehaviorScape Segmentation
²Source: Nielsen Explorer Food 5 RDH; Total 2016; DeCA Shopper

24. OPPORTUNITY TO GROW TRIPS AMONG “OBF”
DeCA earns fewer trips and larger baskets from Older Bustling Families
DeCA
Shopper
at DeCA
Older
Bustling Families
at DeCA
Older
Bustling Families
Opportunity
Trips per HH
Trips per HH
Trips per HH
14 (-2%)
10 (-27%)
+0.5
Vs.
Dollars per Trip
Dollars per Trip
Sales
61 (-4%)
71 (-8%)
Vs.
+5%
2016 ( %Chg vs. YA)
*Sales opportunity among Older Bustling Families
Source: Nielsen Homescan XOF, 52 weeks ending 12/31/16, Total US, DeCA Shoppers, Total Product Line, UPC Coded Items
Source: Nielsen Homescan ASP, 52 weeks ending 12/31/16, Total US, DeCA Shoppers (Older Bustling Families), Total Trips

25. Connecting with older bustling families

26. OLDER BUSTLING FAMILIES ARE DIGITAL
Busy families use Internet to interact efficiently with world around them

27. OLDER BUSTLING FAMILIES ARE SOCIAL
Connect with DeCA families on popular digital platforms
Digital Platform Usage
FACEBOOK
YOUTUBE
TWITTER
PINTEREST
64%
110 Index to US
55%
114 Index to US
14%
122 Index to US
17%
110 Index to US
Source: Spectra, MRI

28. OLDER BUSTLING FAMILIES WANT “READY-TO-EAT”
Quick and easy foods over-index among Older Bustling Families
BREAKFAST FOOD
DESSERTS, GELATINS, SYRUP
BOTTLED WATER
BAKING MIXES
SNACKS
DRIED FRUIT
Source: Spectra Best Products; Blue Book Hierarchy

29. DeCA SHOPPERS SEEK CONVENIENCE
Opportunity for DeCA to improve association w/ Prep. Foods and In & Out
% Association with Commissary
DeCA Shopper
Source: Store Choice Drivers, 2016

30. BLUE APRON MAKES COOKING “FUN AND EASY”
Not just a practical benefit but also a story and experience
Our
chefs and
famers work
together
We send you higher quality food at a better value
You cook incredible meals from scratch

31. MEAL KIT POPULARITY REVEALS UNMET NEEDS
Delivering on key trends such as health, convenience, and exploration
TOP REASONS FOR PURCHASING A MEAL KIT:
Saves time on meal planning
Short prep & cook time
Saves time on grocery shopping
Enables me to try new recipes
Healthy recipes
1 IN 4
U.S. ADULTS PURCHASED A MEAL KIT
IN THE PAST 12 MONTHS
70%
ARE STILL ACTIVELY PURCHASING MEAL KITS AFTER TRIAL
Source: Harris Poll® conducted online, in English, within the United States between December 27 and December 29, 2016 among 2,015 adults aged 18+ (including 474 adults who have purchased a meal kit in the past 12 months

32. IN-STORE MEAL KITS ARE SMALL BUT GROWING
Sales of $80.6 Million, up 6.7% versus last year
Offer a ’fresh take’ on
Meal Ready-To-Eat…
via
partnership…
or in-house collaboration across fresh depts.
Adjust merchandising to create grab-n-go centers
Provide DIY
meal kit station…
Turn Deli-Prepared
into full meal solutions
*Meal kits defined as complete meal solutions that includes multiple components with preparations still required, items included from grocery, seafood, meat and deli departments, but no prepared/foodservice foods were included
Source: Nielsen xAOC 52 weeks ending 3/4/17

33. CONVENIENT SHOPPING OPTIONS QUALITY MEAL SOLUTIONS
REACHING THE OLDER BUSTLING FAMILY…
It’s all about convenience
DIGITAL CONNECTIONS
CONVENIENT SHOPPING OPTIONS
QUALITY MEAL SOLUTIONS

34. Win in value segment against heightened competition
SUMMARY
Win in value segment against heightened competition
Target regional grocery shoppers with local understanding and clear value proposition
Connect with busy families using digital media to offer healthy, convenient, and time-saving meal solutions

36. Food & Specialty Food
Ms. Barbara Merriweather
Category Manager

37. Sales Update ($M) Business Unit FYTD 2017 Sales $ Change $ % Change
Unit % Change
Total Food
$239.67
($19.04)
-7.4%
Category
$ Share
Cereal RTE
14.2%
$34.03
($3.36)
-9.0%
-8.4%
Shortening & Oils
7.2%
$17.28
($1.15)
-6.2%
Baking Needs
6.5%
$15.53
($1.64)
-9.6%
-8.5%
Herb & Spice Seasoning
5.8%
$13.95
($0.36)
-2.5%
8.3%
Snacks Wholesome
5.5%
$13.16
($1.69)
-11.4%
-12.4%
Meat & Fish Sauce
5.2%
$12.36
($0.63)
-4.8%
-5.6%
Fish Canned
4.9%
$11.67
($0.79)
-6.3%
-7.9%
Breakfast
4.7%
$11.21
($1.23)
-9.9%
-5.9%
Peanut Butter
4.3%
$10.24
($0.48)
-4.5%
-2.2%
Above categories make up 58.2% of total dollar sales in Food
Source: Nielsen, RDH – DeCA Worldwide, FYTD Week Ending 3/25/2017

38. Patron Savings & Sales Trends
Source: Nielsen, RDH – DeCA CONUS, Week Ending 3/25/2017

39. Strategies Implemented the Cereal Cup & Banana Rack
K2 – K5 stores
Placement recommendations: Grab-N-Go, Queue Line, Produce
Deal of the Week Promotions
Hormel SPAM (February 2-5)
Sales: $83,725
Units: 41,296
Notification from Dunham & Smith states that according to their invoice’s for the SPAM 4-Day Sales, compared to an average week (19,656 units) the commissaries did over two weeks of sales (total units 39,969) in four days!!! I think you all will agree this 4-Day Event was very successful!!

40. Sales Update ($M) Business Unit FYTD 2017 Sales $ Change $ % Change
Unit % Change
Total Specialty Food
$151.38
($11.18)
-6.9%
-8.9%
Category
$ Share
Soup
16.6%
$25.13
($3.35)
-11.8%
-17.0%
Fruit Packaged
12.8%
$19.40
($1.14)
-5.5%
-7.0%
Vegetables Shelf Stable
11.6%
$17.62
($1.76)
-9.1%
Rice
10.3%
$15.60
($1.54)
-9.0%
-6.2%
Pasta Sauce
6.4%
$9.76
($0.56)
-5.4%
-6.1%
Pasta Dry
5.5%
$8.36
($0.71)
-7.8%
-7.9%
Prepared Beans
5.3%
$7.98
($0.92)
-10.3%
Asian Foods
4.6%
$7.03
($0.11)
-1.6%
-2.0%
Breading & Stuffing
2.2%
$3.31
($0.39)
-10.5%
-13.7%
Above categories make up 75.4% of total dollar sales in Specialty Food
Source: Nielsen, RDH – DeCA Worldwide, FYTD Week Ending 3/25/2017

41. Patron Savings & Sales Trends
Source: Nielsen, RDH – DeCA CONUS, Week Ending 3/25/2017

42. Strategies
Category Evaluations (Ramen, Rice, Pasta Sauce, Instant Potato)
Optimize stock assortment
Reduce SKUs to align with patron shopping patterns
Private label opportunities

43. Bread & Snacks
Mr. Dave Leffert
Category Manager

44. Sales Update ($M) Business Unit FYTD 2017 Sales $ Change $ % Change
To be completed by Michele
Sales DeCA Worldwide, FYTD week ending 2/25/2017
Sales Update ($M)
Business Unit
FYTD 2017 Sales
$ Change
$ % Change
Unit % Change
Total Bread & Snacks
$229.88
($18.16)
-7.3%
-6.9%
Category
$ Share
Snacks
26.1%
$60.09
($2.78)
-4.4%
-6.8%
Candy
16.0%
$36.70
($3.53)
-8.8%
-9.3%
Bread
15.5%
$35.61
($2.68)
-7.0%
-6.2%
Cookies
8.7%
$19.94
($1.26)
-5.9%
-4.6%
Tobacco
8.6%
$19.81
($3.22)
-14.0%
-8.4%
Crackers
8.3%
$19.00
($1.88)
-9.0%
-8.0%
Nuts and Seeds
7.2%
$16.44
($1.69)
Above categories make up 90.3% of total dollar sales in Bread & Snacks
Source: Nielsen, RDH – DeCA Worldwide, FYTD Week Ending 3/25/2017

45. Patron Savings & Sales Trends
Source: Nielsen, RDH – DeCA CONUS, Week Ending 3/25/2017

46. Trends/Strategies Salty Snacks POG Implementation
Additional space for growing healthy snacks
Racks for the two leaders and lower prices
Jerky/Miscellaneous Snacks vertical set completed
Candy POG Implementation
New stand-up bags
Prominent section for Premium Chocolate
Organic Breads
New POG
Salty Snacks POG implementation completed April 2, 2017
- Racks for the two leaders and lower prices will grow sales
Candy test set completed on February 24, POG implementation will begin April 24, 2017

47. Beverages
Mr. Darrell Clary
Category Manager

48. Sales Update ($M) Business Unit FYTD 2017 Sales $ Change $ % Change
Unit % Change
Total Beverages
$184.88
($10.59)
-5.4%
-6.4%
Category
$ Share
Coffee
24.9%
$46.01
($3.87)
-7.8%
-9.1%
Juice
19.0%
$35.07
($2.69)
-7.1%
-8.8%
Soft Drinks
17.9%
$33.06
($2.16)
-6.1%
-8.4%
Water
10.0%
$18.43
$0.49
2.7%
7.3%
Energy Drinks
5.8%
$10.77
$0.20
1.9%
-1.4%
New Age Beverages
4.1%
$7.65
($0.61)
-7.4%
-7.6%
Water Sparkling
3.5%
$6.55
$0.60
10.1%
4.7%
Tea
3.4%
$6.35
($0.67)
-9.5%
-8.6%
Above categories make up 88.6% of total dollar sales in Beverages
Source: Nielsen, RDH – DeCA Worldwide, FYTD Week Ending 3/25/2017

49. Patron Savings & Sales Trends
Source: Nielsen, RDH – DeCA CONUS, Week Ending 3/25/2017

50. Trends/Strategies Coffee Juice Soft Drink Trends:
K-cups
Bags (Specialty)
Juice
Healthier Alternative
New Innovation
Reduce Cannibalism
Soft Drink
Premium
Planograms
Trends:
Healthier Alternatives
New Innovation

51. Trends/Strategies Water Energy New Age Trends: Healthier Alternatives
Premium
Sparkling
Energy
Organic
Sugar Free
New Age
RTD Coffee
RTD Tea
Trends:
Healthier Alternatives
New Innovation

52. Brainstorming Session

53. Facing the Future Together
Discussion Topics
Product Availability
Speed to Shelf
Fill Rate
Event Marketing & Promotions
Display Excellence
Promotional Displays
Planogram Opportunities
Facing the Future Together

54. THANK YOU!