Joel M. Small is serious about sweets. The Sales Directorate (SD) buyer for candy, direct store delivery (DSD) categories, and water, Small is ultimately responsible for ensuring that the Defense Commissary Agency (DeCA) assortment meets patron expectations.

One of his responsibilities typically involves attending the All-Candy Expo, a major industry event. His impressions of its relevance to DeCA? “Many of the items at the All-Candy Expo are directed to mass-merchandise retailers and/or specialty stores. DeCA is more a grocery store retailer, with the main emphasis on national branded candy bars and candies.

“Shelf space limits the selections for the DeCA stock assortment. Most candy purchases are impulse-driven, and we try to appeal to the patrons with off-shelf displays and shippers.”

One interesting trend that Small has seen is the updating of traditional favorites, i.e., familiar products with a new twist. “Snicker's candy bars are now available with caffeine, and are for sale in DeCA commissaries. Also, Mars has introduced Premium M&M's with flavors such as mint in white chocolate that feature an additional dark chocolate exterior, as well as [Dove brand] dark chocolate covered almonds.”

Computer assisted ordering (CAO) is helping DeCA keep its shelves fully stocked with product. Fort Detrick, Md.

Innovation extends even to packaging. “Many of the stick gums, like '5' and 'Stride,' are being repackaged into 'slim' packs that fit into a pocket or purse more easily.” Does Small see any patron preferences converging with the products now coming into the marketplace? “Patrons are looking for convenience. The 'slim' pack gums should be a very popular item. Another offering is 'mega' packs of items, such as Ice Breaker mints, which are available in packages that fit into car cup holders, thereby allowing easy access for on-the-go eaters.”

In some categories, “never out of stock” is a key consideration for both buyers and store directors. Small said that “while there are some items in each category that need to be in stock at all times, DeCA's policy is to have 98 percent or more of all carried items in stock every day. This policy holds true even for an impulse item like candy. The most important consideration for candy is to ensure storage in temperature- and humidity-controlled areas to prevent damage.

“Store directors and their staffs do an exemplary job in maintaining the in-stock rate of their items. It would be advisable for each store to keep as many of the top-selling items as possible to maintain and grow sales.”

Among the top items that Small would classify as the candy equivalent of “never out of stock” are Hershey's chocolate bar (plain and almond); Snickers bar (single and six pack), Dove bagged chocolate; M&M's (peanut and milk chocolate); Reese's peanut butter cup (three separate SKUs); Butterfingers bar; Twix bar; Hershey's Kisses; Baby Ruth bar; York Peppermint Pattie; Nestlé Crunch bagged candy; and Schokoladé boxed chocolates.

The All-Candy Expo, held May 20-22, at McCormick Place, Chicago Ill., was the major event in the candy industry this year, and the Army & Air Force Exchange Service's (AAFES) Senior Buyer for Retail Food Kathy Wulff and Buyer II-retail food Randal Demster, were on hand to see what was happening in the industry and learn how those changes could benefit AAFES patrons.

During the event, Wulff was presented an Outstanding Achievement Award by Professional Candy Buyer magazine during a private reception on the Monday, preceding the All-Candy Expo. When E&C News spoke to Wulff prior to the event, she was optimistic about the department's fortunes in 2008, saying, “We expect a net sales increase — price increases aside — of 2 percent for fiscal 2008 and 4 percent for the holiday season.”

In his new role on the AAFES Candy buying team, Demster had a number of observations to share about the show. “We saw many new items, such as Ghirardelli's new Milk Chocolate with Peanut Butter filling bar and Russell Stover's American Classic standup bag line, that we feel could help drive corporate goals and help keep the candy department fresh and exciting,” Demster said. “In regard to top sellers presenting in new packaging, we met with Mars Inc., and they are introducing M&M's in a premium format, in a box with upscale colors and flavors.”

There were other updates to traditional favorites. “The Jelly Belly Company plans on introducing Ice Cream Parlor flavors to their existing flavors. There will be five new flavors that will come in a variety of packaging, and AAFES intends to offer this assortment as a gift set for the holiday season.”

Demster explained that he feels that AAFES is “heading in the right direction to meet the unique need of military shoppers. We are taking action to increase our assortments in growth areas, such as sugarless gum and premium chocolates.”

With troops downrange combating heat and boredom, Demster had as a goal to seek “new items to freshen up the everyday stock assortment.”

"For troops on the job, a mouthwatering candy or familiar favorite bar is one of the rewards of shopping the exchange. New items help to “freshen up the everyday stock assortment,” said Army & Air Force Exchange Service (AAFES) Candy Buyer Randal Demster. Fort Detrick, Md.

How did he do? “We did find some new vendors. We're buying from Hospitality Mints and Cody Kramer Dutch Caramel Wafers, as well as specialty items from Elegant Gourmet and Sunny Seed Drop items from Sunflower Food and Spice Company, among others.”

“New” is also the buzzword for the holiday candy assortment. For older children approaching their teenage years, “We've included some fun High School Musical and Hannah Montana licensed items from Frankford that should appeal to tweens,” he said. “We're also buying Christmas novelty items for kids from Hilco and expect the same strong customer response that we saw to similar items at Easter. We'll also have a 40-oz. Whitman's Sampler in the assortment this year. It will make a fun, impressive gift.” Demster tells patrons to “look for the 40-oz. Whitman's Sampler and the Hershey's 5-lb. bar in our Christmas ads.”

The Navy Exchange Service Command (NEXCOM) has been paying close attention to the various changes in taste in the candy market and thinking of new ways to anticipate and meet its customers' shopping preferences.

According to Amy Via, the exchange service's candy buyer, fiscal 2007 sales were $21.6 million, a 0.3-percent increase over fiscal 2006. For year-to-date 2008, sales are up 2.26 percent over last year. Via said that the 2008 plan for candy — $22.36 million — targets a similar trajectory with an increase of 3.5 percent over prior year.

NEXCOM ships its candy worldwide, said Via. The product is shipped either direct to store, or is cross-docked through its warehouses.

On the specifics, she said, “We are rolling out the McLane Company as the delivery agent for CONUS. Overseas locations, including Hawaii, are replenished direct from the vendor or military distributor into that location's warehouse.”

On the issue of managing candy inventories, Keri Vierra, NEXCOM candy planner and assistant to Via, said, “The candy department strives to maintain a 95-percent in-stock rate for all NEXCOM store locations. It is our expectation when serving our military families to provide a solid assortment, and to be sure we are in stock on the items when they shop our stores.”

She said that in order to properly manage candy inventory, “it is necessary to be proactive in setting a strong presentation and to ensure full communication with the buying and planning team at all times. By working together, we can guarantee optimal sales for the company, and optimal satisfaction for our customers.”

There are certain candy brands and items that are considered “never out of stock” — products that must always be on the shelf.

The premium assortment in Navy exchanges will be expanding in the upcoming months to help capitalize on the growing sales in the category.

Currently, the 20 top items that Via would classify as “never out of stock” are Snickers Single Bar; Snickers King-Size Bar; Planters Nut and Chocolate (6 oz.); M&M's Peanut Single; Reese's Miniatures (13 oz.); M&M's Peanut Candies (14 oz.); M&M's Peanut (21.3-oz laydown bag); Snickers Fun Size (11.18 oz.); and Trolli Sour Brite Crawlers (5-oz. bag).

Also, Reese's Peanut Butter Cup (1.5 oz.); Planters Fruit and Nut Mix (6 oz.); Twizzlers Strawberry (16 oz.); M&M's Peanut Butter (12.7-oz. bag); Kit Kat Snack Size (10.78 oz.); Hershey Kisses (12 oz.); Twix Caramel Single Bar; Dove Smooth Rich Dark (9.5-oz. bag); Lindor Truffles (assorted 12-count bag); Dove Smooth Milk Chocolate (9.5-oz. bag); and Wrigley Orbit Wintermint (14 pieces).

Defense Commissary Agency (DeCA) stores have always committed themselves to meeting patron needs, and patrons' pets are no exception.

The $108 million DeCA pet food and supplies category (which includes such items as leashes, bowls and toys) is the responsibility of buyer Linda Callery, who reported that the area has seen growth in leaps and bounds in the first half of DeCA's fiscal year

According to Callery, who spoke to E&C News in July, the year-to-date figure for fiscal 2008 is $67 million, compared to $57 million for the same period in fiscal 2007 — a remarkably robust 18-percent increase.

Last year, Callery told E&C News (9/07) about the efforts of manufacturers, distributors and DeCA in handling the March 2007 pet food recall. She said that, during this period, customers added alternative choices for their pets with natural, organic and fresh foods. Has the trend for these alternative food choices continued, grown or reversed? “I feel,” she said, “that most people have gone back to buying their original brands that their pets had been used to or traded up.”

... Callery explained, flexibility exists within the system to help stores respond to unique patron needs. “If a store indexes high in a commodity, we can allocate more space accordingly. Our stock assortment is tailored to what our customers are purchasing, by utilizing store data.” In the pet food category, she said what patrons respond to “varies from premium to health maintenance to value products.” She said stores also listen to “customer comments concerning products they would like to see us carry.”

Military servicemembers purchases of dog food comprised 1.5 percent of total scannable items recorded by The Nielsen Company in DeCA stores.

Rawhides and toys, Callery noted with an animal anology, “rule the roost in pet supplies.” NAS JRB Fort Worth, Texas.

From fiscal 2006 to fiscal 2007, the dog food category — the single largest pet category in DeCA stores — grew in sales from $62.9 million to $64.6 million. While this 2.66-percent increase is more modest than its cat food counterpart, those sales represent a higher share — 1.5 percent — of DeCA's total sales of scannable items in fiscal 2007, according to the Nielsen Co. It is also a higher share than that of total civilian CONUS — only dog food sales (0.92 percent), which may indicate that military servicemembers proportionately own more dogs than their civilian counterparts.

From fiscal 2006 to fiscal 2007, the cat food category grew in sales from $27.9 million to $29.3 million — a 5.07-percent increase (and a 0.68-percent share of DeCA's 2007 total, which is nearly identical to its CONUS civilian counterpart, viz., 0.66 percent).

Is there any message Callery would like to convey to store managers about the handling of the assortment? “We want to let our store directors and managers and their staff know that the job they do on a daily basis is appreciated by us, as well as our customers who come in through those doors each day. The workload at store level is immense, with new products coming and old ones going, changing packages, sizes, etc.

“It is a challenging but worthwhile effort that pays off by giving our patrons new and different choices. From building displays that promote the product to ensuring our customers are provided exceptional service, it's a team effort at store level, where the rubber meets the road.”

With gas prices soaring, Callery projects, pet food and supplies are “those strong commodities that will assist in making the commissary benefit 'Worth the Trip.'”

With the transition to a focus on a differentiated core mass/specialty offering well underway, Army &Air Force Exchange Service (AAFES) pet food and supplies sales have strengthened significantly during the first few months of fiscal 2008.

According to AAFES's pet category buyer Bryan Calk, prior to the category's turnaround in early 2008, sales for the total AAFES pet business were $31.7 million, a drop of approximately $1.3 million from the $33 million the department reported in fiscal 2006. This 3.9-percent dip “was a result of the pet food recalls that occurred in 2007,” Calk said.

The recall “affected the whole pet retail industry, not just AAFES,” Calk said. “We worked closely with our vendor partners to pull the recalled products from our shelves in a timely manner.”

In 2007 — as the recall was making headlines — AAFES was in the process of beginning a complete overhaul of the pet department, with a focus on core items. Calk said this transition is an ongoing one, stretching into fiscal 2008.

“We are continuing the transition to a mass/specialty offering that will differentiate AAFES's pet selection from those of grocery and big-box retailers,” Calk said. “We are offering better goods at a great value. Thus far, the response from our customers has proved that this was the right move. In addition, we keep patron interest by offering special buys throughout the year.”

AAFES's pet department assortment continues to transition toward a mass/specialty offering in an effort to differentiate itself from grocery and big-box formats. Fort Lee, Va.

Sales through May for AAFES's pet business are up 6 percent versus the prior year, which was in line with the exchange service's fiscal 2008 financial plan. Fort Lee, Va.

AAFES's top sellers include some of the most well-known brands and items in the industry. Calk said Hill's Science Diet “led the way” in AAFES stores during fiscal 2007, having six of the top 10 wet/moist dog food items and seven of the top 10 dry dog food items.

“Our value pricing on this high-quality product has made us a destination for Science Diet products,” Calk said.

Calk said Nestlé Purina supplied seven of the top 10 wet/moist cat food products during fiscal 2007 with its Friskies and Fancy Feast lines. Citing their popularity, Calk said, “These are name brands that our customers know and trust for their pets.”

During fiscal 2007, the buyer said the most popular dry cat food was split with three vendors — Hill's Science Diet, Nestlé Purina and Mars Pet Care — each having three items in the top 10 dry cat food category.

In addition, food products that have been formulated for a specific concern extended their popularity in fiscal 2007.

“Specialty food items make up roughly 16 percent of the overall pet food business,” Calk said. “This makes them an integral part of our pet food assortment — weight maintenance, hairball control, sensitive stomach, sensitive skin, oral care and senior pet products.”

The most popular specialty food items in the assortment include Hill's Science Diet Minced Light Adult Cat Food (3 oz.), which is the top unit seller, and Hill's Science Diet Lite Adult Dog Food (20 lbs.), the top seller by dollars.

As far as pet care items are concerned, Calk said products such as training pads and cat litter make up six of the top 10 items. In addition, toys and treats continue to grow, “and we have recently updated our department/class/subclass hierarchy to assist us in identifying and reacting to sales trends in these categories.”

Navy Exchange Service Command (NEXCOM) stores pride themselves on their service to military families, a call of duty that also extends to those families' cuddliest members — pets!

The responsibility for pet supplies has recently passed to Diane Martinsen, buyer for Food & Pet, who succeeds Charles Phillips (see E&C News 8/08).

Martinsen said fiscal 2007 sales were $8.2 million — an increase of 1.3 percent over prior year sales of $8.09 million. “We feel this is an acceptable increase,” she stated, “when you take into consideration last year's pet food recall.”

Year-to-date 2008 sales through June are $3.58 million, up 5.9 percent versus sales for the same period last year of $3.38 million. Martinsen said the overall performance year-to-date for pet food and supplies is “within our expectations.”

In 2007, manufacturers, distributors and NEXCOM, together, made great efforts dealing with the March-through-June pet food recall. Now, Martinsen believes things have settled back to normal. “We did incur some manufacturer deletes. We were also offered some replacement items.”

Assortment size remains the same, said Martinsen: 56 percent of sales generate from pet food, 44 percent from pet supplies. “Our niche market is premium dog food. We also do well with portable pet items such as housing and carriers. Another proven item would be puppy training pads.

Year-to-date 2008 pet food sales through June are $3.58 million, up 5.9 percent. 2007 sales for the same period were $3.38 million. NAB Little Creek, Va.

Fiscal 2007 sales were $8.2 million, while fiscal 2006 sales were $8.09 million — an increase of 1.3 percent. NAB Little Creek, Va.

The assortment of pet food items that suit a particular need has broadened, said the buyer. Items such as weight maintenance, sensitive skin and other enhanced quality-of-life products for pets continue to grow and expand within the assortments.

Martinsen reported that the top 10 pet food SKUs for the past year, in order of sales, were: Pedigree Mealtime Small Bites (20-lbs., bag); Science Diet Canine Light (20-lbs., dry); Canine Adult (44-lbs., dry); Science Diet Canine Small Bites Adult (20 lbs.); Purina Beneful (17.5 lbs.); Science Diet Canine Small Bite Adult (40 lbs.); Mealtime Small Bites (44 lbs.); Science Diet Canine Adult (20 lbs., dry); Pedigree Dry Mealtime Small Bites (8.8 lbs.) and Science Diet Canine Maintenance L&R (20 lbs., dry).

The buyer said that the top 20 pet accessory and treat items for the past year, in order of sales, were: Smokehouse Piggy Chew (20-pack); Kennel Wire XL (42 in. x 28 in. x 31 in.); Sky Kennel Vault Door X-Large; Sky Kennel Medium/Grey; Kennel Wire (34 in. x 24 in. x 27 in.); Sky Kennel Vault Door/Large; Fresh Step Scoop Litter (28 lbs.); Furminator Medium Deshedding Tool; Sky Kennel Small/Grey; Arm & Hammer Multi-Cat Litter (21 lbs.)

Stationery, including school and office supplies, continues to be a solid sales generator for Army & Air Force Exchange Service (AAFES) stores, according to Divisional Merchandise Manager (DMM) Tom Wilmoth, who handles stationery items, and buyer Beverly Calloway, who handles writing instruments and basic Back-To-School (BTS) items. The category has seen some interesting developments in merchandising, replenishment, and assortment, with increased use of floor-ready shippers; close work with AAFES Planning, Allocation and Replenishment (PAR) teams; and the addition of new items to the shelves, some of which have an earth-friendly bent.

Wilmoth reported that stationery and school and office supplies sales, boosted by a solid holiday season, finished fiscal 2007 up 2.4 percent at $41.3 million. Prior to the holiday surge, sales through November 2007 were up 1.8 percent.

Year-to-date 2008 figures through February were $15.5 million, indicating further growth of 2.6 percent.

Wilmoth said that AAFES stores carry a wide variety of stationery items to suit just about any need. “Generally speaking, our assortment is 75 percent BTS — basics, like pens, pencils, binders — and 25 percent home office items, scrapbooks and accessories,” he said.

The DMM said that among the most popular items in this assortment are gel pens; permanent markers and marker sets; highlighters; binders; scissors and other classroom tools; writing instruments, including pencils, technical pens and pencils; and what he characterized as “young children's needs,” including crayons, craft paper, and glue sticks.

He said that among the key brands in these categories are Crayola (markers, colored pencils and crayons), Elmer's (glue and glue sticks), Mead, Paper Mate (stick pens); Sanford, Bic (pens and highlighters), Fiskars and Avery.

“We're committed to using the Store Communications tool much better this year, which will give the stores a constant roadmap to a successful BTS,” said Manager Tom Wilmoth. Fort Lee, Va.

Stationery and school supplies finished fiscal 2007 up 2.4 percent with $41.3 million in activity. Fort Lee, Va.

The most popular period of the year for stationery and related sales is BTS, which takes place during the July-August two-month time frame. Wilmoth said that early planning helps to make this period a productive one in exchange service stores.

“BTS planning was completed on March 1,” he said. “The majority of one-time-buy dollars went into our direct import program, which will be 100-percent PDQ displays priced to sell and totally color coordinated.”

Wilmoth said that PDQ displays refer to floor-ready displayers, shipped already packed with merchandise, that are specifically for categories with short selling seasons.

The 2008 direct import program, he continued, consists of key items, priced sharp with great margins that are being shipped in color-coordinated PDQ displayers.

During the BTS period, and throughout the year, the ability of the exchanges to have the right item on hand at the right time is a challenge that needs to be addressed on a daily basis. AAFES's PAR team is tasked with ensuring that the exchange service's stores are properly stocked.

“PAR responsibilities have been clearly defined and are currently being implemented,” Wilmoth said. “The PAR team works initially with the buyer to build the plan. Once the buyer finalizes this plan, the PAR team once again takes over, to replenish the stores and the distribution centers.”

According to Lisa McCollum-Artis the Navy Exchange Service Command (NEXCOM) assistant buyer for office and school supplies, the exchange service is targeting a sales goal for 2008 of $15.1 million.

Helping it reach that mark in the current fiscal year will be many of the traditional patron favorite purchases augmented by a selection of new items.

In 2007, the top sellers were integrated shipper/displays and PDQ displays, which NEXCOM brought in from Avery, Quartet and Sanford, among others. “We purchased three different displays vehicles from Sanford that housed assorted writing instruments, two different display vehicles from Avery that housed binders/dividers, and a dry-erase boards display from Quartet. Each of these display vehicles proved to work well for our stores,” McCollum-Artis said.

Navy exchange patrons have also been responsive to contemporary environmental concerns and the “buying green” trend. McCollum-Artis said, “We carry earth-friendly product in our stores. Acid-free products are a must in our scrapbooking category. We also carry recycled computer paper.” Do they worry that “buying green” is a passing fad? “We feel earth-friendly product will become more popular as long as prices remain affordable.”

As busy as the Back-to-School period is, the NEXCOM stationery area does almost as well, if not better, during the holidays according to Assistant Buyer Lisa McCollum-Artis.

McCollum-Artis noted “several high-velocity items that are classified 'never be out of stock.'” The top-selling items are the Pilot G-2 gel pen; 2-pack black ballpoint pen; black Sharpie marker; Avery Dennison yellow highlighter; Avery Dennison 1-inch vinyl binder; Acme 5-inch soft-handle pointed scissors; Rose Art 24-count crayons; and Rose Art washable school glue.

Among the hot trends and new products that might affect the school and office supplies area in 2008, the buyer believes, are new movie releases, which typically help drive specific themes. “During our 2008 Back-to-School (BTS) season, you will see action heroes, which will include some of the following: Indiana Jones and Speed Racer. Other popular themes you will see are Hannah Montana and High School Musical.”

As busy as the BTS period is, the exchange stationery area does almost as well, if not better, during the holidays. “We are looking to do extremely well,” said McCollum-Artis, “with gift wrap, ribbon, bows and gift bags. We are also looking to do well with our mailing centers, which include boxes, bubble wrap, envelopes, etc.”

McCollum-Artis noted “several high-velocity items that are classified 'never be out of stock.'” The top-selling items are the Pilot G-2 gel pen; 2-pack black ballpoint pen; black Sharpie marker; Avery Dennison yellow highlighter; Avery Dennison 1-inch vinyl binder; Acme 5-inch soft-handle pointed scissors; Rose Art 24-count crayons; and Rose Art washable school glue.

The stationery assortment in the Marine Corps Exchanges (MCX) saw an increase in sales activity during early fiscal 2008. With the summer Back-to-School period projected to be strong, the exchange service is looking to the category for another successful sales year.

Karen Macdonald, MCX consumables buyer, reported that MCX stationery sales during fiscal 2007 were $2.81 million compared to $2.77 million in fiscal 2006, a 1.5-percent increase.

Sales got off to a roaring start in the first few months of the year. Macdonald said that stationery had produced $217,331 in activity through February, compared to $190,819 during the same period a year earlier, representing a 13.9-percent increase. These increases reflect and include the reopening of three MCX exchanges — MCB Quantico, Va., MCAS Cherry Point, N.C., and MCAS Miramar, Calif. — all of which went through major renovations during the preceding year.

According to the buyer, the 2008 sales plan for this category is $3.16 million, which if realized, will represent growth of 12.3 percent.

Crayons add color to the MCX stationery assortment, which increased sales by 1.5 percent during fiscal 2007. MCB Quantico, Va.

Traditional stationery items continue to generate significant sales activity at MCX stores. MCB Quantico, Va.

Whether at a larger store or a smaller one, certain stationery items stand out as the department's top sellers. The MCX carries the latest items from the most well-known stationery companies, as well as private label and National Industries for the Blind (NIB) items.

“The very basics, or those items that the Marines use in the course of their normal day-to-day operations, continue to drive this category,” said Macdonald.

During fiscal 2007, the exchange service's top-selling stationery product was the 3M Scotch Tear-By-Hand Packing Tape (1.88 in. by 38.2 yard), which sold 63,469 units and generated $273,033 in sales.

This was followed by a private label item — a protractor/square rule, which sold 14,110 units and produced $52,913 in sales — and Bic Round Stic Black Pens (10-pack), which sold 31,696 units and amassed $47,093 in sales.

The buyer said this fashion trend — which is directed at younger clientele — will be a major focus of the MCX's 2008 Back-To-School (BTS) program.

“This particular trend can be found most in our Back-to-School timeframe assortments,” Macdonald said, adding that the trend ties into the increasingly popularity of this July-August period, when students from kindergarten through college — and their parents — prepare for the coming school year.

“Back-To-School continues to be a big draw for MCX,” the buyer said. “Sales for 2007 were $549,019 compared to $505,353 the previous year,” amounting to an 8.6-percent gain. “We are planning similar increases for 2008 during BTS,” she noted.