PLUS GAIN ADHERENCE

In the marriage of produce and technology, standardized price look-up codes have been playing the part of the unruly teen-age stepchild -- unfamiliar, awkward and sometimes only grudgingly accepted.But as more and more retailers become determined to make that marriage work, PLUs are finding their place. Shippers and retailers alike are accepting the little stickers with the four-digit code. An estimated

In the marriage of produce and technology, standardized price look-up codes have been playing the part of the unruly teen-age stepchild -- unfamiliar, awkward and sometimes only grudgingly accepted.

But as more and more retailers become determined to make that marriage work, PLUs are finding their place. Shippers and retailers alike are accepting the little stickers with the four-digit code. An estimated 10,000 supermarkets were using the standardized codes at the end of 1995.

There are still growing pains in the relationship, though. Questions remain about what information, and how much of it, can be crammed onto a sticker. And, perhaps more importantly, who should pay for it all.

The codes themselves are a key element on any sticker, said most retailers, shippers and industry experts interviewed by SN.

Retailers could live with or without a brand name, however, while growers and shippers consider it a priority. Industry sources did agree that they like the idea of including a varietal name, especially for the sake of consumers who often can't tell the difference between a Braeburn and a Gala.

For Vince Terry, director of produce at Harp's Food Stores, Springdale, Ark., varietal names are even more useful than PLU codes.

"Varietal names and brand names are far, far, far more important than the number itself," Terry told SN, bucking conventional opinion.

A finite pool of available numbers is the problem, in Terry's view. The current PLU system limits produce items to the numbers 4011 through 4959. The interindustry Produce Electronic Identification Board this month formed a task force to look at allocating more numbers for the standardized system, according to Alicia Calhoun, PEIB coordinator.

Meanwhile, the current uniform system fails to encompass all the variety and sizes Harp's carries, Terry said. For navel oranges, for example, there are only two codes for the more than one-dozen different sizes. "If I carry an 88 and a 48, they both have the same PLU. The end result is that prestickered product can create a good amount of confusion if there are not enough PLUs in the system, or preapproved by the PEIB, to take care of the problem," he explained.

Harp's is taking its own initiative to clear things up. "We're trying to come up with a system where, if I carry an 88-, and a 113- and a 138- and a 48-size navel orange, they all have different PLUs."

Terry described the PLUs as "a good step in the right direction," but added that "there's a tremendous amount of fine-tuning that needs to take place." Jack Lanners, director of fresh fruits and vegetables at Glen's Markets, Gaylord, Mich., said the code and the variety are both important.

"All the cashier cares about is the number that's there, because she's got to ring in that number," Lanners said. "So the PLU code is extremely important from that end of it.

"But as far as the consumer is concerned, the customer doesn't care about the number; she just wants to know, what is it?"

Varietal names are not that important for some fruits and vegetables. After all, there aren't that many different kinds of bananas on the market.

But there are a lot of apples. And varietal names help avoid confusion, according to Jim Doherty, marketing director for the Washington Apple Commission, Wenatchee, Wash.

"With all the new varieties looking so much the same, particularly the Fujis, Braeburns, Galas and Jonagolds, many times it's almost impossible to tell the difference," he said.

"Unless the stickers are there, the consumer could think she's buying a tart Braeburn, and at the same actually be picking up a very sweet Gala or Fuji. And she'd be very unhappy when she gets home."

Besides the consumer's best interests, Doherty said there are other reasons to squeeze a varietal name onto the sticker.

"It educates the personnel in the store, it educates the checker at the front end for the limited -- and I say limited -- time they spend looking at that," he said.

Howard Nager, marketing director at Pacific Fruit, New York, agreed with Doherty about the importance of varietal names. However, he added that there are other untapped informational opportunities for the sticker as well. "I still think there's room to put additional information on a sticker, without creating too much confusion," Nager said, including such information as "ripe when soft" on the sticker of a mango.

Lanners of Glen's Markets contends that there is a limit to how much information should be placed on a sticker. "I don't think you're going to get to the point of putting recipes or things like that on the sticker," he told SN. Instead, point-of-sale material, signs and brochures could serve that purpose better, he suggested.

Two key items need to appear on a PLU sticker, according to Bryan Silbermann, executive vice president of the Produce Marketing Association, Newark, Del.

"No. 1 is the number, printed in a minimum of 14-point type. No. 2 is the varietal name," he said. "That's the order of importance."

Beyond those two top priorities, Silbermann said brand names or regional identification could be added on the sticker if there is room.

"The key reason for having the PLU code is to allow the clerk to see the number and ring it up. Does that mean there should be nothing else? No, it doesn't. But it does mean you have to design your label carefully," he said.

The Washington Apple Commission is one of a number of organizations trying to juggle such concerns with newly designed labels.

The commission's old sticker used to carry the commission's logo in the center, with the varietal name above it, and the PLU number below, Doherty explained.

"We realized after we did that, the number was not really big enough to assist the store in ringing it through the checkstand. So we left the variety on the top, in red. The PLU number will be in the middle in dark blue. Then our logo, which is red, will be at the bottom."

Doherty anticipated that the new stickers will start to show up in late spring or early summer, when shippers have used up the supplies of older stickers they already have on hand.

Not surprisingly, shippers sounded more interested than retailers in seeing brand names on the sticker.

Seald-Sweet Growers, a Vero Beach, Fla., citrus cooperative, has developed a PLU with the Seald-Sweet name on it. Since Seald-Sweet is a cooperative, it is left to each of the 15 participating packing houses to decide whether they want to use the branded PLU or not, said Suzy Peterson, marketing administrator.

"If a packing house chooses to use the Seald-Sweet PLU, I think that helps their brand identification," she said. "If a single packing house chose to try to promote their packing house name, then their brand identification would be very small. But they've joined the co-op to better leverage an identity."

The reasoning behind the branded sticker is that consumers do look for brand names, she said.

"A large percentage of people do reach for brand names. So we want to take whatever opportunity we can to show that this is not just a piece of citrus, but Seald-Sweet citrus," she said.

With the Seald-Sweet name on the sticker, consumers can also contact the cooperative with compliments, questions or complaints, she said.

"We're fairly easy to reach. All you have to do is call information. Anybody who needs to get in touch with us can, since our name is on the PLU," she said. "We want them to be able to get in touch with us."

Nager of Pacific Fruit supported that logic. "I think brand names, as far as we're concerned, are a must to be on the sticker," he said. "Speaking specifically for Pacific Fruit, the brand name was on the sticker before the PLU was on the sticker.

"I know that there has been

ongoing debate about which should have greater prominence on the sticker. If it's up to the retailer, they certainly want to have the number as large as possible. If it's up to the grower or the shipper, they certainly want to have their brand as large as possible," he said. Retailers Terry of Harp's and Lanners of Glen's Markets both said they do not have a problem with brand names on PLUs, but neither sees them as a priority.

However, both retailers were quite sure that they shouldn't be paying for a grower's brand name on a PLU sticker.

"If a grower wants to sticker and put their code on it, that's great. I don't have a difficulty with that. I get a little bothered by a big sticker, because then I think I'm subsidizing their advertising. If they want to put a billboard on every orange, that's great. That doesn't mean I want to pay for it," Terry said. The question of who does pay for PLUs continues to be a source of controversy in the industry. Several significant shippers have added an upcharge to the items that carry PLU stickers, as a way to defray the huge expenses involved.

Lanners doesn't buy that approach.

"I think shippers ought to pay for the sticker, too. I don't see any reason why they shouldn't pay," he said. Growers and shippers benefit directly from the PLU stickers, he reasoned. The standardized PLU system enables retailers to supply customers more efficiently and more effectively. In turn, those efficiencies are going to allow retailers to sell more products. And when they sell more, growers can charge more, due to the increased demand.

"Sometimes, I think growers or packers are short-sighted. They look at the PLU as an expense they shouldn't have to absorb," he said. "It's not thinking of the big picture, of accommodating the needs of the ultimate customer; that's the customer who shops in the grocery store, not the supermarket operator.

"Even if you look at it as value-added, it's a way [for growers] to get the product to the consumer as efficiently as possible, and to get more of it into their hands."

Lanners said he doesn't pass along costs to his customers when he upgrades his services, so shippers and packing houses should look at PLUs the same way.

Washington apple growers, at least, don't agree. And despite the grumbling of some retailers, the Washington apple industry is charging an extra quarter per box for the stickering, Doherty said.

"Retailers are not totally happy about that, but when the stickering started, the retail industry said, 'We're willing to pay for it, because it's for our benefit. We want the PLU number data, and for customers to know what the varieties are, et cetera, et cetera,' " he said.

"So we put this program in, and we have a huge investment in it. Many, many plants have made huge investments. They've had to enlarge their buildings, they've had to tear out packing lines, they've had to extend the lines to fit the stickers on. Even at a quarter a box, the industry is losing money, Doherty added. "We're standing our ground with it, and charging a quarter a box. The resistance to the quarter upcharge is far less than the acceptance. The majority of retailers are willing to pay. And even of the ones who grumble, the majority of those are willing to pay."

Meanwhile, the supply side of the industry is still awaiting some of the benefits PLUs are supposed to bring to them, such as the sharing of marketing information between retail operations and their own.

"I think it's still fairly early in the development of the PLU for suppliers to be able to purchase demographic information or sales information, or work with retailers to get that information that's being entered into their computer system," said Nager of Pacific Fruit.