How is it that the incoming board chair of the Food Marketing Institute sees healthy signs for the industry at a time when many participants are despairing about the future?
Jeff Noddle, chairman, president and chief executive officer of Supervalu, is an optimist regarding the future of food retailing and distribution. That's not a bad thing for an industry down on itself. His two-year FMI term begins this month.
However, his optimism would be meaningless if it weren't grounded in realism. That's not a problem in this case. Jeff bases his outlook on exposure to all segments of the business due to Supervalu's unusually diverse network of relationships with retailers, suppliers and third-party logistics customers. (A series of stories about Jeff's FMI and Supervalu roles are referenced on Page 1.)
Supervalu is also taking a leadership role in new industry ventures this year. Its moves include the agreement to acquire third-party logistics company Total Logistics; launch of a new produce distribution business called W. Newell & Co; and a major retrofitting of a distribution center with new supply chain technology. These activities are all layered onto Supervalu's existing diverse portfolio of businesses.
All of these endeavors give Jeff a big-picture view of the industry. What he sees through that lens is innovation in segments including health and wellness, supply chain and service. While some say the industry is in decline, he calls it evolution.
Jeff concedes that many retailers are having financial challenges, but he points out that food-at-home is a very broad $500 billion to $600 billion industry that will include some winners in every market.
He also sees positives in the growing number of retail and wholesale assets that are changing hands in this industry, even though that development signals instability to some other observers. Jeff's take is that assets will land in the hands of those who can make better use of them, a process he considers healthy.
Jeff will take his positive outlook to his FMI chairman's role. Rather than focusing exclusively on the battles between supermarkets and other formats, he will point out that all food retailers have something in common: They are serving consumers. He describes FMI's role as making it easier for retailers to cater to shoppers. That means working with other associations, identifying new opportunities, and battling against challenges such as higher credit and debit card fees.
In crystallizing what drives Supervalu, Jeff says, "We skate to where the puck is going to be," citing a famous quote by former hockey star Wayne Gretzgy. That is surely Jeff's prescription for what the industry needs to do.
Jeff has proven his communication abilities at Supervalu. He has managed to package the company's complicated, nontraditional structure (wholesale distribution, conventional and price-impact retail, third-party logistics, etc.) into an understandable story for the investment community.
Now, Jeff will have a shot at communicating the food retail industry's message. That role will take all the skill he can muster.