Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, March 3, 1993 TAG: 9303030044
SECTION: BUSINESS PAGE: B8 EDITION: METRO
SOURCE: SANDRA BROWN KELLY
DATELINE: LENGTH: Medium
TURNS OUT THE FARMERS AREN'T CHICKEN LITTLES AT ALL
Every month, workers for Virginia's Department of Agriculture and Consumer Services take a grocery list of 40 items and go shopping in four metro areas: Roanoke, Richmond, Northern Virginia and Norfolk.The survey is set up to monitor changes in food costs, but it also shows where costs are the highest. For instance, in February's survey the state agency's "market basket" cost $71.82 in Roanoke and $82.69 in Northern Virginia. Richmond and Norfolk were $75.08 and $75.64 respectively.
Roanoke's prices were one-tenth of a percent higher than in February 1992.
No matter where you shop, however, the prices paid for groceries has more to do with what happens on the way from grower to consumer than with what farmers get for their harvests.
Farmers have complained about this for so many years that they've become like Chicken Little, meaning many of us don't pay much attention anymore.
But, the farmer is right, says a recent study from the U.S. Department of Agriculture.
USDA calculated that out of each dollar you spend for food, the farmer gets 22 cents or less. The biggest chunk, 35 cents, goes to food-marketing labor costs.
A Texas A&M study says that on a 60-cent can of beans, the farmer gets eight cents, the processor gets 27 cents, the wholesaler gets 10 cents and the retailer 15 cents.
Gordon Groover of Virginia Tech's Cooperative Extension Service talks in terms of "undifferentiated products" and "differentiated products."
That means when potatoes are freshly dug, they're worth about the same no matter which farmer grew them; they're undifferentiated. But if they're cooked, mashed and flavored with butter, packaged and displayed invitingly in the grocery's refrigerator case, the potatoes have been differentiated.
A few days ago this newspaper - actually, this reporter - said that plastic peanut butter jars couldn't be recycled. That was half right.
Not all plastic jars are equal. Some peanut butter is packed in containers made from lightweight, brittle polystyrene. These are labeled No. 6 and shouldn't be recycled.
Jars with a "1" inside the recycle triangle symbol are just fine for recycling; they're made from PET, polyethylene terephthalate.
Now that those little plastic coupon holders are jutting out of supermarket shelves all over - some of them even blinking at us - it seems we might be headed for a future of fewer coupons.
The reason is "value pricing," which can be translated: If companies don't give out "cents-off" coupons, they can lower the prices of their products.
For instance, Procter & Gamble Inc. said it will cut the price of its Tide powder and Cheer detergents 9 percent and begin reducing the "frequency and value of coupons for these brands," Advertising Age reported recently.
The ad industry's trade publication said this brings all of P&G's detergent products into the "everyday low pricing" category.
P&G's new emphasis on price apparently was prompted by a drop in sales of its Tide and Cheer brands. Tide, still No. 1 with 21.9 percent of the $2 billion powder detergent market, suffered a 5 percent drop in sales from February 1992 to the end of January. Cheer lost almost 25 percent, according to Nielsen Marketing Research.
Advertising Age says the price trimming will come with the introduction of a new formula "grease releasing" Tide and Cheer With Advanced Color Guard.
Western Virginia has units of nine of the 10 chain restaurants that were voted tops by the 2,502 households responding to a National Family Opinion survey sponsored by Restaurants & Institutions magazine.
The winners were: Old Country Buffet, in the buffet category; Wendy's, hamburgers; Chick-fil-A, chicken; Baskin-Robbins, sweets; Golden Corral, steak houses; Red Lobster, seafood; Chi-Chi's, Mexican; Pizza Hut, pizza; Cracker Barrel, family dining; and The Olive Garden, dinner houses.
Winner in the sandwiches category was Rax Restaurants, a Columbus, Ohio, company.