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O C G S h o w D a i l y M o n d a y, Ju n e 6 , 2 0 1 6 4 4 OLIVE OIL INDUSTRY FIGHTS LABEL FRAUD By Lorrie Baumann Olive oil industry experts are enlisting retailers to improve the quality of the olive oil assortment on their shelves and to educate consumers that the low-price olive oil they can buy on some retailers' shelves isn't a quality extra-virgin olive oil, regardless of what it says on the label. While it's not necessarily easy for the average consumer to know if the olive oil they're buying is truly a high-quality oil, it is very easy to identify a very cheap oil as a fraud, says David Neuman, Chief Executive Officer of Gaea North America, a subsidiary of Greek olive oil maker Gaea. "When you're selling as a retailer a liter of extra-virgin olive oil for $7, that's not possible. Organic extra-virgin olive oil being sold for $5.99 a liter. It isn't pos- sible. You can't make it for that," he said. "You could ask, how do they do it? How do they sell an EV for $4.99?" adds Alexandra Devarenne, Co Founder of Extra Virgin Alliance, a nonprofit trade association representing producers of extra virgin olive oil from around the world. "It's not really an extra virgin olive oil," she said. The product in that bottle is very likely all olive oil, since the presence of other oils, such as canola or soybean oil, is easily detected. Although other oils can be mixed into olive oil and then sold as pure extra-virgin olive oil, the relative ease of detection and clear illegality has discouraged that particular fraud in U.S. retail, she says. The fraud that's more often perpetrated on American retailers and consumers involves the adulteration of extra-virgin olive oil with lower grades of olive oil to produce a mixture of inferior oils that's then labeled and sold as extra virgin. "That's possible, and it's undercutting the market for true extra virgin," Devarenne said. Widescale fraud is made possible because olive oil as a category is worth more than $1 billion a year in U.S. sales, and of that, more than 98 percent is imported, Neuman said. "With olive oils, there are a lot of foreign entities labeling things extra virgin that don't meet the standards. The rest of the world is send- ing whatever they want to America. Grocers are selling what they need to to meet the demand," he said. That leaves the producers of genuine high-quality extra virgin olive oils – the kind that have been shown actually to have the health benefits and flavor that Americans are often seeking when they choose to buy olive oils, struggling to com- pete in a marketplace in which their oils, which have to sell at prices that reflect what it actually costs to produce them, sit on the shelf next to commodity-grade oils with much lower prices. Retailers are in a similar bind, according to Maria Reyes, Director, Vendor Management at KeHE Distributors. "It's a business and we all have to make money including the retail- ers. There are a lot of oils out there and consumers are confused or simply don't know the right olive oil to buy. The chal- lenge is how we get the consumers to be educated about olive oil so that they are able to make the right decision as to what they're buying off the shelf," she said. KeHE is getting more and more requests every year from over-stressed retailers who are asking for help with cat- egory reviews and product tastings, partly because they're finding it more difficult to find the time to educate themselves about a product that's often regarded as a commodity instead of as a specialty cate- gory like wine or cheese, Reyes says. "The challenge is that they're requesting the information, they give us the time, and they listen," she said, "But then, 'How do we do this? How do all of us find the time to do this?'" "They think of olive oil as an every- day food, but it's as technical as wine – it has a standard of identity; it's regulated," Neuman added. "But grocers generally just don't have the time to investigate. One buyer may be buying half the center store. They sometimes do two reviews a year for each category. Plus, they go to trade shows, etc." They'd like retailers to regard olive oil as a category more similar to wine, for which many specialty markets have a som- melier who has invested a significant amount of time to learn about the products their store is selling. But short of that, they'd like to see grocery retailers support- ing their buyers in gaining some training about olive oils. "Anyone who cares enough to learn can learn. It's not neces- sary for a buyer to go to multiple trainings to make a big difference. It's enough to want to learn and to taste and to seek out people who are experienced," Devarenne said. "You may not become an expert taster – that takes years – but you can become a competent taster pretty quickly." "It's not super-easy, but it's also not rocket science," she added. "And it real- ly is important. Otherwise, you're just at the mercy of the person who comes in and says it was done the way his grand- father did it, and then you taste the prod- uct, and if you know nothing, then you still know nothing. Do the same research you'd put into other purchases. We need to convince people that there's informa- tion out there, and there's good unbiased information out there. They just have to care enough to look for it." The investment is worthwhile for retailers because specialty food consumers are looking for premium products. Americans are not using a lot of olive oil now, especially in comparison to con- sumers in European olive-oil producing countries, but as they learn more about the value of high-quality oils and their range of flavors and varieties, there's a lot of room for American consumption to increase, according to Neuman. "There's nothing else in the grocery story that costs $17 per unit and drives a 40 percent to 50 percent gross margin," he said. "Retailers win when they're selling a better product at a higher price. The producers win because we can afford to pay farmers premium prices. And the specialty consumer wants to be taught how to use good product.... There is a lot of room for premium brands." HEBERT: 99 SWEET YEARS In 1917, Frederick Hebert purchased a copper kettle, knife, table, thermometer and a slab of marble for the meager sum of $11 (approximately $210 today). Over the next three decades, Hebert tirelessly handcrafted chocolates and caramels in his own kitchen, selling his creations through small neighborhood stores in central Massachusetts. As demand for the rich flavor and velvety smooth texture of Hebert's chocolates grew rapidly throughout the region, Hebert looked to expand. In 1946, Hebert purchased a Tudor Style mansion on Route 20 in Shrewsbury. The building, affectionately known as the Candy Mansion, became the first roadside retail confectionary operation in the United States and is still home to all Hebert operations today. Always seeking the finest ingredi- ents to perfect his recipes, Hebert intro- duced white chocolate to the United States in 1956 after tasting "white coat" candies while in Europe. White chocolate became a mainstay in America as a result of Hebert's discovery. Throughout the second half of the century, the Hebert name became a New England regional favorite for men and women, and boys and girls alike. The Hebert experience is universal: everyone can enjoy great chocolates. In 2012, Hebert merged with American Gourmet Group, a company that special- izes in gourmet gifts for major retailers across the United States. The company understands presentation and packaging makes a huge difference with consumers. Together, they offer a variety of cus- tomizable chocolate packaging and gift options. Continuously striv- ing for excellence, Hebert's Premium American Made, Kosher Certified chocolate bars received the prestigious SQF Level 3 certification in 2015. This is the high- est certification given by the Safe Quality Food Institute. From humble beginnings to New England staple, and now growing to a national brand, Hebert is still committed to the same passion for handcrafted excellence that Frederick Hebert intro- duced nearly a century ago. TOO TARTS CANDY KEEPS KIDS HAPPY AND HEALTHY Innovative Candy Concepts has been making kids candy for 22 years. The company's product lines and sales con- tinue to be a top seller at retailers across the U.S.A. What makes Too Tarts so spe- cial? The company's desire to have it all: healthy candy that tastes great, strong sales and a product made in the U.S.A. The company's sales continue to grow, along with its product offerings. Too Tarts is now available in four dis- tinct top sellers: Spray Candy, Suck Ups Liquid Candy, Gimme Goo in a bottle and Goo4You in a squeeze tube. All Too Tarts products are sugar-free and loaded with Vitamin C. Xylitol is the main natural sweetener, made from fruits and berries and No. 1 recom- mended by the American Dental Association to help promote healthy teeth and gums for chil- dren. Armand Hammer, President and Chief Executive Officer, said, "We recently discovered that we are the only major kids candy brand sold in the U.S.A. that is made in America. About 60 percent of kids candy purchases are actually made by adults, so we decided to let the con- sumers know we were proudly made in the U.S.A." The new candy labeling features the American flag on each piece of candy and all of the displays. Since the decision was made to promote "Made in the U.S.A.," Too Tarts sales at retail have sky- rocketed and are stronger than ever. The adult con- sumer cares what they are buying for their kids. Innovative Candy Concepts wel- comes all new retailers to join in its efforts to make a difference in children's lives by profitably selling a kids candy you can be proud of. Healthy candy, healthy kids and healthy sales!