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Marketplace knocks notwithstanding, 'fresh guys' are stubborn in defeat.

Marketplace Knocks Notwithstanding, `Fresh Guys' Are Stubborn in Defeat While chilled processors are being frozen out of the case space race, supermarket operators are hot on the trail of on-site food preparation. And back in the pack is an upstart sous vide entry.

Not put off by the largely unprofitable track record of so-called "fresh-prepared" retail foods in the United States, an increasing number of manufacturers are putting money into researching, test marketing and rolling out products for sale in supermarkets' refrigerated cases. But the movement in this direction has been slow compared to that in Europe, as concerns over food safety and distribution logistics have generally weighed against major investments.

It is clear that thus far the short commercial shelf-life limitations of chilled items has made break-even an elusive point for most food processors in this country to reach. General Foods admitted failure in January by canceling its Culinova line of refrigerated meals. Despite three years of aggressive merchandising and drastic price cuts designed to appeal to a broader customer base, the microwaveable bubble-top packs couldn't cut it.

"Expansion was hampered because we had to develop a refrigerated system from scratch," a company spokesman was quoted as saying. Hence, the decision was made to call it quits.

But hope springs eternal. While Culinova is exiting the scene, sister company Kraft (which joined the General Foods family via parent Philip Morris' $13.1 billion acquisition last fall) is testing its Chillery range of refrigerated foods in selected markets. And a Nestle subsidiary has introduced FreshNes, a line of chilled entrees and main course salads.

Kraft's longtime presence in the traditional refrigerated case could give its chillery range an advantage over most competitors. And, unlike General Foods which had to assemble a costly fleet of special refrigerated trucks to deliver Culinova to the marketplace, Kraft has an existing vehicular distribution network making daily deliveries to foodservice outlets.

Eyeing U.K. Success

Taking notice of the segment's success in the United Kingdom, where growth is reported to be in the range of 20% annually, North American manufacturers--including more than a few engaged in the frozen food business--are looking at the fledgling category in a new light. Especially since retailers around the nation have taken it on themselves to cook up on-site meals and side dishes to sell shoppers.

Indeed, many supermarkets look more like restaurants these days as operators build in-store eateries and even hire chefs in their battles to recoup food dollars lost to the fast food industry over the past decade. A blurring of traditional food service (catering) and retail profiles continues to be seen as restaurant take-out operations are countered by expanding supermarket delicatessens which have slowly evolved into merchandisers of fixed menu hot foods.

"Off-premise consumption has been the growth area in the restaurant industry over the past few years. Without it, business would have been flat or down," assessed Thomas R. Pierson of Michigan State University's Food Industry Institute.

And supermarkets have moved earnestly to take their share of the market, he recently told delegates at the National Food Processors Association's (NFPA) annual convention in Anaheim, Calif. "Most Grand Union stores now allocate 20% of their space to refrigerated prepared space...and D'Agostino's in New York City is delivering all kinds of food products directly to homes."

The professor maintained that the "fresh-prepared" segment in the U.S. is now growing at a rate of over 18% per year and accounting for 10% to 15% of all food sales. But his definition of "fresh" is broad, running the gamut from commissary-prepared salads to sliced meats. The debate over what's "fresh" is an old one, as marketers liberally use the term to describe everything from items in glass jars to fried chicken subjected to the dehydrating effects of display under heat lamps for hours on end.

At any rate, the chilled segment of so-called "fresh" foods gravitated to the center of attention at one NFPA conference. And Ronald D. Harris of Kraft, Inc. provided a definition that is as good as any: "These are products that are freshly prepared refrigerated foods that are processed by performing some or all of the steps normally performed by a homemaker or a restaurant."

Vice president of refrigerated product development for the Glenview, III.-headquartered company, Harris suggested that the potential market for chilled foods could be in the multi-billion dollar area. So it comes as no surprise that Kraft is actively testing a line of limited shelf-life products under the Chillery brand name. He predicted a 15% annual growth rate for chilled items including refrigerated entrees, prepared salads, complete meals, pasta and sauce, soups, and cooked or partially cured meat and poultry.

`A New Frontier'

Carl Randall of Culinary Brands, Inc., an upstart Sausalito, Calif., packer of vacuum-cooked foods, pegged the potential market at around $50 billion. "We are in the early stage of a new frontier," he remarked. "Fresh-prepared refrigerated will become the third tier of the food industry, along with canned and frozen."

His projection is very optimistic considering that total frozen food volume (both retail and foodservice) was $44 billion in 1987. But with the overall U.S. food industry worth upwards of $480 billion, the Culinary Brands president sees a wide window of opportunity opening up.

With such great expectations, a newly born refrigerated foods lobby is organizing to prevent the door of consumer and governmental rejection from slamming in its face. "The microbial safety issues are very real and must be addressed," warned Kraft's Harris. "Those who plan to enter this category either as a supplier, processor, distributor or retailer must develop an understanding of the cold chain."

He continued: "There is a need to maintain refrigerated temperatures starting with raw material handling, through production, warehousing, distribution, in-store display, right down to the consumer. It is also necessary for food processors to learn about and then establish a system to insure product safety. At Kraft, for instance, the multiple approach we take includes the use of good manufacturing procedures based on a hazard analysis formulation and packaging that can control the growth of microorganisms..."

With the average shelf life of chilled products lasting from seven to 21 days, there is virtually no room for error in distribution systems. Unlike frozen foods, which if thermally abused in transit may be affected by off-flavor or texture problems, interrupting the chill chain could prove fatal. Potentially harmful microbes are all but checked in deep frozen products, while they are lively and multiplying at temperatures near or above freezing. In addition, as respiration rates increase, enzymatic and oxidative changes occur.

Regulatory authorities in Washington have observed that the incidences of foodborne illness in the U.S. seem to be rising. Over the past seven years more than 400 North Americans have been sickened by the effects of listeria, resulting in a death toll exceeding 150.

"We are in desperate straits today because of the neglect of food microbiology. It is ironic that in the last few years, we have had one of the greatest outbreaks of foodborne salmonellosis in the history of the United States," declared FDA Commissioner Frank E. Young, referring to the 1985 Jewel Foods milk contamination case.

With such concern in the nation's capital, Kraft's Harris welcomes government regulation of chilled foods. And so far at least three trade associations have declared their interest in providing data, establishing guidelines and shaping policy. Interestingly, while the Chilled Foods Association is almost brand new, two other groups have been spun off from the ranks of the established frozen food industry.

The American Frozen Food Institute last October announced the formation of its own Refrigerated Foods Committee headed up by Steven A. McNeil of Campbell Soup Co. AFFI president Tom House suggested a metamorphosis was in the making as he outlined the sub-group's mission:

"Work will include issues of immediate concern as well as those that may lead to a much larger role in the future, not excluding a reorganization of what is now AFFI."

North of the border, the Canadian Frozen Food Association is now the Chilled and Frozen Food Association of Canada. Executive Director Christopher J. Kyte, noting that the name change was voted unanimously by the organization's membership, proclaimed:

"This is the first frozen food association in the world to include chilled food."

Kyte listed product safety as the association's top concern with respect to chilled food, reporting that a hazard critical control point (HACCP) computer program is being developed using state-of-the-art artificial intelligence technology. "Basically, the system would contain a company's quality control program. All the considerations of a product are entered such as packaging, temperature, ingredients, etc. The system would analyze the information and recommend changes to improve shelf life."

With Bob MacGregor heading the HACCP project, it is not going unnoticed that Campbell Soup personnel have assumed high profiles on refrigerated foods committees in both Canada and the U.S. One can speculate that despite the discontinuance of the company's Fresh Chef line of packaged refrigerated salads -- reportedly a $25 million loser -- the company is not ruling out a return to the chill cabinet. Indeed, its subsidiary Beeck-Lacroix is presently cooperating with Northern Foods in Germany in test marketing chilled ready meals for the home market as well as for possible export to the Marks & Spencer retail chain in the United Kingdom.

R. Gordon McGovern, president of the Camden, N.J.-headquartered Campbell, which sells more than $1 billion worth of frozen food annually, succinctly stated his opinion on the status of the food industry during a keynote address to the National FF Convention in Chicago last fall: "It's only a matter of months, or perhaps hours, before fresh or refrigerated, or aseptic or nitrogen-flushed products drive frozens to the wall. The wall being the perimeter wall of the outlets where much comes in frozen and goes out labeled something else."

An example of this food delivery system is seen in ConAgra's World's Fare, a frozen range that is thawed out and sold as "fresh." Of course this technique has been common-place in the foodservice segment for a long time, with familiar retail brand names such as Stouffer providing restaurants with a menu of quality frozen recipe dishes.

On the retail front at the moment, however, it is the non-frozen segment that is leading the charge. Supermarkets have taken the lead in pricing by producing from scratch entrees at their deli counters to competitively challenge fast food restaurant take-outs. But the growth of in-house supermarket foodservice has some concerned that a disaster is just waiting to happen.

"How about the safety at stores where chilled foods are being produced?," asked John W. Allen, a Michigan State Food Industry Institute academic. "Are we going to discuss this issue or not?"

The question was put to the National Food Processors Association conference in Anaheim. And the answer was not directly forthcoming, although the panelists' preference to side-step debate may have spoken for itself.

Nonetheless, Dr. Colin Dennis, director-general of the Campden Food & Drink Research Association in the United Kingdom, minced no words about the seriousness of the issue: "The raw materials of these products are usually very perishable... They do have a significant potential for spoilage and for food poisoning."

Still, he maintained, following guidelines established by the Institute of Food Science and Technology has kept British commissary producers relatively free of hygiene problems. In addition, a list of do's and don'ts has been published for those involved in pre-distribution storage, distribution and bulk transport, retailing, catering preparation and ultimate consumption.

Dennis underscored the importance of the cooling process for products which are generally held in a range between -1|C and +10|C. "Cooling must be viewed as part of the manufacturing process and not something that one does during the early part of distribution," he said. "The physical properties of the food, air

distribution and the cooling system will all influence the rate at which food is cooled."

The crucial importance of strict temperature control and consumer sensitivities about same was made painfully clear to Marks & Spencer in February. Sales of refrigerated foods at Britain's largest retailer took a nosedive after a health official announced that chill cabinets in Bristol city supermarkets were not kept at sufficiently low temperatures to safely maintain their contents. And shoppers took no comfort from a Leeds University professor's pronouncement that refrigerated ready meals are especially vulnerable to tainting from certain strains of bacteria.

Looking toward the future, Dennis speculated that the emergence of pathogens capable of growth at low temperatures will necessitate wider adoption of superchill techniques throughout the distribution chain.

He predicted that major innovations in product lines, processing and packaging will take place: "Perhaps one of the most exciting possibilities is the use of antagonistic microorganisms where food grade microbes will be used to reduce or eliminate undesirable microorganisms in foods."

The director-general reported that research is now going on in this area at Campden. Microbes already identified as showing potential antagonistic activity include: lactic acid bacteria such as lactobacilli, pediococci, leuconostocs, lactococci; propionic acid bacteria; and possibly yeasts and acetic acid bacteria.

"Microbial antagonism can be applied as a protective measure to many existing food products and, by allowing extreme fermentation to occur, could allow the formulation of novel added-value foods," said Dennis.

For those schooled in the parlance of microbiology, the Ph.D. explained that antagonism is caused by one or more factors of antimicrobial nature. These include:

. Production of antimicrobial organic compounds such as lactic acid, acetic acid, propionic acid, diacelyl.

. Reduction of the pH level.

. Alteration of the oxidation-reduction potential (Eh).

. Changes in the O2 and CO2 concentrations.

. Production of specific antimicrobial proteins called bacteriocins.

. Production of H2O2.

The bottom line is that two distinct applications are possible, requiring microbes with differing properties. They are:

. Living and active antagonists can be added to foods as a culture where they then produce antimicrobial factors. Such a procedure is often termed "direct antagonism" by food scientists.

. "Indirect antagonism" involves antimicrobial factors which can be extracted from active populations of the food grade bacteria, purified and added to foods as an active perservative. (Editor's note: Readers wanting more scientific and technical details on this subject should write to Dennis in care of the Campden Food and Drink Research Assoc., Chipping Camden, Glos. GL556LD, U.K.

Back to the Present

While science may find ways to greatly prolong the commercial shelf-life of refrigerated foods tomorrow, the sous vide process of vacuum cooking available today is advanced enough for some food packers. And as far as Culinary Brands Inc. is concerned, the technique may be the wave of the future, too.

It's the "leading edge" of the U.S. chilled foods movement, according to Carl H. Randall, who just happens to also be head of the Chilled Foods Association.

"While the quality of frozen and canned foods is terrific, we think research shows that consumers are looking for an even higher quality. And many times frozen foods just don't deliver the promise that consumers are looking for," claimed Randall.

The French-originated vacuum cooking technique is nothing new -- dating back a decade or so. An equipment investment of about $100,000 is said to be adequate to set up a processor with the means to vacuum-pouch and gas-flush food. More than 50 European companies use the system, which removes oxygen that would normally hasten spoilage in finished products.

The idea is for commissary production to provide restaurateurs with pre-made, upscale quality entrees and meals formulated for easy, on-premise reheating. It has proved appealing to establishments lacking skilled chefs as well as hotels offering late-night room service after their culinary staff is off duty.

While the process has caught on in parts of Europe -- reportedly some 450 restaurants in France alone have adopted sous vide--it is still in its infancy in the U.S. But a number of top dining spots in New York City and other North American culinary centers have embraced the technique, according to Michael Gorlich, president of In-Line Packaging Inc., Fort Myers, Fla.

"They prefer to be low key about it, but I can tell you that one place writes an average check of $75 to $100 per person for dinner -- without wine," said the installer of sous vide systems. "We've put in quite a few in big name establishments, but I can't identify which ones." (One supposes that free-spending gourmets may be less than pleased to learn that their $100 meal was not cooked in the back kitchen minutes before serving, but perhaps was prepared a week or so ago at an unromantic location many miles away.)

The sous vide process involves bagging food in a plastic pouch and cooking it in the packaging. Virtually any recipes can be utilized, drawing on diverse ingredients ranging from meat and fish to pasta and vegetables in sauce. Upon completion of the vacuum-cooking phase -- where temperatures are generally not in excess of 212|F--rapid chilling follows. Time and temperature control is critical, requiring fine-tuning of plus or minus half a degree.

"It is essential during this stage to have absolute assurance that appropriate pasteurization levels are being achieved for each individual product," advised Carl Randall. "It's just a matter of doing research on every product manufactured, as each one differs.

"Equally important is chilling the product and getting it back down through the dangerous microbial zone...Once chilled, vacuum-packed products should remain under refrigeration in the 32|F to 36|F range."

Meanwhile, Culinary Brands is researching superchill processing, in which temperatures are quickly reduced to levels between the freezing points of water and solid food ingredients (generally a 29|F to 32|F range).

The company's recent sous vide pilot operations have involved providing consumer-driven menu lines to retailers and foodservice operators. Having expanded its presence in supermaket chains, Culinary Brands is now building a continuous chilled foods manufacturing plant in northern California that should be operational later this year.

As vacuum cooking pasteurizes rather than sterilizes, shelf-life is limited to only seven to 21 days due to the danger of bacteria growth. Hence its proponents are keen on emphasizing richer taste and preparation conveniences over the commercial and safety advantages of frozen foods.

"We think that vacuum cooking brings out the best in foods," remarked Randall, adding that the oxygen-free process greatly enhances the final product's organoleptic qualities. Aroma, flavor and texture are superior, he said, as the food retains most of the original juices it is cooked in. Other pluses: less weight loss, higher nutritional values, and the fact that preservatives and additives are unnecessary.

To guard against product abuse in distribution, scan code labels are affixed to transit cartons which allert handlers if temperature integrity has been breached. In addition, consumer packs carry indicators which will chemically darken if thermal abuse has occurred.

While these and other factory-to-home monitoring systems add to the cost of distribution, paramount safety concerns make such precautions mandatory. And, of course, inevitable "red flag" warnings will result in the trashing of a fair volume of time-expired foods, seriously impacting on profit margins. Still, optimistic chilled foods pioneers foresee billions of dollars to be earned.

"The new generation foods that we are talking about today represent well less than one percent of the potential $50 billion market," said Randall. "But when we start talking about growth of 15% to 18% a year, we can see what this is really going to mean to the food industry."

Michael Gorlich envisions the day when Californians will be able to eat gourmet dishes pepared by a famous New York chef without having to leave home. But he's a realist, too: "While the future potential for food processing plants to supply restaurants or stores is very strong, one of the biggest problems will be product liability. There are a lot of lawyers in this country."

There are also a lot of government regulators. Especially those who know that chilled foods not properly stored can become a breeding ground for such nasty things as Clostridium botulinum. The toxic bacterium can not only cause sickness, but death. And while no cases of botulism have been attributed to sous vide, there is concern that the process inherently heats food long enough to kill some less harmful bacteria that emit foul odors as spoilage occurs, thus alerting consumers to possible danger.

So the Food and Drug Administration is watching developments in this area very closely. "What we have said is,`We're going to keep an eye on you'," advised Thomas L. Schwarz, assistant director for program development in the agency's retail food protection branch. And, speaking as a consumer leery about the handling of sous vide products, he added: "I wouldn't buy it."

PHOTO : "Fresh meals delivered daily" from Culinova are no more. General Foods has called it quits

PHOTO : for the refrigerated line after three years of unsuccessful test marketing in the New York

PHOTO : area. Retailers report that fresh pasta from Carnation's Contadina division, however, is

PHOTO : selling well.

PHOTO : Carl Randall of Culinary Brands Inc. is all smiles about the sous vide process of vacuum

PHOTO : cooking that he has great expectations for in the U.S. food market.

PHOTO : Culinova may have been knocked out of competition, but the Chillery line from Kraft is

PHOTO : still in the ring. Ronald D. Harris (left), vice president of refrigerated product

PHOTO : development, tells a NFPA meeting about the new range. At right is Dr. Colin Dennis of the

PHOTO : Campden Food & Drink Research Association.

PHOTO : "How about the safety at stores where chilled foods are being produced?," asks Professor

PHOTO : John W. Allen. "Are we going to discuss this issue or not?"
COPYRIGHT 1989 E.W. Williams Publications, Inc.
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Author:Saulnier, John M.
Publication:Quick Frozen Foods International
Date:Apr 1, 1989
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