Sales & Marketing

Mail-Order Food Sellers Bank on Procrastinators


On the weekend before Christmas, the mail-order arm of Zingerman’s specialty food shops will work round-the-clock to pack some 10,000 boxes with coffee cakes, hand-cut cheeses, panettones, and 800 other edible items into four 35-foot semi trailers. On Monday afternoon, they’ll depart for the UPS (UPS) shipping center in Livonia, Mich., bound for kitchen tables and office pantries across the U.S. in time for Dec. 25.

It’s the busiest day of the busiest week of the year for the popular Ann Arbor food seller. Zingerman’s Mail Order does a quarter of its $10 million annual sales in the seven days before Christmas, says Brad Hedeman, who is in charge of marketing and product selection.

The staff of 50 swells to 450 in November, filling the call center and 20,000-square-foot warehouse like so many of Santa’s elves. There is never enough parking, though this year the crunch has eased. The warehouse is adjacent to the former headquarters of Borders Group, the bankrupt bookseller, and Zingerman’s has been able to use its lot.

Americans spent more than $17 billion on food gifts in 2009, according to market researcher Packaged Facts, with more than half of sales coming from online stores and catalogues. The mail-order food business peaks around the holidays, when consumers tap the power of technology and speedy supply chains to get their favorite comfort foods to their tables.

BOXING AND BAGGING

Careful preparation for the scramble is crucial. “It’s like we have two different businesses,” Hedeman says, a normal pace for 10 months of the year and a manic holiday rush for the last two. “We’re basically working 24 hours a day, we’re bagging bread, we’re making gift boxes, we’re slicing cheese.”

Omaha Steaks starts prepping for its holiday rush in October, cutting slices of tenderloin by hand and cooling them in a minus-50F blast freezer that turns a juicy steak rock hard in five minutes. The 94-year-old, family-owned company, which has more than $450 million in annual sales, brings on an additional 2,600 workers for November and December, on top of its 1,800 year-round staff.

During peak shipping times before Christmas, Omaha Steaks moves 100,000 coolers of meat, kept frozen by 1 million pounds of dry ice. Every day. Depending on the destination’s climate, the ice is measured to keep the steaks frozen but to evaporate before reaching the customers, says spokeswoman Beth Weiss. (Coolers include instructions for safe handling in case any dry ice remains.)

RIBS GALORE

Google (GOOG) searches for shipping foodstuffs spike at the end of the year. People looking for “bagels shipped” rise fivefold in December, searches for “deep dish pizza shipped” double, and queries about ham and lobster peak as well. People punch in “bbq shipped” 10 times more often in December than the rest of the year.

That’s good news for Dreamland Bar-B-Que, which boosts its spending on Google AdWords before the holidays. Betsy McAtee, Dreamland’s chief executive officer, says about 40 percent of the Birmingham (Ala.) company’s mail-order business comes at the end of the year. On a busy day, the 10-employee operation ships out 200 pounds of meat, including some items that need to cook for six to 10 hours. “Ribs cook a lot faster than, say, a Boston butt, which is the cut of meat we use for our chopped pork,” McAtee says.

At both Zingerman’s and Omaha Steaks, the peak day creeps closer to the 25th each year. Perhaps customers want the freshest batches on their tables for Christmas dinner, or maybe those who buy food through the mail have the opposite temperament of those eager shoppers who camp outside stores in the wee hours of Black Friday. Judging by Omaha Steaks’ late rush, “we have definitely become a society of procrastinators,” says Weiss. Many customers don’t mind paying extra fees to overnight some steaks to loved ones on their last-minute gift lists, she says. Whatever it takes to make a holiday taste like home.

John_tozzi
Tozzi is a reporter for Bloomberg Businessweek in New York.

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