Wal-Mart starts new food line

Posted: October 28, 2017 at 1:56 a.m.

Wal-Mart Stores Inc. has unveiled a new line of authentic Italian food products as part of the retailer's continued efforts to improve the assortment and quality of its private label products.

The private label brand is called S̶a̶m̶'̶s̶ ̶C̶l̶u̶b̶ ̶I̶t̶a̶l̶i̶a̶ Sam’s Choice Italia* and initially consists of about 40 items, including boxed dinners, pastas, pesto and pasta sauces, canned tomatoes and balsamic vinegar. All of the products in the private label line consist of ingredients from Italy.

The Bentonville retailer worked with the Italian Trade Agency -- a governmental organization that promotes companies from the country -- on the project as well as multiple suppliers from Italy. The private label line, which is available in 3,600 stores and at Walmart.com, will expand over time.

"Everything in the line is sourced directly from Italy," said Stephen O'Brien, a Wal-Mart culinary and product expert who worked on the development of the brand. "They're not Italian-inspired products. They're not things that we're trying to emulate in items. These are direct from Italy."

O'Brien said Wal-Mart has been working on Sam’s Choice Italia* for about a year and the Italian Trade Agency played a key role, helping the retailer identify and collaborate with culinary experts and suppliers. Wal-Mart said in it's announcement it was the first time the Italian Trade Agency has worked with a U.S. retailer on the development of a full line of private brand products.

Italian Trade Agency President Michele Scannavini said in a statement that the Sam's Choice line presents an "authentic Italian experience."

"We are committed to bringing authentic Italian offerings to American households, so when Wal-Mart approached us with this idea, we were immediately interested," Scannavini said in the statement.

Wal-Mart has been devoting more resources to improving its private label assortment as it competes with online giant Amazon.com and discounters Aldi and Lidl. Private label offerings have become increasingly important to retailers, providing alternatives to brand names that help differentiate them from competitors and drive customer loyalty to their stores and websites.

Wal-Mart Chief Executive Officer Doug McMillon told analysts earlier this year that the company has "some pretty big opportunities" to create product-driven loyalty through its private brands.

While Wal-Mart introduced Sam's Choice Italia on Friday, Jet.com rolled out its first private-label line on its website earlier this week. Uniquely J features about 50 grocery and household items -- like coffee, cleaning supplies, salsa and toilet paper -- aimed at younger shoppers in urban areas.

Carol Spieckerman, a retail consultant and president of Spieckerman Retail, said private brands are enjoying a major resurgence and retailers have become compelled to "continually raise the bar."

"Wal-Mart's Sam's Choice Italia is a great example," Spieckerman said. "Wal-Mart knows that it is competing against Whole Foods, Kroger, and any number of regional grocers that enjoy loyal followings for their high-quality private brands. The days of slapping a different label on mediocre, opening price point products are over."

O'Brien said putting together 40 items for the private label in about a year was an "incredible" feat for Wal-Mart. The Sam’s Choice Italia* items now on the shelves were created and tested extensively in the retailer's culinary and innovation center, which is located at the home office in Bentonville.

Some of the final results include plenty of traditional items like a tomato-basil pasta sauce, spaghetti and frozen pizzas. But O'Brien said he's curious to see how U.S. consumers react to other items like a tomato and marscapone cheese pasta sauce, pesto gnocchi and truffle risotto meal kits.

"The organization is allowing us to bring products to life in an innovative way to customers," O'Brien said. "So I think that the most exciting thing about this is allowing us to branch out, and not just have an emulation of another program and trying to mirror what they're doing, but actually innovate and actually bring both value and quality to customers that they haven't seen before."

Business on 10/28/2017

*CORRECTION: Wal-Mart Stores Inc. has introduced a private label line of authentic Italian food called Sam’s Choice Italia. The name of the private label line was incorrect in a previous version of this story.