Mixing It Up

Volatility has defined the edible oil market for several years. In 2022, the price of vegetable oils skyrocketed. Now, as vegetable oils are finally coming back to a comfortable price, the cost of peanut and olive oil is spiking to never-before-seen highs. For retailers, inflation compounds this issue by forcing consumers to tighten their wallets and think twice before purchasing an expensive product. As consumers become increasingly hesitant to purchase 100% or straight oils, many retailers are turning to outside-the-box solutions that are simultaneously profitable and attractive to customers. 

Blended oils are an affordable alternative to 100% or straight oils for budget-conscious consumers. Many retailers looking to change up their strategy are considering adding a blended oil to their shelves. Below are five dos and don’ts that retailers should keep in mind when considering the addition of a new blended product.

• (Do) Customize to achieve the perfect taste, quality, and price for your customer base. There’s no shortage of possibilities when it comes to creating a blend tailored to the needs of a specific customer base. A traditional olive oil blend may have a 90:10 or 75:25 ratio of canola oil to EVOO, but alternative blends designed to meet a specific taste or price requirement are also possible; for example, an 85:10:5 ratio of canola oil to EVOO to grapeseed or avocado oil. Retailers can choose a conventional blend or select a non-GMO or organic option. If this sounds overwhelming, 
• (Do) Label carefully. White labeling is a great tool for retailers to market a blended oil to their customers and pique interest in the new product. A “Mediterranean blend” may sound more appealing to health-conscious consumers, while an “Everyday blend” may be popular with busy families or students. Careful labeling is also essential to counter the growing issue of edible oil fraud. The adulteration or mislabeling of edible oil products is increasingly making news headlines, eroding consumer trust in the products they are buying and the institutions that sell them. Clear, honest labels will help foster trust between consumer and retailer and will ensure consumers do not perceive blended products as fraudulent or adulterated, instead conveying what we in the industry already know to be true: blended oils are a perfectly viable, budget-friendly alternative to pure oils. 
• (Do) Choose your suppliers thoughtfully. Edible oil fraud is insidious and can occur at any point along the supply chain. Choosing a trusted supplier equipped with testing facilities to guarantee the authenticity of their oils can stop the spread of edible oil fraud and ensure new products contain exactly what their labels state. 
• (Don’t) Assume consumers will keep purchasing 100% or straight oils no matter the cost. This may be true for some demographics but will surely not be the case across the board, especially if inflation remains high. As olive oil prices are set to remain elevated for at least another six months, demand destruction is likely to eventually occur. When that happens, having a blended product prepared to hit the shelves or on the shelves already will protect retailers financially while catering to consumers’ evolving needs. 
• (Don’t) Be intimidated by the timeline of creating a new product. Some may be reluctant and wondering whether to pursue alternative solutions such as a blended product, or wait the market out, hoping prices will fall soon. After all, it takes months to bring a product from concept to shelf, and by that point the market may have changed again. While the right choice will look different for everybody, the time commitment of creating a new product should not make or break the choice to pursue a blended oil option. Since olive oil prices are set to remain high for at least six months, that’s plenty of time to take a product from concept to shelf and see a return on the investment. In addition to the immediate benefit, creating a blended product now is also an investment in the future. The market has experienced immense volatility in recent years and is liable to do so again at any point. Retailers who start now will have an affordable product prepared and ready to hit the shelves next time market volatility inevitably strikes, putting them a step ahead when it comes to navigating the challenge. 

Tasty, customizable, and budget-friendly, blended oils are simultaneously affordable to cash-strapped consumers and profitable for retailers. Blended products offer an ideal solution for retailers looking to change up their strategy in the face of extreme market volatility.