September 24, 2015

For Restaurant Use Only - Not For Resale

Why does the Heinz ketchup on the table at your local diner read "For Restaurant Use Only - Not For Resale?"

My friend, David Klein (creator of Jelly Belly) asked this question and got me to thinking about the actual reason that the Heinz company made the decision to add the copy on the neck of the bottles. I began my search to find the answer.

What makes this question more interesting is the company's foodservice division offers more than 16 different Heinz Tabletop Ketchup Bottles and a limited amount has this marking.

It turns out the company does not offer this glass bottle for sale or distribution in grocery stores or other retail channels. It is only available for restaurants. The company discontinued sale of the item in retail and desired enforcing the decision along with stopping the many requests for the item. They transitioned retail to much larger 32 ounce plastic bottles.

The primary factors in this decision include staying on restaurant tabletops, reducing expenses, distribution costs, profit per ounce, move consumer to larger size and breakage. 

Each reason played an important part in this decision along with possibly the most important and that was informing the grocery industry and consumers that the bottle was only available in restaurants.

Heinz has shared they want to offer the restaurateur a reason to stay tabletop. The classic unique bottle gives them an edge over competitive brands in this area. This is the same product but packaged in glass. Retail grocery is kicking glass off many retail shelves and breakage is one of the issues.

Glass is heavy and bulky along with once broken it makes a big mess. These factors create massive expenses when you consider the tons of ketchup shipped, sold and moved around the country in grocery stores from coast to coast and now worldwide. This positive impact on distribution costs along with the bills associated with damaged glass made it an easy decision to move to plastic in the grocery industry.
There is some discussion that the label comment “For Restaurant Use Only – Not for Resale” is an attempt to control diverting or stop other market related activity. Heinz personnel have shared internally and in various communications that the restaurant accounts price differential with the rebates is not large enough to motivate any action. My hunch is the bottle has a slight premium compared to bulk or grocery prices per ounce.

During this process, I discovered a neat trick to get the ketchup out of the glass bottle easier. “Tap the bottle where the ‘57’s” are molded into the glass while holding the bottle at an angle tilted towards the plate, not straight down.”

At the end of the day, the iconic glass bottle is beautiful and well positioned to demo the brand in our nation’s restaurants. Top restaurants like to have the bottle on the table and it provides a sense of home, quality and vitality to the dining experience. It is so valuable that restaurateurs will switch ketchup makers before they will switch out the bottle. They do this by filling the glass bottles with cheaper ketchup at times.

Enter your email address for more insights from Tim:

Related Posts Plugin for WordPress, Blogger...