Specialty Food Magazine is the leading publication for retailers, manufacturers and foodservice professionals in the specialty food trade. It provides news, trends and business-building insights that help readers keep their businesses competitive.
Issue link: https://www.e-digitaleditions.com/i/1119718
THE SPECIALTY FOOD MARKET S2 THE STATE OF THE SPECIALTY FOOD INDUSTRY Specialty food and beverages hit $148.7 billion in sales in 2018, a 9.8% increase since 2016, with 74% of consumers surveyed saying they purchase these products. The industry is strong: Growth in specialty foods is about three times higher than all foods—10.3% versus 3.1%. However, growth has slowed a bit year to year as the market matures: in 2017 sales increased 5.4% versus 4.3% in 2018. "Today, virtually all consumers take some degree of interest in their food," says the president and CEO of a family-run premium chocolate and confectionery brand. "What it is and why that matters, where it comes from, how it's made, what is and is not in it, how it can benefit them, how they can eat better, live better, enjoy more through basic knowledge of food sources, cooking, entertainment, and so on." Specialty food 10.3% 3.1 % All food Source Mintel/SPINS Download the full 200+-page State of the Specialty Food Industry report 2019-2020 Edition at specialtyfood.com/state2019. The Specialty Food Association's State of the Specialty Food Industry report is a joint research project prepared by Mintel and SPINS/IRI. The research encompasses the three most recent calendar years of sales data and includes figures for 63 specialty food categories, pulled from the SPINS database of mainstream and natural food stores. The report also estimates online specialty food sales. Mintel has forecast 35 specialty food categories through 2023. The report also includes data and insights from a robust 26-question consumer survey conducted in January among 1,630 adults. Interviews with members of the supply chain, including retailers, foodservice operators, specialty food manufacturers, brokers, and distributors complete the report. ABOUT THE RESEARCH Growing competition from foodservice and restaurant deliv- ery is putting pressure on retailers. Specialty food sales in foodservice outpace retail, though foodservice accounts for a smaller market share. Consumers report spending more of their food dollars on foodservice. Online retail continues to expand—it is the smallest channel but is growing the fastest. On the brick-and-mortar retail side, the mainstream channel's growth outperforms specialty and natural stores. Consumers across age ranges are shopping in a variety of channels as many specialty food and beverage options are now widely available. Yet, despite slowing growth, the future for specialty food retail sales is positive. From 2013 to 2018, the specialty food and beverage market at retail grew an average of 7.2% annually, from $47.3 billion to $67 billion. Mintel forecasts that it will achieve a compounded annual growth rate of 5.9% from 2018 to 2023, reaching $89.1 billion. Consumers continue to focus on fresh, frozen, health-orient- ed products and ingredients. For example, the frozen and refrig- erated departments were the fastest growing in specialty retail during 2016-2018, up 16.3% and 12% respectively. Demand for clean, better-for-you products is clear. Brand transparency is increasingly important—35% say they like to learn the story about brands/products they buy, up from 26% in 2018. Supply chain interviews with producers, distributors, brokers, and retail and foodservice buyers confirm these patterns. One vice president at a large specialty foods distribu- tor notes an increase in demand for clean label products. "I'm seeing a lot more transparency, where the ingredients and the brands are much more specific about their sourcing and using that as a selling point," adds a founder of an urban, independent natural/specialty food supermarket. Design by Funnel Inc. "Today, virtually all consumers take some degree of interest in their food—what it is and why that matters, where it comes from, how it's made, what is and is not in it, how it can benefit them, how they can eat better, live better, enjoy more through basic knowledge of food sources, cooking, entertainment, etc." —president and CEO of a family-run premium chocolate and confectionery brand of Specialty Food Vs. All Food at Retail sales growth