Specialty Food Magazine

Summer 2021

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.

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28 SPECIALTY FOOD SPECIALTYFOOD.COM 24 % 17 % Sales Growth of Specialty Food vs. All Food at Retail Specialty Food All Food The Specialty Food Market at a Glance Design by Funnel Inc. About the Research COVID-19 and its related stay-at-home mandates influenced shopping decisions, category fluctuations, and channel sales. Overall, all food sales, both specialty and non, grew much faster between 2018 and 2020, spurred by COVID surge buying and at-home meal prepara- tion and consumption. All food grew 17 percent at retail during the timeframe compared to 3 percent from 2017-2019. Specialty food sales, specifically, grew 24 percent at retail from 2018-2020, and 19.4 percent in 2020 alone. Categories related to cooking or baking at home soared, benefitting products like baking mixes, pasta and sauces, frozen entrees, and meat, poultry, seafood (frozen, refrigerated). On the flipside, some products associated with on-the-go convenience slumped without daily commutes to schools or oŒces. Last year was a year of extremes for grocers. Both brick-and-mortar and online retailers experienced signifi- cantly elevated sales as COVID guidelines limited consumers to their homes. But retailers also had to contend with increased costs, out-of-stocks, reduced hours, and reduced or ill sta'. Strict in-store limitations or fewer people choosing to shop in store as frequently as normal resulted in lower foot traŒc. One-stop shopping options and ecommerce benefit- ed from the circumstances. The growth in both physical and online retail o'set a 30 percent sales freefall of foodservice, which was devastated by the pandemic. While industry estimates predict foodser- vice's overall recovery will take years, retail sales are expect- ed to thrive. By the end of 2021, the specialty market is fore- cast to be down about 1 percent, but still well above normal, up 18.4 percent over 2019. Brick-and-mortar retail is forecast to grow 4.4 percent CAGR by 2025. This year's State of the Specialty Food Industry research focuses on sales data and growth, 10-year category forecasts, and supply chain insights. The consumer survey on generational preferences, shopping and consumption habits will be released as a separate report. The Specialty Food Association's State of the Specialty Food Industry report encompasses the three most recent calendar years of sales data from SPINS/IRI and includes figures for 63 specialty food cate- gories, pulled from the SPINS database of mainstream and natural and specialty food stores. The report also estimates online specialty food sales. Market researchers David Browne and David Lockwood worked with SFA to analyze the data and forecasted 37 specialty food categories through 2025. Interviews with mem- bers of the supply chain, including retailers, foodservice operators, specialty food makers, brokers, and distributors complete the report. The state of the specialty food industry and the realities of the pandemic were inextricably tied over the past year.

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