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have pared down production to essential products,
but also retailers who are more cautious than ever
about bringing in new products. The impetus is on
makers to innovate with far more thought, R&D,
and investment. Innovation centers, incubators, and
culinary kitchens are ramping up efforts to help
producers design, package, and create products that
will make their way into specialty retail.
BIPOC- and women-owned brands in the
spotlight. Consumer desire for brands from
Black, indigenous, and people of color (BIPOC)-
and women-owned companies is skyrocketing.
According to the State of the Industry's companion
research, Today's Specialty Food Consumer,
published in September 2021, 17 percent of specialty
food consumers say they buy specialty food "to
support diverse suppliers (e.g., women-, Black-,
BIPOC-, LGBTQ+-, veteran-, disabled- owned
companies)." Meanwhile, 22 percent of SFCs said
they prefer to shop in stores that feature these types
of brands/products.
Increasingly incubators, distributors, and
brokers are specializing in supporting diverse-owned
brands. Retailer and foodservice operators are also
seeking out a broader diversity of brands. Target
launched its Racial Equity and Change program
with plans to spend $2 billion+ with Black-owned
businesses by 2025. Pop Up Grocer featured a
Washington, DC spot to highlight brands that are
women-owned, BIPOC- and queer-owned, and/or
local. Many specialty retailers, such as PCC Natural
Markets, are retooling their mission to address
Justice, Equity, Diversity and Inclusion, which is
translating to product assortment in stores.
To learn more about The State of the Specialty
Food Industry + 10-Year Category Tracking and
Forecasts, 2022-2023 Edition, you can attend our
session on-site at the Summer Fancy Food Show or
look for upcoming information about our webinar
on July 21.
T
he specialty food market has prospered
amid two difficult years. According to SFA's
newly released State of the Specialty Food
Industry research, the market hit $175 billion in
retail, foodservice, and ecommerce sales is 2021 and
continues to grow at a faster rate than all food.
Growth will continue but at a much slower
pace than the industry experienced in the 2020
stay-at-home whirlwind of grocery shopping
and at-home meal preparation. The market faces
well-known challenges due to inflation's role in
pushing food prices, supply chain difficulties, fuel
cost increases, packaging shortages, and shipping
issues. Growth over the next few years depends
heavily on shifts in these challenges and supply
chain bandwidth.
Beginning on page 55, you can discover the
highlights from this year's research, such as sales
and forecasts in key segments, fastest-growing
categories and subcategories, and COVID's
impact on category sales. In addition to a deeper
dive into all this data, the full 112-page research—
available for purchase in the specialtyfood.com
Learning Center—also details key trends driving
opportunities and decision-making in the market.
Here is a preview of some:
Home cooking and baking slows as COVID
subsides. As COVID took hold in 2020, consumers
returned to kitchens in full force. Up until then,
consumer food spending had been pretty evenly
split between groceries versus at restaurants, but
tilted heavily back on groceries almost overnight,
with specialty benefitting from the shift.
Fast-forward through 2021 and dollar sales
growth in various cooking/baking categories
has taken a turn, giving back much of the 2020
COVID gains. But unit sales through April 2022
are strengthening, suggesting that home cooking/
baking will remain a long-term trend but not nearly
as strong as the pandemic-influenced phenomenon.
Collaboration carries the industry forward.
Supply chain challenges necessitated long overdue
SKU rationalization, not only among makers who
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editor's letter
KEY TRENDS DRIVING THE SPECIALTY FOOD MARKET
Denise Purcell
Editor, SFA Specialty Food
dpurcell@specialtyfood.com
