The State of the Specialty Food Industry and The NASFT

Transcription

1 The State of the Specialty Food Industry and The NASFT Los Angeles Chamber of Commerce November 28, 2012

2 The State of the Industry Report > Published each Spring with groundbreaking research from: NASFT Mintel International SPINS > Summary Format Published in Specialty Food Magazine > Full report available NASFT Members via specialtyfood.com Non-Members contact Mintel directly 1

3 Framework for Today s Presentation > Today s Topics: State of the Industry Study Highlights Specialty Food Category Analysis Specialty Food Supply Chain The Retail Landscape Threats & Future of the Industry > International Opportunities Fancy Food Shows Other NASFT Programs > Speaker: Ron Tanner, NASFT 2

4 Study Highlights 1 > Total U.S. specialty food sales grew by 19.1% between > 2011 Total Sales = $75.14 billion ($59.74 billion of this at retail) > 13.7% of all food sold at retail is specialty food > Fastest growing retail channel (in terms of sales) = natural food stores (sales increase 19.8% between ) 3

5 Study Highlights 2 > Private label product introductions dropped in Share overall has also been dropping since 2009 > Largest specialty food category: Cheese and Cheese Alternatives = $3.44 billion > Fastest growing categories ( ): Shelf-stable functional beverages (+204%) Yogurt & Kefir (+96%) > Specialty food manufacturers reporting increase in sales in 2011: 78% (41% up 20+%) 4

6 Study Highlights 3 > Most influential product claim over the next 3 years: Local (per all supply chain respondents) > Emerging cuisines: Latin, Eastern European & Indian (per Retailers) > Average transaction size for specialty food stores up 11.4% over

7 The Size of the Specialty Food Market 6

8 Unit Sales vs. $ Sales of Specialty Foods Percent Change $ Sales / Current Unit Sales % 8.0% % 7.4% % 16.0% Note: $ Sales / Current and Unit Sales are based on retail sales of specialty food excluding Whole Foods Market, Trader Joe s or Wal-Mart, as well as private label and PLU items 7

9 Top Ten Specialty Food Sales Categories 1. Cheese & Cheese Alternatives $3.44 billion 2. Meats, Poultry, Seafood $1.92 billion 3. Chips, Pretzels & Snacks $1.84 billion 4. Coffee, Coffee Substitutes & Cocoa $1.70 billion 5. Bread & Baked Goods $1.63 billion 6. Yogurt & Kefir $1.63 billion 7. Condiments, Dressings & Marinades $1.44 billion 8. Frozen Lunch & Dinner Entrees $1.12 billion 9. Candy & Individual Snacks $1.09 billion 10.Frozen Desserts $1.05 billion Note: Based on retail sales of specialty food excluding Whole Foods Market, Trader Joe s, or Wal-Mart, as well as private label and PLU items. 8

10 Top Specialty Food Growth Categories % % % % 50.00% % 181.7% points variance 49 of the 52 Specialty Food Categories Grew in 2011: Top 5 with Biggest Spread Shown Here 21.80% 76.7% points variance 95.70% 18.70% 34.3% points variance 49.70% 15.40% Specialty Food % Change All Foods % Change % points variance 12.60% 27.9% points variance 38.4% 10.50% 0.00% Shelf-Stable Functional Beverages Yogurt & Kefir Energy Bars & Gels Rice Cakes Nuts, Seeds, Dried Fruits & Trail Mixes % % 9

11 Top Specialty Food Growth Categories Specialty Food Categories Grew by More Than 10% Between 2009 and 2011 Shelf-Stable Functional Beverages 203.5% Yogurt & Kefir 95.7% Energy Bars & Gels 49.7% Coffee, Coffee Substitutes & Cocoa Nuts, Seeds, Dried Fruit & Trail Mixes Nuts & Seed Butters 48.3% 38.4% 29.5% Refrigerated Salsas & Dips 26.4% 0.00% 50.00% % % % % 10

12 Specialty Food Category Sales Penetration Specialty Food Category % of All Food Sales 1. Refrigerated Sauces, Salsas & Dips 57.5% 2. Teas 52.4% 3. Pickles, Peppers, Olives & Other Veg. 34.4% 4. Refrigerated Pasta & Pizza Sauces 34.2% 5. Yogurt & Kefir 33.1% 11

13 Specialty Food Category Sales Penetration Specialty Food Category % of All Food Sales 47. Other Dairy & Alternatives 5.7% 48. Eggs 4.6% 49. Shelf-Stable Functional Beverages 4.5% 50. Carbonated Beverages 3.1% 51. Frozen Juices and Beverages 1.9% 12

14 U.S. New Product Launches in 2011 New Premium Product Launches ,415 Down 6.2% from

15 U.S. New Product Launches in 2011 By Claim Leading Claims: Kosher All-Natural Whole Grain on the rise Significant Drops: Convenience- Related Claims Organic declining 14

16 Specialty Food Supply Chain 15

17 Specialty Food Manufacturers > More than half of manufacturers reported sales growth of 10%+ in % Sales Change in the Past Year 4% 2% Up 1-9% 15% 41% 17% 20% Up 10-19% Up 20% or more Unchanged Down 1-9% Down 10-19% Down 20% or more Note: Summing doesn t equal 100% due to rounding 16

18 The Voice of the Manufacturer > What is the biggest threat to your business? > Losing distribution as large multi-national companies have the ability and deep pockets to buy their way into accounts. > Competition and costs to get product into supermarkets i.e. shelving fees. > Higher freight, rise in food cost, and the quality of food coming in from suppliers. The state of the economy. 17

19 Specialty Food Importers 18

20 Emerging Cuisines - Importers 19

21 The Voice of the Importer > How have rising food prices and/or currency fluctuations/the economy impacted your business? > Euro has declined, better for margins. Rising container costs are problematic, but we have kept most prices stable. > Margins have decreased, We have not been able to pass all the increases of cost of goods to our customers. > Yes, seeking more value-based products. 20

22 Distributors Sound Off: # of Stores Serviced 21

23 The Voice of the Distributor > What is the biggest threat to your business? > Bigger distributors who can undercut our prices. > High raw material costs. > Manufacturers selling directly to retailers. 22

24 Specialty Food Channel Accounts For Most Growth 3 out of 4 Supply Chain Sectors Indicate That the Specialty Food Store Channel Represents the Fastest Growing Segment (Top Three Responses Shown Here) 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Specialty Food Stores Natural Supermarkets (e.g. Whole Foods) Conventional Supermarkets (e.g. Kroger/Safeway) 23

25 U.S. Sales of Specialty Food by Retail Channel > Supermarket share shrinking slowly but natural food stores are gaining market share 24

26 Key Retail Statistics 25

27 Growth for 74% of Specialty Food Retailers Dollar Sales Changes: Specialty Food Stores 26

28 Organic, Natural and Local Important to Retailers 27

29 The Voice of the Retailer > What is the biggest challenge to you as a specialty food retailer? > Big box stores offering similar items for better pricing; educating consumers to appreciate and purchase fine foods. > Continue to provide customers with unique and interesting products. > Keeping selection/assortment up-to-date, fresh, of superior quality without sacrificing too much margin. 28

30 Threats to the Specialty Food Market Manufacturers Competition (copy-cat innovation for less) Costs Consumers interested in lower-priced items Importers Local food movement has hurt sales growth Lower margins (Euro vs. dollar) Larger retailers/distributors pushing costs onto vendors Retailers Market share loss (mass merchants/big box stores) Matching product mix to consumer base Misinformation and marketing 29

31 Future Trends in Specialty Foods Innovation Increasingly competitive marketplace will lead to more unusual and niche products Local/regional food explosion Heavy skew toward natural and ecofriendly Retailing Seeking differentiation through product mix and services Specialty retailing seen as hot, meaning increased competition. 30

32 Future Trends in Specialty Foods > Hot categories haven t peaked lots of room for continued growth > The return of the brand less emphasis on store brands > Specialty in expansion phase again (new channels, direct-to-consumer, new products) 31

33 About the NASFT > Not-for-profit trade association established in 1952 with 2,950+ member companies. > Producer of the Fancy Food Shows, sofi Awards, Specialty Food Magazine, specialtyfood.com, and foodspring.com. > Our vision: To be recognized as the innovative hub of the global specialty food and beverage marketplace. 32

34 The Fancy Food Shows > Since 1955, the Summer Fancy Food Show has been considered to be the Premier Marketplace for Connecting the $70 Billion U.S. Specialty Food Industry 180,000 innovative specialty food products, 2,400 exhibitors 24,000 attendees 41 international pavilions 80 countries/regions represented 1,500 U.S. companies 330,000 sq. ft. of exhibit space 33

35 The Fancy Food Shows > Since 1975, the Winter Fancy Food Show has been considered to be the Premier Marketplace for the West Coast 140,000 innovative specialty food products 1,500 exhibitors 18,000 attendees 20+ international pavilions 35+ countries/regions represented 1,000 U.S. companies 205,000 sq. ft. of exhibit space 34

36 Business Builders Program Guarantees Time with Buyers > A value-added matching program designed to give Fancy Food Show Exhibitors the opportunity to meet key buyers in a private, oneon-one professional setting Pairs buyers with suppliers for 10-minute meetings the day before exhibit halls opens Free program to NASFT exhibiting members. At Summer 2011 Fancy Food Show: there were 2,000+ one-on-one sessions between buyers and suppliers. 35

37 Multi-faceted Attendance Building Program > Program focuses on comprehensive content and targeted key segments to attract 17,000-25,000 Buyers from every major food buying channel Direct Marketing Advertising (print/banner ads) Digital Marketing Social Marketing Coverage of the Show through Twitter and Facebook updates using rich media content such as videos and pictures to capture the actions and buzz. Social Media Help Desk for Exhibitors Extensive Telemarketing/Voic blast Strategic Partnerships specialtyfood.com website Traditional and Interactive Promotions Video 36

38 Education Programs to help exhibitors grow their business 50+ sessions a year including workshops, seminars, tours and special events Classes begin two days before Show 30+ subject matter experts speaking at 20+ sessions for each Show Online programs including videos, reference guides, research summaries, guides to industry standards, webinars and more Local Share groups Live Learning Center Reaching professionals annually 37

39 The NASFT produces the industry s leading resources > NASFT s Specialty Food Media connects exhibitors to the right buyers before, during, and after the Fancy Food Shows. Specialty Food Magazine Provides food trends, products and business insights. Official Show Directory specialtyfood.com the trade s leading information hub Specialty Food News daily e-newsletter foodspring.com the consumer s gateway to food adventure Mobile navigation ap 38

40 Press Outreach Services > Fancy Food Show Press Attracts thousands of influential trade and consumer press including The New York Times, Fox Business News, O, the Oprah Magazine. > Virtual Press Office: Year-round online news center that is no cost to members Members submit news/press releases Viewed by thousands of journalists, analysts and industry professionals over 1 million hits per year Social Media: In addition to traditional media outreach, NASFT utilizes new media strategies such as connecting with press via social networking 39

41 Sofi Awards- The most prestigious award in the industry > The sofi Awards are the highest honor in the specialty food industry. Finalists are judged by 300 retail and foodservice buyers during the Summer Fancy Food Show Winners are announced at the show in a red-carpet ceremony featuring a Celebrity Chef and keynote speaker Winners are covered by the media: Good Morning America, The Today Show, the Early Show. 40

42 New Product Introductions Discover everything from cheese to chocolate, spices to sorbets, pastas to pastries 100+ first time exhibitors in the New Brands for the Shelf Pavilion The industry s finest in 33 categories with the sofi awards judging, showcase and awards ceremony What s New, What s Hot! showcase features 100s of new products, gift ideas, holiday items and natural & organics 41

43 Presented by: Ron Tanner National Association for the Specialty Food Trade (NASFT) Q & A