Natural Foods Merchandiser


Low-carb isn?t dead, Adams Harkness says
Research analysts at a Boston investment bank warn that to write off low carb as last year?s fad may understate the diet?s long-term viability.

Scott Van Winkle and Mark Rupe of Adams Harkness say: ?We simply find it foolish to call the trend dead when it is still outpacing the overall food industry?s growth by a multiple of 20—even on the most conservative method of evaluating the growth.?

Yes, the diet peaked in early 2004, then dropped as the year progressed—just as any diet will. And yes, products have disappeared from the market, but Van Winkle and Rupe find that hardly surprising, since 3,375 new low-carb items (many of them ?like shoe leather?) hit store shelves last year.

Research from Opinion Dynamics Corp. of Cambridge, Mass., found that 15 percent of adults said they were following a low-carb diet in January 2005, up from 6 percent in December and 11 percent the January before. The telephone survey of 1,000 respondents convinced the Adams Harkness team that low-carb eating has staying power.

?In and of itself, low carb is no longer explosive, but it isn?t dead either,? the report concludes. ?Watch the sustained shift in commodities for the real proof.?

Hain products fly high
Hain Celestial brands will soon show up in new places—from airplanes to vending machines. Chief executive Irwin Simon told analysts Feb. 3 that the natural foods giant has been negotiating with Jet Blue and Ted, as well as Canteen and other vending companies to add vegetarian and healthy items. On the strength of the Yves McVeggie Burger?s success in New York-area McDonald?s, Pizza Hut is testing a vegetarian pepperoni.

Hain discontinued about 70 SKUs last year, part of a push to cut about 20 percent of its overall assortment by the end of 2005. The rationalization process will continue, even as Hain launches a major new product push across many of its brands, including Imagine aseptic soup, Rice Dream horchata and Earth?s Best baby care products made by Jason Natural Cosmetics. ?That?s my challenge,? Simon said. ?What?s the next iPod for Hain??

Natural Foods Merchandiser volume XXVI/number 4/p. 20

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