August 24, 2020
Growing online grocery sales
The pandemic created an unexpected demand for online services as customers sought delivery and curbside pickup for safety. Retailers rushed to meet these newfound needs. Grocery sales, according to a Brick Meets Click/Mercatus Grocery Survey, grew 9% just between May and June, when some thought the U.S. was rising up to more normal times. During that time, 45.6 million households used delivery or pickup services and did so more often—1.9 orders per month compared with 1.7 earlier. Rabobank International expects online grocery to reach 6.4% of total sales by the end of 2021, compared with 3.1% at the end of 2019. That’s incredible growth. Now what? Many suspect consumers, especially Baby Boomers, will return to in-store aisles. Online, it appears, continues to get outsized attention when it comes to food shopping.
Time to have that talk
No, not the birds and the bees. The test tube and the shelf. Will cell-based and animal-mimicking products like Brave Robot find a place in your store? Brave Robot features animal-free whey developed by Perfect Day, which touts its whey-identical ingredient as “flora-made dairy protein.” Basically, it uses an acellular process not containing any animal cells and instead uses fermentation (along with some science and technology) to create dairy proteins. Meanwhile, a handful of venture-capital-fed companies are racing to bring cell-based meat alternatives, whether burger or fish, to market in the next two years. Dozens more follow with startups pulling in about $700 million in investment over the last five years. But is it all natural enough to fit among traditional health food stores’ veggie and bean burgers? Does the environmental promise deserve special consideration? Standards questions abound. It’s never too soon to start the research and conversation with customers.
Need a go-forward foodservice plan?
COVID-19 abruptly closed many natural products retail foodservice operations. Those temporary safety measures now give way to a new future for this important side of retail business. What’s changing? Less self-serve and more deli service and even restaurant-service experiences. Restaurant partnerships could grow, too. It eases pressure on the retailer and gives a challenged sector a new outlet. And just like restaurants, connecting with all the apps gives natural products stores easy access to customers. After all, convenience is still king and prepared foods fulfill this customer desire. Read more details at The future of foodservice: Here's what to expect.
An investment in product and people
We were excited to hear that Native American Natural Foods, makers of the Tanka Bar and other meat and fruit products, received a multimillion dollar equity capital investment this summer. The business exists to create a better environment and economy for the Lakota people of South Dakota. Fundraising for such a mission-driven organization has proved challenging, but co-founder Mark Tilsen has remained committed and hasn’t wavered from his mission.
Canned cocktails for the win
Forget the crafted cocktail of culinary connoisseur dreams. It’s all in the can now, especially in this time of social distancing. Canned cocktail sales grew 90% year-over-year for the 52-week period ending June 27. They were selling at good clip before, too, with 21.5% growth for the year ending Feb. 29. SPINS reports similar specialty beverage sales success in 2020 with hard cider, mead and other malt beverages growing at 60% through June. Why the success? Ease. Safety. Taste. Adventure. Cost. There’s no need to stock the home bar and learn recipes and technique when the pop of a can top will do.
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