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Natural Foods Merchandiser

Specialty food sales swelled in 2009

TAGS: Archive News

Sales of specialty foods and beverages jumped 2.7 percent in 2009 to more than $63 billion, according to the latest National Association for the Specialty Food Trade State of the Specialty Food Industry report. Overall, specialty food accounted for slightly more than 13 percent of all food sales at retail.

“The fact that the specialty products experienced growth in 2009 shows tremendous promise for the industry," said Amy Jacobsen, vice president of business development for Schaumburg, Ill.-based market research firm SPINS. "Consumers continue to support items that represent a unique offering--thus, products promoting attributes such as artisanal, local, or have a distinctive flavor profile are 'winning' across retail channels."

The NASFT defines specialty foods as premium-quality foods that are often made by small or local manufacturers or that have exotic or ethnic flavors. Within the 42 specialty food segments surveyed, yogurt and kefir were the fastest growing specialty food category, expanding 38.9 percent to $830 million.

But specialty foods weren’t immune to the recession in 2009. Manufacturers focused on improving sales of existing lines rather than new product introductions, which dropped by 37 percent last year. And sales of beans, rice and shelf-stable pastas each rose 30 percent since 2007, reflecting economic meal choices, according to the report.

“The data reveals an industry that continued to grow despite the economic challenges that confronted the U.S. and the world last year,” said Ron Tanner, vice president of communications and education for the NASFT, in a release. “This year, manufacturers of specialty food are working hard to maintain that momentum with new go-to-market strategies.”

Other key findings in the report include the following:

  • The top-selling food categories were cheese; condiments; frozen and refrigerated entrees; pizzas and convenience foods; chips; pretzels and snacks; and frozen and refrigerated meats, poultry and seafood.

  • Mediterranean, Latin and Indian were the fastest emerging cuisines.

  • Retailers reported that 23.4 percent of the foods they sell are local, produced within 250 miles of the store.

  • Eighty-five percent of specialty food manufacturers make or market natural foods.

  • Mainstream supermarkets remained the predominant seller of specialty foods, with 74 percent of sales.

  • Local, sustainable and eco-friendly products were identified as the items that will grow the most in the coming years.

Jacobsen sees the growth of specialty foods as good news for the natural products industry. "The news is good for natural products as well, as we see a significant crossover in natural and specialty products and consumers," she said. "Natural retailers are increasing their specialty positioned natural items within their supermarkets, and specialty gourmet supermarkets have expanded their natural product sets to appease consumers as well. As specialty continues to gain ground and natural products continue their strength, we can expect the boost within the segment to only reinforce the other as these two industries converge.”

The annual State of the Specialty Food Industry report is a joint research project prepared by the NASFT in conjunction with Schaumburg, Ill.-based market research firm SPINS and the international market research firm Mintel International. The sales data include 42 specialty food segments, pulled from the SPINS database of mainstream and natural food stores. Mintel also surveyed specialty food manufacturers, importers, distributors, brokers and retailers for the report.

Look for more information on the specialty food industry in NFM's guide to gourmet foods in the June 2010 issue.

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