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How Sawall Health Foods reaches shoppers beyond the core

Sawall Health Foods Sawall Health Foods expansion

Despite eight different expansions since 1990, Sawall Health Foods closed the book on another massive renovation and 4,500 square foot expansion when it opened the doors to Cafe 36, a full-service restaurant, in August 2017. With a deli, two kitchens, an organic coffee bar, full selection of pastries, and an all-natural gelato station—in addition to the fact that the store itself is a full-service grocery store offering all natural and organic products—one might wonder why store leadership decided to open a restaurant in the first place.

Essentially, what it boils down to is that COO Mark Sawall wants the store to be a destination for community members to get everything they need in one place, and to redefine the shopping experience for not just natural food shoppers but conventional shoppers as well. If you ask him, his competition is anyone that sells groceries—not just other health food stores.

Sawall

“The natural products industry tends to focus on the core shopper who comes in every week, but especially with all the natural chains going up in this industry, we cannot forget about the customers who haven’t been in the store before and are coming in for the first time,” Sawall says.

How does he reach these shoppers?

Drawing people in. In order to enter the restaurant, guests must walk through the grocery store; there is not a separate entrance. Menu items feature ingredients and wine that patrons can buy at the store. “In that aspect, even though we’ve been here 82 years, the restaurant has drawn people who have never come to the store before,” Sawall says. “This represents a cross merchandising area for us.”

Blocking out the noise. Rather than taking inspiration from his competition, Sawall focuses on his own store. “If there are two natural food stores in a small town, they’re often worried about what the other is doing,” he says. “If you’re the innovator, you worry about yourself.”

Giving shoppers what they want. Sawall has received some feedback from his core shoppers that some of the products on the shelf might not meet their standard for what’s healthy (too high in sugar, for example). This isn’t to say that the store doesn’t have stringent standards of its own—it does. “But our job isn’t to decide what the customer eats,” Sawall says. “Our job is to help them along the way and provide a full range for those consumers who are transitioning from a not-so-great diet of conventional foods to a healthier one.”

New Hope Network hosted Techstars Food+Tech Startup Weekend. Here's what happened

Startup Weekend 2017 from Visceral Art on Vimeo.

What happens when you place more than 80 passionate food enthusiasts in New Hope Network’s offices for 54 hours? A whole lot of creativity, entrepreneurial spirit and the invention of tasty comestibles such as lentil snacks and seaweed bars. 

From Nov. 17-19, New Hope hosted Techstars Food+Tech Startup Weekend in Boulder, Colorado, an event designed to incubate new business ideas at breakneck speed from ideation through, in some cases, a working product prototype. The event started on Friday night, where food business concepts were rapidly pitched (60 seconds per pop!), teams were formed and fledgling startups were launched.

The rest of the weekend was a flurry of activity. Scores of groups ventured to downtown Pearl Street, where the last farmers market of the year was in full swing, to gain market validation for their ideas.

Would consumers use an app that connected locals, Meetup-style, for dinner? Would backpackers buy a dehydrated meal made from ugly fruits and vegetables? Would shoppers devour a nutrition bar infused with copious amounts of slimy, salty kelp? Would environmentalists taste a puffed snack made out of food waste? Via online and in-person interviews, groups garnered solid evidence that their food idea would succeed in the marketplace if released onto grocery store shelves (or the App Store). Mentors from Boulder’s vocal food community provided each team invaluable advice on branding, messaging and product development. 

The event concluded on Sunday night, with each team procuring a 5 minute pitch in front of all attendees and, most important, to a trio of esteemed judges who scored the teams on market feasibility, preparation, branding, knowledge of  potential consumers and more.

After a tense deliberation, the judges delivered the verdict on the winners (one of which went to yours truly). Startup Weekend ended with a jubilant toast of craft beer, pizza and sundaes before all attendees invariably went home to collapse into their beds, tummies full of ice cream and hearts swelling with inspiration.

 

[email protected]: Campbell Soup, Techstars back culinary incubator startup | Premama on the fast track

Thinkstock commercial kitchen incubator

Pilotworks, a WeWork for food entrepreneurs, is taking its commercial kitchens national

A company building shared commercial kitchens across the country has $13 million in new funding from investors including Techstars and Campbell Soup’s venture fund, Acre Venture Partners. Pilotworks hopes to make it easier for food entrepreneurs to start businesses by providing up-to-code kitchens equipped with the necessary tools and features, plus scheduling software and an online community for members. Read more at CNBC…

 

How this prenatal vitamin startup has achieved fast-paced growth

Supplement brand Premama was born out of a trip that then-Brown University student Dan Aziz took to Whole Foods in 2010 to research what kinds of supplements customers wanted but weren’t finding. Several told him they wanted prenatal pills that weren’t so hard to swallow and weren’t so hard on the stomach. He continued doing research on the prenatal supplement market and decided to launch a company to offer prenatal pill alternatives including gummies and drink powders. Today, Premama has eight SKUs and five more in the works, and its sales have grown more than 500 percent over the last three years. It closed a series B earlier this year and is focused on growing its presence online. Read more at Rhode Island Inno…

 

Skyr retells its story via innovative packaging

Chobani isn’t the only yogurt company rebranding. Icelandic Provisions, which has helped popularize the Icelandic cultured dairy product skyr in the U.S., has redesigned its packaging with a whimsical look and a recyclable PP cup. Read more at Packaging Digest…

 

American farm towns, with changing priorities, reject industrial agriculture

Residents of a small town in Kansas are protesting Tyson Foods’ plans to build a chicken processing facility south of town. They’re concerned about groundwater pollution, infrastructure and smells, for starters. Other rural towns have turned away meat plants recently, too, including Mason City, Iowa, and Port Arthur, Texas. Read more at WSJ…

 

Everyone’s favorite CBD maker just launched a line of topicals

The Stanley Brothers, one of the leading CBD supplement brands, has a new line of hemp-infused skin care products including a cream and balm. Read more at Mind Body Green… 

New (natural) hope for the painful reality of endometriosis

Dr. Marita Schauch

Endometriosis is a gynecological disease that affects roughly 10 percent of reproductive-age women. It causes severe pain and cramping in the pelvis and lower abdomen, extremely painful menstrual cramping, pain from penetration during sex, abnormal bleeding, and, ultimately, infertility.

It’s an incredibly challenging disease that women contend with and, until recently, the only courses of action for treatment were highly disruptive hormone therapy, heavy-duty pain killers or invasive surgery.

It was a bleak situation for women’s gynecological health.

Luckily, research is starting to show that a natural supplement called N-acetylcysteine (NAC) can drastically decrease endometriosis and improve fertility—without the negative side effects that come from messing with our hormones, taking pain killers or having surgery.

One study in particular, conducted in Italy, shows promising results. Ninety-two women were divided into two groups: 47 were given 600 mg of NAC three times a day, three consecutive days a week, for three months. Forty-five were not. All 92 women suffered from endometriosis, had not had any hormonal treatment in the previous two months and were scheduled for surgery.

The results were significant: In the NAC group, 24 patients canceled their surgery, 14 had decreased ovarian cysts (a painful byproduct of endometriosis and contributor to the overall condition), eight had a complete disappearance of cysts, 21 had pain reduction and one became pregnant.

In the control group, only one patient canceled her surgery, and four patients had a disappearance of cysts.

In both groups, four patients saw new cyst growth.

So what do the numbers mean?

NAC may be just as effective at reducing the impacts of endometriosis and treating its growth, without the side effects of current treatments. A huge consideration for women with endometriosis is their fertility; hormone treatment can often be just as disruptive to fertility as the disease itself. NAC, on the other hand, has been shown to improve fertility. In fact, eight patients from the NAC group in the above study became pregnant soon after the trial.

The suffering caused by endometriosis and its relatively high incidence among women in their prime childbearing years is a genuine cause for concern. What’s more, invasive treatment of the disease has been the only option for a long time. NAC may represent a new, natural hope for those suffering from this unfortunate condition.

NBJ

Supplement industry experts weigh in on confidence

When we talk about confidence in the supply chain, it may come down to having reasonable certainty in the integrity of ingredients and that the dosage and purity specifications promised are delivered. But simple definitions don’t always fit with complex situations. There’s more to it than the integrity/purity questions. With that in mind, as Nutrition Business Journal published our 2017 Confidence Issue, we asked a dozen industry figures what confidence in the supply chain means to them. This is what they told us.

National Restaurant Association reveals 'what's hot' in foodservice for 2018

Thinkstock/LarisaBlinova house-made condiments

In 2018, American kids will be eating a wider range of foods, and grown-ups will be swapping out carbs for vegetables and eating heritage breeds of meat with uncommon herbs, according to chefs polled by the National Restaurant Association.

In its annual What’s Hot survey, the NRA asks members of the American Culinary Federation to rank a long list of items as either a “hot trend,” “yesterday’s news” or “perennial favorites.”

New cuts of meat ranked in first place, same as last year, followed by house-made condiments, which leapt five places to second. Street-food-inspired dishes, ethnic-inspired breakfast items and sustainable seafood rounded out the top five. They all scored in the top six last year, with ethnic-inspired breakfast jumping up two spots to fourth. 

Healthful kids’ meals fell three places to sixth, but gourmet items in kids’ meals moved up two spots to 18th and ethnic-inspired kids’ dishes joined the top 20 trends for the first time at 16th place. 

Other newcomers are vegetable carb substitutes (think riced cauliflower and parsnip purée), uncommon herbs (thank the New Nordic movement for this, with ingredients such as yarrow and stinging nettle), Peruvian cuisine, heritage breed meats, Thai rolled ice cream (ice cream base poured on a super-chilled “anti-griddle,” frozen and rolled into a tight cylinder), doughnuts with nontraditional filling and ethnic condiments (such as Sriracha, gochujang and chimichurri). 

Doughnuts with nontraditional filling is the fastest-growing trend: More chefs voted for it this year compared to last year than any other trend. 

It was followed by ethnic-inspired kids’ dishes, farm/estate-branded items, heritage-breed meats and Peruvian cuisine. 

Conversely, the items whose trendiness is cooling off fastest are artisan cheese, heirloom fruits and vegetables, house-made charcuterie and house-made/artisan ice cream. 

In terms of nonalcoholic beverages, the hottest trend was house-made or artisanal soft drinks. Of the 700 chefs surveyed, 56 percent said it was hot. 

Next came cold-brew coffee, gourmet lemonade and locally roasted/house-roasted coffee, all of which got 55 percent of votes. 

They were followed by specialty tea (hot and iced), mocktails and kombucha.

Topping trends in alcohol beverages are culinary cocktails—such as those containing savory ingredients, fresh ingredients or herbal infusions. 

They were followed by locally produced spirits, wine and beer, and then craft or artisan spirits, on-site barrel-aged drinks, regional signature cocktails and food-beer pairings.

The full report can be found here.

This piece originally appeared on Nation's Restaurant News, a New Hope Network sister website. Visit the site for more restaurant trends and insights.

A promising outlook for private label in grocery [infographic]

Sprouts private label products

Why are Kroger, Sprouts Farmers Market, Costco and other big retailers making private label a centerpiece of their growth strategies?

While store brands haven’t gained much share over national brands in recent years, industry experts say their time is coming, for many reasons. The grocery landscape seems to have arrived at the perfect moment of consumer demand for more affordable but trustworthy products, and retailers’ ability to deliver quality products that meet clean label demands—and for a cheaper price than national brands.

But store brands are no longer confined to “value” positioning—now there are many premium, natural and organic private label brands that stand on their own on the shelves with unique offerings and flavor profiles, and attractive packaging. And with more non-GMO, organic, gluten-free options on the shelf than ever, a trusty store brand can take a lot of the work out of the purchasing decision for consumers.

“There is considerable upside potential for private label in organic and specialty segments because these are categories where the benefits clearly outweigh the brand,” Don Stuart, managing partner at Cadent Consulting, told Frozen & Refrigerated Buyer.

Indeed, half of millennials in a recent Cadent survey reported having no real preference between store brands and national brands.

The U.S. expansion of discount chains Aldi and Lidl, which for many products offer only one option that they source directly from manufacturers, may be another important force at play in getting consumers more comfortable with store-brand products. The same is true of the Amazon-Whole Foods merger, which made Whole Foods’ popular 365 Everyday Value brand available online, and the emergence of e-commerce retailers like Brandless and Thrive Market, which offer their own brand natural and organic offerings.

Nestlé to buy Atrium Innovations in $2.3B deal

nestle atrium innovations acquisition

In a deal that could boost sales momentum across the supplement industry, multinational food giant Nestlé announced that it is acquiring Atrium Innovations for $2.3 billion. The mammoth acquisition is eclipsed only by the $3.3 billion that KKR paid for Nature’s Bounty just three months ago, making 2017 the biggest year ever for supplement company acquisitions.

It also marks an astonishing uptick in price. Atrium, which owns natural-channel powerhouse brand Garden of Life and a number of practitioner brands, was purchased by private equity group Permira in 2014 for $751 million in a deal completed in early 2014. Hours after Nestlé's announcement, investment banker William Hood said the purchase of a supplement company by a global food company is a “$2.3 billion statement” marking confidence in supplements. Big consumer packaged growth companies are recognizing that they must incorporate health and wellness into their food-focused portfolios, Hood said.  “I’ve always said it’s only a matter of time before they cross over, and this deal is the crossover,” said Hood, who was a co-advisor on the acquisition.

Atrium CEO Peter Luther called the purchase a good fit for both companies. Garden of Life gives Nestlé exposure and experience in the natural channel. Nestlé Health Science, the division where Atrium’s operations will settle, has sales connections in mainstream medicine, including 4,500 U.S. hospitals, Luther said. While Atrium professional brands like Pure Encapsulations have already penetrated the physician market, Nestlé has deeper penetration. “I believe that their footprint in professional medicine will help expand our footprint,” Luther said.

That could be good for the entire supplement industry, as an endorsement by mainstream medicine has long been a goal for supplement makers. The Nestlé deal could help validate the supplementation concept.

The deal also fits well with public statements from Nestlé that the company aims to move into healthier nutrition and away from the sweets for which it is synonymous to many consumers. Nestlé’s confectionery business is reportedly for sale and a $2 billion-plus deal could have Hershey acquiring Nestlé’s candy operations, including iconic sweets like Butterfinger.

Nutrition activist Robyn O’Brien said that while some consumers are likely to be shocked that a brand like Garden of Life is owned by a global CPG like Nestlé, the truth is that acquisitions like this are proof that big business knows the tide is shifting. “You have to step back and see that the big companies are finally buying in,” O’Brien said.

While noting the irony that a candy company is buying a wellness company, O’Brien called the deal a sign that the natural products industry is nearing or passing a tipping point to become mainstream. "The Grocery Manufacturers Association is literally dissolving before our eyes,” O’Brien said. “We are watching the reshaping of our food system in real time.”

Karen Howard, executive director of the Organic and Natural Health Association, echoed some of O’Brien’s thoughts.  “Nestlé has walked away from GMA and has embraced the value of supplementation,” Howard wrote by email. “The consumer pocketbook is now a documented force.”

Howard also noted that Nestlé can learn from Atrium’s commitment to supply chain integrity. The overall integration of food with health and wellness at a global scale with a transparent and clean supply chain could be a very good thing for consumers, she wrote.  “Food, healthcare and medicine in the same boardroom? Sounds like a great recipe.”

For Luther, Nestlé Health Science’s scientific gravitas and resources could help grow sales for Atrium’s practitioner-channel brands, which include Pure Encapsulations, Douglas Laboratories and Genestra. There are concepts in the Nestlé Health Science R&D pipeline that could be a better fit for Atrium’s sales expertise than Nestlé’s, Luther said. The larger company’s connections in hospitals allow not only more touch points for sales, but also help establish relationships like the one Atrium has with the Cleveland Clinic, an alliance that builds credibility of nutritional strategies for often skeptical MDs. Those relationships drive more exposure to nutrition-based care and draw more doctors into integrative medicine, he said. “The broader we can make that funnel, the better,” Luther said.

With Garden of Life, some of the benefits flow in the other direction. Owning the brand could allow Nestlé access into the natural channel when its conventional offerings could shrink. Food companies know they need to move into natural and organic to build growth as conventional foods remain largely stagnate.

Aaron Bartz, president of practitioner channel brand Ortho Molecular, said he is encouraged by what the deal could mean for the channel but that he sees Garden of Life as the major factor in the deal. “I think it’s more a retail play than a practitioner play,” Bartz said. At the same time, Bartz said he is curious what Nestlé’s scale could do for the practitioner channel model. Nestlé’s footprint in mainstream medicine could lead to a sales model that’s palatable to entities like the American Medical Association. “That could be the big up side of this,” Bartz said.

Erik Goldman, who covers the practitioner channel as editor of Holistic Primary Care, said he also doubts the professional brands were the primary target in the acquisition but noted that Nestlé's acquisition of several of the strongest practitioner-focused brands is likely to have a significant impact on the entire practitioner channel.

For retail brands in general, the effects remain to be seen. With greater scale and greater resources comes the potential for greater growth for the brand, but the legitimacy that the deal stamps onto supplements will likely be noted by investors and consumers across the whole industry. "The significance of the deal is hard to discount,” said Hood. “This is an historic transition from that standpoint."

[email protected]: Sugar, salt and saturated fat in packaged food | Kroger to close experimental Main & Vine store

Thinkstock sugar and salt on spoon

Food-makers are taking salt and sugar out of food. But they’re adding fat.

There may be less sodium and added sugar in packaged foods, but there’s more saturated fat, according to a new USDA report which looked at a large sample of breakfast cereals, yogurts, snacks, candies and frozen/refrigerated meals. Between 2008 and 2012, sugar content of products in all five categories fell, but saturated fat increased statistically in four of those categories, suggesting that changes to those products to meet consumer demand for less sugar and salt may have not actually made them overall healthier. The American Heart Association calls saturated fat a contributor to cardiovascular disease. Read more at The Washington Post…

 

Kroger to close Main & Vine store after only 23 months

Kroger’s fresh concept store, which opened in 2016, may have failed, but it did so fast and yielded lessons that Kroger says will use to improve upon its other stores. Main & Vine, located in Gig Harbor, Wash., focused on fresh, healthy food and local products, and featured 300 bulk items. Read more at Supermarket News…

 

Feeling blue? Biotech startup raises $13M to create ‘natural’ color pigments using algae

Seattle-based Lumen Bioscience plans to launch its first product, a blue colorant for food and cosmetics made from spirulina, in early 2018, with help from a $13 million series A round. Read more at GeekWire…

 

Soy is set to become our biggest crop by acreage. But what are we doing with this soy?

The USDA predicts that in 2019, soybeans will surpass corn as the crop that occupies the most acreage in the U.S. We export about half of the soy produced in the U.S. to China, the EU, Japan, Mexico and Taiwan. Read more at Modern Farmer…

 

Organic lollipops grow into a herb or flower after they have been eaten

Amborella Organics makes organic lollipops with hints of roses, sage, rosemary, lavender and other herbs, and puts them on a biodegradable stick with heirloom seeds inside. Read more at ConfectioneryNews…

How new brand Farm & Oven optimizes package design for e-commerce

Farm& Oven Promo

It’s hard to believe that the Boulder-based snack company Farm & Oven launched just a few weeks ago. Unlike many new brands, Farm & Oven’s packaging is polished, on-point and distinctly designed to join the scores of food brands now launching online.

For a fledgling company, initially focusing on e-commerce sales over traditional distribution may be a smart option. While vastly more dollars are spent on natural and organic food and beverage in traditional grocery stores (by the end of 2017, Nutrition Business Journal estimates traditional retail sales will fetch $78.1 billion), natural e-commerce has already surpassed sales growth of brick-and-mortar. In 2017, internet sales of natural food and beverage grew 13.5 percent to $2.5 billion, while traditional grocery natural food and beverage sales grew 11.8 percent. NBJ expects internet sales to continue to grow 15.8 percent to $4.3 billion by 2021.

It’s important to remember that traditional brick-and-mortar sales for natural products are stronger than ever. And they are expected to experience double-digit growth through 2021. But there is a shifting tide in retail that savvy brands—such as Farm & Oven—are starting to expertly navigate.

Here, learn how (and why) Farm & Oven caters its packaging to reap improved online sales.

Why are you focused on launching Farm & Oven primarily on e-commerce sites like Amazon first over brick-and-mortar?

Kay Allison: We intend to be at the early stages of consumer trends that will transform the food industry. We know more consumers are buying food online and believe this will fundamentally reshape the food category. We want to be part of driving that transformation.

E-commerce allows us to intimately know how our marketing is working and to adjust our strategy quickly to impact sales. By launching online, we are already seeing which ads, audiences and offers convert profitably. We're learning which consumers repeat and what the lifetime value of that customer is. Retail distribution doesn’t provide this level of knowledge. And, we believe, this knowledge is powerful and will be key to our success.

E-commerce is simpler for a startup to handle. We aren't managing sales people, brokers and distributors. We ship directly to our customer or to Amazon and focus our advertising dollars online as well. We also believe that cash flows more quickly on e-commerce. The sales from our own website get deposited every day. Compare that to 60-day payment terms from retailers. For a startup company, this is a huge advantage.

Could you describe the importance of designing packaging in the new digital retail landscape?

KA: We believe consumers gravitate toward products that look, smell and taste great. And it's hard to get those sensory cues from a screen. It's critical that the look of the package makes people's mouths water. One great advantage of selling online is the white space background on the screen. Your pack isn't right next to another product's colors and images on shelf, so it can pop.

Farm & Oven’s four flavors each have a color associated with them. For example, the Beet Dark Chocolate SKU features a bright pink color. In what ways does color play a role in package design or web? How did you decide on these specific colors?

KA: Our primary visuals are consistent from package to package. Our first priority is the sensory appeal of our product—the look, the texture, the broken off crumbs from one of the pieces. Each package has large photos that show chocolate chips, poppy seeds, shoestring carrot shreds or pieces of pecan to create that sensory appeal.

Our point of difference is that one serving of Farm & Oven Bakery Bites gives you 40 percent of the recommended daily vegetable intake. Communicating that—in an effective but not dominant way—is our second priority.

The color banners on our packages are coordinated with the color of the vegetable featured in that flavor. The pink and purple tone is associated with the Beet Dark Chocolate, the green with the Zucchini Lemon Poppy Seed, bright orange with Carrot Cinnamon and the deep orange for Pumpkin Maple Pecan. Also, if you look closely at the color bands on the packaging, you will see subtle line drawings of the main vegetable from each flavor.

How did you test the package’s effectiveness for e-commerce? What kinds of market validation did you conduct to arrive at the final product?

KA: Mike and I have 50 years of combined experience in the food industry, as successful innovators of big food brands. And although we’ve brought our expertise to table, we’ve relied on input from the consumer every step of the way. Consumer insight and innovation are the interwoven DNA of our company, and we intend to keep it that way as we grow.

Before we even started developing recipes, we conducted a concept test with a national sample of 750 respondents. Next, we ran a Kickstarter fundraising campaign using digital marketing that generated over $11,000 from 240 backers. As we developed our recipes, we assembled an ad hoc sensory panel of students from the University of Colorado-Boulder as taste-testers. Our designer then developed concepts to show us how our packaging would stand out in a retail shelf set of competitive products and how it would look on screen compared to competitors' digital presence. Finally, we relied on our professional network of colleagues and our own experience to make final decisions.

What advice do you have for food entrepreneurs who are interested in catering their product’s package design for e-commerce?

Spend the time, money and energy to get expert, sophisticated design. Be exceptionally clear with your design firm about your communication priorities (no more than three elements, in clear order of priority). And, focus on making your product look enticing to your target audience.

Want to learn more about navigating the changes in retail? Don’t miss our Disrupted Retail Summit on March 8, 2018, available to all Super Pass badge holders.