The SFA and Mintel recently released the 2020-2021 Edition of The State of the Specialty Food Industry report. The annual research explores the market and where it is going based on sales data from the past three calendar years, sales forecasts in key categories and a consumer survey that tracks behaviors, preferences and generational differences shifting the market.
This year’s research includes analysis of the impact of COVID-19 on the specialty food industry, including supply chain commentary, to provide insight on market ramifications, challenges and opportunities in the current business environment.
Specialty food sales have increased 10.7 percent since 2017, but growth had slowed as the market matured. Foodservice and online sales continued to be bright spots in growing sales, though both now have different landscapes due to COVID-19.
The specialty food and beverage market continued to outpace sales of all food, growing three times faster than the entire food and beverage market during 2017-2019. In 2019, 12 categories — more categories than ever before — achieved at least $2 billion in annual sales.
Cheese and plant-based cheese; meat, poultry, seafood (frozen and refrigerated); chips, pretzels and snacks; coffee and hot cocoa (non-RTD); and bread and baked goods topped categories with the highest retail sales.
Refrigerated and frozen categories accounted for four of the top five categories with the highest dollar growth and included refrigerated plant-based meat alternatives; refrigerated creams and creamers; refrigerated RTD tea and coffee; and frozen breakfast foods. Shelf-stable creams and creamers rounded out the list.
Mintel tracked and forecasted retail sales for the specialty food market overall and 35 key categories from 2014 through 2024, including sales data from SPINS through the first quarter of 2020 to incorporate the pandemic impact. Due to COVID-19, the specialty food industry saw an unprecedented sales spike beginning in March 2020. SPINS data shows that specialty food and beverages grew nearly 42 percent versus March 2019.
“The impact of COVID-19 on the specialty food industry cannot be underestimated,” said Bill Lynch, interim president of the SFA. “Food retail is an essential business channel and while that has been beneficial to sales for our members, many of whom are small businesses, the overall landscape is both optimistic and uncertain.”