February 2022 Grocery Insight

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Grocery Insight February 2022

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Inside Special Report: Walmart 60th Anniversary • 2 Category Analysis: Bacon • 6 Category Analysis: Charcuterie Merchandising • 8 Category Analysis: Powdered Drinks • 10 Category Analysis: Sour & Novelty Candy • 12 Category Analysis: Fudge • 14


Special Report

Walmart 60th Anniversary

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s a new year brings fresh perspectives, a milestone anniversary presents the opportunity to look back at the successful journey taken. This year, Walmart celebrates 60 years in the industry, a stunning achievement as the company has maintained an industry-leading presence as a powerhouse grocer and superstore chain with several banners.

History:

Walmart started as a small discount retailer in Rogers, AR and was founded by Sam Walton in 1962. Within five years, Walton had expanded his operations to 24 locations. The company officially became Wal-Mart Stores in 1969. In 1970, the company became publicly traded, and a year later the first distribution center and home office opened in Bentonville, AR. The company quickly made strides to become a superstore when the company opened its first pharmacy in 1978. By 1980, Walmart had expanded to 276 stores and employed 21,000 associates. Embracing its rapid expansion, the company opened its first banner store, Sam’s Club, in 1983 in Midwest City, OK. Within the same year, Walmart replaced its cash registers with computerized point-of-sale systems in order to help consumers shop and check out more efficiently. It wasn’t until 1988 that the first Walmart Superstore opened in Washington, MO, which was the industry’s first hint that Walmart was evolving into a one-stop-shop for consumers that prioritized convenience. Also in 1988, David Glass was named CEO, and in 1991, Walmart went global through joining forces with Cifra, a Mexican retail chain, which helped Walmart open the first Sam’s Club internationally in Mexico City. In 1992, Rob Walton was appointed chairman of the board and the company grew to 371,000 employees and 1,928 stores and clubs. Walmart established its presence in Canada through the purchase of 122 Woolco stores in 1994, and three years later, the company opened its first location in China. One year later, Walmart introduced its consumers to The Neigh-

borhood Market with three locations in Arkansas. H. Lee Scott Jr. succeeded David Glass as CEO in 2000, and within the same year, the company created an e-commerce presence that provided shoppers the opportunity to shop online. Staying ahead of industry trends, Walmart launched its Site to Store service in 2007, which allowed consumers to purchase items online and pick up instores—further evolving and growing its e-commerce presence. In 2009, Mike Duke was named CEO, and a year later the company opened its first location in India. In 2011, Walmart entered the South African market by acquiring 51 percent of Massmart Holdings Limited. In 2012, the company celebrated 50 years of service and in 2014, Doug McMillon succeeded Duke as CEO, and later becomes the current President and CEO. A year later, Greg Foran became President and CEO of Walmart. In 2015, Rob Walton retired as chairman of the board of directors but continues to serve as a director, and Greg Penner succeeded Walton. John Furner was appointed Sam’s Club’s President and CEO in 2017, and in 2018, Walmart modified the spelling of its name from Wal-Mart to Walmart. Judith McKenna became President and CEO of Walmart International in 2018 and in the same year the company acquired Flipkart in India and Eloquii, Bare Necessities and Art.com. John Furner was named President and CEO of Walmart in 2019 and the company opened its First Walmart Health Center. Currently, the company has approximately 10,500 stores and clubs under 48 banners in 24 different countries.

Sam’s Club:

Walmart has had a variety of banners over the years, many are international chains, but one of Walmart’s largest and well-known banners is Sam’s Club. Sam Walton opened the banner in 1983 in an effort to help smaller businesses save money on buying products in bulk. Sam’s Club has evolved from one location to approximately 600 in the US, 200 international locations and online.

Sam’s Club is a membership-based warehouse club and offers members quality products in bulk and at a discounted price. The company has grown over the years, and has put emphasis on only supplying and carrying high-quality, premium brands. Sam’s Club eventually was able to launch its own private label, Member’s Mark. The brand’s products include home décor, clothing, food and snacking options and health and wellness items to name a few. Similar to Walmart, Sam’s Club has remained ahead of trends and is working on rolling out its Inventory Scan, which is considered the largest and fastest technology deployment by Brain Corp, an artificial intelligence company. The Inventory Scan will be installed to the 600 autonomous floor scrubbers Sam’s Club already has in place and will be able to scan and capture data while it moves around each storefront. The AI is expected to provide various insights such as verification of pricing, product stock levels and localization.

Online Developments:

Walmart launched online shopping in 2000, but it wasn’t until 2007 that consumers had the option to shop online and pickup in-stores. In 2013, the company piloted its online grocery curbside pickup services and by 2017, Walmart had launched it 1,000th curbside pickup location. Online grocery pickup gives consumers the option to shop from more than 40,000 items. Walmart also launched Walmart Marketplace, which allows people to sell their products online and grow their business. According to the company website, “offers customers an expanded assortment while also giving small businesses access to the surging traffic on Walmart. com. Shopify powers a dynamic portfolio of third-party sellers who are interested in growing their business through new, trusted channels. This integration will allow approved Shopify sellers to seamlessly list their items on Walmart. com, which gives Walmart customers a r Cont'd on Pg. 4

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Special Report: Walmart 60th Anniversary r From Pg. 2

Over the course of six decades, shoppers’ health priorities and shopping styles and preferences have evolved in rhythm with advances in technology. / All photos courtesy of Walmart.

broader assortment.” Walmart Marketplace is one of the largest omni-channel retailers that help millions of consumers not only list their own items on Walmart’s website, but also add their catalogs, manage orders and coordinate shipments. In 2016, Walmart acquired Jet.com, which was hailed the largest e-commerce acquisition in history. The acquisition furthered Walmart’s e-commerce platform, helping to accelerate growth and provide a smoother, more unique shopping experience for consumers. Walmart has subsequently worked to bring e-commerce merchandising in-house to Bentonville, AR in a more streamlined omni-channel approach.

Leadership:

Doug McMillon is the current President and CEO of Walmart. According to the company, McMillon has focused on simplifying life for busy families while earning consumer and associate trust. While McMillon has been President, Walmart has invested in associate salaries, benefits and education while creating a plan to partake in helping PG 4 / GR O C E R Y I N S I G H T

climate change. He was named President and CEO in 2014, but from 2009 to 2014, McMillon was President and CEO of Walmart International. From 2005 to 2009, he was President and CEO of Sam’s Club, making him very familiar with every aspect of the company. John Furner is the President and CEO of Walmart US and oversees more than 1.5 million associates while remaining responsible for the strategic direction and performance of the company’s 4,700 US locations. Before entering this role, Furner was the President and CEO of Sam’s Club, but actually started out as an hourly associate in 1993 at Walmart. Judith McKenna is the current President and CEO of Walmart International. In her role, McKenna oversees the company’s footprint outside of the US. McKenna manages 550,000 associates within 23 countries. She focused on expanding the company’s e-commerce and omni-channel offerings. Before entering this role, McKenna was the evp and COO for Walmart US where she guided the launch of online grocery in the US.

Future:

Being an innovator and staying ahead of the trends and demands, Walmart has announced it signed an agreement with Plenty Unlimited to invest in Plenty, an indoor vertical farming company. The investment is part of what the company is referring to as a “broader strategic partnership to utilize Plenty’s indoor vertical farming technology platform to deliver fresh produce to Walmart retail stores.” Walmart’s 60th anniversary further demonstrates the company has always been a ‘trend setter’ by staying ahead of the demands and expectations of its consumers. Since its inception, Walmart has proven its leadership through its online grocery developments, same-day delivery and pickup services, and many other conveniences and adaptions that some grocers might have struggled with during 2020. Walmart has been on top of these innovations and conveniences for a while and continues to stay ahead of the evolving market.


New Year’s Essentials


Category Analysis Bacon

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n American classic, bacon is “We continue to work directly with some pork products to family tables, known for its crunchy, salty our retail customers to streamline it’s best for us to keep our business as and delectable taste, and has become distribution in larger shipments and a family affair.” more versatile than some may realize. through distributors to bring down the Beeler’s Pure Pork, similar to PederWhether it is a side with breakfast, a challenging shipping costs,” said Dud- son’s Natural Farms, prides itself on hutopping for salads manely raising its pigs. or wrapping on a The company outlines “We are lucky to be a vertically integrated company. That helps us react filet, bacon has reits practices on its webquickly to change. In light of the stress currently in the supply chain and mained a staple for site to ensure its retail labor market, we are growing our pig herd and adding equipment in our many households. partners and consumfurther processing production facility at a pretty quick clip! Another truth Alongside this, the ers are educated on the that isn’t fun but very necessary in times like these is keeping our current state of the products they are purcompany healthy financially. That requires pricing considerations. We category has taken chasing. must also be the kind of company that our customers can trust us to bring several turns with In line with the redown costs when and if our market realities will allow.” new laws, progrescently established Cal— Neil Dudley, Pederson’s Natural Farms sive ways of thinkifornia laws, Beeler’s ing and innovative Pure Pork raises its ways to use the product. ley. “As mentioned above, growing our pigs without the use of gestation crates Since its inception, Pederson’s Natu- herds and farms allows us to both bring and prioritizes animal care standards. ral Farms has worked toward humanely down the cost of raw materials and The company also offers a line of nonraising its pigs to ensure the end prod- ensure the end consumer can rely on GMO pork products, which are raised ucts are made without artificial ingre- consistent quality, in-stock conditions, on specific farms that provide enhanced dients and preservatives. The recent and high product standards without the animal practices. proposition established throughout cost-saving corners cut by non-verticalClemens Food Group was founded in California fits right in with the compa- ly integrated companies.” 1895 by John C. Clemens and has exny’s core values. When it comes to Pederson’s Natural panded to become a six-generation fam“The simple answer is we are swim- Farms, cutting corners has never been ily-owned business. The company also ming as fast as we can to keep up with an option. The company prides itself on has a strong focus on humanely raising new bacon opportunities coming our its humanely raised pigs and the tech- its pigs through state-of-the-art bioseway, thanks to Prop. 12 in California,” nology used to ensure the quality of ba- curity systems, full-time veterinary and said Neil Dudley, Vice President of Ped- con exceeds expectations. According to nutrition staff and a goal to have 100 erson’s Natural Farms. Dudley, cheaper isn’t always the answer, percent group housing on all farms by “Sustainability and traceability con- and Pederson’s Natural Farms believes the year 2022. tinue to be front of mind for younger that supplier diversity is something Clemens Food Group has more 250 consumers like Millennials,” Dudley worth educating others on. company-owned and independent famcontinued. “With technology and social “I think the media is missing the ily farms throughout Indiana, Michigan, media, access to information and misin- mark on really diving into why supplier Ohio and Pennsylvania. formation are at an all-time high. Telling diversity is so important and what that Another leader within the categoyour brand’s story in an authentic and means for our food system,” said Dud- ry, Daily’s Premium Meats, has been in meaningful way will be more important ley. “We’ve all ‘paid the price’ for faster, business for more than 125 years. The than ever.” cheaper, more volume, etc. and while company was founded by John R. Dai“We are lucky to be a vertically in- some of those efficiencies can keep ly and James Walsh in 1893. The pair tegrated company,” said Dudley. “That costs down there needs to be balanced opened the Union Market, which was a helps us react quickly to change. In light diversity to truly have effective supply local retail meat market in Montana. It of the stress currently in the supply continuity. I feel the risk is far too great wasn’t until the 1980s that the business chain and labor market, we are grow- to have the nation’s supply chains ‘all in shifted its focus to mainly producing ing our pig herd and adding equipment one basket.’” bacon. In 1992, the company opened in our further processing production Beeler’s Pure Pork, a leading sup- a second bacon plant in Salt Lake City, facility at a pretty quick clip! Another plier of bacon, has continued to be UT and later in 2016, Daily’s opened its truth that isn’t fun but very necessary family-owned and operated since its third plant in St. Joseph, MO. in times like these is keeping our com- inception. The Beeler family owns the Today, the company strives to propany healthy financially. That requires original farm that started the company duce premium bacon products and pricing considerations. We must also be in 1846. According to the company, “We maintains its reputation as an industry the kind of company that our customers stick to the simple humane and natural leader and supplier for high-quality and can trust us to bring down costs when way of raising pork because when your innovative pork products. and if our market realities will allow.” goal is to deliver the very best, wholePG 6 / GR O C E R Y I N S I G H T



Category Analysis

Charcuterie Merchandising

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he last two years have allowed for consumers to flex their creativity. Charcuterie boards are versatile in providing a satiating snack combining a triad of carbs, protein and fat and allows for consumers to choose to integrate traditional ingredients or explore multiple categories to individualize their boards. Amidst supply chain disruptions, manufacturers in multiple categories remain dedicated to providing quality products and advocating for retail partners. To ensure a strong start to 2022, Partners, a tasteful choice company, is leading with three key attributes: familiarity, reliability and trustworthy innovation. “More than ever, consumers crave something familiar and comforting,” said Partners President Cara Figgins. “Our All-American snack crackers bring that homemade nostalgic feel to the shelves, with flavors like Crispy Cornbread, Sweet Butter, Salted Butter, Crispy Cheese and our new favorite, Jalapeño Cheddar Cornbread.” “Partners is also excited to announce our partnership with Source Atlantique, which specializes in the distribution of gourmet and natural foods sold through specialty retailers, natural and independent food stores, supermarket chains, mass merchandisers, clubs, foodservice and gift packers,” Figgins continued. “We believe this manufacturer-distributor and west-to-east coast relationship will strengthen our brand presence and product reliability across the US and provide the marketing strength and support that our small family-owned bakery needs to survive this ever-changing climate.” “The best way for us to ensure we have a good start in 2022 is actually the groundwork we laid in Q4 of 2021,” said Stephen Docherty, Marketing Analyst for Fiorucci Foods. “Last October, we launched Fiorucci’s first regional advertising campaign in the US, ‘Savor Every Minute.’ Through various media platforms, we invited consumers across the country to slow down and enjoy every moment they spend with their friends and family with elegant charcuterie and Italian meats. By the end of the year we garnered more than 21 million impresPG 8 / GR O C E R Y I N S I G H T

sions and nearly 1 million engagements with the campaign. We plan on building on this campaign with additional campaigns throughout 2022, including more media markets.” “Over the last two years, we have recognized the importance of being able to thrive in change,” said Irene Costello owner of Effie’s Homemade. “We have taken this opportunity to strengthen our internal performance, focusing on communication and professional development. These efforts have set the foundation for our team to excel in 2022 and beyond.” Consumers’ interest in selecting the right ingredients and mindfully crafting an appetizing and Instagram-worthy charcuterie board has made a meaningful impact on companies. “Charcuterie is taking on multiple formats, from large beautiful platters to small single-serve, prepacked kits,” Figgins said. “During the pandemic and restaurant shutdowns, a beautiful charcuterie plate feels like something special, like bringing a little slice of restaurant-style eating into the comforts of home.” “For years, we have provided single-serve items for food service, like our Partners Olive Oil & Sea Salt Crackers for Alaska Airline’s Fruit and Cheese Platter,” she continued. “With this year’s continuance of social distancing and smaller gatherings, we have seen a large increase in the need for single-serve individually wrapped items and are very fortunate that we are already experts in the process and have the capabilities to continue to support this rising trend. In addition, our large assortment of crackers already fits the need for charcuterie plates for small gatherings, with multiple cracker cuts and flavors.” “We see it regularly in the online community we’ve developed through social media, charcuterie content reigns supreme,” Docherty with Fiorucci Foods said. “However, we know consumers demand the very best from their brands, so we are planning to push the envelope in 2022 with new, innovative products to disrupt the category and provide new additions to our consumer’s boards. Additionally, we’ve seen consumers’ preference for online grocery shopping

steadily rise, so we are diligently working to increase our digital retail shelf presence with our retailers websites and also offering new e-commerce and direct-to-consumer outlets.” Pre-pandemic, consumers were shifting towards shopping for groceries online and enjoying the benefits of a hybrid experience where they could purchase essentials online and make thoughtful purchases in stores where they could consider brands and product and packaging appearance. Costello said with more people staying home, it caused “a seismic shift in online shopping and delivery services.” “As consumers have shifted towards online and delivery services, we have been focused on building our digital presence,” Costello said. “Leveraging new technologies and adapting to consumers’ behaviors and changing demands has strengthened our relationships with our retailer partners and positioned us to grow the business.” “For our retailers taking advantage of two technologies, increasing the brand awareness and the brand digital presence out there using new technologies like Instacart and making sure that we are best shown on all of the retailer sites has been huge,” she continued. “A lot of time and effort goes into it and the digital world is vastly different from brick-and-mortar. In the past, it’s ‘We’ve got to look good on the shelves,’ now we have to make sure we look good in the online shopping cart and they all have different platforms and portals. How are we positioning Effie’s in the best possible light digitally? How can we be the best partner we can be for the retailers digitally as well as in the store.” To continue being a reliable partner for retailers and distributors, “We have certainly been challenged by supply chain issues for the past year and a half,” Docherty said. “The best thing our team has done with these challenges is over-communicate with our suppliers, retailers, and distributors. We provide complete transparency to our customers and find them to be receptive and understanding. At the end of the day, suppliers and retailers are in this matter together.”


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Category Analysis Powdered Drinks

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onsumers who are bored with water and looking for new drink options at the grocery store have many choices these days. From seeking quality ingredients to promote hydration particularly during physical activity, to trying to reduce their consumption of single-use plastic containers and avoiding the need to lug 24 oz of liquid in a purse or backpack, a convenient and light-weight solution has taken the spotlight that addresses all of these issues: the powdered drink pack. Though historically this category featured overly sweet products with much kid appeal but little redeeming nutritional value, category leaders now are refining and creating product lines that align with today’s health-conscious and value-driven consumer. As the consumer consciousness has gravitated toward refillable water bottles, the powdered drink format has grown more popular as a portable drink product that only needs to be mixed with water to enjoy. “We continue to realize growth across all of our functional brands, like Super C and All Sport Elite,” said Joe Bouma, evp of Sales for Jel Sert. “Consumers have never been more focused on their health and wellness, and we know this won’t slow down anytime soon. At the same time, as inflation rises, households are under tremendous budgetary pressure. This puts quality and value at the highest of importance when making purchasing decisions. For Jel Sert, quality and value have always been part of our DNA, which lines up well with where the powdered sticks category is headed in 2022 and beyond.” Last year in a BevNet Magazine roundtable discussion with category peers, Jel Sert President Ken Wegner shared that the company’s energy-focused Pure Kick brand rounds out the functional brand offerings as it moves through its evolution from a legacy company to one that is still hip to the times. Wegner asserts its legacy brands are still very relevant to the discussion. “But on top of that, for us, we still see a tremendous amount of opportunity,” he said in the discussion. “Not only with those brands, but with the licensed brands that we are continually bringing PG 10 / GROCE R Y I N S I G H T

to the market; our Skittles item, our Starburst items have been unbelievable, doing really, really well in the category. And there are a lot of consumers out there that are still challenged from a budgetary perspective and if we’re doing something from a fun and flavor perspective, we certainly give them a great value.” Jel Sert embarks on its 96th year this year, said Bouma, but it has never wavered in striving to continue delivering consumer value. “In these uncertain times, it’s what our loyal consumer base wants and has come to expect from The Jel Sert Company,” he said. “We will also continue to invest in our production facilities to accommodate our rapidly growing Powdered Soft Drink and Freezer Pops businesses. In these last two years, The Jel Sert Company has seen a significant increase in consumption and new users. Also, in the previous two years, we’ve recognized the shift in when and where our consumers want to buy our products. Therefore, we will remain laser-focused on becoming a more digitally driven sales company. We will continue adding expertise and promoting talent to navigate the tremendous change and growth in the coming years.” Jel Sert’s recent acquisitions—what it calls functional brands like All Sport— represent only a sampling of all the moving and shaking happening in the category. Unilever in 2020 also acquired electrolyte drink brand Liquid I.V. Fabian Garcia, President of Unilever North America, said, “Liquid I.V. is an impressive and innovative brand in the fast-growing health, wellness and personal nutrition space. Liquid I.V. shares Unilever’s purpose to improve people’s health and wellbeing, as well as our ambition to create sustainable products that have a positive social impact.” Crystal Light may have gotten the ball rolling on healthier options way back in 2013 when the brand introduced Crystal Light Liquid, a portable drink mix from Kraft that was designed to appeal to the calorie-conscious consumer, and women in particular. “We’ve found that women are tired of choosing between taste and calories,” said a company rep-

resentative at the time of launch. “With Crystal Light Liquid, our new zero-calorie drink option, women can finally have it all—all of the flavor, but without the calories.” Crystal Light Liquid is sweetened with a blend of non-nutritive sweeteners and is caffeine-free, gluten-free and sugar-free. With most flavors containing between 0 and 15 calories per serving, Crystal Light drink mixes now come in both powder and liquid forms. The company markets its offerings as an excellent option for those interested in limiting sugar and for people with diabetes because many flavors contain 4 grams or less of carbohydrates per serving and are considered a free exchange. On the logistical side of the operation, no one was left untouched by the supply chain and labor issues that have plagued the economy since the onset of the pandemic, but Jel Sert didn’t come by its industry longevity simply reacting to a problem. “Our world-class Procurement and Operations Team was very quick to recognize back in March 2020 the importance of acting with speed,” Bouma said. “First, Jel Sert was very quick to modify the production facility and allow for a Covid-19 safe work environment. This has minimized downtime and missed production time. Second, with our scale, coupled with our long-standing relationships with our suppliers, we have been able to maximize buy forwards on materials and ingredients. Finally, while others in our category are third-party co-packed, we manufacture and produce all of our products. Fully controlling the manufacturing and production process has been a meaningful advantage in these uncertain times.” Realistically, Bouma offers the reminder that as much as the media has played up supply chain shortages, it is the labor deficit that will continue to impact the economy for the foreseeable future. “The major issue facing business now and in the near future is the labor market,” he said. “From our perspective, labor shortages and the associated increased cost are and will be the biggest issue in the months and potentially years to come.”



Category Analysis Sour & Novelty Candy

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hile the tail end of Gen X and They’re pumping up products like ours.” sense for us to continue to grow the segMillennials grew up daring each Haley Peyron, Marketing Coordinator ment that we’re in and expand on our other to consume candies that triggered for Candy Dynamics which includes the brand offerings, expand our branded massive puckering reflexes, makers of Toxic Waste brand, said social media has line to include more different types of sour and novelty candy are happy to re- helped sustain the growing populari- items and stay on trend with these curport the next genrent growth areas.” erations are also Nonetheless, Face “Retailers shouldn’t underestimate the power of novelty candy. Many fans of these tartest Twisters is an estabbelieve novelty candy is a fad that will soon sink in the market. However, of confections, but lished and recognized the novelty of Toxic Waste, especially that of the drums becomes a now they have Tikbrand and is still seecollectible to the children who love the candy. There will always be a Tok. Sour candies ing growth. “Everyplace for novelty candy in the market, so we should work to make it a have grown more thing in our line of more permanent part of any retail location.” popular in the last products is sour, thus — Haley Peyron, Candy Dynamics decade or so as the name Face Twistsocial media helps ers,” Schuster said. “It’s propel these companies toward more ty of the brand in the last year. “Due to a 22-year-old brand and our line covers growth and opportunities. The chal- the large number of videos showcasing the gamut of sour to include sour powlenge these days is in convincing gro- our product on TikTok, we have started der, sour taffy, sour bubblegum, sour cery partners to expand their novelty toying with candy that has a play-fac- chewy items and some new items that candy assortment, and these companies tor; meaning a product that is as great will come this year as well. Sour is reare ready with numbers and figures to to use as it is to taste,” she said. “Hav- ally what you would call a sub-segment do just that. ing the play-factor allows users to show within the candy industry and has been Steve Schuster, of Schuster Products, more in a post as opposed to simply giv- consistently growing year after year for makers of Face Twisters Sour Candy, ing a review of the taste. We’re finding approximately 15 straight years.” shared some IRI data figures for US strong correlations between what kids Peyron brings the point home. “ReFood from December 2021, including are seeing on TikTok and their buying tailers shouldn’t underestimate the that novelty non-chocolate is up 31.6 habits, especially that of candy.” power of novelty candy. Many believe percent. “So that would be your fastest On the heels of its growing populari- novelty candy is a fad that will soon growing everyday category in grocery. ty, Candy Dynamics last fall announced sink in the market. However, the novThe only other items that are higher it had partnered with Surge Brands to elty of Toxic Waste, especially that of than that would be seasonal chocolate create branded products based on Tox- the drums becomes a collectible to the valentine candy which is seasonal,” he ic Waste Slime Licker and Toxic Waste children who love the candy. There will said. “If you looked at multi-outlet plus Hazardously Sour Candy. “Our iconic always be a place for novelty candy in convenience, you’d be at 29.6 percent Toxic Waste drum still remains a favor- the market, so we should work to make over those past 52 weeks and you’d be ite among sour-candy-loving children,” it a more permanent part of any retail 39.5 percent over the past four weeks. Peyron said. “Within the past year, we location,” she said. So, I think grocery is an area that real- have been working to bring out a candy For all of their gusto, these companies ly needs to address novelty and expand unique to the American market while also note the current issues facing the sour as a major opportunity for them. still being reminiscent of our brand. national supply chain casts a bit of a They’re starting to address it as we The success of Slime Lickers last year cloud. “For our company and our brandspeak but it’s not yet a national trend.” brought new eyes to our brand, but this ed family, the year brings an enormous Schuster speculates, “The grocery year we aim to bring this increased at- amount of anticipation and excitement mindset might be that kids aren’t shop- tention to new products.” because of huge demand for our prodping in the stores or the mindset might Schuster said Face Twisters is taking uct on a national basis,” Schuster said. be that the parents aren’t going to buy notes of general trends in candy as well “At the same time, there is apprehenfor the kids. Whatever it is, but you can as overall grocery. “We’re going to stay sion due to all of the unknown factors imagine if you have a limited sub-set on trend with what we’re doing,” he and uncontrollable that exist throughof novelty items in the grocery stores, said. “There’s obviously new trends that out the entire supply chain process and and off of the limited subset, it’s still are taking hold in the candy industry inability to deal with inflation et cetera.” growing 29.6 percent, which is one of which would include more sugar-free And yet they operate on good faith the fastest segments of all candy items alternatives, more low carb alterna- and hope prospective retailers will in grocery stores, that would be an area tives, more better-for-you alternatives, come around to sour candies. “We’re to pounce on. That would make intui- a plant-based alternative. These are really loyal to the companies we deal tive sense. Basically what we tell people new areas which have had some major with,” he said. “And we have a lot of exis the kids are voting. They are voting success, but we have 22 years of expe- perience, not only in the candy industry, through online, through social media. rience in the sour category, so it makes but in particular the sour segment.” PG 12 / GROCE R Y I N S I G H T


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Category Analysis Fudge

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eal ingredients coupled with nostalgia have helped boost sales within the fudge category during the past couple of years. The fudge category is experiencing a dramatic boost in popularity and demand which suppliers link to fudge made with real ingredients and the reality that fudge is relevant year-round, not just during the holidays. While everyday chocolates serve a purpose, fudge suppliers have helped consumers realize they can expect more from chocolate treats, and fudge is the answer for those craving a premium and refined indulgence. “We shifted gears in late 2021 when we suspended our wholesale program,” said Jake Bloss, Director of Sales, Digital Marketing and Talent Acquisition for Northern Confections. “We did this to better serve our distributors as a manufacturer. We no longer drop ship to direct customers.” “First thing for us is we’re looking to move into a new building in this first quarter, hopefully by the end of this first quarter,” said Ed Stockton, Owner of Country Fresh Food and Confections. “We’re really looking forward to that because it puts us at a much larger facility, a much more modern facility and it will support our growth. We have definitely outgrown where we are and we have a lot of new equipment to install to improve efficiencies and support some of our other projects—packaging redesigns, and what have you. Plus it gives us more room to have storage for a lot more inventory we carry on hand now as we try to circumvent some of the problems of the past year or two of getting supplies or having trade issues. We just try to carry a lot more.” “Last year we saw a tremendous growth in our chocolate and fudge sales,” said Amanda “Mandy” Hughes, Chief Customer Officer for Sweet Shop USA. “We purchased Big Little Fudge back at the beginning of 2020 and so with everything going on, for this year so far, we’ve seen more and more growth in both fudge and chocolate sales. When Covid hit, we thought our chocolate sales would go down, but it’s been amazing how it’s grown by 25 percent this last year.” PG 14 / GROCE R Y I N S I G H T

“We see ourselves as a pinnacle manufacturer in the confections category,” Bloss said. “We manufacture traditional Mackinac Island Candy with recipes going back more than 100 years. We have refined our processes and have spent the last three years renovating a newer, larger facility. Our goal is to continue to grow our footprint. We want the world to experience the joy of Mackinac Island without having to wait until summer. Our company mission is to make Devon’s Mackinac Island Fudge and Candy Co. into a household name like Hershey or Mars. We also plan to continue to add to the confections that we offer, including importing specialty candy made in other countries.” Country Fresh Food and Confections offers finished fudge, packaged fudge options, mixes and private labeling and assorted grades and styles of packaging to suit a variety of needs including impulse buys and shelf displays, said Stockton. “We offer more than 100 flavors now in finished fudge so we will be expanding some of those flavors more in our packaged lines. For example, we have a 12 oz package we offer 85 flavors in. We are going to expand that to where everything we do and finish will be available in it. And then we do a 6 oz size that is offered in 26 flavors and by having the new building and the room to put it, we will be able to expand that at double the offerings there. Then we’ll also be expanding and focusing on our keto-friendly and sugar-free fudge—more packaging of it. We are also expanding our fudge mix offering for those folks who want to make it on premises so that program will be expanding somewhat too,” he said. “We are one of the very first to develop sugar-free fudge and about the only ones that ever made it taste good,” he added. “It is diabetic safe-plus it hits the mark for all of the people that are doing low carb, or actually just about any diet because it’s also reduced in calories. It’s a good product and it has a few healthy benefits like the dietary fiber that we’re supposed to get in our system every day. It does all that and hits people a little more digestively friendly than some others out on the market.”

“We have seen that especially the past couple of years because we’ve had very high double digit growth and then we have customers, for example, like Nuts.com who are a big online retailer and we have seen their orders jump by 1,000 percent because people are doing online shopping and still wanting. The thing about it is people also seem to have gravitated toward wanting more premium product,” Stockton with Country Fresh continued. “They’re cooped up, they can’t go out and do everything they want, so they feel like ‘Hey, I deserve this.’ That’s what we try to give them with our product because we use Belgian chocolate, Dutch cocoa, high grade cream and butter—all of the good stuff, it’s in there. We do private label for Cracker Barrel; all of their stores across the country. It’s becoming an important category for them because again people want to treat themselves and just take that little edge off of all of the other stuff going on in this world. It’s a retreat that still brings them nostalgia. Maybe they remember grandma making some for them or what have you.” “Sometimes we’ll have people that taste our peanut butter fudge because we don’t use any artificial flavoring — the flavor comes from peanut butter and pure vanilla—and I’ll have people say, ‘Oh my gosh, it tastes just like my grandmother made or my mom made for me!’ and of course you know everything was better when you were a kid. It’s a compliment. It makes us feel good, of course. That’s what we wanted to do was stir up those memories,” he said. Sweet Shop USA plans to revitalize its packaging and has partnered with designer Jeff Granito. “He’s designed for Disney, Warner Bros., DC Comics, Nickelodeon, Paramount Pictures and now he’s designing for us,” Hughes said. “We’re hoping to come up with some new and cool designs with him. He’s working on Christmas and Halloween packaging, so we’re excited.” “Supply chain challenges continue to keep us on our toes,” Bloss said. “With Covid slowly improving we are excited to get back to in-person tradeshows, and we are excited to get back out on the road.”


Country Fresh Fudge “The Finer Fudge” TM

One Stop Shopping *Finished Pre-Cut Fudge * Over 100 Flavors * Packaged Premium Fudge * Private Label Fudge * Keto-friendly, Sugar-Free * Premium Fudge Mix CountryFresh Food & Confections, Inc. 800-545-8782

info@countryfreshfood.com