January 2024 Grocery Insight

Grocery Insight January 2024

A FRESH LOOK AT CATEGORY INNOVATIONS AND THE EVOLVING CONSUMER DEMANDS IN THE INDUSTRY Inside • Special Report: H-E-B 2 • First Take: Bison 6 • First Take: Soups 14 • First Take: Onions 18 • First Take: Gourmet Snacking 22 • First Take: Allergen-Friendly Candies 24 • First Take: Sour Candies 26 • First Take: Pierogies 30

Special Report H-E-B

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n 2023, the consumer research firm dunnhumby named H-E-B as the No. 1 US grocery retailer factoring in five key drivers: price, speed and convenience, quality, digital and operations. More recently, the Texas-born and bred company also took the No. 5 spot on Forbes’ list of Best Large Employers in America.

While clearly a source of pride for the company, these distinctions are but a footnote in H-E-B’s storied history as not only a significant provider of jobs and nourishment for the state of Texas (and northern Mexico) but also an entity steeped in the culture and values of the state in celebrating and supporting their local communities whenever and wherever possible.

History

In 1905, Florence Thornton Butt opened Mrs. C.C. Butt’s Staple and Fancy Grocery in Kerrville, TX, on the ground floor of the family home. According to Forbes, she started the business after her husband was diagnosed with tuberculosis and was unable to work. She turned the management of her business over to her son, Howard Edward Butt in 1919, who oversaw numerous upgrades and expansions during his tenure, along with several name changes including C.C. Butt Cash Grocery and H.E. Butt Grocery Company before he opened the first H-E-B store in San Antonio, in 1942.

According to the Texas State Historical Association, H-E-B stores carried no beer or wine given that Butt was a traditional Baptist deacon until his son, Charles C. Butt, took over as president and chief executive officer of the company in 1971. Under his leadership, H-E-B opened its first Central Market store, offering organic and international foods, in Austin in 1994 and opened the first store in Mexico three years later. The H-E-B Plus! Stores, focusing on non-food items, were introduced in 2004; Mi Tienda, catering to Latin tastes and preferences, came about in 2006 with the first location opening in south Houston; and Joe V’s Smart Shop, a discount grocer, was introduced in 2010. In all this time, annual sales grew

from $250 million in 1971 to $34 billion when he stepped down in 2021.

Now with more than $38 billion in annual sales, H-E-B is the largest privately held employer in Texas, employing more than 154,000 people in its workforce and operating more than 430 stores in Texas and Mexico.

Expansions

In the span of just a few months last summer, H-E-B opened or announced openings in several of the Texas metro areas it serves. There is long-game strategy in its growth and expansion, according to a recent article in The Real Deal covering real estate news. “Part of that strategy is land banking. By the time the population spreads to the next city, H-E-B already owns the best commercial parcel near land zoned for residential uses,” said the article.

“They’ve been the most strategic of any grocer in being able to break into the North Texas market,” Danny Lovell, President of the Rainier Companies, told The Real Deal. “They have been way out in front of everybody.”

In 2023, H-E-B opened its largest e-commerce fulfillment center—at more than 100,000 square feet—in Katy, TX, outside of Houston, to support curbside and home delivery orders across the Houston area.

In July, H-E-B opened a 118,000-square-foot store in McKinney, TX, the third store in the Dallas-Fort Worth metro area. The new location, employing about 750 people, features True Texas BBQ; full-service H-E-B Pharmacy with a drive-thru; fuel station and car wash; and Home by H-E-B home décor department featuring furniture, woven textiles and accent pieces from the Haven + Key and Texas Proud collections. The store, which also offers H-E-B Curbside and Home Delivery, joins the existing Frisco and Plano H-E-B locations along with six Central Market locations in the DFW area. Construction on a second Frisco location was announced in May. H-E-B stores in Alliance, Allen and Mansfield—which are the only other future H-E-B store locations the retailer

has announced in the DFW area—are currently under construction. H-E-B also announced plans to open two Joe V’s Smart Shop by H-E-B stores in Dallas, the first locations the multi-format retailer will open outside the Houston area in late 2024 and early 2025.

“With the introduction of Joe V’s Smart Shop to Dallas, we are excited to build on our longstanding presence in the area and commitment to serve more customers in this dynamic and growing part of Texas,” said Roxanne Orsak, H-E-B Chief Operating Officer.

“As a multi-format retailer, we have developed a variety of brands and formats to best serve our customers across the state. With each store we open, our goal is to provide the best shopping experience, offer fresh, top-quality products and create jobs and career opportunities that help build a stronger community.”

To further support its growth, H-E-B opened a 55,000-square-foot e-commerce fulfillment center in Plano, TX in June. The center was envisioned to support curbside and home delivery orders throughout Plano and for surround stores including Frisco and the planned McKinney and Allen stores.

Meanwhile, further south, H-E-B in July also began construction on a new store in Pflugerville, a community north of Austin. It is expected to open in Fall 2024. At 127,000 square feet in size, the store will be the third H-E-B store in Pflugerville alone. H-E-B’s first two Pflugerville stores opened in 1987 and 2000, respectively.

“We are thrilled to start construction our third store in Pflugerville, a growing community we’ve proudly been a part of for 35 years,” said Cathy Harm, H-E-B Senior Vice President Central Texas. “We look forward to serving our dedicated customers in this part of Travis County with a new store that offers a wide assortment of quality products, innovative services and the best of what H-E-B has to offer.”

The company also revamped the site r Cont'd on Pg. 4

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Special Report: H-E-B r From Pg. 2 of Austin’s Nutty Brown Café & Amphitheatre, which operated as a music venue for more than two decades and opened a 107,000-square foot store at that location in early July. The property was originally home to Nutty Brown Mills, which served as a flour mill and candy shop.

“This is a special store at an iconic site, and we are excited to preserve and showcase the history of such an important landmark as well as provide a unique shopping experience our loyal customers will be proud of for decades to come,” said Sarah Longoria, Nutty Brown H-E-B Top Store Leader.

Demonstrating its dexterity, H-E-B last spring also revamped its H-E-B convenience stores by introducing the H-E-B Fresh Bites brand, envisioned to provide customers with more fresh options including produce, prepared food and convenient meal choices. The first H-E-B Fresh Bites opened in April adjacent to its Leander, TX store. It also features the company’s second True Texas Taco restaurant.

The True Texas Tacos concept, which H-E-B launched in San Antonio in 2018, showcases a menu of more than a dozen breakfast and specialty tacos made with fresh ingredients. Tacos range from traditional Tex-Mex offerings such as bacon and egg and bean and cheese to specialty bites such as barbacoa and chopped Texas brisket. All flour tortillas are made in house and corn tortillas are available upon request. There’s also a salsa bar.

The second H-E-B Fresh Bites opened in June in Lytle, TX—also featuring a True Texas Taco restaurant. With this location, H-E-B operates 12 convenience stores throughout the state, which all have fuel stations and car washes.

Key Leaders

The Butt family continues to hold both legacy and functional leadership positions at H-E-B. Charles Butt remains Chairman though his nephew Howard Butt III took over as CEO in 2021.

Charles’ sister Eleanor Butt Crook also continues to serve on the company’s board of directors. Howard’s younger brother Stephen is president of the Central Market banner, which he’s led since PG 4 / GR O C E R Y I N S I G H T

1999.

Craig Boyan assumed the role of president in 2010. He had initially joined the company in 2005 as H-E-B’s chief strategic officer. Boyan had worked at Monitor Company, a global consultancy based in Cambridge, MA and founded Monitor’s New York office prior to coming to H-E-B. In early 2022, industry news reported that long-time President of H-E-B Food and Drug stores Scott McClelland was to retire by year-end. Boyan said at the time of the announcement he would continue to serve on the H-E-B Executive Committee and as an adviser on the company’s expansion into the DFW area. Meanwhile, Armando Perez, evp of Houston Food and Drug stores; Bill Anderson, evp of San Antonio Food and Drug stores; and Juan-Carlos Rück, evp of North West Food and Drug stores, would be reporting directly to Boyan.

Outreach

As H-E-B continues to make substantial inroads in Texas real estate, the company has never shied away from celebrating its Lone Star State history and culture, continuing to invest heavily in its education, innovation and environment.

The company’s environmental leadership led it to take on a producing role last summer as it worked with Austin-based Fin and Fur Films to release a series of documentary films focused on conservation efforts in the state of Texas. The five films, which are available at ourtexasourfuture.com, look at the creation and diversity of the Texas State Parks system as well as tell compelling stories from Texans working to preserve habitats for bats, black bears, ocelots and redfish.

“H-E-B has a deep commitment to support all Texans, and that includes helping to protect, conserve and beautify our great state for people to enjoy now and for generations to come,” said Leslie Sweet, Managing Director of Sustainability & Environmental Affairs.

“We’re excited to support these passionate filmmakers and their mission to tell important stories that we hope will inspire people to celebrate and protect the diverse habitats, unique wildlife and beautiful landscapes across Texas.”

Through a decade of hosting its Quest

for Texas Best competition, H-E-B has also celebrated and elevated close to 1,000 unique food items, beverages and general merchandise via placement on its store shelves. In the last 10 years, 180 finalists have made it to the judges’ table. They represent a dynamic lineup of small local businesses owned by women, minorities and military veterans with diverse backgrounds. Since launching the contest in 2014, H-E-B has awarded $2 million in prize money along with marketing, mentoring and supplemental support. Additionally, H-E-B has awarded 50 Quest for Texas Best suppliers with a commemorative H-E-B Million Dollar Club belt buckle for achieving $1 million in sales.

“We recognize the important role small businesses play in our industry and welcome the opportunity to support their journey,” said James Harris, Sr. Director of Diversity & Inclusion and Supplier Diversity for H-E-B. “Not only are we supporting small business in Texas, we’re also expanding our selection of innovative, diverse and quality products our customers expect.”

Along with celebrating Texas’ entrepreneurial spirit, H-E-B also invests in the state’s higher education initiatives, last year making a $2 million gift to support experiential learning and workforce development programs at The University of Texas at San Antonio (UTSA) School of Data Science (SDS) and the university’s Prefreshmen Engineering Program (PREP).

In K-12 education, H-E-B celebrates the state’s top educators through its Excellence in Education Award program. The company in 2023 awarded $430,000 in cash awards and grants to eight educators, two school districts, one early childhood school and a public school board. Since its start in 2002, the program has awarded more than $13 million in cash and grants to Texas teachers and schools.

With a robust long-term strategic growth plan focused on real estate development coupled with high profile investments in the Texas communities it serves, H-E-B is positioning itself as a formidable presence in the state that has mass appeal for its geographically, ethnically and culturally diverse customer base.

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First Take Bison

Key Takeaways

• Consumer Education and Palate Expansion: Bison promotion has transitioned from prioritizing trial to expanding its use as a staple in foodservice and retail markets.

• Growth and Sustainability Efforts: 1) Category leaders emphasize consumer awareness of and appreciation for the American bison story for long-term growth.

2) Sustainability efforts include supporting family ranches facing challenges like high feed costs and drought.

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hile educating and encouraging consumers to expand their palates to try bison has become a growth driver for the category, bison has started to become less of a trial and more of a staple in foodservice and retail markets. Leaders in the space have been able to help consumers easily enter the category and remain loyal to it through their high-quality product offerings.

“For us, the key has always been product quality awareness,” said Rocco Verelli, President of NorthFork Bison in an earlier interview. “We are strong believers in educating the buying public on the quality and advantages of bison meat. Our packaging along with our website is filled with all kinds of information designed to help the consumer make informed buying decisions.”

NorthFork continued to address that although bison offerings have grown to include both ground meat as well as steak cuts, the typical fresh cut still isn't found at grocery retail.

“In so far as the grocer being able to offer fresh bison cuts, this is really a question of supply and demand. Today, volumes aren’t really high enough to be able to justify it,” Verelli continued.

“Our business is split pretty much down the middle, with approximately half going to foodservice and restaurants and the other half going to retail,” said Verelli. “Our retail business is mostly built around various steak cuts, with a smaller portion going to our ground products. At Northfork Bison, this breakdown between foodservice and restaurants and retail has evolved over the years to where we are today. As always, this ratio is very much driven by demand.”

When it comes to doing business in both foodservice and retail, there is a delicacy in the production and the

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way companies split up the meat to ensure their partners are receiving premium quality packaged meat. “Average bison carcass weights are actually smaller than average choice/prime beef carcasses,” explained Bob Dineen, Founder and President of Rocky Mountain Natural Meats, which produces the Great Range Bison brand, said in a previous interview. “Bison produces all the same cuts that are produced from beef carcasses. There is a limited quantity of steak cuts per animal. Some grocers merchandise whole primals in the full-service meat case, but we have found providing these cuts in case ready vacuum packaging helps the grocer with labor and food safety concerns.

Providing pre cut steaks, roasts, stew meat, etc. in a case-ready package has opened the doors for us to move more middle meats. With restaurants putting more and more steak cuts on the menu, we also produce portion cut steaks to offer the convenience this provides. It is always a balancing act to determine where the cuts are going, we try to distribute the available cuts as best we can.

The bison industry is small and as a result fragile. Utilizing our own in-house grading standards, we can ensure the quality and consistency grocers and food service operators demand.”

“Ground bison has become increasingly popular at retail and is our best-selling product,” said COO Ace Ward for Rocky Mountain Natural Meats. “The availability of steak cuts is dependent on the demand for ground bison. In order to achieve full carcass utilization we must balance ground demand and steak demand. This is not easy and can result in limited availability of steaks. At the end of the day, bison steaks are almost a by-product of ground bison. Retailers choose the vac-

uum-packed steaks for labor reasons, and we have the equipment and staff to continue to grow this category.”

Great Range Bison’s leadership efforts reflect the company’s dedication to providing for its partners and consumers. “We are trying to keep the family ranches going and they have had a rough couple of years with high feed cost as well as the drought. We will have to pay more for animals just do to supply and demand as they bounce back with all the good rainfall we have had the past six months,” Ward previously said. “This year has been very tough with inflation and the economy; we are seeing steady sales but the bison market, like the beef market, is tight on animals with the drought, and then with all the recent rain we are going to see producers keeping animals back so it will tighten up even more.”

Similarly, NorthFork Bison has been striving to ensure more sustainability in the category through education and awareness. “We believe that the key to growth and sustainability for the bison category is very much tied to consumer awareness,” said Verelli. “The more people come to understand that not only is bison raised in a more natural environment, but it is also healthier for you, the greater the acceptance. Widespread consumer approval is what will ultimately ensure a solid future for the bison industry. Even though bison will always be a tiny fraction of the beef industry, it is certainly well positioned for long-term growth and stability.”

“When it comes to bison products, we currently offer the widest array possible. Our focus will always be on continuous improvement by incorporating leading edge technologies in processing and packaging,” said Verelli.

First Take Eggs

Key Takeaways • Growing Consumer Awareness: Egg quality has improved with more humane chicken raising practices such as appropriately sized housing and free-range living conditions.

• Product Innovation and Market Trends: Leading brands are introducing specialty egg options while catering to consumer demands for high-quality, ethically and humanely produced eggs.

• Market Anticipation and Supply Chain Stability: Producers recognize the impact of avian influenza on the egg market and are grateful for farmers who continue to maintain bird health and food safety.

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onsumer awareness of the benefits and versatility of eggs as a leading protein has grown immensely through the years. The education surrounding the different ways farmers distribute eggs and raise their chickens is also on top of mind for consumers. Leaders in the category are enlightening retailers and consumers on the ways they are humanely raising chickens, whether it’s appropriately sized housing or allowing chickens to roam, and how these conditions positively impact the quality of the eggs hens produce.

“Happy Egg has introduced an 18-count of our certified Organic and original Free Range eggs to grocery store shelves, ideal for families or people entertaining and who want a premium, free range option. We’ll also be continuing to support our 12-count of these offerings and serving as a trusted resource for our retail partners as they work to make their egg sets as efficient and easy for consumers to shop as possible,” said Whitney Fortin, VP of Marketing at Happy Egg Co. “We are very excited for 2024 and the opportunity to service the consumers looking for specialty eggs. We plan to launch an elite egg that we have had many requests for, so stay tuned for that. I believe 2024 will be another year of people learning about the mega farming practices that support the shelf and push for clarity on where their eggs are actually raised. Labels and buzzwords are very deceiving and cause confusion,” said George Weaver IV, Customer Relations Manager with Utopihen.

Consumers aren’t always willing to sacrifice quality for a lower price point as they continue to increase their awareness of what they are purchasing and choosing to feed their families. “Consumers’ interest in buying

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high-quality foods for their family and knowing where their food comes from continues to be a strong driver in purchasing decisions. Shoppers are getting more conscious in their choices, which is why they appreciate Happy Egg’s humanely raised eggs which offer farmfresh flavor and golden sunrise yolks in every shell. Consumers see firsthand that the humane treatment of our hens, which are happily raised on more than eight acres by small family farmers, leads to eggs that are superior in quality and taste,” said Fortin.

The versatility of eggs has become a key factor in the category’s growth and innovation as leading producers recognize that consumers are demanding convenience alongside better-for-you, high-quality egg products. “Launched last spring, Jimmy Dean Egg Bites are a protein-packed breakfast that’s ready in minutes and perfect for on-the-go consumption,” the Jimmy Dean brand said in a previous interview. “The Egg Bites are fully cooked and contain fluffy, whole eggs baked with premium Jimmy Dean Sausage or Bacon, and real cheese. The Jimmy Dean Brand has decided to introduce Egg Bites to provide consumers with a delicious and convenient meal that is on trend with that of their favorite breakfast spots. This innovation moves the category forward by providing consumers with a level of convenience that is unparalleled in the breakfast category; all consumers need to do is reach for Jimmy Dean Egg Bites in their freezer, heat thoroughly and enjoy.”

“The success of the Jimmy Dean Brand in the breakfast category can be directly attributed to the fact that the team has placed great emphasis on the research and development of products based on consumers’ consumption habits and

meeting them where they are through their tastebuds,” the brand said.

Meanwhile, as more states move towards the banning of caged hens, Utopihen anticipates consumers will see a continued rise in specialty eggs. “As well as large egg producers starting to offer ‘specialty’ eggs to diversify their portfolio. Consumers are continuing to ask for our niche eggs: Pasture Raised Soy Free eggs, Pasture Raised Duck Eggs, and Omega-3 Free Range eggs. It’s these lower movers that will drive an overall higher basket value per consumer in the stores. Retailers that want to attract the natural consumer need to have at least one niche SKU to elevate their egg set,” said Weaver.

“We would consider the current supply chain conditions to be at a ‘normal’ place, in which we are very thankful for. The rise and fall of avian influenza have an impact on the overall egg market which will make a difference in the number of eggs in the US to feed the people. We are grateful for our farmers and community that work very diligently to keep our birds healthy and safe,” said Weaver.

Consumers are becoming increasingly aware of the correlation between humanely raised chickens and the quality of their eggs, which is leading to more selective and intentional purchasing habits. Realizing that shoppers are supporting companies that prioritize animal welfare, egg category leaders are unveiling specialty eggs that reflect consumers' demands for quality and ethical production practices. In addition to humane treatment of animals, farmers are focused on keeping birds healthy and taking preventative measures against diseases, which subsequently leads to safe eggs and peace of mind for households.

First Take Maple Syrup Key Takeaways • Health and culinary trends: Suppliers are positioning maple syrup as a versatile and wholesome alternative to traditional sweeteners, offering essential minerals, antioxidants and bioactive plan compounds.

• Diverse Applications and Partnerships: Companies are collaborating with chefs and restaurants as a strategy to highlight and educate consumers about the many diverse ways to use and incorporate maple syrup.

• Market Outlook and Stability: Suppliers are more confident about meeting demand and maintaining stable prices this year, while still allowing for fluctuations in climate and economic impacts out of their direct control.

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s consumers dig into their New Year’s resolutions surrounding diet and wellness, premium maple syrup suppliers are ready to show them a healthier and less processed way to enhance and sweeten their favorite foods.

This assortment of product iterations and recipe ideas help keep culinary adventures in the kitchen novel and exciting. These clever applications are not confined to home consumers, as several maple syrup suppliers are also partnering in food manufacturing and private label to integrate pure maple syrup into everything from baked goods to meal kits.

Last summer, Bascom Maple Farms, which includes Coombs Family Farms, attended the Institute of Food Technologists 2023 Annual Event and Expo in Chicago to showcase its suite of clean label, organic and 100 percent pure maple syrup and maple sugar solutions.

Arnold Coombs, Executive Director of Sales and Marketing, Bascom Maple Farms and Coombs Family Farms said, “From savory appetizers and entrees to trendy cocktails and sweet desserts, our high-quality and sustainable 100 percent pure maple products provide a delectable sweetness with consistent flavor and a recognizable, clean and sustainable label. Additionally, maple syrup provides essential minerals, antioxidants and bioactive plant compounds unlike traditional sugars, to offer a more wholesome alternative that today’s consumers demand.”

Steven Anderson, President of Anderson’s Maple Syrup, said the company was following a similar path in cross promotions with local chefs and restaurants in which these professionals would be using Anderson’s maple syrup in their dishes and offerings. “Our real focus for 2024 is to show value,”

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Anderson said. “Keep the price as low as we can and show customers how Anderson’s Maple Syrup is not only a great tasting option for their family but also a healthier option. We are going to see maple syrup used more and more in other items. As we move towards a healthier country, more and more [people] will find ways to use maple syrup in their everyday lives not only on pancakes but as a sweetener for many cooking and baking projects.”

Maple syrup is a special product, asserts Beth Calcagni, Marketing Coordinator for Butternut Mountain Farm.

“We’re making sure to highlight the product attributes and options that Butternut Mountain Farm has to offer retailers including specialty products, specialty packaging, private label and branded, as well as solutions for commissary and in-house kitchens and bakeries,” she said. “As the industry continues to evolve, we foresee an effort to expand consumer knowledge about the different classes of maple syrup based on increased consumption and special promotions. Focus will return to pure maple syrup as a core pantry staple that can be used in various ways spanning sweet and savory applications.”

How creative consumers and food professionals can be with maple syrup will determine where the category will go, said Calcagni. “The trend of unexpected flavor combinations can shift the direction of the maple syrup category,” she said. “Maple syrup has a number of pairing partners ranging from miso and soy sauce to bright fruity flavors to salty cheeses. As consumers learn more about the different classes of maple syrup, and their unique flavor profiles, combining maple syrup with other flavors will illuminate the versatility of maple as a kitchen staple.”

Companies like Crown Maple are reaping the rewards of this outside-thebox thinking with regards to the category. In November, the company became a brand partner in a partnership between Top Chef star Tom Colicchio and NBTV Studios to launch a new v-commerce integrated series called The Pantry on Spirits Network. CEO Mike Cobb said, “We expect consumers will increasingly recognize the benefits of maple syrup as a more flavorful, versatile and healthier alternative to highly process sugars. This includes the continuation of consumers discovering how highly versatile maple syrup is as a premium ingredient capable of enhancing any recipe, food, beverage or cocktail. Much like premium olive oils and balsamic vinegars, maple syrup is a go-to to create exceptional recipes and beverages.”

To accommodate the increased interest in experimenting with maple syrup, suppliers report the whims of Mother Nature notwithstanding, other aspects of maple syrup supply for the new year appear to be stable—hopefully including price. There are “no expected major changes in our category,” said Cobb. “We do expect to continue to see cost reductions in BOM [bill of materials] that will help to moderate pricing.”

Anderson of Anderson’s Maple Syrup said, “As with any agricultural product we are dependent on Mother Nature.

Over the years we have seen many ups and downs in the supply of maple syrup due to the seasonality of the crop. At this point there is enough syrup to get us into the next crop [Spring of 2024], but the surplus that we used to be able to rely on as a backup is getting smaller, so everyone is hoping for a good crop in 2024. If an average to good crop occurs there will be no supply issues and most likely no price increases either.”

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First Take

Produce Snacking Key Takeaways Trends in Produce Snacking: 1) Producers are leaning on bite-sized fruits and vegetables to drive sales in the snacking category due to their easy-to-eat and fun format.

2) Items that are conducive to snacking, like cherry tomatoes, are gaining in popularity and inspiring growers to explore further avenues of innovation with different vine varieties.

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ite-sized fruits and vegetables have remained at the forefront of the produce snacking category and for good reason. The category presents a fun and appealing way to encourage people young and old to eat healthier and in a format and texture that delivers a crisp bite or a sweet burst such as dipping carrot sticks in ranch or hummus, celery sticks in peanut butter or berries in fluffy creams.

"In 2024, we’re expecting to see a continued push for healthy options," said Jim Roberts, President of Sales for Naturipe Farms. "Fitness, health, and overall holistic wellness have grown in popularity amongst consumers, and we’re expecting to see blueberry sales increase as a result. Blueberries are a natural fit for the health-driven consumer: they’re chock-full of antioxidants, vitamin C and fiber."

"We’ve also seen an increase in consumers being interested in 'specialty' versions of their favorite berries— think bigger or different color berries that have that unique, viral quality for social media," he continued. "At Naturipe Farms, we’ve spent years carefully growing perfectly sweet, juicy, jumbo versions of our classic blueberries and strawberries. We’re also bringing to market our new Sweet Selections line, which features flavor-forward varieties that share the same quality as our other varieties but with a more robust flavor profile. We’re expecting this to be a trend in the industry: people love trying something different!"

“Snacking tomatoes are gaining popularity year after year, and we continue to see consumers gravitating to 'on the vine tomato' offerings like our cherry tomatoes,” said Ryan Cherry, Director of Sales for Windset Farms. “We recently came out with a tri-colored tomato pack that has red, orange and brown cherry

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tomatoes on the Vine (Tri-colour Cameo Cherry Tomatoes on the Vine). People love the peak freshness and ripeness that comes with on the vine tomatoes, coupled with the intense sweetness and pop of color our cherry varieties boast, it has definitely been an exciting addition to our product line.”

“We also continue to diversify with more unique tomato varieties,” Cherry continued. “At Windset, we’re constantly trialing new varieties, experimenting with different flavors, different colors, different yields. We’ve brought to market some cool, one-of-a-kind tomatoes that consumers enjoy; most recently our YOOM® Cocktail Tomatoes on the Vine. It has an umami flavor with a deep purple, almost black hue, which really stands out on produce shelves. Consumers’ palates are expanding, leaving room for growth in the tomato category, which is always fun for us!”

“You’re not snacking on chips or junk food; you’re having something healthy that tastes good, is fresh, nourishes the body—and still satisfies that snack craving,” he added.

NatureSweet believes a few of the most exciting things about the tomatoes category are healthy snacking and convenience.

"We’re giving our consumers time back in their day," External Communications Manager Jenny Halpin said.

"Our washed-and-ready-to-eat Cherubs To Go are the perfect healthy snack to throw in a lunch box or a gym bag and kids love them, too! Our snacking tomatoes are so sweet, you forget you’re eating something healthy. And speaking of convenience, our Cherubs are also available in the food industry; we launched that program. A major restaurant chain kicked off this venture with us and began by replacing their sliced Roma tomatoes with our Cherubs snacking

tomatoes in salads. Not only has this improved taste but it’s saved on labor, so they’ve expanded the program to include more restaurants."

In 2024, NatureSweet plans to continue an industry-wide dialogue about the treatment of agricultural workers.

"Our goal is to transform the industry and improve the lives of agricultural workers in North America," Halpin said. "NatureSweet is driven by the conviction that doing the right thing and building a business model grounded on treating people with dignity is not a conflict, but the reason for our success.

Historically, the industry has not placed its workers at the center, or treated them as the most precious driver for success. We are committed to providing agricultural workers with the resources and tools that will improve their lives.

We hope our example and impact goes beyond NatureSweet and serves as a roadmap for the entire industry."

Key goals for Naturipe Farms is to continue building upon the company's achievements in 2023 and carry that momentum and excitement into the new year.

"In 2023, we made huge progress in growing our brand, developing and bringing to market new products in our fresh and value-added lines and establishing ourselves as an industry leader in innovation and sustainability," said Marketing Manager Marissa Ritter. "In 2024, we plan to continue to strengthen in all those areas. Consumers have loved trying our new products—including our Mighty Red jumbo strawberries, and our Sweet Selections proprietary berry varieties—and we want to continue to wow them in 2024. We have some new snacks up our sleeve that we think will do just that! We’re also considering 2024 to be the start of a new era of berries at Naturipe Farms."

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First Take Soups

Key Takeaways • Market Trends and Consumer Preferences: Inflation has not impacted consumer preferences for trusted brands and quality products.

• Industry Focus on Development and Consistency: 1) Companies plan for new product developments and ingredient exploration within the early months of the year.

2) Soup is a promotable category in all seasons, even in the warmer months.

A

s the cozy, winter months have officially hit, soup season has been in full swing. While soup consumption goes up during this time of year, leading soup manufacturers have noticed that many consumers prefer to enjoy soup year-round as it provides health benefits and checks the convenience box with delicious taste.

Looking at the new year, Blount Fine Foods is gearing up for debuting new developments and pushing the category forward. “[We are] continuing to help our customers grow their soup sales with our Panera Bread line as well as our Plum Family Kitchen soups that are new to the category in the fall, which are doing very well,” said Bob Sewall, VP Sales and Marketing at Blount Fine Foods. “So, we have this complete line of decadent seafood and non-seafood soups that are just fantastic. Over the last four years, the soup business has grown 200 percent and is projected to grow another 55-plus over the next four years.”

“This will be a focus to help our customers reach other customers beyond the private label and Panera Bread,” he continued. “The other thing we’ll be doing is focusing on customers [that receive] our 10-ounce and 11-ounce cups to help them develop more of a graband-go set with their salads and sandwiches. We’re geared up and ready, we get all the ammunition, we get all the products and our customers have gotten onto the bandwagon with the new soups.”

Even though inflation has continued to affect the industry, and more specifically consumers, Blount Fine Foods has noticed that consumers still prefer to purchase items they enjoy from companies they can trust.

“Even in tough economic times, cus-

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tomers are going to buy what they truly like and believe in; both Panera and Blount are brands they trust in the category,” Sewall said. “So, I believe our quality drives consumers to buy more soup. We’re certainly working with our individual supermarket chains to develop promotions to entice customers to keep purchasing. So, that will be a focus: continual support of marketing ads with our customers, which is fun.”

“Around the timing of IDDBA, we will have some new items around that time, but it’s a little too early to talk about what they are. January and February are great months for us to dig in looking for new ingredients and collecting all the data on what consumers are looking for. We start the development phases so we’re ready to really jump into it in a big way.”

“We will work with our vendors in January and February to develop new ingredients and look at new flavor profiles,” Sewall continued. “But all in all, I would say that things will remain at least consistent so you can avoid any bumps in the road because soup consumption is year-round. We have a big non-primetime season push to help our supermarket customers and consumers eating soup, so we promote heavy in the off season. So, we need our vendor partners and everybody to stay consistent.”

Starting with soup, Kettle Cuisine has continued to grow its product offerings since its inception in 1986. The company started as a door-to-door campaign meant to change the soup category overall. The company wanted to showcase the possibilities of the category by providing fresh, high-quality soup options that are convenient and enjoyable.

Through the years, Kettle Cuisine has acquired and partnered with various companies to expand their offerings.

In 2019, the company acquired Harry’s Fresh Foods, a custom food manufacturer. The partnership allowed Kettle Cuisine to expand its distribution of soup and become one of the leading fresh soup producers.

Another leader in the category, Fortun Foods, started in 1981 when Kevin G. Fortun launched Stockpot Soups.

This line of soup filled the category’s white space for premium soup with high-quality ingredients that were fresh and could be refrigerated. With the original mission to give food service operators and partners convenient soup options, the company eventually grew a presence in retail, and was later sold to Campbell’s Soup Company in 1998.

Fortun Foods now has several soup options that include plant-based soups, fresh sauces and homemade soup with no preservatives or artificial ingredients. Fortun Foods launched its plantbased soup options in July of 2020.

“We are not for everyone, but we are for that customer who is looking to offer the best on their menu or offering a fresh premium soup in their stores,” said Mary Shepard, Director of Sales.

“Competition is fierce. You have to be outstanding in your field.”

While inflationary pressures are forcing consumers to make difficult choices and tighten their belts, their inclinations for reliable brands and dependable products is seemingly inflation-proof and not something they will compromise on as they stretch their dollars.

As these spending habits relate to the soups category, households are seeking out brands that offer soup recipes made with whole ingredients and filling proteins. Suppliers and restaurants have helped consumers realize year-round soup can standalone as a meal or start a multi-course meal on the right foot.

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First Take Dough

Key Takeaways • Home Cooking Resurgence: The isolation of the pandemic encouraged more home cooking, leading consumers to turn to dough as a versatile and convenient ingredient for feeding their households.

• Pizza as a Dominant Trend: Pizza is expected to take center stage in the coming year, driven by its affordability, ease of use and appeal to Millennials.

• Educational Focus and Health-Conscious Choices: With the increased awareness of consumer dietary needs, the category is moving toward more health-conscious choices, including flatbreads and an emphasis on using real, whole ingredients.

O

ne silver lining during the pandemic was households turned the task of preparing meals at home into an opportunity to learn how to cook and get creative with recipes—enter dough. Dough allowed for families that wanted a hot and flavorful meal without obscure ingredients or tedious preparation to pull together a meal quickly and effortlessly that also fit their requirements of being fulfilling and made with whole ingredients. With dough in their fridge or freezer, consumers no longer had to depend on restaurants to bring comforting appetizers, fluffy dumplings or cinnamon rolls into their kitchens. And for parents that were trying to appeal to each child’s flavor preferences, parents could keep the peace by giving their kiddos the opportunity to construct their own personal pizza.

Ryan Fillmore, CEO of Janey Lou’s Bakery Products, which produces dough for cookies, bagels, pizza and donuts for restaurants and grocery stores, expects pizza to take center stage in the coming year. “Donuts circulated for a moment," he said. "Cookies had their flair. We’re starting to see the end of the crumble cookie phase. The market is moving towards a pizza phase. There is a way to make pizza relatively inexpensively and still healthy, like have whole milk mozzarella. You’re still dealing with a relatively simple carb base, and that carb base, if it’s made right, doesn’t have a lot of excessive fat. It’s a lean dough. There’s an acceptance of that type of product by Millennials and a need for it because it’s relatively inexpensive. At least [with] the chains that we’re working with, pizza has become their objective for 2024. That’s what category managers are interested in putting on their menu."

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In 2024, Feel Good Dough is focusing on more education surrounding the dough category. Even though the company is well known for its organic pizza dough, Feel Good Dough’s offering equips novice and experienced home chefs with the central ingredient to create items including rolls, appetizers, dumplings, breadsticks and cinnamon rolls. Company leaders have spotted weak points in the category that have led to some households being unsure of how to safely store dough, as an example. Their lack of awareness and knowledge on this versatile ingredient means many consumers are missing out on fun and creative meal prep and recipes and creating positive memories with their families in the kitchen. “The dough [category] is a bit confusing for people,” said Feel Good Dough CEO Terry Thompson.

“They have many questions regarding how to use, store and make things with it. Their first experience with dough should be fun and uneventful. [One of our goals is] giving them a good experience so they come back and buy more!”

One of the more significant impacts to the dough category has understandably been tangles in the supply chain.

However, suppliers like DeIorio’s Foods are confident these issues will unknot themselves. “The greatest impact on the dough category has been supply chain,” DeIorio’s Foods' spokesperson Jim Viti said in 2023.

One key development changing the dough category is people returning to the category because they understand which baked goods they can eat. "We’ve seen the peak of gluten intolerance or gluten-free products," Fillmore said.

"Our consumer is more and more health conscious. They are more aware of what they are eating. At Janey Lou’s, we don’t

house automatic systems for high fructose corn syrup or anything like that.

We use pure cane sugar, real butter and whole ingredients. We’re a bakery; we’re not necessarily calorie conscious but we’re super whole foods-oriented and so I think that is what has led the charge for us during the last half decade. In the foreseeable future we’re aware of what is in the product, and we try to cater to the mindset of our consumer and that is more and more health conscious."

"People are comfortable when we go back to basics. If they understand what they’re eating, then they’re comfortable consuming it," he continued. "When there are a lot of additives and things that just don’t—food as it comes out of the ground or off livestock, that’s the way it’s intended to be consumed. Not in an 'added to' or 'stripped away' [format]. It’s really interesting especially in the bakery category, because there’s so many additives that are made by deconstructing wheat. There’s gluten added into raw. It’s products that were once part of a whole but they strip it down and then add it in excess to a product.

I don’t think that’s the way we’re meant to digest it. A lot of people have experienced gluten intolerance because [they are] digesting wheat not in its whole form or have gluten directly added in excess on top of wheat into their bakery products. Now you have a lot of people who are discovering maybe they don’t have a gluten sensitivity if they eat whole sourdough or real whole wheat bread. We don’t see a spike or a trending growth pattern in the gluten intolerant category. Instead we see people becoming more [aware]. They want to eat bread, and they are understanding why they couldn’t before."

First Take Onions

Key Takeaways

• Global Supply Challenges and Short Market: Global factors, including increased demand from Canada and Mexico, are expected to influence onion prices and supply in the short term.

• Year-Round Availability and Sustainability Focus: 1) Growers strategically plant onions in various regions, ensuring year-round availability and mitigating weather-related risks.

2) Companies are expanding existing programs, including state-of-the-art packaging, to help retailers with merchandising ideas and boost consumer use and sales.

O

nion growers and suppliers have come to expect that the holiday feasting and indulging in December will inevitably lead to a noticeable spike in sales come January as consumers dive into their New Year’s resolutions to eat healthier and spend more responsibly by cooking at home. This time of year is characterized by a shorter supply of onions overall as growers await longer daylight hours and milder temperatures, so while they’re dedicated to managing stock and sales programs to support their current retail partners, shopping around for new customers remains largely on hold.

“Right now, overall, the market is fairly short on onions and prices have increased,” said Peri & Sons Farms’ Retail Sales Manager Jessica Peri. “There’s been a lot of demand from Canada and now Mexico, putting pressure on the market for the supplies, and I really do anticipate that it would be a fairly short market until we get into really good production this summer around maybe June or July. We’ll start to see things taper off and more supply come in, but onions are truly a global market because a lot is exported but also imported.”

Peri clarifies that while the market is truly global, Peri & Sons Farms’ onions are all domestically cultivated.

The company grows, packs and ships its onions from three separate growing locations that operate on their own time frames so their production efficiencies are maximized and there is minimal overlap. September typically represents the start of the season when growers are lining up customers, she said. “We’re just managing supply right now, so everything was harvested in the fall, and they’re in refrigerated storage buildings right now, and we’re just kind of managing inventory the best we can

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with the demand that’s out there,” she said. “Most onion shippers right now are in oversold positions. We’re just very conservative with our sales but we have a lot of programs, so for companies that are on our programs, they buy our onions year-round, we do fulfill their orders. We’d never say, ‘no, sorry, we can’t take the PO.’ It’s only really to the wholesale markets or to maybe someone who hasn’t been supporting our programs we just aren’t going to layer them on right now. There’s not a lot of opportunity to bring on new business at this current time just because there aren’t enough onions.”

Illustrating the juxtaposition of a short market versus a peak summer production cycle, Shuman Farms last May was getting its Vidalia onions program underway. “One of the things that sets Vidalia onions apart from other varieties of sweet onions is their limited availability,” President and CEO John Shuman said at the time. “Because they are grown exclusively in a small area of Georgia, the Vidalia onion season is relatively short—typically running from late April to July. This limited availability only adds to the allure of Vidalia onions, making them a sought-after ingredient for home cooks and chefs alike.”

From G&R Farms’ perspective, “As a whole, the onion market and sweet onion market are fairly stable with yearround availability from areas including Georgia, Peru, Mexico and Texas during key growing seasons. Our goal is to maintain key production in all the appropriate growing regions to make sure we can provide a consistent year-round supply of product, even in the event of weather issues that may impact supplies,” said CEO Blake Dasher. “This year, Peruvian supplies have been shorter than normal, but our Vidalia crop is

well underway. Time will tell if Mother Nature will be kind, but we spread our plantings and acreage over a variety of dates and locations to lower the risk of weather-related impacts and to extend the Vidalia season as far into August/ September as possible as the Peruvian crop comes into season. We have also installed new state-of-the-art packing equipment enabling us to process 80 percent faster and far more accurately than our previous equipment. This has elevated our service now able to meet large, last-minute and special requests from our customers with a high degree of efficiency and quality control.”

Coming into 2024, G&R Farms is prioritizing product quality and customer service. “Cliff Riner, our VP of Grower and Ag Relations is one of the leaders in sweet onion research and has spent the entirety of his career exploring opportunities to improve sweet onion quality, flavor and sustainability to deliver consistency consumers expect with the same rigor all year-round,” said Dasher.

“His work includes countless variety trials, production trials and sustainability trials that help us not only find new varieties of sweet onions, but also improve our production efforts to reduce inputs and improve our sustainability footprint. We are active in conservation efforts and plant more than 1 million trees per year and partner with conservation endowments to protect waterways and habitat to maintain wildlife.”

Shuman Farms is also ensuring an efficient production infrastructure. “The company’s state-of-the-art packing facilities are equipped with the latest technology to ensure that the onions are carefully sorted, graded and packaged to preserve their flavor and freshness,” Shuman said.

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First Take

Sweet Potatoes Key Takeaways • Sweet Potatoes as a Health-Conscious Choice: Despite their glycemic load being comparable to white potatoes, sweet potatoes, with additional minerals and fiber, are considered a healthy and versatile ingredient.

• Year-Round Promotion and Consumer Creativity: Growers are promoting sweet potatoes as a year-round ingredient, moving beyond traditional holiday associations.

• Market Trends and Production Challenges: The reduction in production is attributed to farmers diversifying crops for long-term sustainability, leading to potential market tightness in the coming quarters.

T

he Harvard School of Public Health touts sweet potatoes as a great natural source for vitamins A, B6 and C, along with potassium and fiber, while still cautioning those watching their blood glucose levels that the glycemic load remains comparable to white potatoes. Nonetheless, this non-tuber that is in fact a member of the morning glory family, has become a frequently used ingredient in many healthy and whole recipes that appeal to consumers who are looking to start their New Year’s healthy eating resolutions in earnest.

Growers are capitalizing on the healthier profile that sweet potatoes have earned to continue sharing usage ideas in their efforts to grow and expand the category.

“Once we go into that first part of January, you traditionally have a lot of people making their resolutions to eat healthier, and sweet potatoes are a very nutritionally dense food,” said Jeff Thomas, Director of Marketing for North Carolina-based Scott Farms. “It’s probably as nutritionally complete a single item as you can get. They’re healthy for you and they’re also good.

They’re good for you and they taste good, so people will tend to incorporate those a little more.”

After the frenzy of New Year’s resolutions have also settled, growers like Scott Farms are working with partners to continue encouraging end consumers to incorporate sweet potatoes into their cooking regimens. "What we have done historically is work with chef partners and things like that that develop recipes for unique ways to prepare them, that you can find in a restaurant or something simple enough you can make at home,” he said. “From an appetizer all the way through dessert, even creating center of plate type of menu or

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dish option. We have one chef who created some adult beverages using sweet potatoes. It’s kind of unique in the use of it.”

Susan Noritake, Bako Sweet’s director of sales, indicated last fall while preparing for the Global Produce Show that the brand was committed to promoting sweet potatoes as a year-round ingredient. "While sweet potatoes are traditionally associated with holiday feasts, our focus is on 'sweetening your every day.' We're working closely with retailers to merchandise our products in a way that supports year-round sales,” she said.

The Covid era of isolation encouraged consumers to become creative with their use of ingredients like sweet potatoes, Scott said. “Coming out of Covid, they had time to learn how to cook different dishes and not try to eat the same things over and over again. Even though it’s [sweet potatoes] been here a long time, it became sort of exotic to a lot of people. Once you know how to do something it’s not as daunting to think ‘what am I going to do with this sweet potato?’

That sweet potato sitting on a retailer shelf is really a blank slate.”

In October, California-based Bako Sweet announced an optimistic start to its harvest season, projecting its conclusion in mid-November to see a higher yield over the previous year.

“We expanded acreage this year and have been really pleased with the quality and sizing of the crop so far this season,” said Matt McCort, EVP of Bako Sweet.

“We're committed to meeting the growing demand for Bako Sweet products and have plans for continued growth in our value-added business from the ground up."

Bako Sweet’s expansion of acreage

runs counter to the trend of sweet potato planting, at least in North Carolina, according to Thomas.

“As in industry, you see a little bit of attrition in the amount of acreage that’s actually been planted in North Carolina,” he said. “Two years ago we were north of 100,000 acres; last year we were roughly about 85,000 acres; and this year when all’s said and done, we’re looking at sub-70,000 acres. It is going to put a little bit of market pressure on sweet potatoes. We, personally, at Scott Farms, we planted the exact number of acres as we planted last year and the year before. We look at taking care of our customers and make sure they’re carried ‘from cured to cured’ [from one crop to another so there’s no gap in product]. But what you’ll see is a tightening of availability of sweet potatoes from the industry as you get probably into the first quarter into the second quarter of 2024.”

The reduction in sweet potato production is tied to farmers configuring their field operations into a way that remains sustainable for the long-term.

“Farmers are diversifying their crops and looking at things that make their farms work,” said Thomas, noting that such changes are still at the whim of many factors including Mother Nature and could still evolve. “It’s probably going to take two to three years for some sort of course correction to happen.

I’m not sure that you will see it above 100,000 acres any time soon but you’ll probably see it settle somewhere between 75,000 and 80,000 acres. And I’m speaking of North Carolina; it really does depend. All in all, the market does tend to take care of itself but until it’s more lucrative to grow sweet potatoes, farmers are going to tend to find more lucrative crops to grow.”

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First Take

Gourmet Snacking Key Takeaways

• Growth Drivers in Gourmet Snacking: 1) A preference for healthier choices, a moving away from traditional meal structures and a more adventurous consumer base are driving growth and innovation in the category.

2) Manufacturers are making space for plant-based options with a focus on more worldly flavors that appeal to a wider range of snackers.

• Consumer Lifestyle and Snacking Trends: A need for convenience and a desire to explore a range of new flavors are large drivers for the growth in snacking, which has now also shifted the paradigm of a three-meal-a-day traditional routine.

F

actors driving the growth of the gourmet snacking category include a desire for healthier options, a moving away from the traditional three meals a day lifestyle and a more adventurous consumer base when it comes to novel flavors and pairings. The most effective category leaders aren’t relying on generalizations, however, in planning their 2024 strategies. Ample research into consumer behavior, preferences and spending are driving their next steps.

“As part of our annual State of the Specialty Food Industry research, several buyers we interviewed pointed to the full-blown return to entertaining and hosting as a driver for the rise in snacking categories like salty snack and chocolate and confectionery,” said Specialty Food Association VP of Resource Development Denise Purcell. “Chips, pretzels and snacks, for example, hit the No. 1 spot in terms of retail dollar sales for the first time in our latest research, and chocolate was also in the top 10. What’s interesting is that in times of economic upheaval, consumers will often scale back or trade down on categories like these. We’re seeing the opposite, driven in part by the amount of continuing innovation in these categories. Global flavors and ingredients, for example, are big trends that will continue to shift the direction of specialty snacks. Things like chips made from freekeh or tempeh and flavors like black sesame, salted egg and ube showing up in popcorn and chocolates.”

“At Venus, we will be launching our new South Shore Puff Snacks in 2024,” said VP Sales and Marketing Jim Anderko. “The South Shore Puff Snacks are baked with quinoa and carry the nonGMO Project verification. South Shore Puff Snacks will have three flavors avail-

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able: Barbecue, Chili Lime and Vegan Nacho Cheese. [They are] the ultimate plant-based snack with the crossover of healthy and flavorful.”

Venus is homing in on the growing demand for plant-based options. “Gourmet snacking is growing and plantbased is growing,” he said. “We focused on this with our new South Shore and highlighted this on the packaging. Flavors are key, and we did focus groups for initial flavor offerings, but we have other flavors to follow, [ranging] from savory to sweet to hot and spicy and even regional flavor options that we have developed for 2024/2025. This will depend on the initial timing of the South Shore launch.”

Attention-grabbing flavors have been propelling Lantana Foods’ hummus and dip offerings off the shelves and into baskets. “Overall, we’re seeing consumers—especially younger shoppers—gravitate toward flavor experimentation,” Maggie Carey, President of US Business, said last fall. “Fortunately, Lantana was founded on a belief that hummus and dips can and should be flavor-forward, with unique and crave-worthy options. We recently introduced a number of new items across both segments to meet these consumer trends including bringing back Hatch Chile hummus and adding some distinct flavors including Cauliflower Pizza Crust and Dill Pickle. Both flavor-forward and plant-based trends informed how we chose to launch the brand into dips, including an unbelievably delicious take on a dairy-free French Onion dip, plus dairy-free takes on other top selling flavors like Chipotle and a beanbased Spicy Poblano Corn Dip.” The company heeded the changes in the in-store environment as new brands

entered the market in 2023 to expand its plant-based offerings. “With hummus continuing as our core product, we took this as an opportunity to reground in what’s important to Lantana—offering our consumers crave-worthy snacks that happen to be made from plants—and then extended the brand into multiple segments. Beyond hummus, consumers can now find Lantana in dips, salsas and salads, all of which has carried across our core messaging in consumer channels as well.”

The expanded snacking options at retail are forcing changes in consumer behavior, and Fiorucci Foods, utilizing consumer research data and analysis by agencies like Mintel, is ensuring it has options for those who have increased their snacking frequency. The company has tongue in cheek dubbed this group of consumers as “super snackers.” “Snacking has become a lifestyle as consumers are driven by their need for convenience, their adventurous palate and their move away from three daily routine meals,” said Shawn Munck, Director of Marketing, European brands and foodservice for Sigma USA, which oversees Fiorucci Foods. “We have data and research stating that snacking frequency has increased sharply, nearly 3 in 4 Americans snack at least once a day and nearly half of people eat three or more snacks per day. Mintel has identified various snacking trends that we follow closely, including snacking seen more [as] an everyday staple, snacking innovations developed based on channel conscious shoppers, snacking becoming more of a core category in grocery stores or as we call it ‘functional snacking,’ and snacking to deliver on nostalgia or as a needed distraction to fill value gaps.”

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First Take

Allergen-Friendly Candies Key Takeaways • Rise of Allergen-Friendly Candies: The confectionary industry has witnessed a surge in sales of allergen-friendly candies.

• Awareness and Industry Growth: The Covid pandemic has contributed to increased mainstream awareness of food allergies, further fueling the momentum of the allergen-friendly candy category.

T

he segment of the confectionary industry that focuses on consumers with allergies has opened the candy space up to a broad consumer base.

Parents who are understandably concerned with the ingredients in their children’s Halloween candy or birthday party favor bags can find some comfort in knowing there are candy companies that consider the sweet tooths of those with dietary needs.

However, even with the growing number of companies looking out for people with allergies, parents and those with allergies are wise to check the ingredients before consuming their preferred sweet treat. Inclusion in a tasty and fun category makes living with allergens less isolating and not as likely to feel leftout.

“We have seen an unprecedented increase in demand for our products across all channels of distribution both every day and seasonal,” said YumEarth’s Jeff Grossman.

In preparation of the new year, YumEarth is targeting the ideal timing of introducing new products and ensuring the process of delivering its product to retailers runs smoother.

“Our goal is to bolster the supply side to make sure we can meet that demand,” he said. “We will continue to launch new innovations that will come later in the year.”

Surf Sweets promises to offer people with allergies confidence to enjoy indulgences without fear.

“Feel confident having allergen-friendly, delicious treats everyone can share,” according to company leaders. In 2021, Surf Sweets joined Sweet Candy Company, which distributes more than 250 candy products nationally and internationally through bulk, bags and boxes, essentially expanding Surf Sweets' presence and manufacturing capabilities. "It brings a new web-

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site and shopping experience, all while continuing to bring you the same quality delicious treats you have come to expect from Surf Sweets! Our goal is to make our allergy-friendly treats easier to obtain by the entire community," according to a company blog post.

Surf Sweets was conceptualized by two surfers who wanted allergen-friendly treats. Surf Sweets brings to the category intentional and tasty candies made with quality, allergen-friendly and organic ingredients that are void of the Top 8 common allergens: dairy, eggs, fish, shellfish, tree nuts, peanuts, wheat and soy. Surf Sweets’ allergen-friendly arsenal includes: Organic DelishFish, Gummy Worms, Jelly Beans, Cinnamon Organic Bears and Organic Fruity Rings, to name a few.

Another key player in the allergen-friendly candies space is Torie & Howard which was acquired by American Licorice Company in 2021. Torie Burke and Howard Slatkin founded their company in 2012, driven by their objective to offer healthier candies that address consumers’ health preferences and dietary needs.

Torie & Howard’s offering of allergen-friendly candies include: Organic Chewie Fruities Valentine Candy in a bag filled with 20 snack packs, Organic Hard Candy in Pomegranate and Nectarine in a 2-oz tin, Chewie Fruities Meyer Lemon and Raspberry Candy in a 4-oz bag and Chewie Fruities in 2.1-oz stick pack in Sour Apple and Sour Cherry flavors.

“Torie & Howard has driven category growth by capitalizing on overarching trends as consumers have sought premium flavored better-for-you options with clean and allergen-friendly ingredients,” Founder Torie Burke previously said. “Our organic brand had an early entry into growing segments like chewy

and sour, which has been driven primarily by Millennial and Gen X consumers.”

“Torie & Howard has always worked hand-in-hand with retailers by creating robust social media presence tying in retailer shelf presence and by offering and partnering on a solid promotional program to drive consumer trial,” she continued. “We also have recent retailer interest in specific products developed exclusively for their outlets.”

Growing awareness that allergen-friendly options exist in the candy aisle is one area that YumEarth not only plans to focus on in the near future, but has been a linchpin in the quickening momentum of this category’s growth.

“It took a worldwide pandemic to make food allergy awareness more mainstream,” Grossman said. “We continue to work with our retailers to create that allergen-friendly solution section across multiple categories to provide that solution for the consumer.

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YumEarth is setting the foundation to ensure the company has the capacity to outpace growing demand for allergen-friendly candies. “We continue to invest in additional capacity to meet the unprecedented demand, especially for some of our new innovations of Giggles and Chewys,” Grossman explained.

The industry has experienced a surge in demand—and necessity—for candies void of common allergens. Leaders within the allergen-friendly candies category are bringing to households—particularly to parents—something most people take for granted, which is peace of mind, security and support in their daily endeavor to protect their children from potentially fatal allergic reactions.

Retailers are doing their part to make their allergen-friendly candy selection noticeable on-shelf, even going so far as to designate a destination for these increasingly sought-after products.

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First Take Sour Candies Key Takeaways • Sour Candy’s Popularity and Health Benefits: Sour candies not only evoke a sense of nostalgia but studies suggest they are a non-invasive solution for people suffering from anxiety.

• Generational Trends and Social Media Impact: 1) Specific generations, especially Gen Z and Millennials, show a keen interest in trying new candies.

2) Social media platforms like TikTok and YouTube play a crucial role in the popularity of sour candies.

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hile many gravitate toward candy to satisfy a sweet tooth, there are even more specific reasons why people tend to reach for sour candies. Sour candies have been proven to provide a sense of nostalgia to consumers, but alongside this, studies have shown that sour candies can help with anxiety as the sour flavor profile offers a jolt back to the present. Leaders in the category had a successful 2023 and are looking forward to the new year and all the opportunities that come with a fresh start.

Candy Dynamics was founded in 2006 and has been a leader in the sour candies category since its inception. The company’s signature product is known as Toxic Waste Hazardously Sour Candy and has been deemed a unique, “double-action” sour candy.

“As a leader in novelty candy, we come into every year with a focus on innovation. This year is no different. We have plans to innovate on previous iterations of our products and look to add entirely new products to the Toxic Waste product range,” said Haley Peyron, Marketing Manager with Candy Dynamics.

“While there has been increased interest in ‘better-for-you’ candy, there is a greater desire for a traditional candy treat. Consumers use candy to provide a positive moment during what could be a difficult day,” Peyron continued.

Touching upon the difficulties that have hit the industry through inflation and supply chain issues, Peyron mentioned the challenges the company recently faced and how it overcame them.

“Issues within the supply chain continue to diminish as we get further out from the pandemic. While we experienced shortages in sugar and plastic in the past, we have found more stability in the supply chain today. Due to this and the purchase of updated equip-

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ment, our manufacturers are ramping up production more than ever before,” said Peyron.

Looking at the growth of the category and where the company sees the most potential, Peyron mentioned that specific generations are more interested in trying new things.

“Gen-Z and Millennials are most likely to seek out new candies to try with many of them turning to social media for inspiration. Interactivity on social media has become increasingly important,” said Peyron. “With the younger generation having grown up with sour candy, they desire increased levels of sour. We encourage this through our Toxic Challenge which is labeled on all our hard candy packaging. This has continued to trend throughout the years, garnering millions of views across TikTok and YouTube.”

“The sour candy category has continued to grow creating saturation in the marketplace. We come into every opportunity remembering what the Toxic Waste brand was founded on; creating a candy so sour that kids will want to dare each other to try,” Peyron continued.

Schuster Products, parent company of brand Face Twisters, was started in 1998 by a brother and sister partnership. Steve and Heidi Schuster headquartered the company in Hales Corners, WI, which has created more than 25 product offerings. The company donates to and partners with organizations such as Ronald McDonald House, St. Jude Children’s Hospital and Pandas Network. Recently the company added a new product to its lineup: Sour Tongue Slime, a candy gel. The candy comes in four sour flavors: strawberry, green apple, blue raspberry and cherry.

The company also launched Sour Slime Series 2 recently, giving consumers two

flavors in one packet: watermelon and grape or orange and lemon.

Mondelēz International has been a leader in the snacking category through various brands but has continued to be famously known for its “first their sour, then their sweet” candy brand: Sour Patch Kids. The company has solidified its position in the category through listening to its consumer feedback about which flavors are the best, such as making an exclusive watermelon or an all blue raspberry packet. Along with this, the company provides consumers with nostalgic and seasonal flavors throughout the year, specifically with its recent launch of its Halloween campaign, which encouraged consumers to enter old photos of themselves that might be deemed “horrifying” for a chance to win a grand prize.

"From those awkward middle school dances to the regretful hairstyles and outfits that continue to haunt your school pictures, we all have embarrassing, cringe moments from our own past that make us laugh," said Jenna Carls, Senior Brand Manager, Candy, Mondelēz International. "What better time than Halloween to unearth our true terrors and share a bit of loveable mischief with Sour Patch Kids candy."

The sour candies category is experiencing a boom in popularity. The string of years when Covid was at its peak left many households feeling isolated and unsettled. Sour candies proved to be a shot in the arm. Devouring candies that people enjoyed in their youth evoked memories and feelings of familiarity and comfort that eased apprehension.

Manufacturers have bridged the gap between opposing generations through their assortment of traditional flavors and new, up-and-coming flavor profiles that appeal to younger crowds.

First Take

Greeting Cards Key Takeaways • Consumer-Driven Innovation: Consumers favor unique, personalized options over generic illustrations and sentiments in their purchase choices.

• Industry Response and Challenges: Companies have experienced enough growth in the last year that they’ve actively prioritized facility upgrades and product line diversification to keep up with demand.

• Digital Integration and Partnerships: Other companies are finding novel ways to work in digital partnerships in their product offerings as gifting trends evolve to include e-commerce.

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hile the breakneck speed with which technology and associated commerce continues to push innovation toward automation and AI, a noted segment of consumers actively seek out products and services, like greeting cards, that support individual expression and sentiment. The ongoing success of the greeting cards category reflects the power these consumers have in helping guide the category’s innovation down a path away from cookie cutter illustrations and toward one of new styles, themes and options for personalization.

“Over the last few years, we’ve seen a shift to more embellished cards,” said Steven Gimbelman, President of Designer Greetings. “Handmade cards with jewel gems, sequins, etc. Our Premier Boutique line showcases these handmade cards.”

The Greeting Card Association (GCA), a non-profit trade association serving the greeting card industry, is also tracking the gravitation toward one-ofa-kind products. Endsley Eggert, GCA Marketing Manager, said, “More than ever, retail consumers are looking for unique greeting cards that align with their aesthetic, sentiment and specific message for the intended card recipient. Rather than viewing cards, or even packaging and gift wrap, as an add-on, customers view the concept of a gift as a mini experience. When buying cards from a grocery store, they are looking for convenient, one-stop shopping while still expecting to find variety that meets their needs. Millennials, who now spend more on greeting cards than any other demographic, are willing to pay a premium for cards that include embellishments, handmade touches and high-quality paper—and reflect their unique personality and relationship with the card recipient.”

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Hallmark has been actively developing new creative strategies to meet the needs of multicultural and multi-generational consumers, said Amy McAnarney, VP and General Manager of Strategic Accounts and Business Development, previously. “Hallmark knows it’s imperative we evolve to meet the diverse needs of today’s consumers,” she said. “We aim to create cards that get to the heart of what shoppers want to say, while authentically reflecting their lives and relationships.”

Hallmark’s innovations of late include additions to its Hallmark Showbox humor brand, multiculturally relevant themes related to the importance of faith, family and home, pop culture pieces and products that reflect values that appeal to younger generations including kindness, generosity, inclusiveness, the importance of making a difference and of putting good out into the world, said McAnarney. “One of the fastest growing segments of the greeting card category continues to be cards that lend themselves to becoming a keepsake, such as Hallmark’s highly designed, premium cards and the three-dimensional pop-up paper craft cards that feature intricate designs and details—Hallmark Paper Wonder and Signature Paper Wonder,” she said. “Hallmark continues to build on the popularity of these two card lines by innovating with new materials and formats across the collections. We are demonstrating category and brand leadership in the growing papercraft market by offering a range of impactful, unique and displayable three-dimensional papercraft cards.”

In 2023, while keeping up with consumer trends, Designer Greetings had the enviable problem of rapid growth but is working on solutions. “The main challenge we’ve faced is growth, to be perfectly frank,” Gimbelman said in

the fall. “Many grocery stores are not happy with their current suppliers and many, many have been contacting us to switch. With our state-of-the-art fixture displays, superior product mix and dedicated merchandisers and sales team, we have experienced more growth than in any previous year. We are just finalizing our expansion of more than 200,000-square-feet, which will be ready in May 2024.”

He added, “On the product side, we launched a handmade popup card line, and we will be releasing motion and light cards in 2024. Our focus on production is to expand our ever-growing stationery line for 2024 and 2025.”

Forward-looking innovation comes easier this year with a stabilization of supply side logistics, but new hurdles related to cost have arisen. “While supply chain issues have impacted every industry at some point since Covid struck, things have leveled out and are largely back to normal where greeting cards are concerned,” Eggert said. “Makers who source paper and printing domestically have a bit more control, and in particular those who use hand-printing techniques, such as letter press. The rising cost of raw materials, shipping costs and labor, as well as macro-economic trends, tend to be more challenging at the moment than supply chain issues.”

McAnarney with Hallmark said that innovating the shopping experience remained key to moving the category forward. “The acceleration of online shopping has impacted all categories across the retail landscape, and Hallmark knows consumers want and expect a seamless retail experience—whenever they shop and wherever they shop,” she said. “A primary focus for Hallmark continues to be innovating new ways for our customers to find, buy and send our products."

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First Take Pierogies

Key Takeaways

• Straight forward meal planning: Pierogies remain popular as a convenient and versatile meal option.

• Nimble and adaptive category: The category is adapting to changes in grocery store roles, e-commerce and evolving consumer preferences while tapping into a segment of consumers that is still unfamiliar with pierogies.

• Bringing together deep cultural roots with current trends: Suppliers focus on diverse flavor options; blending tradition with modern trends.

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ierogies are one of the best kept secrets in the grocery industry. But not for long. Airy yet filling, pierogies fuse smooth and creamy fillings with savory proteins, and for those households who haven’t tried them yet, pierogies are an accessible meal solution that isn’t intimidating for picky eaters. In the coming year, suppliers are positioned to educate consumers on what pierogies are and how to properly include them in meal planning to get the most out of these convenient and flavorful morsels.

"Consumers are looking for convenience, value, consistent quality and flavors they love, or are inspired to try," said Alyssa Panzarella, Director of Marketing for Mrs. T’s Pierogies. "Pierogies check all those boxes and continue to evolve to meet consumers’ needs."

"According to a recent study done by the NFRA, 81 percent of consumers are cooking more than half their meals at home, and consumers frequently rely on frozen foods to do so," Panzarella continued. "Targeted media continues to evolve and become more efficient helping us to send the right message to the right consumer, driven by purchase data," she added.

Leadership at Mrs. T’s Pierogies places heavy emphasis on being known for its reliability and trustworthiness when not only forming partnerships but also maintaiing these alliances long term.

"Because of our team, we have been able to maintain a 98 percent fill rate throughout 2023, keeping Mrs. T’s Pierogies stocked on shelf," she said.

"We have also been investing in joint business planning opportunities, customer events and retail media partnerships," she continued.

In the coming year, Mrs. T's Piergoies is keeping a watchful eye on the ever-changing evolution of the role traditional grocery stores play in the overall

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grocery industry. Consumers' spending habits, combined with expectations of their shopping experience and the hard reality of having to tighten their belts for the unforseeable future, calls for suppliers to offer products that entice and motivate consumers to shop at grocery.

These products have to induce a craving and at a fair price point consumers don't have to feel guilty over. "While it is still a challenge, options to close e-commerce gaps for frozen products continue to evolve," Panzarella said.

"Consumers have never had so many options, and while traditional retailers will need to understand what their consumers’ preferences are, studies have shown the consumers are using technology to make eating at home more convenient and purchase more when shopping online through a retailer," she continued.

Pelmen Foods has developed recipes which bring consumers back to the pierogies category. The company’s assortment of “share-worthy meals that take the guesswork out of lunch and dinner” reflects households’ demands for filling and delicious meals that are easy to concoct and don’t require a lot of imagination—a plus for most overexerted and overbooked families.

Pelmen Foods’ pierogies encourage friends and family to gather around the same table and engage in dialogue using savory and sweet flavors and aromas to encourage people to try their products.

Comforting pairings such as potato with bacon or bolder pairings like cheddar and jalapeno ensure there is a flavor combination for everyone, making mealtime planning smoother.

More recently, Pelmen has been catering to younger crowds with “kid-friendly meals even the pickiest eaters will love,” the company promises. Flavorful but not too daring for

children’s persnickety and finicky preferences, Pelmen pierogies can be enjoyed alone or at a more child-friendly pace via sauteed in butter or dunked in sour cream. “Our perogies [sic] come in many delicious flavors, a wide selection of plant-based options and create a yummy destruction [distraction] from dinner-time meltdowns,” according to the company.

At Supereme Pierogies, company leaders are proud of their reputation for being passionate about pierogies.

With humble beginnings that started in the basement of a modest house in Mississauga, Ontario in 1991, Founder and Owner Joseph Wilk has transformed Supreme Pierogies into a dependable and sustainable company that delivers on great flavors and ingredients.

Additionally, Wilks has mastered the balancing act of staying up to speed with the latest consumer trends and methods of mass producing product while preserving and being respectful of his roots and paying homage to Eastern European tradition.

In the near future, leadership at Mrs. T’s Pierogies would like to have a deeper understanding of their retail partners’ objectives and priorities for the coming year.

“Integration continues to be a priority as we strive for best-in-class joint business planning,” Panzarella said.

“Knowing retailers’ strategic goals and consumers, and how they integrate with our own, will help our teams build mutually beneficial plans that provide valuable solutions.”

At Mrs. T's Pierogies, “We know consumers need quick, easy and convenient mealtime solutions for their whole family,” said Panzarella in late 2023. “This brings exciting opportunities to expand the category with new products and flavors to drive trial and usage."