The specialty food market is changing drastically driven by cultural factors that are shifting the way people consume and increasing the range of choices that consumers have. Population demographic shifts, income and spending habit changes and growing demand for products within the wellness and indulgence spaces are key drivers affecting this change. While these shifts are serving to create tremendous areas of opportunity, they are also raising the barriers to entry.
Over the past decade, annual sales of Private Label goods have increased by >40% in Supermarkets and > 96% in drug chains according to research done by the Privale Lable Manufacturers Association (PLMA[NY,NY]), reaching more than 100 billion last year. Whether being driven by consumers making cost based decisions in the recession, mellenials coming of age with less brand loyalty, or better private label packaging owing to companies aligning to the model proven effective by retailers like Trader Joe’s & Whold Foods Market who have found success developing premium, brand aligned, products under their own name, this is a trend that shows no signs of slowing.