Specialty Foods Gaining in Popularity

No longer considered niche products, sales of specialty items increased by more than $50 billion last year.

April 14, 2015

NEW YORK – Retail sales of specialty food, a category that includes items from imported cheese to top-quality coffee beans, rose to $51.23 billion in 2014, according to numbers released recently by the Specialty Food Association (SFA). That brings specialty foods  share of retail U.S. food sales to 15% of overall sales, up from 13.7% in 2013.

Shifting consumer tastes toward foods that are perceived as more natural, less processed or locally produced has encouraged retailers to seek out new, smaller brands.

Specialty foods are becoming more than a niche market, Rabobank food analyst Nicholas Fereday told the Wall Street Journal in a recent article. According to the Journal, investors have also taken note. Last year, small food companies raised $258.9 million from venture capitalists, more than the previous two years combined.

According to the latest SFA report, “The State of the Specialty Food Industry 2015,” retail sales of specialty food sales grew 19% from 2012 to 2014 compared to a 2% increase for all food. The industry, fueled by small businesses, now boasts 15 segments that exceed $1 billion in sales, including cheese; coffee; meat, poultry and seafood; chips, pretzels and snacks; candy; and yogurt.

The top 10 best-selling categories have shifted since 2013. Cheese is still on top with $3.7 billion in sales, but coffee and cocoa have jumped over frozen and refrigerated meat, poultry and seafood to claim second place. Bread and baked goods entered the top five, bumping out yogurt. Nuts, seeds, dried fruits and vegetables made it into the top 10, with $1.3 billion in sales in 2014.

The fastest growing categories in unit sales are refrigerated pasta and pizza sauces, up 78% since 2012, followed by refrigerated pasta and eggs, both up 53%. Other notable gainers in unit sales are functional beverages, nut and seed butters and energy bars and gels.

Advertisement
Advertisement
Advertisement