Predictions For The Food & Beverage Industry For 2022 And Beyond

Earlier than I reveal my predictions for 2022, it is just honest to revisit my previous predictions made pre-Covid, at the moment in 2019, to see how far off the mark I used to be. Right here’s what I used to be forecasting then:

·        Non-public label can be neck-and-neck with main manufacturers in unit gross sales, rising from 33% of the market to 50% by 2023.

·        Ghost Kitchens would have a serious influence by 2022.

·        CBD rules can be clarified by the top of 2022.

·        Plant-based labeling would have extra readability by the top of 2020.

·        Cell-based would have extra traction by 2023 and will develop into an actual issue within the trade.

Right here’s the place issues now stand.

Non-public label has outpaced title manufacturers 4 years in a row and continues to take action. Whereas title manufacturers made a restoration throughout Covid, I’ll keep on with my prediction for 2023 that non-public label will develop into the bulk participant in unit gross sales. 

Ghost kitchens have additionally cooled a bit because the financial system reopened and prospects have returned to eating out. However since 60% of customers now order supply or pickup at the least as soon as every week, takeout is predicted to rise to 21% of restaurant trade gross sales by 2025, in keeping with Technomic. So I will even keep on with my prediction that ghost kitchens can have much more of an influence in 2022. 

If you happen to requested the FDA in 2018 if it was authorized to promote meals or drinks infused with CBD, the reply, unequivocally, would have been NO. In 2021, Congress initiated a invoice to legalize CBD-infused meals and drinks, however it has not handed up to now. So the reply continues to be no. Nevertheless, I’ll keep on with my prediction that by the top of 2022, we can have readability on this subject, particularly since analysis signifies that world CBD edibles will increase at a CAGR of practically 14% over the subsequent decade in keeping with Transparency Market Analysis.

Plant-based labeling has brought on some actual confusion and tons of litigation. Whereas some progress has been made on labeling, I missed the boat on this one, and will probably be for much longer till we get readability.

Cell-based merchandise have generated a lot curiosity. In simply 5 years, the cell-based meat trade has developed from a handful of startups to round 80 startups, together with corporations creating finish merchandise and people engaged on particular know-how challenges. Greater than $800 million has been invested within the area since its arrival in 2016, in keeping with IFT, so I will even keep on with this prediction as properly.

Now, my new predictions for 2022:

1.      Expertise will proceed to speed up at a feverish tempo within the F&B trade and permeate each sector and course of. From autonomous automobiles, drone deliveries, sensible fridges, robotics, AI, simply walk-out shops, weed-picking robots, Viome to examine your intestine, and Blockchain, F&B has develop into the brand new tech trade! Whilst manufacturers remodel with tech, so are retailers, equivalent to Kroger

KR
, which is taking daring steps to affiliate with and purchase know-how by teaming with tech firm Ocado to construct robotic fulfilment facilities.

2.      Plant-based and cell-based proceed to rise, however slowly, right into a potential area of interest class. That is an enlargement of my earlier prediction, particularly contemplating that we now have hybrids the place plant-based and cell-based collide, and due to the significance of ESG to customers. Client training continues to be a should for cell-based to achieve success. Due to environmental considerations and the necessity to feed the world sooner or later, these merchandise are crucial. Additional information supporting progress embrace an IBM

IBM
survey that discovered 80 p.c of customers imagine sustainability is necessary and practically 60 p.c would change buying habits to scale back environmental influence. The survey additionally discovered that about 64 p.c of customers comply with a weight-reduction plan or health-related wellness program, up from 49 p.c in 2018. Moreover, there’s fierce competitors as giant corporations have entered the marketplace for plant- and cell-based meals, specifically Conagra

CAG
, Kroger, Unattainable, and Past. Nestle has cultured meat. JBS just lately introduced plans to speculate $100 million in cell-based meat. Redefine Meat additionally launched a 3D plant-based meat. Slovenia-based Juicy Marbles produces filet mignon-like meat, and Copenhagen’s Geranium will make the transfer to a meatless menu beginning in January. The one that actually will get me is lab-grown mouse meat cookies for cats.

3.      Frozen Meals keep sturdy and proceed to develop regardless of the misperception of frozen meals as synonymous with poor high quality and poor well being prior to now.  Along with filling dwelling fridges, frozen meals are proliferating at eating places, and eating places are offering new menu gadgets for frozen. Even Martha Stewart created a brand new line. There’s additionally Really feel Good Meals with gluten-free frozen merchandise. Additional driving progress, 72 p.c of frozen meals customers mix frozen and recent substances in keeping with the American Frozen Meals Institute, and Statista notes that frozen pizza gross sales in the USA have been rising steadily, up from $4.98 billion in 2019 to $5.47 billion in 2020 and a projected $6.06 billion in 2021. Firms are leaping in full drive, with plant-based sausage from Past Meat, chick pea crust from Banza, Harvest pizza bowls from Nutrisystem, and Nestle’s DiGiorno Authentic Rising Crust mac and cheese pizza in 2022. Day by day Harvest, an organization that focuses on frozen-food merchandise, together with ready-to-blend smoothies, is valued at $1.1 billion.

4.      The large traits for eating places will proceed to be out of doors eating, supply and ghost kitchens. Whereas there are blended opinions about ghost kitchens, Alliance Kitchens just lately shaped a ghost kitchen combining a number of manufacturers in an fascinating twist. With labor and meals prices as their best considerations, ghost kitchens permit eating places to function extra effectively and add to their backside traces. Manufactured “kits” will scale back prices. Supply of each takeout and groceries will proceed to extend, albeit in a really aggressive market. KFC initiated Seize and Go, and McDonald’s

MCD
has a brand new partnership with Uber Eats and DoorDash. Outside eating will proliferate and develop into a mainstay. However beware! All of those choices will make analyzing the prices of supply, ordering platforms, brick and mortar rents, labor, stock, know-how, promotions and buyer loyalty applications very difficult.

5.      Direct–to-consumer will proceed to outpace all different distribution channels. Everybody appears to be participating on this phenomenon, even farmers! 73% of customers just lately purchased groceries on-line. CPG corporations could make up for added delivery prices with nice logistics programs, fewer coupons and slotting charges, growing margins whereas customers pay much less. It’s a win-win because it eliminates layers of price to the buyer. Who loses? Distributors might must shift focus extra to the meals service sector (eating places, and many others.) and retail revenues may very well be hit.  However brick-and-mortar retail is rising its capacity to serve prospects by way of e-commerce. Shops are usually not standing nonetheless. In the course of the pandemic, retailers grew on-line gross sales by way of curbside and supply as properly.

We’ll be again subsequent yr to examine in on how I did with these predictions. Within the meantime, joyful holidays to all, and proceed to search for my month-to-month column in these pages.