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Technomic to Study Organic Opportunities for Foodservice



"This is a growing category and we believe it will continue to grow. There is growing demand from white tablecloth, higher-end restaurants, and selected demand from colleges and business and industry feeders" observed Bob Goldin, executive vice president.

Goldin remarked to ID Access that broadline distributors cannot currently serve this market except in a limited way and they are not looked at as potential suppliers. As market grows, Goldin said, to drive account penetration with these products, distributors will have to serious look at this end users, sources and product types.

His colleague, Gary Karp, executive vice president, added that manufacturers also need to investigate this category.

"Manufacturers need clear insights on how to leverage the organic/natural opportunity in the foodservice market," observed Karp. "There is a strong need to clearly define this niche--from its size, outlook and key players to product opportunities and consumer and operator drivers."

Overall, Technomic pointed out that the organic and natural food market represents nearly $21 billion in sales, according to the Nutrition Business Journal. Though the category remains a small portion of the foodservice market, it still represents a sizable opportunity that has consistently generated double-digit sales growth, the researcher said.

Operator demand is also intensifying, Technomic said, even in major chains and the beyond-restaurant segments. Early adopters such as Chipotle and O'Naturals have made organic and natural ingredients an important part of their identity. Other chains that are advertising organic and natural usage include Panera, Arby's and Chick-fil-A.

The researcher continued that consumer interest has clearly broadened due to media coverage and retail exposure to these types of products in both organic/natural and traditional supermarkets. Heightened awareness of health and wellness and food safety concerns have also played a role. No longer a niche for the affluent, organic/natural foods and beverages are increasingly demanded by mainstream consumers who also appear willing to pay higher prices for perceived quality.

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