Industry Voices: Specialty Product Price/Value Shifts

The specialty food supply chain shared opinions and observations on pandemic-influenced pricing strategies, consumer behavior around trading up and down, and private label. More insights can be found in the recently released State of the Specialty Food Industry report. 

“I was looking at [a big retailer account] today, and the condiment set. Based on the trends you’d think with condiments, cooking sauces, etc., that the retailers would go into specialty because of the cooking at home thing. And instead, they went really commodity, really warehouse, away from the distributor business, and put in a lot of restaurant brand name stuff. But then the same buyer, for pasta and pasta sauce, went more specialty. I can’t really understand why.
      Consumer behavior in general varied wildly by category. With pasta, it almost didn’t matter what brand. If it was on the shelf, people bought it. Pasta sauce in the $7.99 to $10.99 range did better than it ever does. People also traded up on coffee.”
-SVP, business development at a specialty food and beverage broker

“As far as private label, we’ve made the decision to stay committed to our makers and not compete directly against them. To support them and help amplify the greatness of their products, and their stories, and their voices, so in contrast to a lot of other players out there we don’t have a need or interest to get into private label.” 
-CEO, co-founder of a specialty ecommerce retailer

“We have seen competition from private labels, especially in baking chocolate. But a good thing about a good private-label brand is that it can help by getting more exposure to a category.
We had the opportunity to expand into a club store, but in the rest of retail we didn’t need to upsize any of our packaging. We got feedback from customers at the onset of COVID that they would like to stock up, but we knew it would take a while to develop that packaging, so we took a wait and see attitude and didn’t jump into it.”
-CEO of a specialty chocolate brand

“In the beginning of the pandemic, retailers didn’t put promotional tags on the shelf because they had to simply keep up with the increased volume. Then we saw a huge bounce back in promotions. While a lot of consumers lost their jobs, I haven’t seen an overall change in pricing strategy. It was more around the promotional piece of it – EDLP (everyday low price) versus a hi-lo strategy, a shift in when they promote, or the depth of the deal.”
-SVP, category management and growth solutions for a specialty distributor

You can learn more about market growth, fluctuations, and drivers, as well 10-year category tracking and forecasts by purchasing the State of the Specialty Food Industry, 2021-2022 Edition.  

And weigh in on what you think the new post-pandemic industry norms will be in our discussion in the Community Hub.