Gluten-Free Label Becomes Secondary to Other Benefits
By Greg Gonzales
Disco didn’t really go anywhere; it inspired new forms of music, and eventually gave rise to nu-disco, a genre that blends the classic style with electronic dance music and modern rock, satisfying a larger and more diverse crowd. The same could be said for gluten-free foods. Sales growth peaked a year ago, but producers continue to launch and expand gluten-free lines, innovating them with nutritious, better-tasting ingredients that help the products compete with their gluten-containing counterparts. Though gluten-free food sales are growing at a slower pace, the brands and their fans are here to stay.
Going gluten-free is not motivated by gluten intolerance or sensitivities for most people, but a third of American consumers still purchase gluten-free products. According to the Packaged Facts July/August 2016 National Consumer Survey, 30 percent of consumers who bought gluten-free foods said they bought them for reasons other than gluten-free certification. Twenty-nine percent of respondents said the products are “generally healthier,” while 20 percent said they use the products to manage weight. Of those surveyed, nine percent of consumers said they buy gluten-free products for a household member who has celiac disease, a condition that affects only one percent of the population.
“The bottom line is, people are looking at the back of the package and being critical of what they put in their mouths,” said Barry Novick, President of Kitchen Table Bakers. “If the consumer turns the package over and the information is not there, the consumer suffers.”
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Consumers seek out gluten-free, but want more than a gluten-free label. A 2013 New York Times poll found 75 percent of Americans were concerned about GMOs. A 2015 Gallup poll showed that 44 percent of Americans incorporate organic foods in their diet, too, and half of them avoid sugar. In addition, about 90 percent of those polled said they try to eat more fruits and vegetables. This lines up with Nielsen’s Global Health and Ingredient-Sentiment Survey, which found that 64 percent of respondents are avoiding or limiting consumption of specific foods or ingredients.
“Informed and savvy consumers are demanding more from the foods they eat, and some are prioritizing ingredients over brands,” said Andrew Mandzy, Director of Strategic Health and Wellness Insights at Nielsen, in the ingredient-sentiment survey report. “To many consumers, simple is beautiful, and foods with a short list of recognizable ingredients resonate strongly. Savvy manufacturers are responding to this trend by modifying product portfolios by simplifying food ingredient lists and creating natural and organic alternatives to existing offerings. Meanwhile, retailers are also prioritizing healthful foods and better-for-you brands in the center of the store, and emphasizing fresh and perishable foods around the perimeter in order to drive growth.”
Total sales for gluten-free foods this year are set to clock in at $1.328 billion, according to the Packaged Facts Gluten-Free Foods in the U.S. report. The report also said gluten-free food sales growth fell from 81 percent in 2013 and 30 percent in 2014 to 11 percent in 2015. By 2021, the report says, growth rates should end up at a steady five to six percent, with $2 billion in sales by 2020. “Sales do continue to grow, just at a slower pace,” said Mintel Senior Food and Drink Analyst Billy Roberts. “As manufacturers, large and small, enter the largely fragmented gluten-free marketplace, consumers gain an increased availability, quality and variety of options.”
Small Specialty Food Producers Find a Home in New Hampshire
By Lorrie Baumann
Mary Macdonald got just three weeks’ notice that her business, The Discerning Palate, was about to lose its home because the facility in which she was making and packing Swineheart’s Signature Sauces, Old’s Cool Wild Game Sauces and Our Local Table specialty food products had been sold and was closing. The other New Hampshire food producers who shared the space with her were out on the street just as suddenly.
She and her husband Gavin responded by building Genuine Local, a specialty food production facility that functions as an incubator for specialty food businesses, a shared use kitchen, co-packer and the new home of her house brands. “We wanted to figure out how to make something that worked for the people who were also displaced,” she said. “We found that not only did the people who were displaced by the other facility need a new production facility, but there was also a need within the central part of the state because there were no other resources like this anywhere.”
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Genuine Local opened for business on January 2016 in a 1,800 square-foot former warehouse, and now has 125 to 150 products coming out of the kitchen from 23 different producers. “We received our final notice of occupancy on January 25, 2016 at about 10:00 in the morning,” Macdonald said. “By 1:00, the first batch of sauce was in the kettle.”
In December 2016, Local Baskit, a meal kit subscription service owned by Beth Richards of Concord, New Hampshire, became Genuine Local’s first graduate. Local Baskit had launched in June 2016 using Genuine Local’s facility as the base of operations in which Richards packaged all her meal kits. As the business grew, she shifted her attention to customer service and recipe development, while Genuine Local took on assembling the meal kits. Then in December, Richards relocated her business to a space that will allow her to expand her offerings to include cooking and nutrition classes. “At lightning speed, she leaped and she landed,” Macdonald said.
Genuine Local, located in Meredith, New Hampshire, is in the middle of the state, about 40 miles north of the state capital in Concord and about 80 miles west of Portland, Maine, as the crow flies. It’s equipped as a small-scale commercial kitchen with 40-gallon kettles, which is large for a catering kitchen but small for a production facility. “We expect that people will come in and work for a year or two, but then move on as they outgrow what we’re here to offer,” Macdonald said. “The group that I’m most excited about working with are all the specialty food producers who need to take the next step.”
The facility doesn’t have a USDA license, so it’s not for meat products, and there’s no cold chain production capacity. “We don’t do cheese, but we can pretty much work with anybody else,” Macdonald said. “It’s a very purpose-built facility, so it has a very functional footprint. All of the equipment is on wheels. Everything we have is semi-automated, including the bottler and the labeler. It’s all about being the bridge.”
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The 23 producers who are currently sharing the space make a variety of products, including conventional hot pack products and a range of ethnic foods that include a unique West African pepper relish, Ruth’s Mustards, Little Acre Gourmet Foods’ condiments and Bleuberet’s microbatch relishes and jams. Local caterers also use the facility. “Products coming out of here are in distribution throughout New England into upstate New York, as well as pushing down into New York City. We have one customer that’s featured in all of the Eataly stores,” McDonald said. “We have another customer that’s really happy being able to drive to every single store that carries their product, and that’s where they want to be.”
“We have everything from one company that makes a northern Indian-style eggplant relish, and that’s their only product, to Little Acre Gourmet, which is really pushing to expand their line,” she added. “I’m thinking that in three years, we’re not going to be big enough for her, but we are for now, and we’re very glad.”
The facility is also home to The Discerning Palate’s house brands. They include Swineheart’s Signature Sauces, which offers seven flavors of handcrafted, small-batch sauces representing various styles of American barbecue. “We got into the food business as a hobby gone wrong. The kids gave their dad a small smoker for Father’s Day about 10 years ago,” Macdonald recalls. From that beginning, the Macdonalds started competing in the barbecue circuit and developed their own sauces. “From there, people started wanting to purchase the sauce, and the company just grew,” she said. Once they’d decided to produce the first Swineheart’s Signature Sauces on a commercial basis, they set up shop in a copacking facility that also rented space on an hourly basis. “It was historically a culinary training program run by the county,” Macdonald said. “It was set up as a catering kitchen that transformed into a production facility, whereas ours was set up to be a production facility from the get-go.”
New brands grew up around that 2010 start, including Our Local Table, which offers a trio of onion relishes as well as salsas and spicy Peri Peri sauces, and Old’s Cool, a line of three sauces designed for wild game. “They’re fat-free and made with gluten-free ingredients with no preservatives or artificial flavors or colors,” Macdonald said.
Genuine Local is also home to Genuine Local’s Bootstraps Program, an a la carte business development program that works by subscription and offers assistance with all the myriad problems that people have to solve when they’re starting a food business: labeling and nutrition panels, licensing, market development and recipe development. “For regular business planning, we refer those out. There are simply not enough hours in the day,” Macdonald said. “We have some people who are qualified to do a variety of types of production, and they’re willing to work with people on a freelance basis, so we do make those types of connections as well.”
“We developed that Bootstraps Program out of recognition that we’d never have been able to do what we’ve done without the generosity of other people,” she added. “It’s frankly not rocket science, but there’s no manual. We have a really strong commitment, with our focus on local, to help people take the next step.”
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