The state of snacking
by Joanie Spencer, Baking & Snack
Settling into his first year at the helm of the Snack Food Association (SFA), Tom Dempsey, president and CEO, strives to uphold the association’s three pillars of membership: education, networking and government affairs. Since taking the position last July, Mr. Dempsey, former CEO of Utz Quality Foods, Hanover, PA, has placed heavy emphasis on broadening SFA’s reach and attracting new members. He also has worked to strengthen ties with existing members and sharpen the focus of all the association’s programs and services.
In this exclusive Q&A, Mr. Dempsey sat down with Baking & Snack Managing Editor Joanie Spencer to discuss what’s new in SFA membership, trends in the snacking industry and his transition from SFA business member to head of the association. To learn more about SFA and snack food trends, check out the next edition of Snack World, produced by Sosland Publishing, or visit www.sfa.org for membership information.
Joanie Spencer: SFA has three pillars of membership — education, networking and government relations. What can members gain in each of these areas?
Tom Dempsey: Combined, all three should make their companies and the industry more productive, efficient and successful. SFA’s focus is on the industry, the people driving the industry and the marketplace that supports it.
What changes has SFA made this year to make events like SNAXPO and the Legislative Summit more relevant to members?
The biggest change is that we have made all of our educational events free with membership. In the past, there has been a registration fee for our Legislative Summit, Quality Innovation Management course and various HACCP and FSMA training sessions and webinars. Now, our members can have as many associates as necessary attend these as a benefit of membership.
How are snack producers coming up with new products — such as popcorn chips and pretzel crisps — that play in different categories? How would you describe the overall health of the snack food industry?
Innovation will in the long run help drive our industry. The new products you mention are only a few of the new offerings that now are in the traditional snack aisle. We are very confident that mobile, fast-paced consumers will continue to find a wide range of snacks that fit their lifestyles and diet needs. The category has never been broader with more diversified multi-category companies competing.
Snack World will release its annual State of the Industry report in May. What can readers expect to learn about the state of snacking in 2014?
As always, the issue will be loaded with statistical data provided by IRI as well as narrative digging a little deeper into the numbers. We have historically had member companies comment on their product innovations and stories behind the numbers.
How has the snack food industry evolved over the past five years as more “new age” snacks begin to emerge? What does this mean for conventional snacks?
To survive as a consumer packaged goods company, you need to evolve and respond to your consumers’ preferences. Just as the “typical” American profile isn’t the same as it was 25 years ago, neither are the snacks they desire. I don’t see an end to the traditional, full-flavor, fun snacks we have come to know, but there will be an ever-increasing market for the “better for you” or new age snacks that you refer to.
How much of a hot button is GMO labeling for snack producers? Specifically, what products are affected by proposed legislation?
Not only for snack producers but also for the food industry in general, GMO discussions are very important. International bodies such as the World Health Organization, US food safety regulators such as the Food and Drug Administration and medical groups such as the American Medical Association have all reviewed the science and agree that GMOs are safe. The snack industry is first and foremost following the science. Some snack customers do want a choice, and they have that available by buying products that are USDA Certified Organic. What we cannot afford is a montage of state regulations/legislation that mandate different labeling for our products.
Such a plan would not only confuse customers but also be a waste of resources trying to keep straight which packages are sold in which state. We are advocating a federal solution for the definition of GMOs, the science-based safety and voluntary package label guidance so our members can continue with interstate commerce without being encumbered by a patchwork of differing state regulations.
What are some of the potential implications of partially hydrogenated oil (PHO) regulations for the snacking industry?
The snack industry addressed this issue more than 10 years ago by eliminating the vast majority of PHOs from our processing. And for those who didn’t complete the change at that time, work continues to get the remaining levels out of the products. In a member survey, 90% had reduced PHOs in some of their company’s products, and around 65% of them indicated that none of their products contain PHOs.
Moreover, 80% of the SFA survey respondents indicated that PHO reduction has been part of their innovation plans for the past five to 10 years. Many of the companies have plans to eliminate PHOs from 100% of their portfolios, yet retaining quality and avoiding cost increases while preventing unintended consequences. We do question how this tentative decision will impact other nutrients and ingredients going through the Generally Recognized as Safe (GRAS) notification process.
At SNAXPO, Frito-Lay’s Ann Mukherjee urged snack food producers to embrace the competition. How can SFA members benefit from working together?
Ann hit the nail on the head. Category competition is good for the industry. It’s the catalyst for new products, innovation in logistics and the generator for individual companies’ growth. Frito-Lay as the category’s largest player can be a leader, but we have numerous other family-owned, regional and national players that benefit from an expanding and vibrant snack category.
Ms. Mukherjee also spoke about front-of-packaging nutrition labeling. What is SFA’s position on that topic?
SFA has endorsed and signed on as supporting the Grocery Manufacturers Association’s Facts Up Front initiative, and at SNAXPO, we encouraged our members to place the icons on any new product introductions and on any graphic changes to existing products where artwork is needed.
You have been at SFA for almost a year. What changes have been made to make the association more relevant?
I don’t think there have been any seismic changes made. I have attempted to instill in our staff an appreciation that we exist for the members. As a former business member of SFA, I know it’s important for the members to know that whatever we do, it’s to benefit them. Additionally it’s my goal to expand the membership, to broaden it, so that it more represents what is being offered in the snack aisle today.
How is running an association similar to/different than running a company?
Where do I begin! The similarities are easy. In both, you need people to work toward a common goal. Communication and culture are essential in both. The differences are a little more subtle and, at times, more frustrating. Working to keep our industry free from onerous regulation and legislation has been the biggest learning curve for me. I’m no longer making a product, marketing it and selling it. There, you have an almost instant scorecard on your efforts. However, in the association business, the results and successes take a little longer to register.