A.B.A. panel probes disruption in the market

by Dan Malovany
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Taking photos of foods
In the U.K., 20% of all food being served to millennials is being photographed.

BOCA RATON, FLA. — Changing consumer preferences as well as new shopping patterns and an onslaught of new product innovation are disrupting the market for bakers and the food industry as a whole, said Cyrille Filott, global strategist for consumer food at Rabobank.

Mr. Filott led a high-powered panel of speakers at the American Bakers Association convention, held March 26-29 in Boca Raton.

Cyrille Filott, Rabobank
Cyrille Filott, global strategist for consumer food at Rabobank

“Consumer preferences are changing at a pace that is unprecedented,” Mr. Filott said. “The rise of new channels is amazing.”

Driving that change are millennials, who are looking for products that offer health, transparency, convenience, sustainability and especially experience. In many cases, their experiences with food made at home or eaten at restaurants are being shared with their friends and family on-line.

“In the U.K., 20% of all food that is being served to millennials is being photographed,” Mr. Filott said.

Moreover, he added, 1.6 million moms now post blogs about food, resulting in challenges and opportunities for companies.

Grupo Bimbo Healthfull whole grain bread
Grupo Bimbo is offering more products with whole grains, such as its line of Healthfull 100% whole grain bread.

In the health and wellness arena, Mr. Filott pointed out that organic now accounts for 5% of all food consumed, and it is growing at double digits.

“It is one of the key drivers for millennials,” he said.

Aline Clavellina, corporate senior vice-president, health and wellness new business at Grupo Bimbo S.A.B. de C.V., Mexico City, elaborated on the constantly evolving health trend. She noted that Bimbo is offering more products with whole grains as well as an increasing number of organic options. In many cases, consumers are looking for cleaner label products that offer more than the traditional drivers such as price and convenience.

Aline Clavellina, Grupo Bimbo
Aline Clavellina, corporate senior vice-president, health and wellness new business at Grupo Bimbo

“The less processed, the better the product will be,” Ms. Clavellina said.

In the convenience store channel, some companies are providing consumers with fresher, higher quality sandwiches and food to go, “not just gas station food,” said Ashleigh Michaels, corporate executive R.&D. chef for RaceTrac Petroleum, Inc.

From an operational perspective, bakers and other suppliers need to provide products that are convenient such as par-baked bread and rolls that take 10 minutes to prepare instead of frozen dough that requires up to two hours to proof and bake.

Sister Schubert's par-baked rolls
Suppliers need to provide products that are convenient, such as par-baked rolls that take 10 minutes to prepare.

Another dramatic shift in the market involves the rise in popularity in food produced by small companies. Danielle Gould, founder and chief executive officer of Food+Tech Connect, observed that “big food” has lost $18 billion in market share since 2011.

Danielle Gould, Food+Tech Connect
Danielle Gould, founder and c.e.o. of Food+Tech Connect

“Over the last five years, the top 25 food companies in the U.S. lost $18 billion in market share, and 46% of the growth that has happened in the industry came from small and mid-sized businesses,” she said.

Changes also are happening overseas. Jean Manuel Leveque, managing director, Delifrance, noted that there are hundreds of fewer bakeries in France each year. At the same time, scratch baking continues to decline while par bake is expected to grow in popularity throughout Europe. 
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