New study confirms explosion of grocery prepared foods

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By Rita Jane Gabbett on 2/2/2016

A new study showed that 64 percent of grocery retailers saw growth of 9 percent or more in their fresh prepared food sales in 2014.

Released by the Food Marketing Institute (FMI) and Technomic, the survey looked at fresh prepared foods among 28 banners, representing 8,000 stores.

The report titled “The Sophistication of Supermarket Fresh Prepared Foods” predicts continued strong growth in grocery prepared foods in the range of 8 percent to 9 percent annually for the next three years, compared to restaurant growth of 4 percent to 5 percent.

“It’s clear that food retailers are differentiating their businesses by leveraging fresh food selections to meet shopper demands for convenience, all while counterbalancing declining center store sales,” FMI Vice President, Fresh Foods, Rick Stein, observed. “The trends in consumers eating away from home are being fought among restaurants, supermarkets and even convenience stores.”

Technomic’s Principal Wade Hanson explained, “Sixty-two percent of supermarkets participating in this research now offer customers made-to-order stations along the store perimeter, but select supermarkets have incorporated limited service or full-service restaurants into their physical footprint.”

For meat processors, it is important to note this: the survey showed grocers are dedicating less space and resources to sliced meats and cheeses as they invest in prepared food offerings.

At the same time, grocers are investing more in food preparation equipment, including smokers and wood-fired pizza ovens.