US Food & Beverage Market
Overview
Prepared by Bord Bia North America
Growing the success of Irish food & horticulture
AIDAN COTTER
Growing
the success
CHIEF
EXECUTIVE
BORD BIA
of Irish28food
& horticulture
JANUARY
2009
November 2014
North American Markets
Irish F&B exports by market, €m 2013(e)
600
506
500
US
400
Canada
USA
300
Canada
Mexico
Mexico
200
Total =
€633m
100
79
48
0
Irish exports by market
Growing the success of Irish food & horticulture
Source: CSO 2014
US Market Facts
Population: 317 million
GDP: $17.3 trillion (+2.5% growth 2013)
Exchange Rate $1 = €0.79 / €1 = $1.27
US Food Market est. $1.2 trillion; Retail 55% / Foodservice 45%
US Alcoholic Beverage Market est. $200bn
Top 5 Food Markets: North East; Florida; Mid West; California; Texas
5th largest export market for Irish food & drink: €506m / $673m in 2013
Sources: Bureau of Economic Analysis
Growing the success of Irish food & horticulture
Irish F&B Exports to US 2013, €m
Pigmeat
€14m
Prepared Food
€15m
Seafood
€2.5m
Horticulture &
Cereals
€2m
Dairy €122m
Beverages €351m
Beverages - 70%
Dairy - 24%
Prepared Food 3%
Pigmeat - 2.8 %
Seafood <1%
Horticulture &
Cereals <1%
• Irish F&B exports to US totaled €506m / US$673m in 2013, -0.6% on 2012
Growing the success of Irish food & horticulture
Irish F&B exports to US 2007-13, €m
€m
600
509
500
400
428
506
462
438
397
356
300
€m
200
100
0
2007
2008
2009
2010
Growing the success of Irish food & horticulture
2011
2012
2013
A Selection of Irish Food & Drink Exports to US
Growing the success of Irish food & horticulture
US Grocery Retail Structure
Dollar Stores
Discount
Hypers
Supers
US
Grocery
Channels
Wholesale
Convenience
Growing the success of Irish food & horticulture
Drug Stores
US Grocery Retail Overview
Channel
Core Offer
Retailer Examples
Hypermarket
Large out-of-town stores with a sales area exceeding 120,000 sq.ft
with an extended area allocated to food and grocery goods.
Walmart Supercenter
SuperTarget
Discount
Big box stores selling general merchandise goods, typically sized
between 80,000 sq.ft and 120,000 sq.ft
Walmart, Target, Kroger (Fred Myer
and Marketplace Stores)
Members
Club
Wholesale
Large warehouse cash and carry units stocking high volume grocery
lines in large pack sizes. Exclusive to members only.
Costco, Walmart (Sam’s Club),
BJ’s
Supermarket
Traditional food & drug combo stores with a sales area 15,000 to
100,000 sq.ft. Trad. US supermarkets have strong fresh offer.
Kroger, Supervalu,Safeway, Ahold,
Publix, HEB, Wegmans, Schnuck’s
Convenience
& Forecourt
Stores less than 1,000 sq.ft that stock a limited selection of fresh
grocery goods.
7 Eleven, Kroger (Quick Stop, Tom
Thumb), Circle K
Dollar Stores
Small neighbourhood stores. Low price points facilitated by efficient
operations, often centralised distribution and uniform stores.
Dollar General, Family Dollar,
Dollar Tree Stores and Fred’s
Natural &
Organics
Premium stores that stock a wide variety of organic, naturally
preserved and environmentally friendly goods.
Whole Foods Market , Sprouts,
Trader Joe’s
Limited Line
Extreme value grocery stores stock a small number of products at a
very high volume, therefore giving the customer low prices.
Save-a-lot (Supervalu), Aldi Sud
Drug Stores
Stores retail drugs and medicine, health and beauty products, and
increasingly a limited selection of food and beverage items (snacks.
CVS, Walgreens, Duane Reade,
Rite Aid
Source: IGD
Growing the success of Irish food & horticulture
US Grocery Retail Overview
Top Grocery Chains
Chain
No. Stores
Grocery Sales $ Bn
Market Share
Walmart
3,275
$147
26%
Kroger
3,427
$ 99
10%
Costco
648
$ 67
7%
1,406
$ 37
4%
632
$ 36
4%
1,080
$ 28
3%
Ahold USA
774
$ 26
2.5%
Albertson’s
1,059
$ 22
2%
Safeway
Sam’s Club
Publix
Source: CSG 2014
Growing the success of Irish food & horticulture
US Grocery Retail Overview
Natural
Product
Retailers
Specialty/
Natural
Hybrid Retailers
Growing the success of Irish food & horticulture
Conventional
Supermarkets
50+ stores
Grocery Retail Landscape Changing
Growing the success of Irish food & horticulture
US Grocery Retail Overview
Key Trends
Private label growing, now 22% of sales (47% in Europe)
Discount sector benefiting from price conscious consumers
Convenience sector growing due to long-term demographic changes
Urban shopping trend creates opps for specialist retailers & local stores
Online grocery growing - traditional grocers, general e-tailers, premium
Health, wellness & functional foods show significant sales potential
Natural, organic, speciality & ‘free from’ foods still growing
Imported foods benefit from Americans’ exposure to many food cultures
Growing the success of Irish food & horticulture
Alcoholic Beverage: Open and Control States
(Control States in Blue)
Alcoholic beverage
control states (19),
have state monopoly
over the wholesaling
and/or retailing of
some or all
categories of
alcoholic beverages
such as beer, wine,
and distilled spirits.
Approx 25% of US
population lives in a
control state.
Growing the success of Irish food & horticulture
US Route to Market / Margins
Note: Margins are
general. Categories
will differ.
Source: Bob Burke
Growing the success of Irish food & horticulture
US Natural / Specialty Food Distributors
National
Distributors
70+%
Regional
Distributors
15+%
Local Market
Distributors
5%
Customer
Exclusive
Distributors
10%
Associated Buyers
Lomar (Hy Vee)
Black River Produce
Peyton (Kroger)
Chex Finer Foods
Valu
Merchandisers
(AWG KC)
Arizona Select
Cavallaro
Davidson
European Imports
JC Wright
MDI
SWD/Kiwi WFM
Vitamin Cottage
Henry’s
Sunflower
Source, NS Sales, Acosta, Inc.
Growing the success of Irish food & horticulture
Attitudes to Sustainability
US Food & Beverage Consumers
93% Health
Nutrition
69%
concerned
with
sustainable
packaging
Attitudes to
Sustainability –
What’s
Important?
67% Non
GMO
77%
prioritise
Sustainability
69% Animal
Welfare
65% protect
& renew
natural
resources
(Source: Cone Communications 2014)
Growing the success of Irish food & horticulture
Opportunities for Ireland
Ireland - excellent credentials with trade buyers as source of quality supply
Alcoholic Beverages: US is world’s largest market.
Irish whiskey is fastest growing spirits category +17.5% 2013.
Dairy: Butter & Cheese. Kerrygold is #1 imported butter into US.
Irish cheese also benefiting from grass-fed attributes.
Meat: Market access for Irish beef by end 2014.
US has world’s highest per capita beef consumption.
Trend toward healthier grass-fed & ‘free from’ offerings.
Gourmet / Artisan products offering particularly strong, distinctive
USPs not already on offer.
High-quality private label.
Growing the success of Irish food & horticulture
Source: Bord Bia
Doing Business: Market Challenges
Food Importation becoming increasingly strict due to Bioterrorism
threat & the Food Safety Modernisation Act (FSMA)
US Compliant Labelling & UPC Bar Codes
Complex Route to Market
Listing Fees / Marketing Support
Currency fluctuations
Distance from Ireland
Takes long time to gain traction (3-7 years), but once established,
it is typically a long-term and rewarding market
Growing the success of Irish food & horticulture
‘Must Haves’ for the US Market
Knowledge of Competitive Set & Your Points of Difference
Route to Market & Pricing in place
US Food Compliance – Registration / certification (USDA,
FDA, TTB), import prior notification, US labelling, etc.
Reasonable shelf life
Previous Export Experience
Long-term Commitment – time, people, focus & money
Growing the success of Irish food & horticulture
Buyers Targeted for Marketplace 2015
Alcoholic Beverages – 8 Buyers
Meat – 8 Buyers
Seafood –3 Buyers
Grocery – 5 Buyers
Growing the success of Irish food & horticulture
Bord Bia North America Office
Remit: USA, Canada, Mexico
Client services: customised market research; store audits; retail
store itineraries; importation advice; FDA regulation guides; market
information; trade meeting facilitation; market readiness
programme
Karen Coyle – karen.coyle@bordbia.ie
Anna Power – anna.power@bordbia.ie
Tel + 1 (212) 935 4505
Additional Resources:
4 BB fellows – 3 NYC; 1 Toronto
1 Origin Green Ambassador – NYC
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Growing the success of Irish food & horticulture