2020 in Hindsight: CPG News, Week of Dec 28-Jan 1

by Veronica Drake

7 Minutes

Contents

good-reads

Good Reads to Wrap Up the Year

Earth to the meatpacking industry: 2020 is coming up, exit the time capsule by Phil Kafarakis, Food Dive

SKU cuts and vendor shortlists defined CPG supply chains in 2020 by Shefali Kapadia, Supply Chain Dive

Pardon the Disruption: 2021 will be a critical year for supermarkets by Jeff Wells, Grocery Dive

How Will We Eat in 2021? 11 Predictions to Chew On by Kim Severson, The New York Times

2020's 10 biggest M&A deals in the food and beverage industry, Food Dive

frozen-fresh

2020 Makes Frozen Fresh

The frozen food category has had a comeback in 2020, just years ago facing one of the greatest declines in the food and bev world, this year becoming a staple in freezers across the country. With limited access to restaurants and a greater need for home-cooking, growth in sales has increased 25% year-over-year in the 40-week period ending in November according to Nielsen, and IRI data shows 17.4% growth in November alone. 

The stigma around frozen food being seen as unhealthy and unappetizing was starting to lessen before the pandemic hit, but was given an extreme boost when consumers went into lockdown and stockpile shopping became the name of the game (sales spiked 70% between March and April). Its momentum has been sustained as months have passed, acting as both a practical replacement for fresh foods with a shorter shelf life, and a way to achieve a home-cooked meal with less effort, a welcome timesaver for households managing a myriad of other responsibilities. Significant trends in the frozen food market have included redesigning packaging, offering sought-after international flavors and forms like bowls, and emphasizing a healthier image. These tactics have worked for major CPG companies like Conagra Brands and Nestlé, both of which have repositioned themselves as innovative and nutrition-conscious to appeal to consumers. 

With particular popularity for frozen fruits and vegetables, two of the highest growing subcategories, 2020 has proved that fresh taste can come frozen, giving the frozen food industry the chance to revamp its reputation and outlast the pandemic.

delivering-safety

Delivering Safety

goPuff announced last week that it would begin offering perhaps its most 2020-esque item: Covid-19 tests. The delivery service has teamed up with Purlab to add the at-home testing kits to the virtual shelves of the 500 cities it currently serves, promising delivery within minutes and cutting the time it takes for consumers to access them from pharmacies or online retailers. No-contact delivery makes the process safer than a trip to a brick-and-mortar store, and results can be expected in as little as 24 hours, according to Purlab president Michael Cohen

Kroger and Albertsons were among the first grocers to offer tests in-store, and Walmart is in the process of testing drone delivery for at-home kits. As cases continue to rise in the wake of holiday celebrations in the U.S., easier methods of testing in the form of at-home options have become more prevalent, making for high potential revenue for retailers. Kroger has also announced it will give Covid-19 vaccines at its over 2,000 pharmacy locations as they become more available, hiring nearly 1,000 healthcare professionals to assist in the undertaking. It joins other retail chains, including Publix and ShopRite, in a partnership with the U.S. Department of Health and Human Services to help administer the shots. Kroger has already provided over 250,000 tests since the pandemic began, and rolled out antibody tests to determine if an individual was previously infected. This year has added another level of importance to retail chains, giving them an important role in the fight to control the virus, a reliance which will continue in 2021 as efforts ramp up to vaccinate the nation. 

making-good

Making Good in 2020

More than a decade in the making, community-owned South Philadelphia grocery store South Philly Food Co-Op has opened with a goal of providing people “of all income levels access to fresh, local, and sustainable groceries,” the store said in its announcement. Partnering with local vendors to offer a selection of fresh produce, fish, meat, and cheese, among other products, the co-op is aiming to take the challenges of Covid-19 and use them to create a strong community with a focus on accessibility and affordability to all of its members. Shoppers can become member owners for a $300 fee, which can be split into payments, which provides them with member sales and discounts. The store is starting with 1,400 member-owners, which has allowed it to finally get off the ground after 10 years of effort, a welcomed bright spot in 2020. 

change-to-last

Change To Last

Giant Food has announced that beginning in January it will introduce updated labels in-stores and online to promote women- and minority-owned brands as well as those owned by members of the LGBT community and veterans. The initiative comes as the company continues its efforts to demonstrate its commitment to inclusivity and diversity, which shoppers are looking for after a year of devastating effects from Covid-19 and the protests against racial injustice that took place all over the country this summer. Consumers have indicated that they are willing to alter their shopping habits to support brands and retailers that align with their values, which can range from racially inclusive to environmentally sustainable, and are seeking out minority-owned businesses to support. 

Giant Foods donated $500,000 earlier this year to various racial equality organizations, and are not the only company to increase their efforts to meet consumers’ demands. Kroger recently laid out a ten-point plan that will be used to help nurture its diversity and inclusivity in stores and at the corporate level, while Giant Food’s owner, Ahold Delhaize, has begun using a wider range of diverse manufacturers thanks to partnerships with nonprofit organizations that assist in finding them. 

2020 has sparked an international conversation about the importance of consciously promoting diversity and inclusion, and with shoppers willing to put their money where their mouth is, retail response has been significant. While the changes are just beginning and there is a long way to go, the future is promising thanks to pushes this year to ensure that these issues are not simply trends and are sustained in the long term.

About Unioncrate

Unioncrate is an AI-powered Supply Chain Planning Platform that gives CPG brands the technology they need to compete and win in a rapidly changing consumer landscape. Our automated demand and supply forecasts deliver unmatched accuracy, collaborative visibility, and actionable intelligence, simplifying a manual-heavy process and slashing hours from your week.


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