Photo courtesy of Aldi

In U.S. and across globe, retail success may be hard to sustain

Jim Prevor

Originally printed in the April 2021 issue of Produce Business.

Jim Prevor

Though the produce category had a record year at retail in 2020, foodservice was, of course, way down as so many restaurants were closed as were institutions such as schools and their lunch and meal programs. The statistics are not all in yet, but there is little reason to think that produce consumption hit a high during the pandemic, especially not fresh produce consumption.

There is some evidence that certain items, particularly associated with health that were never previously heavily consumed at restaurants — such as oranges and clementines and, in general, fresh citrus — did see a jump in sales and consumption. However, the famous big four of foodservice — potatoes, lettuce, onions and tomatoes — will probably show a decline in overall consumption when all the numbers are in.

In general, while there were a few weeks where consumers were desperately buying everything — with people not wanting to go to stores… people buying more online where they were depending on surrogate shoppers of mostly little produce knowledge working for delivery companies… people uncertain when they would resume normal life, etc. — it all made perishable items, with uncertain shelf-life and sometimes need for refrigerator space, a risky and limited buy.

The pandemic may have moved eating occasions around and may have switched product favorites and, at different moments, boosted family meals and encouraged simpler meals than what one would get at a restaurant. But the Produce for Better Health Foundation’s recent “State of the Plate” Report in the U.S. tells the overarching facts with which the produce industry must wrestle:

Fruit and vegetable eating occasions continue to decline. Over the past 16 years, the frequency in which Americans consume produce has decreased by nearly 10%. This amounts to a loss of at least one fruit/vegetable eating occasion per week. Between 2015-2020 alone, consumption declined by 3%, indicating that the trend is worsening every year. Within the fruit, vegetable, and juice categories, the most significant contributors have been decreased vegetable consumption frequency (down 16% since 2004 and 4% in the past five years) and a reduction in juice (down 15% since 2004 and 8% in the past five years). Fruit eating occasions (excluding juice) grew 10% between 2004-2020 and 3% between 2015-2020. Yet, even this growth in whole fruit intake over time has not been enough to overcome the net decline.

It is nice that consumers associate fruits and vegetables with nutrients and anti-oxidents, but it is not clear to what extent such association impacts consumption. Think about this: The Annals of Internal Medicine published a study and determined that during the period of April 1 to June 30, 2020 alcohol purchases at retail and delivery jumped 34.4%:

Retail alcohol and tobacco sales increased 34% and 13%, respectively, early during the COVID-19 pandemic compared with the same period in the year prior. The greater increase in alcohol sales unlikely reflects bar and restaurant closures alone because alcohol sales increased more (+34.4%) than nonalcoholic beverage sales (+17.7%) or total sales by a non–alcohol purchaser (+2.6%). Previous estimates (4) were that 22% growth of off-premise alcohol sales would be needed to fully offset on-premise losses from closures — in our analysis, alcohol sales increased 34%.

The yearning of so many to burst out of quarantine provides a great likelihood that foodservice will rebound strongly.

There is certainly anecdotal evidence that some people used the pandemic lockdowns to eat healthier, exercise more, etc., but there is no evidence that, as a whole, lockdowns produced a healthier populace. In the Journal of Addiction Medicine, they reported that half of cannabis users increased their marijuana use during the pandemic, pushing frequency of use or consumption up to four days a week.

The point, of course, is that many people do not act based on what is most likely to improve their health. They drink or use drugs to escape from their problems, not deal with them.

The Produce for Better Health Foundation research further points out there is significant evidence that higher produce-consuming individuals are more motivated and have a better ability to plan.

There is hope for the industry: The explosion in fresh-cut items, combined with the development of superior varieties and new convenience items, all make it possible for the produce industry to reach out and appeal to consumers who previously looked askance.

After the last global pandemic took place shortly after World War I, the U.S. moved into the Roaring 20’s. The yearning of so many to burst out of quarantine provides a great likelihood that foodservice will rebound strongly. This new age will likely see foodservice boom and cause consumers to resume the century-long pattern of spending higher and higher percentages of their money on food consumed outside of home.

Retailers right now are drunk on success. But it will be hard to sustain. Yes, people may look wistfully back on times they could engage with their families and all eat dinner together. Young adults will, however, go off to college again and high school students will have sports, plays and other extracurriculars after school. Business that was done on Zoom because that was the only way will change as some executives find they need to go out and compete in person.

Lessons learned will not be forgotten, but, perhaps the lesson most likely learned is that human beings enjoy human contact and, as soon as they think it safe, well, whatever the Charleston of the 1920s was to its time, we can expect a new version for the 2020s, and people will want to dance



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