Markets Private label supply for breakfast foods on the rise

Private label supply for breakfast foods

on the rise

The health emergency caused by the COVID-19 pandemic in 2020 not only revolutionized some consumption dynamics, but also became an opportunity for many to change their breakfast routine. Based on recent research carried out by Istituto Piepoli - the independent Marketing Research Institute in Italy - one out of five consumers admits having changed their breakfast habits in the last year, dedicating more time to it, eating at home and privileging healthy products. Based on IRI data, in 2020 the breakfast food market Customers have rediscovered their love for homemade breakfast food. The product categories that recorded the highest increase were melba toasts, cereals, jams and spreads, together with hot drink mixes

generated a turnover of about 10.5 billion euros, with a growth of +6% compared to the previous year. Some of the most dynamic value added categories were hot drink mixes (+10.8%), UHT milk (+11%), sweet spreads (+11.2%) and jams (+10%). In this market, consumers preferred PL products of large-scale distribution brands, which are now offering richer assortments of higher quality, also thanks to partnerships with supplier companies.

In 2020, in D.It stores an exponential growth is recorded in the sales of base products such as flour, sugar, butter, eggs and yeast.

SKYROCKETING PURCHASES OF BASE INGREDIENTS

One of the most interesting trends of the last year was the rediscovery of breakfast homemade foods. “We recorded an exponential growth especially in some base products such as flour, sugar, butter, eggs and yeast - said Roberto Romboli, D.it PL Manager - which were mainly used to prepare homemade sweets to eat as an alternative to traditional breakfast. In Sigma, Sisa and Coal points of sale, the categories with the highest growth were melba toasts, cereals, jams and spreads, together with hot drink mixes, linked to purely indoor consumption.”

BREAKFAST AT HOME, STILL THE MOST BELOWED

The health emergency was undoubtedly the main factor behind the growth of purchases in the breakfast food sector, and the trend seems to continue. “Our PL recorded significant improvements throughout 2020 - comments Francesco Iuculano, Todis Sales Manager - with breakfast products increasing in both value and volume by over 8%. This confirmed the revamped desire of Italians to eat breakfast at home due to what experienced during the most critical months of the pandemic. This consolidated in the first months of 2021. In fact, we are now seeing a substantially equal trend in terms of volumes and turnover (+0.2%).”

D.IT IS WORKING TO OFFER A NATURAL BREAKFAST

D.It breakfast food supply is widening with the addition of healthier and more sustainable products. “The choice of gourmet raw materials and short labels will continue to play a major role - explains Roberto Romboli. Such labels are characterized by few, yet good and simple, ingredients (clean labels). We’ve been working on such aspects for years, not only for our Sigma, Sisa and Coal mainstream lines, but especially on our VerdeMio (organic), Gusto&Passione (premium) and Equilibrio&Piacere (functional/healthy) lines, with the aim to offer a range of products that have more distinguishing features and higher quality.”

A DYNAMIC YET NOT HOMOGENEOUS MARKET

According to Luigi Borrelli, Despar Italia Food Product Manager, after a significant increase in the breakfast food market recorded last year (+20%), the stable turnovers as of April 2021 is an extremely positive piece of data for labels’ PL. “Specifically, the turnover generated by cookie sales is stable, while cereals, in particular those of the healthy product line ‘Vitale Scelta Verde’, are increasing. Similarly, melba toasts in 2020 almost doubled their turnover. Whereas, a slightly negative trend was recorded for baked snacks (especially croissants). As for the market of ready-made cakes, it is witnessing a constant increase, recording a growth of over 50%.” u Last year, Todis PL for breakfast foods increased by over 8% in terms of value and volume compared to 2019 and consolidated in 2021 as well (+0.2%).

u In 2020, the turnover generated by Despar melba toasts almost doubled compared to 2019, while the ready-made cake trend reached a percentage of over +50%.

COMPARING PRIVATE LABELS

A WIDER RANGE OF HEALTHY PRODUCTS

The increasing attention of consumers towards health and well-being can also be seen in the breakfast food market. “There’s no doubt that all those months of isolation at home due to the pandemic - stated Samanta Brasiello, Iper La grande I PL off-theshelf buyer - led many people to value the benefits of the most important meal of the day. Analyzing both market trends and our data, we found a preference for healthy products. For this reason, we’re working to widen the range of our fresh-squeezed juices, plant-based drinks and to add new flavors to our Greek yogurt.”

Todis, an all-round supply

With its all-round lines, Todis is the leading brand in the breakfast food market. “Our historic brand, ‘I Tesori del Forno’, includes cookies, snacks and croissants - explains Francesco Iuculano - our ‘Canaria’ brand includes a wide variety of fruit juices, while our ‘Colle Maggio’ brand includes yogurts, fresh, UHT and organic milk. Finally, there are the jams of our ‘La Valle delle Delizie’ line and hazelnut jams of our ‘L’Arte delle Specialità’ line. We’re developing products with a strong emphasis on Italian raw materials and we’ll continue to offer organic and healthy foods, such as the ones of our ‘Solo Sano’ line.”

Most performing added value segments

+10.8% Hot drink mixes +11% UHT milk +11.2% Sweet spreads +10% Jams

Source: PLM processing based on IRI data, 2020.

A TRUE PARTNERSHIP WITH THE INDUSTRY

According to Francesco Iuculano from Todis, to develop complete product ranges under the label’s brand, a true partnership and collaboration with the industry is essential. “Following the market’s trends, we’re convinced that you can achieve good results only if you join forces under a ‘value for money’ point of view, which has to be seen in both product price and quality, using signature and sustainable packaging. We constantly work with our suppliers to develop products with healthy raw materials of certified origin and to offer a quality and sustainable private label with great value for money.”

THE HIGH-END, ALWAYS THE QUALITY REFERENCE FOR PLS

Also Despar has a consolidated relationship and partnership with its suppliers. In fact, it organizes regular meetings with them to discuss and analyze product ranges and turnover trends. “We work with the most important Italian and foreign producers - explains Luigi Borrelli - who are regularly audited and monitored to ensure that they meet all the quality standards required for PLs. To develop our PLs, the quality reference is always the high-end of the market, not only for our premium, but also for our core line, so as to offer our consumers quality products at a fair price.”

AUDITS AND PANEL TESTS FOR ALL SUPPLIERS’ PRODUCTS

D.It current 190 co-packers are all accurately selected through a process based on document analysis of the necessary requirements. “Our standards vary based on reference category and certification of production processes - explains Roberto Romboli - and, where possible, we privilege Italian raw materials. We appoint external laboratories to carry out audits in our suppliers’ companies and panel tests on products analyzed that may potentially be added to an already existing range, as well as, on those already on the shelf. As for our PL, the whole development process is Iso 9001 certified.”

A year of innovations for Despar lines

In the next months, we will see many new products for breakfast on Despar shelves. “We constantly check our assortments and develop new products - explains Luigi Borrelli - to follow the new market trends. We’re currently working to revolutionize our PL supply of trancini (sweet baked product), which will be completed by the end of the year. We also plan to renew our cookie supply with the addition of new references to be launched in the next months. Finally, by the end of 2021, we’ll widen our breakfast food supply in terms of ready-made cakes and cereals. So much is yet to come!”

WATCHWORD: SHARED VALUES WITH PARTNERS

Iper La grande I private label brand development involves sales, marketing and quality assurance departments. “We work to offer quality products with good value for money. For this reason, we always aim at establishing long-lasting relationships with our partner suppliers - explains Samanta Brasiello - sharing with them our same values to ensure quality, traceability and sustainability. This means choosing products made using Italian raw materials and limiting the use of food additives and colorants where possible. For the development of our PL lines, we require safety legal requirements, but, above all, compliance with food safety international standards.”l

+6%

by Fabio Massi

Added value breakfast food sales: 10.5 billion euros