John's World: Food Spending

September 26, 2016 11:48 AM
 
 

For my entire career, farmers have complained loudly about how consumers foolishly think food comes from grocery stores. In a way, farmers may be half-right, but not like you may think.

Our industry’s claim that food comes from farms is a bit of a stretch.

With the exception of some fruits and vegetables, there is nothing grown on our farms that is consumed directly as food. Nobody has a plate of soybeans or corn, or bites of a hog. It’s Wheaties in the bowl, not wheat. This insistence of redefining food makes as much sense as saying cars come from an iron mine.

Most of all, if food really came from farms, farmers would never go to the supermarket themselves.

But even that simple truism needs an update. The majority of food in the US is coming from restaurants, not grocery stores. Last year, for the first time on record, Americans spent more on food away from home than at home. The gap is widening this year, even as restaurants struggle with high labor costs. This is tracking dollars not calories, but it still makes an important point.

For those of us in the food ingredient business, which I think better describes our sector, the customer we’re trying to sell to is increasingly a restaurant or the prepared food industry, such as frozen pizzas, a major target for our dairy industry.

Once we get it through our heads that the people who will influence our sales are less often the proverbial female grocery shoppers and more likely to be marketing directors at a restaurant or food company, the better we will be able to let go of our perennial demand for more attention and credit.

Those decision-makers are making far greater efforts to understand what people want to eat than we are. More importantly, they have proven to be less sensitive to our campaigns based on agrarian images or admiration of our lifestyle.

Food in the U.S. comes from a vast, complicated food system of which we are small, but important part. The sooner we embrace this truth, the better we’ll succeed in satisfying all our real customers. 

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