You may have come across the term Specialty Food. As with most everything, different people will have different takes on what it is. Google it, and you come up with a hodge podge of responses that probably confuses more than enlightens. I’ve come to believe that specialty food is the collection of everything that is not regular food.
So what is regular food? Cheerios, Kraft American Cheese Slices, and Heinz Ketchup are some examples. Regular food, in my definition, are products that a grocer, almost any grocer anywhere, will have on his shelf. It has nothing to do with the quality, the nutritional value, or where the product is produced that distinguishes a regular food item from a specialty food. So don’t get yourself confused. There are some completely horrible, chemical laced, non nutritional products that are specialty foods, and likewise there are some wonderful, nutritious, delicious, made in America by big corporations products that are regular foods. And before we start sorting this all out let me throw one more thing to stir up the pot a bit. Specialty food can and does become regular food over time!
An example of a specialty food becoming a regular food might be olive oil. If you went to a grocery store in the 60’s or the 70’s there probably was not much of a selection of olive oil. What probably was on the shelf were a couple of choices that were likely brought to the store by a Specialty Food Distributor. They probably moved (sold) a couple of bottles per week, like most specialty food items. The product was expensive comparatively. In my Midwestern family olive oil was exotic! My mother never used it for anything but earaches. She would warm it up and place in our ears to soothe pain. As an aside, it seemed to work! Today, my wife and I consume a 64 oz bottle of olive oil every month and there is literally a whole section in the grocery store to choose from. What once was a specialty food is now a regular food.
Today I think of specialty food as the umbrella term for Gourmet, Natural, Organic, Imported, and now Local grocery products that are generally sourced by the grocer from a Specialty Food Distributor because they move too slow compared to regular food products that are sourced by the grocers own warehouse. So that is the key distinction: distribution.
Regular food products are purchased and warehoused by the grocer and are stocked on the grocers shelf by their own personnel. Specialty food items are often brought into the grocer’s store, stocked by the Specialty Food Distributor personnel and are paid for as they are sold or placed on the shelf dependent on the arrangement of the Distributor and the Grocer.
One small word of caution, Specialty Food Distributors should not be confused with the terminology DSD. That term stands for Direct Store Delivery. I hear seasoned grocery people who don’t understand the specialty food channel and refer to it as DSD. DSD product examples are bread, chips and beer. Those items are often brought to stores daily by independent bakery, snack and beverage Distributors that have nothing to do with Specialty Food Distributors.
A simple rule of thumb is that about half of what is in a grocery store is regular food products that come from the grocer’s own warehouse and about half comes from a Specialty Food Distributor. However, that general rule can vary widely dependent on the type, location and clientele of a grocery store. For example, my wife grew up in Denver, Indiana, and I will bet you most of the products in the Denver grocery come from their own supplier’s warehouse. My daughter lives in an upscale section of Brooklyn called Dumbo, and I would guess that many of the items in the small bodega where she does much of her shopping are specialty food from a Specialty Food Distributor.
What does all this mean to you the entrepreneur trying to get your product onto the grocer shelves of America? Most new products especially from startups will be considered specialty food. The bottom line is that if you want to create a national brand, most of how you get to market will probably be through Specialty Distributors for quite some time and maybe forever. I will discuss the benefits and perils of using Specialty Food Distributors in future posts. My advice to you is to learn about Specialty Food Distributors and how you can partner with them to grow your brand and your business.
For now, keep working….to the grocery shelf!