Alternate Channels
What is the Alternate Channel and its Segments?
Alternate Channel is the channel and its associated segments that a food or beverage manufacturer does not currently sell into.
In this case, we look at Foodservice manufacturers, (this can also apply to some Retail manufacturers), and where their products can provide solutions within retail and manufacturing segments
Segments are as follows:
Retail Foodservice (which includes Home Meal Replacement, In Store Bakery and Gas & Convenience), Speciality Retail (M&M Markets, Whole Foods), Club/Cash & Carry including substantial experience with Costco and B2B – Foodservice manufacturer selling a Foodservice product as an ingredient to another food manufacturer.
Read on to learn more about B2B Triangle Partnerships.
Sisu Solution’s Alternate Channels
31% of Canadian’s purchase prepared food from the deli (HMR) each week. (Mintel 2022)
Retail Foodservice –
Home Meal Replacement
These are the food items such as entrees, side dishes, salads, sandwiches etc., that are sold in the deli area of the supermarket for grab and go or made to order in store.
M&M will expand M&M’s 317 brick and mortar stores along with its 1300 express locations. (Parkland 2022)
Specialty Retail
Working with store chains who sell their private label of numerous food items. Providing y as an ingredient or a finished product to be packaged in this chain’s brand, are great opportunities of growth.
60% of Canadian consumers report that convenience store food is = to QSR.
(Bluedot/Cardlytics 2022)
Retail Foodservice –
Gas & Convenience
These are items within a foodservice or retail manufacturers portfolio that would work well with grab and go snack, pre-finished meal item i.e pre-made sandwich or salad or an ingredient sold to a manufacturer who makes sandwiches, salads, entrées, pizza etc. for a Gas and Convenience chain.
Think service deli, bakery, bakery commissary and food court for ingredient opportunities. 107 stores in Canada.
(Costco Q4 2023)
Costco
Key opportunities for foodservice, and some retail manufacturers, are within the Bakery, Bakery Commissary (Vaughan, Ontario), Foodcourt and Service Deli. The Bakery Commissary could be an ingredient for a seasonal bakery treat, bakery, finished dessert item for a permanent listing or as a seasonal listing, adding a foodservice item to the Foodcourt’s menu or an ingredient or finished item to add to the Service Deli’s roster or entrees, salads, pizzas etc.
24% of consumers go to a specialty bakery as supermarket bakery does not offer different desserts. (FMI Dec 2022)
Retail Foodservice –
In Store Bakery
Key area for foodservice manufacturers for the cake/dessert display case with the unique and eye appealing foodservice desserts and also for prepackaged grab and go bakery/sweet treats.
B2B
A Triangle Partnership forming a three partners business together. It works on the principle of you the manufacturer having a new product/ingredient that you know would work well for a new product with your In Store Bakery customer. This finished product, that uses your ingredient, is made by a third party company. (And that cupcake (3rd party) sells the finished product to the retailer or the distributor).
Facts to Make You Act
In Store Bakery & B2B
Donut sales +6% vs YAGO. Most other items are flat.
Supermarket Perimeter August 8.2024.
Consumers are demanding affordable indulgence.
Driver
Can you leverage current capabilities to provide donuts that shout indulgence or possibly an ingredient sold to a donut manufacturer to add that indulgence!
Action
Gas and Convenience
Part of Retail Foodservice
of Gas & Convenience Chains surveyed expect their Retail Foodservice sales to increase in 2024 and 2025. Grew +23 in 2022.
State of the Nation – Convenience Store Products May 2024
Consumers love the convenience, improvement in quality and in most cases a good value proposition vs. QSR
Driver
Look to your company’s lessons within QSR re products, merchandising and promotions and see how they can fit with a G&C retailer for their Retail Foodservice category.
Action