PHILADELPHIA – The natural products industry has the size, scale and influence to create a positive impact for people and the planet, said Carlotta Mast, senior vice president of the New Hope Network.
Sales of natural and organic products, including food and beverages, supplements, personal and household care categories, are on track to exceed $ 300 billion by 2023 and $ 400 billion by 2030, Mast said, citing Nutrition Business Journal estimates, during a presentation at Natural Products Expo East on September 23 in Philadelphia.
Demand has dropped since the peak in 2020, when consumers hoarded groceries during the initial period of the pandemic. Still, growth remains robust as consumer habits over the past year shifted in favor of the natural products industry. Sales growth driven by the pandemic is expected to continue for the next three years as new consumers discover and purchase more natural and organic brands, Mast said.
“People tried those new brands and, in many cases, they stuck with them, especially in the food and beverage categories,” he said. “Additionally, health and wellness and supporting our immune health became top priorities for us during the pandemic, and this also persists and helps our industry grow in 2021.”
The dramatic shift to home cooking raised demand for organic, dairy and packaged foods as more consumers began to pay attention to how food is grown and produced, Mast said.
“It is these new customers who will help define the future of our industry, as well as the core customers who have always pushed natural and organic,” he said.
Sales of natural and organic foods grew three times faster than sales of conventional foods, said Kathryn Peters, executive vice president of business development for SPINS, a data technology company. The pandemic pushed consumers to seek out foods with functional ingredients previously only found in the supplement aisle, Peters said, highlighting products that contain apple cider vinegar, elderberry, moringa, collagen, super mushrooms and ashwagandha.
“It’s very exciting to see people realize that your food can do more for you than just sustenance and really act like medicine,” he said.
Plant-based products continue a strong trajectory, growing 12.8% over the past year, while all food and beverages grew 4.2%, Peters said.
“(Herbal) is still on fire because more and more people understand, ‘It’s good for my body, it’s good for the world,'” he said.
Mast and Peters, along with Nicolas McCoy, managing director and co-founder of Whipstitch Capital, discussed how the industry can harness momentum to address social and environmental issues.
Mr. McCoy suggested expanding the definition of vital infrastructure to include education, healthcare, arable land, and the ocean. Investing in these key areas can accelerate progress in reducing poverty and incarceration, promoting income equality and protecting natural resources, he said.
“One paradigm that is important to change if we want to speed things up is to stop looking at tax increases and charity to fund the impact,” McCoy said.
Brands can take action to address climate change by partnering more closely with economically vulnerable farms and supporting conversion to more sustainable practices, McCoy said. Localizing production as much as possible will help reduce logistics costs and reduce the carbon footprint.
Ms. Mast noted the lack of diversity in industry leadership that does not reflect the general population.
“We don’t have a lot of representation of Black, Indian, Latino, and other people of color on our industry boards or within our industry leadership circles, and that will be increasingly challenging for our industry because how can we stay relevant? and serve an increasingly diverse consumer base if our leadership does not reflect the needs, behaviors and desires of those consumers? “She said.” Our innovation simply will not keep up if we are not actively working to foster more diverse leadership in our industry, if we are not truly supporting those BIPOC-owned and operated brands in our industry. “
Businesses must invest in providing living wages, education and training and creating an inclusive culture, and retailers must ensure their aisles reflect all customers, he said.
“The ethnic and international corridor no longer serves where we are going as a country,” Mast said.
Investors must embrace and create space for new talent on the board and invest in diverse entrepreneurs, he added.
“We have to make sure that our practices and the way we are investing in these companies are really fair and equitable and can, again, provide that diverse leadership that we need for tomorrow,” he said.
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