2008 Hot List

Special Needs Food

Years on the list: 2 out of 21
Special Needs Food
Think simply having organic, fair trade or nutritionally enhanced menu items means you're ahead of the game? Think again. There's a growing category of special needs food that means adding terms like gluten-free, low-glycemic and allergen-free to your vocabulary--and your offerings. Anheuser-Busch has even contributed to the movement with Redbridge, a gluten-free beer.

The Food Products Association reports that about 6 million to 7 million Americans have a food allergy, and market research firm Packaged Facts estimates that low-glycemic food sales will grow at a compound annual growth rate of more than 45 percent from 2007 to 2011, at which point sales are projected to reach a whopping $1.8 billion. "The people who are paying attention to [the organic movement] will look more deeply into what it is they're eating, and they'll probably find that they're allergic to stuff that they didn't know about," says Stephen F. Hall, a specialty food business development consultant.

The dietary needs may be different, but the sweet tooth is the same. According to Anne Muñoz-Furlong, CEO of The Food Allergy & Anaphylaxis Network , "Combinations of allergen-free foods such as milk-, egg- and wheat-free baked goods will be a natural growth area because Americans love desserts." --S.W.

Already hot in London and making their way to U.S. cities, gastropubs might be the next trend to come down the pipeline. The term "gastropub" is open to interpretation, but the short version is an English-style pub that serves high-quality cuisine. Tanya Steel, editor-in-chief of food-focused website Epicurious.com, says, "Comfortable, local places with great food, drinks and atmosphere are here to stay and will only get bigger."

United Kingdom native Jayne Battle, 33; her father, Frank Battle, 65; and her fiancé, Jon Erickson, 36 brought the concept to San Diego this past February with Jayne's Gastropub . "Only a handfulhave attempted this concept in the U.S., and most of them are booming," says Jayne, who projects year-end sales of $750,000.

Want in? "Take over an old bar; keep it the same but with a better chef," advises Ken D. Friedman, co-owner of the first gastro-pub in the U.S., The Spotted Pig , which opened in New York City in 2004. --S.W.

Upscale Frozen Desserts
Consumers are taking a liking as they take a licking of upscale frozen desserts. Ice cream, gelato, frozen yogurt and even shaved ice concoctions are keeping customers cool as the industry heats up.

The International Dairy Foods Association reports that Americans consume about $21 billion in frozen desserts per year.

Frozen yogurt is so hot right now that battles are being waged between today's newest competitors--Juicy Green, Pinkberry and Red Mango--but whether there will be a meltdown in the craze is yet to be seen. Meanwhile, ice cream is growing up with spiked ingredients and flavor fusions. And gelato appeals to all with its air of sophistication.

In 2000, husband-and-wife team Ugo and Cristiana Ginatta, 64 and 37, respectively, decided to bring a little flavor from their native country of Italy to Dallas by opening Paciugo Gelato . They combined the Italian technique and recipes with local specialties to create more than 200 flavors, including Mediterranean Sea Salt Caramel and Black Pepper Olive Oil. "Pretty much everybody likes the idea of trying [something new,] and that's a big change," says Cristiana. "Mentally, people are adventurous." The Ginattas, who started franchising in 2004, expect to open 27 franchise locations and surpass $5 million in systemwide sales by year's end. --S.W.

Food Trends
Dig in to these sizzling food concepts and you're sure to taste success.

Superfruits: Pomegranates, blueberries and now a�a� mean superfruits are on the rise. "A super-fruit contains something from the earth, so it has a natural quality and an enormous amount of antioxidants and health benefits," says Judy Ramberg of Iconoculture, a consumer trend researcher. So what's on the vine for 2008? Aside from Amazonian energy booster borojo, John Davey of CherryPharm points to cherries, while Ramberg bets on sea buckthorn and mango-steen. Broaden your thoughts to skin care, candles and fragrances for budding opportunities.

Selling food online: Forrester Research estimates that U.S. online food and beverage sales will reach $7.2 billion in 2007, up from $6.2 billion in 2006. According to Patrick McKenna, CEO of marketing and e-commerce management firm DMI Partners Inc., "Purveyors of specialty food categories can especially take advantage of this opportunity to provide customers with products they may not be able to find where they are located."

Comfort food/one-item restaurants: Simple is sometimes better. Numerous one-item restaurants are pulling customers in by specializing in food that's comforting to adults and adored by kids. Cereal and sandwiches (like grilled cheese and peanut butter and jelly) are old-time favorites that have endured the test of time and become the foundation of some of today's fast-growing restaurant concepts. In August, Miami-based cereal franchise The Cereal Bowl announced a nationwide rollout of 16 stores under development and plans to launch a kiosk design for airports, malls and college campuses in 2008. --S.W.

New on the Menu
Got a restaurant? Take advantage of these trends.

Convenience/packaging: Today's consumers are a hard bunch to please--they have diets, allergies and fickle taste buds--and on top of that, they want their meals conveniently packaged for portability. A tall order, but you'd better deliver to preserve your bottom line. "We'll continue to see improvements in both ordering, delivering and traveling with food," says Annika Stensson of the National Restaurant Association, who also predicts food packaging will become more sophisticated and environmentally friendly.

Culinary tourism: A new type of traveler is hitting the road. Called "culinary tourists," these on-the-go consumers make food a deciding factor in their pick of travel destinations. Hudson Riehle, senior vice president of research at the National Restaurant Association, says, "Well over 3 out of 5 travelers agree that they like to try new and different restaurants when they travel to experience local cuisine." So hype up the regional flavors and make your restaurant the talk of the town.

Local food: Looking for an effective marketing tool? It might be right under your nose. Tainted products hailing from China recently have made consumers especially conscious of foods' origin. And the "locavore" movement is gaining momentum in its effort to shift market share back to locally owned businesses. "Interest in local and regional food has been exploding," says Brian Halweil, editor of Edible East End . "The interest has moved beyond the culinary fringe. It's no longer a fad. It's a trend with staying power."

Portion sizes/small bites: Supersize your sales by downsizing your portions. Major chains are betting big-time that less is really more: T.G.I. Friday's recently launched a "Right Portion, Right Price" menu, and The Cheesecake Factory is offering smaller alternatives to its trademark large dishes. Meanwhile, a National Restaurant Association survey of more than 1,000 chefs found that one sweet trend hitting menus today is bite-size desserts. Stensson predicts: "We'll see more and more mini versions of other menu items next year."

High-tech ordering: Customer-activated ordering and payment terminals are the wave of the future: According to the 2007 Restaurant Industry Forecast published by the National Restaurant Association, 46 percent of Americans say they would likely use such devices if made available to them, with 71 percent of 18- to 24-year-olds indicating they would. Good service is being redefined. Do you measure up? --S.W.

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This article was originally published in the December 2007 print edition of Entrepreneur with the headline: 2008 Hot List.

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