The State of Fresh Foods 2025: Navigating Industry Growth and Consumer Trends

The Food Industry Association (FMI) has unveiled its latest report titled The State of Fresh Foods 2025, shedding light on the ongoing growth within the fresh foods sector.

Market Momentum and Consumer Trends

This comprehensive report analyzes the progress of fresh food products into 2024 and projects their significance in the food retail landscape for the upcoming years. According to Rick Stein, VP of Fresh Foods at FMI, “Consumer preferences continue to evolve, and as demand shifts, fresh foods are key for the food industry to meet customer needs.”

Stein emphasizes that “Shoppers’ focus on nutrition and health positions fresh foods as a sales driver in food retail moving forward,” indicating that retailers must prioritize fresh food departments to enhance customer engagement.

Fresh Foods as a Strategic Priority

With fresh food sectors expected to contribute to 42% of total sales by 2024, retailers are recognizing these departments as a crucial factor in attracting customers to brick-and-mortar stores. The report illustrates that fresh foods are not only a response to consumer demands but also a means to establish competitive advantages.

The resilience of specific departments like meat stands out, as it continues to thrive despite economic challenges. Coupled with produce, both departments account for an impressive 11% of total store sales, highlighting robust shopper engagement.

Foodservice: A Key Differentiator

Foodservice emerged as a vital component in guiding retail strategies, achieving record-breaking sales of $56 billion last year. Retailers are increasingly focusing on quality and convenience, with 87% leveraging fresh-prepared foodservice programs and 63% reporting success.

Future Prospects and Innovations

While departments like seafood and bakery witnessed slight declines in sales—1.2% and 1.4% respectively—strategic investments in quality and innovation are being directed towards sustaining growth in these vital areas. Stein highlights that “Fresh food is at the heart of many of our most important operational strategies, driving workforce investments, technological advancement, and customer engagement.”

Looking ahead to 2025, the expansion of foodservice remains a top priority, with nearly one-third of retailers planning to increase their workforce in this area. Furthermore, fresh food stands out in the realm of e-commerce, representing an average of 39% of online sales revenue, underlining its digital significance.

Conclusion

As consumer preferences shift towards health and nutrition, fresh foods will play a pivotal role in shaping the future of food retail, ensuring that retailers can meet the expectations of health-conscious shoppers while creating engaging in-store experiences.

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