The recession is boosting sales of chicken at retail grocery stores as consumers look for value even while they cut back on expenditures at casual dining restaurants, an analyst and several industry executives said at a seminar for food writers held in San Antonio recently, according to a press release from the National Chicken Council.
The amount of chicken sold in larger grocery stores increased about 4% in the year ending in February compared to the previous 12 months, Todd Hale, senior vice president for consumer and shopper insights of the Nielsen Company, said at the seminar, which was sponsored by the National Chicken Council and the U.S. Poultry & Egg Association.
Turkey saw a 3% volume growth, as did pork, while sales of beef were flat and seafood declined about 6%, he said.
“There’s been pretty good growth on a volume basis for the poultry industry,” Hale said, in breaking down grocery store sales data monitored by Nielsen.
Chicken breasts were the leading item with a 5% growth rate, Hale said, adding that nearly all chicken parts saw sales growth during the past year.
Meanwhile, restaurant sales have dropped 10% to 15% in response to the recession, said Monty Henderson, president and COO of George’s Inc., a chicken company.
“People are saving money by dining out less,” he said.
Product innovation is important in foodservice, added Bernard Leonard, group vice president/food service of Tyson Foods, as restaurant concepts try to weather the downturn.
“In foodservice, particularly in casual dining, same-store sales are down, and one of the responses we have seen is in innovation,” Leonard said.
He said restaurant concepts are launching new appetizers, entrees and other items, sometimes on a value basis, to “pull that traffic in. Innovation is helping them to sustain their business.”
The picture is brighter at the retail grocery level, said Lampkin Butts, president and COO of Sanderson Farms.
“What we’re seeing at retail is very good demand for chicken products,” he said.
Sales of fresh chicken at retail grocery stores in 2008 were up 7.5% over the year before, Butts said.
“The other thing we are seeing at retail is substitution,” he added. “Consumers are stretching their food dollar, they are looking for value, and they will substitute lower-priced protein for high-priced beef or high-priced pork.”
Meanwhile, products labeled “organic’’ throughout the grocery store have been hit hard by the recession, Hale said, with monthly sales growth dropping from 24% in March 2008 to only 1% in March 2009. The number of products making the “organic” label claim has also dropped, he said.
