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When Beyond Meat went public in 2019 it was one of two companies that were building their brands around being first to market with plant-based alternatives that closely mimicked the look, taste and texture of meat from animals.
The popularity and surge in sales at both Beyond and Impossible Foods spurred a slew of companies to create their own plant-based offerings designed to remake consumers’ idea of what the veggie burger could be.
Since then, competitors of all sizes have jumped into the market, with varying degrees of success. Meanwhile, some signs show that growth in plant-based meat alternatives will look different and more varied in the coming months and years.
Total retail sales of plant-based meat, dairy and egg alternatives last year hit $8 billion, a 7% increase from 2021, despite a 3% decline in unit sales, according to a report out Tuesday from the Good Food Institute. SPINS data included in the report, which was commissioned by GFI and the Plant Based Foods Association, showed retail sales of plant-based meat alternatives dipped 1% to $1.4 billion last year, and unit sales were down 8%.
The report cites inflation as a key factor – most plant-based meat alternatives still sell at a premium price.
But retail sales figures don’t tell the whole story – restaurant chains including Burger King, KFC and Starbucks put more plant-based options on their menus, the report says, and smaller chains and independent eateries have also gotten more creative with plant-based menu items.
At the same time, plant-based companies launched diverse new retail products including vegan versions of steak, foie gras and schnitzel. And companies like Before the Butcher are carving a bigger niche in providing plant-based meats and cheeses to companies making prepared foods for the frozen food case.
Before the Butcher’s plant-based journey
For Before the Butcher, a company launched in 2017 by former Beyond Meat salesman Danny O’Malley, growth has meant evolving with the market.
The company, which focused first on launching its products in foodservice channels before rolling out its Uncut brand of plant-based burgers and meat alternatives in retail channels in 2019, has always opted for providing variety rather than creating yet another version of products already on the market, O’Malley said.
That start in foodservice gave Before the Butcher a leg up when the pandemic hit and shifted everything from consumers’ grocery buying habits to supply chains.
Before the Butcher’s initial focus on foodservice has helped the brand grow and compete in an increasingly competitive marketplace, and also led its entry into a new niche – providing plant-based meats as ingredients to companies making frozen prepared foods.
While Beyond and Impossible might be the only two brands shoppers see in the refrigerated plant-based meat case, the frozen section is increasingly peppered with plant-based versions of pizzas, burritos, bowls and meals next to the familiar animal-food versions.
In a few cases, the brand’s name shows up on the label, as in Before the Butcher’s partnership with celebrity chef Ming Tsai’s Ming’s Bings, a brand of prepared plant-based pockets made with Before the Butcher’s vegan meats and cheeses.
But in most cases, Before the Butcher’s branding won’t appear on products made with its plant-based beef, chicken and sausages, or with its brand-new vegan pepperoni.
“We knew they were looking for base ingredients,” O’Malley said. “We saw that opening and we jumped on it. Partnering with these companies has been a large part of our growth.”
The lineup of customers putting the company’s meats into their frozen meals has grown to about a dozen, O’Malley said, with four or five well-known national brands accounting for the biggest share.
Making the shift into producing ingredients for other food companies, as well as growing into private-label production, was made smoother by Before the Butcher’s beginning as a foodservice supplier.
“We took products we already had in foodservice and repackaged it for industrial customers, with larger cases and larger bags,” O’Malley said. “We were actually in a great position.”
The changing face of plant-based products
Plant-based brands started partnering with Veganuary in January 2021 to promote their products, and many took the opportunity to roll out new products in a month when the focus was on plant-based eating. In January of this year, companies introduced 1,610 new vegan products , according to the UK-based organizers of the event.
The difference this year is that many have ventured further away from burgers and nuggets to create new and varied products aimed at tempting more consumers to try plant-based alternatives.
“I think the consumer is always looking for something new and different,” O’Malley said. “It’s always changing and variety is really important. Today, creating products with ethnic flavors, tastes and textures [is key]. The consumer that eats these types of products tends to be more adventurous.”
Developing those new products has become a bit easier for the company after partnering with ingredient makers that already have the necessary equipment in place, enabling the company to experiment without massive upfront investments, O’Malley said.
“Now we can go to our R&D partners and use their facilities and they will help us develop something,” he said. “Of course they want us to buy their ingredients, which we do. When we can see we can do this, then we go ahead and buy the equipment.”
Is E-commerce the future of plant-based retail?
E-commerce is a growing channel for plant-based meat companies, either with direct-to-consumer platforms or plant-based grocery marketplaces like GTFO It’s Vegan!, which is where consumers can buy Before the Butcher’s Uncut brand products.
According to the GFI report, e-commerce “can also give manufacturers more control over their time to market compared to retail or foodservice channels, where brands need to work with external partners to get their products on shelves or menus.”
Some recent news coverage of the plant-based meat industry seemed to point to a slowdown and painted the industry as a trendy one whose time might be passing, but the GFI report and O’Malley paint a much more nuanced picture.
For one thing, O’Malley says, sales trends in the US aren’t representative of the world – international sales in markets in Asia, South America and Europe are on the rise. And some research from GFI supports that – a recent survey of European consumers found that as many as 50% eat plant-based meat at least one time a month and a separate survey of consumers in Brazil found that the number of respondents who said they were reducing consumption of conventional meat grew to 67% last year from 50% in 2020.
“And we will see it here, it’ll get back on track,” O’Malley said.
Eating plant-based is a lifestyle change and “it doesn’t mean everyone will become vegans or even flexitarians,” he said. “Maybe just once a week they’ll cut back and won’t eat animal-based proteins, they’ll enjoy these plant-based products.
“What will guarantee growth is the younger generation – they’re growing up with this, this is what they know. Children are being brought up to understand the value of eating this way and that will continue to grow. This is not a fad.”
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