Joseph Pawlak

Managing Principal

July 29, 2017

Let’s Talk About Trends, Baby!

Let’s Talk About Trends!!

• Major trends impacting the

industry today, into the future

• Special look at the consumer

of tomorrow…college students

• Special treat: panel discussion

with college students, execs

2

3

Demand Will Grow for

Healthy Fare at

Foodservice

• Many dimensions to

healthy

• Healthy + tasty

important

• Transparency

critical

Various Dimensions of Healthy Today

4

Technical Qualitative Product/ingredients

• Low fat

• Low calories

• Low sodium

• Gluten-free

• High in vitamins

• Fresh

• Clean

• Local

• Wholesome

• Natural

• Fruits/vegetables

• Salads

• Organic

• Whole wheat

Organic Produce Increase Supports Healthier

Food Demand

43%

29% 22%

8% 7% 6% 6%

Beet saladappetizer

Asian saladappetizer

Caesarsalad

Asian saladentree

Specialtysalad

appetizer

Cobbsalad

House/side salad

Organic salad growth

2016-2017

Base: Menus pulled across U.S. 7,042 commercial operators

YOY Menu Mentions – at least (4) 2016 mentions required for consideration

Source:MenuMonitor Research Conducted By Technomic on Behalf of Church Brothers Farms

5

Audience Question #1

Which descriptor is best

for describing produce

menu items that are

both healthy and tasty?

6

Healthy Eating Implications

• Move toward qualitative,

product/ingredient descriptors in

your positioning

• Clean label should be a priority

• Establish transparency as a key

objective

7

Plant-Forward! Plants are getting as much

attention as meat

8

eat a meatless meal at least once a week

59%

9

That’s Not Pulled Pork!

10

San Francisco

• The veggies are listed up top

• The meats are listed under sides

11

Plant Forward Implications

• Understand consumer

increasingly are interested in

flavorful meat substitutes

• Play is both cost cutting, creative

in nature

• Explore new menu development

ideas with produce as the star

12

Innovative Flavors, Combinations Add

Excitement

13

Innovation with Arugula

Source: Technomic Research Conducted on Behalf of Church Brothers Farms

14

Chicken avocado chop Chopped romaine and arugula, all-natural

chicken breast, avocado, tomatoes, corn,

black beans, feta cheese and crispy tortilla

chips with A citrus chipotle dressing. Served

with artisan ciabatta toast. $8.89

Pesto portobello Warm quinoa, organic arugula, roasted

chicken, warm portobello mix, raw corn,

hot chickpeas, spicy broccoli and pesto

vinaigrette. $11.15

Buffalo Cucumber

15

Menu Innovation Implications

• Don’t be afraid to be creative

• Unique flavor combinations hitting

the spot

• On-trend flavors, ingredients

finding into produce combinations

16

Meal Kits

3rd Party Delivery

Restaurant Delivery

The Delivery Wave

17

All consumers

38% Millennials

62% Use 3rd party

services at

least monthly

All consumers

33% 18-34

49% “I’m ordering

food to go more

often now than

3 years ago”

18

Third Party Delivery Service Business Growing

19

Technology Enables Delivery

20

of consumers

Cooking at home is

a good way to live 81%

Rise of Consumer Direct Meals:

Cooking at Home Still Desired

21

Audience Question #2

What do consumers see

as the main advantage of

Direct Meals (e.g., Blue

Apron)?

22

Game Changer in Delivery?

23

Delivery Trends Implications

• Gauge how products “hold up” to

delivery

• Elevate importance of packaging

• Evaluate opportunities with third

party delivery, consumer direct

sources

24

Foodservice @ Retail Taking Share

25

Supermarkets

$32B C-stores

$21B

26

Supermarket Foodservice Increasing in

Relevance to Consumers

41%

48%

2016 2017

% visiting supermarket

foodservice 4x/month of more

say foodservice area important in deciding in where

to shop

77%

27

Supermarkets Transforming

28

Foodservice at Retail Trends Implications

• Consumers have convenient

option for prepared foods

• Explore opportunities with retail

partners

• Innovation required to keep up

with restaurants

29

College Students:

Getting Ready for the Next

Wave of Consumers

30

Vital Statistics

• 21 million strong

• 65/35 4 year/2 year split

• 74% Gen Z; 23% Millennial

• Over half live on campus

• 4,700 institutions

31

Audience Question #3

What is most important

to college students

when making eating

out decisions?

32

FAST

CRAVEABLE

LOW COST

What do College Students Want from Food?

33

College Students Less Concerned About Health

47%

52%

58%

66%

77%

54%

63%

65%

73%

80%

Low fat

Low calorie

Organic

Natural

Fresh

Attributes positively impacting purchasing decisions

General population College students

34

But, College Students are

Adhere to a Special Diet

33%

More Likely

35

College Students are Increasingly Interested in

Global Cuisines

62%

54%

N/A

41%

33%

30%

24%

23%

19%

62%

56%

45%

43%

36%

35%

29%

28%

26%

Chinese

Italian

Spanish

Japanese/sushi

Greek

Thai

Indian

French

Mediterranean

2015 2017

% likely to purchase when available on campus

36

College Foodservice React to Social

Responsibility Demands

69%

69%

54%

61%

51%

33%

79%

76%

76%

75%

74%

72%

70%

Recycling

Sustainability

Local sourcing

Green/environmentalstewardship

Community/philanthropy**

Fair trade

Animal welfare

2009 2017

% indicating foodservice important issues

N/A

37

College Student Influence Implications

• Focus on fast, grab n’ go,

snacking

• Consider atypical dining habits

(late night, breakfast for dinner)

• Bi-polar group–traditional

craveable foods–experimental

foods

38

College-University Panel