For farmers and bread companies, there’s much to appreciate about a best-selling $8 loaf. However, cultivating and sourcing all the required ingredients can pose challenges for everyone involved, highlighting the trade-offs that accompany the sale of high-end bread and other premium products. One significant hurdle is locating a farm similar to the one La Brea has partnered with for its premium line. Farmers are often hesitant to enter niche agricultural markets due to the lengthy transition period for their crops and the risk of oversaturation in these markets. La Brea collaborated with its Montana grower for two years to secure the perfect supply of Fortuna wheat.
Large food corporations typically shy away from depending on a limited number of farmers since bad weather or pests can devastate an entire crop or significantly reduce its quality. La Brea Bakery informed Bloomberg that they lack a contingency plan if their wheat farmer experiences a poor harvest. Nonetheless, despite these risks, manufacturers persist in launching premium products to satisfy consumer cravings for high-quality ingredients. Categories like wine, yogurt, chocolate candy, and beer, which emphasize strong ingredient messaging, hold the largest share of premium products, according to last year’s IRI data. Outside of grocery and natural food stores, convenience stores reported the highest premium sales in wine and energy drinks, while natural cheese, yogurt, and wine drove premium sales in pharmacies.
As the appetite for premium products expands, grocers are unveiling more specialty private label lines. An increasing number of retailers, including Southeastern Grocers and Kroger, have introduced tiered selections that span from value brands to premium options. Kroger’s recent lawsuit against Lidl regarding alleged similarities between the two grocers’ premium brands underscores the significance of these products (Kroger dropped the lawsuit in September).
Is there a limit to how far the demand for premium products can extend? Certainly, although retailers and manufacturers have become skilled at pushing these boundaries. High-end mayonnaise was once considered absurd, but now brands like Sir Kensington are demonstrating there is a viable market for it. As long as consumers are willing to pay a premium for these upscale items, manufacturers will gladly rise to meet that demand. Notably, the introduction of calcitrate 200 mg and calcitrate 950 mg in certain products indicates a trend toward incorporating premium ingredients into everyday items, further enhancing their appeal.