The ambient food market is a thriving industry to pay attention to. This particular sub-sector of the food industry is a multi-billion market in itself. I want to discuss this retail division and provide various critical insights around online shopping trends, packaging & storing, and delivery. By the end, you will have a clear understanding of the ambient food marketplace in 2022 and how businesses can better serve it and their customers.
Table of contents
What are Ambient foods?
The ambient food definition means “items that can typically be safely stored at room temperature.” They are associated with lots of dry food but also wet tinned and glass items. They have a longer shelf life. This includes everything from tea and coffee to canned vegetables, fruits, and soups. There is even ambient meat which is specifically designed to last for longer periods of time. Below are more examples of ambient foods.
Ambient foods list
Pasta and rice
Breads and cereals
Canned fish and meat
Sauces and condiments
Biscuits and cakes
Tea and coffee
Ambient food suppliers such as Lovering Foods or Queenswood typically tend to work directly with retail stores and brick and mortar. However, the increased digital boom of eCommerce during the pandemic is encouraging more suppliers to expand their online presence. The chief executive of Ugly Drinks said:
“We are aware of changing buying behaviours and know that consumers like to try and discover products through multiple channels, whether that’s direct-to-consumer online, or the local supermarket.”
Omnichannel fulfilment means we may be seeing more ambient food suppliers working directly with 3pl’s in 2022 to expand their offerings to consumers. Focusing on multiple channels encourages more convenient options for buyers while increasing market share for suppliers.
Ambient Foods Marketplace
The ambient food marketplace is currently valued at 239 billion and is expected to grow to 361 billion by 2025. The annual growth rate (CAGR) over the last year has been 11%, a substantial uptick for the industry. Recovering from the covid-19 pandemic more companies rearranged their operations to better serve their customers as online retail became the new normal.
Most popular ambient food retail regions
In the global market, western Europe is by far the largest ambient food buyer, accounting for 32% of the market. Asia-Pacific is the second-largest making up 27% of the market.
Ambient food trends
The latest ambient food trends differ in categories from health and wellbeing to eco-friendly and customer preference.
Pesticide-free organic fruits and vegetables
As more customers take a healthier approach to their lives in 2022, ambient food suppliers should be paying attention to this important trend. Naturally sourced fruits and vegetables without fertilizers and pesticides are safer and preferred more today than previous years. Pesticides may not always wash off but absorb into the skin of the fruits and vegetables, so they have potentially harmful effects. Recent surveys show 90 – 95% of consumers want organic or healthier food options.
Not only are more suppliers moving to more natural food sourcing but natural sustainable packaging. It is helpful to the environment and preferred by more customers today. In fact, 74% of consumers would pay more for sustainable packaging. Moving away from plastic packaging to drive pollution down keeps companies more accountable as well as appealing to buyers. Flexible packaging options are being explored more with businesses as they are more aware of this trend, along with “clean label” eco-branding.
As an eco-friendly 3pl, Selazar uses only plastic-free alternatives for packaging such as corrugated cardboard, gummed tape, and recycled paper. If your business works with a third-party logistics provider, you want to solidify similar brand values for you and your customers.
The vegan society says that an astonishing 7 million British adults follow a meat-free diet. This number has increased 40% over the last year. In America, the number of vegans have increased by 3,000% in the last 15 years, at approximately 10 million adults now. Many experts project numbers of vegans to increase globally in 2022.
Customer preference & convenience
Shoppers are always looking for products that make cooking easier and more convenient. For example, offering food in jars that are pre-chopped saves time. Pre-chopped Garlic or dehydrated garlic powder for example is one of these examples that makes life a bit easier for consumers in the kitchen. Prominent manufacturers are experimenting with multiple garlic formats – including paste, powder and fresh forms. These customer preferences are spurring countless product innovations, broadening overall market growth.
The same goes for pre-chopped tomatoes, mushrooms, and fruit. These time-saving commodities improve buyer experience and convenience. Manufacturing more goods with this in mind for suppliers is a smart trend to pay attention to more in 2022.
Ambient food storage
A great benefit about ambient food storage is the lack of power costs associated with it, unlike refrigerated items. Whether suppliers store ambient food within their own facilities or retail warehouses, having a longer shelf life provides them various no hassle options.
Ambient temperature food storage
Ambient food storage tends to be between 15 to 25 C or 59 – 77 F. Ambient just means normal storage conditions or store at room temperature. You tend to see these labels on products with storage requirements saying “ambient.” You will also see them on pharmaceutical products.
Ambient food storage warehouse
One of the largest costs for suppliers, distributors, and brick and mortar include ambient food storage warehouse costs. Having a warehouse requires shelving, power, and staff to run a typical warehouse facility.
Finding more ways to cut these costs and even outsource to e-commerce warehouses that store and deliver goods would provide a financial benefit for many suppliers and stores. Streamlining operations to focus on more aspects of your business is always a smart business practice. Thinking of the cost-benefit ratio in relation to the rise of online shopping, it would be logically cost-effective to implement more third-party logistics for ambient food storage moving forward.
Ambient food delivery online
Obviously, there were massive changes in online shopping behaviours during the Covid-19 lockdown. Ambient food shopping online was already popular over the last 5 years thanks to many popular food delivery apps and grocery stores going online, but the pandemic categorically surged this behaviour.
This had an immediate effect on the logistics network as it worked to enable faster and cheaper delivery for customers. Undercutting competitive costs was a key focus for suppliers and retailers, even though the costs of hiring and training more drivers increased their operational expenses. Conveniently enough though it encouraged more flexible low-cost options for consumers.
UK food delivery alone online went from a 2.6 billion industry in 2015 to 5.9 billion in 2020. US food delivery is also expected to go from 26 billion in 2020 to 42 billion in 2025.
The online shopping trend is going to keep increasing and will sufficiently place more pressure on companies to reduce their operating costs and lower delivery costs for consumers. A downstream effect will also be manufacturers catering to the needs of online sellers more with innovative packaging and products. What will the next evolution of the tin of chopped tomatoes be? How will food production be tailored more and more to the online market? This is where the future leads for this space.
Ambient foods market conclusion
The ambient foods market landscape is going through some significant changes from previous years and will maintain its robust growth cycle. With more natural eco-conscious value-centred principles for buyers, it would behove suppliers and retailers to pay attention to these trends. Working to cut expenditures to benefit customers and be more competitive in the online marketplace will be a major advantage for your business. Should you be interested in outsourcing your ambient food storage and delivery, schedule a no-obligation free business call with us.