As more consumers are eating out less at restaurants, they’re buying more fresh convenience foods at retail stores.

According to a recent study by market research firm Packaged Facts, “Fresh Convenience Foods in the U.S.” the market for fresh convenience foods increased by 5 percent in 2009 to reach sales of $22 billion. Packaged Facts expects these marketing and merchandising efforts to continue, driving sales of fresh convenience foods up another 28 percent by 2014 to $29 billion.

During the height of the recession, fresh convenience food marketers and retailers spotted an opening. Seeing their main competition coming from the restaurant industry (instead of less costly unprepared food), many retailers began to compete more heavily on price and innovation.

“In the short term it seems likely that consumers will have less mad money jangling around in their pockets than they did in the past decade or two. This does not mean that supermarkets will have less money in their cash registers than they did in the past decade or two, but it does mean they will have to work harder for every dollar. Throughout the recent rough patch retailers have been able to incorporate a level of price competition into what was already a groundswell of innovation in the concept of fresh prepared foods,” said Don Montuori, publisher of Packaged Facts.
“ It’s that interaction between innovation and price competition that has worked so far, and both sides of the equation must be maintained if the market is to continue growing.”

The report examines the U.S. market for fresh prepared convenience foods sold refrigerated or hot to consumers, through supermarkets, supercenters, warehouse clubs, small food marts and delis, convenience stores,
and drugstores. Supermarkets and grocery stores account for an estimated 68 percent share of 2009 retail dollar sales of fresh convenience foods. Supercenters and mass merchandisers are the second most popular channel, ringing up 13 percent of sales, followed by natural/health food stores, warehouse clubs and convenience stores.For more information, please visit www.packagedfacts.com/Convenience-Foods-Fresh-2511642/.