June 15, 2015

Never Mind Retail, It’s Foodservice that is Growing the Fastest

When you look at the numbers, it appears that the epicenter of the kosher food industry is in retail. But when I speak to distributors and manufacturers, it appears that it is foodservice that is growing even faster than kosher retail. Perhaps it is the combination of the two that is truly driving sales in kosher nowadays. But speak to people like Elan Kornblum, the kosher restaurant maven, and you marvel just how many new kosher restaurants are opening or for that matter all those new Passover and other holiday programs. The kosher party business is booming with record-setting numbers, particularly in places like New York, Chicago, Miami and LA. It isn’t just that foodservice is growing laterally with more events; it’s that even existing events are upgrading their menus, adding many new foods and wines.

I wonder if we’ve given enough coverage to that segment in the industry which might very well represent at least 40% of annual kosher food sales. My friends in the industry remind me that foodservice often commands larger margins. They say that a good piece of veal could only be sold at a reasonable market price in a supermarket, but put it on the menu in an upscale restaurant and the price includes the wait staff and the rent, for example as well as higher margins. Think of the upcoming summer and the many summer camps, the abundance of wedding and bar/bat mitzvahs, vacation locations, cruises, and more. Foodservice is definitely on the rise in kosher.