July 23, 2012

Will There be Another Kosher Realignment

I first heard the term “realignment” as it applies to the kosher industry more two decades ago at one of the early Kosherfest shows. An old time Manischewitz salesman who covered many Midwestern states reminisced how his route in the 50’s and 60’s was largely small independent grocers. “There has definitely been a realignment in the industry,” he said, referring to the emergence of the supermarket as the new destination for kosher. 

It was a time when many family owned groceries were closing due to gentrification of Jewish neighborhoods and the rise of the supermarket. There is no question that the supermarket played a major role in the meteoric rise of kosher in the ‘90’s and beyond. The fact that kosher was accepted into hundreds of supermarkets meant that kosher foods became accessible to Jews and anyone else who shopped at a supermarket. 

In the early 2000’s came the next “realignment” as the independents made a comeback of sorts with new large special kosher supermarkets and the discount chains slowly joined the fray. In effect, kosher became a 3-tiered retail industry. The re-energized independents, supermarkets and the discount stores. The latter were upending the entire retail food scene and were in fact becoming the new leaders. Wal-Mart, for example, is the leading food retailer  in the nation. Target is making a major push for the food business and Costco is increasingly viewed as a major food retailer. 

The landscape has changed to such a degree that some of the major food chains are reporting major losses and some are openly speaking of consolidations, store closures, and layoffs. Should that happen, kosher may indeed face yet another “realignment,” as the Manischewitz salesman put it. The pecking order may well change with the discounters being the leading kosher destination, followed by the independents and the supermarkets. 

Personally, I hope that this next realignment never happens because the industry and indeed the market are extremely comfortable with the way things are currently.