Specialty Food Stores
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 19,000 specialty foods stores in the US sell produce, seafood, grocery, meat and poultry, bakery, prepared foods, specialty cheese, coffee and tea, nutritional supplements, vitamins, educational products, floral, and even certain household products. Most specialty food stores offer products deemed to be higher quality and premium-priced than traditional grocery stores.
Dependance On Economic Conditions
Specialty food customers typically are more affluent (household income of $75,000) than the average grocery store shopper.
Perishable Products
Specialty food stores typically carry more perishable products than traditional food retailers, often comprising two-thirds or more of their product offerings.
Industry size & Structure
A typical specialty food retailer operates out of a single location, employs 8-9 workers, and generates about $1.4 million annually.
- The specialty food stores industry consists of 19,000 companies that employ 160,000 workers and generate about $27 billion annually.
- Sales by US specialty foods stores increased by 5.2% in 2022 compared to 2021 and reached $28.4 billion.
- Traditional grocery stores and supermarkets are the largest sellers of specialty foods, with about 70% of sales.
- Sales of specialty foods and beverages across all retail and food services are expected to reach $207 billion in 2023.
- Of organic food sales, 56% are sold through traditional food retailers and 32% are through natural food/health stores.
- Specialty foods represent about 22% of all food sales at retail.
- Most specialty food stores are small, single-unit locations, but some specialty food retailers are relatively large, multi-state operations, such as Whole Foods Markets, Sprouts Farmers Market, and Trader Joe's.
Industry Forecast
Specialty Food Stores Industry Growth
Recent Developments
Apr 13, 2025 - Record High Meat Department Sales
- Record high prices for products like ground beef and steak drove meat department sales to a record $104.6 billion in 2024, making meat the largest perimeter department in grocery stores, according to The Food Association’s latest Power of Meat report. Dollar sales growth was driven by drought, high grain prices and interest rates that drove producer prices to record highs last year. Still, shoppers remained resilient, with nearly all (96%) of shoppers surveyed saying they are open to spending more on meat and poultry, especially during special occasions and holidays, per FMI. In 2024, annual average spend per household on meat and poultry was $871, while the average number of times US shoppers purchased meat rose 4% from 2023. Fresh meat outperformed processed meat sales last year and stood out with “above-average gains,” per FMI’s report.
- The food industry has very thin profit margins – just 1.6% for retailers and 7.5% for food manufacturers -- according to the Food Industry Association (FMI). Amid the record high food price inflation of recent years, specialty food stores have struggled to protect their margins while keeping prices low. Now, faced with significant new cost pressures from import tariffs, the food industry may have little choice but to raise prices to maintain their margins and stay in business. Specialty food stores are especially vulnerable to import tariffs because many of the products they sell are imported. More than three-quarters (76%) of shoppers surveyed plan to change their shopping habits to brace for higher prices, according to data analytics company Numerator. In addition to higher prices, retailers and consumers are worried about product availability being impacted by tariffs on imports to the US.
- Rising concern among consumers for their own health and that of the planet is driving outsized gains in sales of organic produce compared to conventionally-grown fruits and vegetables, Supermarket News reports. For the 52 weeks ending December 1, sales of fresh organic produce – a key product category for many specialty food retailers – rose 7.2% compared to 3.3% for conventional selections, according to new data from market research firm Circana. While more consumers across all segments are buying organic produce, boomers (persons aged 61 to 79 in 2025) account for the greatest share of organic produce spending (34%), followed closely by millennials/Gen Y (ages 29 to 44, 33%), and Gen X (ages 45 to 60, 27%), NielsenIQ reported. “Organic is not niche, it is mainstream,” said Sherry Frey, VP of Health & Wellness Thought Leadership for NIQ.
- Employment by specialty food retailers grew 1.1% in January compared to a year ago while average industry wages rose 5.3% over the same period to $19.12 per hour, $0.07 shy of their peak in October, according to the latest US Bureau of Labor Statistics data. Sales at food and beverage stores were up nearly 5% year over year in January but sank 7.6% from December, a peak selling period for specialty foods, Census Bureau data shows. Looking ahead, sales for the US specialty food stores industry are forecast to grow at a 2.81% compounded annual rate from 2025 to 2029, slower than the growth of the overall economy, according to a new forecast by the Interindustry Economic Research Fund.
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