Posted on 08/23/2004 12:55:32 PM PDT by NYC GOP Chick
CHICAGO (Reuters) - Food manufacturers who have stocked store shelves with low-carbohydrate versions of everything from spaghetti sauce to ice cream may find they are eating the costs themselves, as the low-carb fad peaks, analysts and industry observers said.
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"It's typical that one rushes into the party just when the party is breaking up," said William Leach, food industry analyst at Neuberger Berman.
Sales of low-carb branded foods surged $815 million, to $1.13 billion, in the 12 months ended June 13, according to market research firm Information Resources Inc. That includes both new brands like Atkins and Carb Solutions and extensions of existing brands -- like Unilever's Carb Options versions of Skippy peanut butter and Lipton soups.
But the number of people in the United States who say they are on low-carb diets like Atkins peaked in January at 9 percent, in a survey conducted by the NPD Group. It has since leveled off at about 7 percent, Harry Balzer, a vice president at the market research firm, said.
"The awareness has probably peaked," Balzer said.
The industry could have wasted "hundreds of millions" of dollars in reformulating and repackaging products as low-carb, Ken Harris, a consultant who works with consumer products and retail companies for Cannondale Associates. "Just to bring a product to market is very costly."
SAME FATE AS LOW-FAT?
Leach compared the low-carb trend with the low-fat phase in the early 1990s.
Nabisco, now a unit of Kraft Inc., launched the SnackWells brand of low-fat cookies and crackers, which was initially a hit with customers. At the beginning, retailers could not get as many packages as they wanted.
"It reminds me of 10 years ago, you had this fat phobia," Leach said. "SnackWells, one year it was on allocation. The next year you couldn't give them away."
IRI also said that the low-carb craze could go the way of low-fat. Brands like SnackWells and WOW! chips -- made by PepsiCo Inc.'s Frito-Lay unit with the controversial fat substitute olestra -- grew for about five years and have declined ever since, IRI said in a report this month.
"However, consumers may sustain interest in selected naturally low-carb products as they did with naturally low-fat yogurts," the report said. Popular foods that are naturally low in carbohydrates include bacon and eggs.
Even though the trend of people on low-carb diets seems to have peaked, it could be a while before low-carb consumption wanes, NPD's Balzer said.
"I bet it's going to be a year or so before we see declines in low-carb consumption," Balzer said, adding that consumers are likely to try various low-carb products to see if they want to include them in their normal eating habits. "If we're nothing, we are a nation that's tries."
Some of the newer low-carb products could also be repackaged to take advantage of the next big trend in food, Harris said, noting that some consumers are starting to focus more specifically on sugar than on overall carbohydrates.
But the focus on obesity remains a hurdle for food companies, Leach said.
"It's hard to be a food company and really take obesity seriously because your job is to sell food," he said.
FWIW, I fell off the wagon two weeks ago when I decided I couldn't look at another egg without puking.
Total weight loss after two months = zero
It's all about fiber
Try WeightWatchers, its a lifestyle you can live with.
Worked for me
I did Atkins and worked out at the local gym. It does work, it has to be a way of life. I refuse to give up candy bars. I have my own version I call pseudo-Atkins.
Gimmicks don't work, because the plain, simple, boring fact is that you lose when you consume fewer calories than you burn.
What has worked for me is Weight Watchers. Dull and the opposite of trendy, but it's worked for me -- for nearly 2 years! :)
I cannot accept the sanity of a diet that says that pork rinds are good for you.
I tried Atkins and I tried traditional (exercise and rabbit food). The results from traditional are better. Atkins is just too unrealistic a diet to keep to for very long.
And that's exactly what is was... a fad. And a scam.
South Beach. Day 14.
11 lbs.
When is the costof Bacon comming back down?
I think most people who had good success with Atkins end up living with a variant. Me, I look at bread and potatoes the way I used to look at icecream. I can have them, but I need to be aware it's naughty.
Atkins is nothing new. Our granparents knew starchy foods made you fat.
"What has worked for me is Weight Watchers. Dull and the opposite of trendy, but it's worked for me -- for nearly 2 years! :)"
Lucky you! I return to Weight Watchers every year (much like the swallows returning to Capistrano". All I lose is money.
Well, you actually have to *do* the program, not just pay each week. ;)
11 pounds.
The diet works, for a large number of people, and will remain reasonably popular even after the peak of the current "fad" surrounding it.
Unless you are severely obese, that's just too much weight to lose in a short period of time. At that rate, you'll be losing muscle and vital tissue before too long.
I guess that's why there continues to be thousands of low-fat products on the shelves to this day, including SnackWells.
The "craze" may end, but the concept is permanently burned into the public psyche. Low-carb products are here to stay.
You don't have to buy low-carb food to do a low-carb diet. Besides, alot of the low-carb stuff out there is gimmicky, not really low-carb at all, and most of all, EXPENSIVE!
It didn't take a Madison Avenue genius to see the trainwreck arriving, but in this era of three month business models I expect trainwrecks in many short sighted easy-bake numbers driven firms.
I'd bet plenty you weren't strictly on the diet.
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