LAS VEGAS — At the Tortilla Industry Association (T.I.A.) Annual Convention and Expo from May 1-2 in Las Vegas, I.R.I. representatives Brian Burke, director, and Robert Porod, executive vice-president, presented market data that showed how a shifting retail climate is affecting tortilla sales and how the industry needs to adapt to meet customers where and how they shop.
According to I.R.I. research, big box store traffic is down 28% since 2015, while small-format stores have grown 95%. In addition, discount stores such as Aldi and Lidl have had a significant impact on where shoppers are going in the physical realm. Tortilla producers, Mr. Burke said, can capitalize on this shift by making sure that their products are in the locations that shoppers prefer to visit.
On-line conglomerates like Amazon have an advantage with return on investment, sitting at 40% while brick-and-mortar retailers average 13%. Since 76% of all shopping trips begin on-line, Mr. Burke said, getting tortilla products into on-line retailers makes sense now, and will only continue to grow in profitability.
Retail tortilla sales totaled $2.2 billion over the past 52 weeks, which is up 2.1 % over the previous year, according to I.R.I. This is in keeping with the general trend of growth in ethnic food sales. Tortillas also grew in both penetration (households in which tortillas are eaten) and in basket size.
Though grocery store sales still dominate the majority of total tortilla sales, internet sales of tortilla products grew 8.3% in the past year, showing the potential for even more growth in the future. Regions east of the Mississippi river are also seen as a potential significant growth point for additional tortilla sales.
