Pickled Fruits and Vegetables, Vegetable Sauces and Seasonings, and Salad Dressings

SIC 2035

Industry report:

This category covers establishments primarily engaged in pickling and brining fruits and vegetables and in manufacturing salad dressings, vegetable relishes, sauces, and seasonings. Establishments primarily engaged in manufacturing catsup and similar tomato sauces are classified in SIC 2033: Canned Fruits, Vegetables, Preserves, Jams, and Jellies, and those packing purchased pickles and olives are classified in wholesale or retail trade. Establishments primarily engaged in manufacturing dry salad dressing and dry sauce mixes are classified in SIC 2099: Food Preparations, Not Elsewhere Classified.

Diversified multibillion dollar companies like H.J. Heinz Company, Kraft General Foods, Inc., and Unilever Best Foods North America were the major producers of pickles, sauces and seasonings, and salad dressings in the early 2010s. However, small, regional independents often accounted for many familiar products. The fruit and vegetable canning industry reflects the trends that influence other food processors as consumers became concerned with healthy eating and developed a taste for exotic flavors and ethnic cuisine.

The market for sauces and marinades, valued at $3.65 billion in 2010, was expected to reach $4.3 billion by 2012, according to industry reports. The recession that affected the United States during the late 2000s and into the early 2010s negatively impacted many facets of the U.S. economy. However, packaged foods tend to fare quite well during economic downturns as consumers avoid restaurants to save money by eating in. Yet, many sauce and salad dressing companies found stiff competition from private label brands, keeping profits down.

Background and Development

In 1950, the Food and Drug Administration (FDA) established standards of identity, which regulated the ingredients and manufacturing of mayonnaise, salad dressing, and French dressing. Although other dressings were not regulated, they had predictable flavors and characteristics. Italian, ranch, thousand island, French, and bleu cheese were America's favorite salad dressings in the 1990s and 2000s, according to an Association for Dressings and Sauces (ADS) survey. Steady growth in the sector was in line with the findings of the same survey that three out of four people ate a tossed salad every other day.

Low-fat, low-calorie dressings were introduced to meet consumers' dietary concerns, but achieving the flavor and texture to which people were accustomed was a challenge. By the end of the twentieth century, the food additives industry was growing faster than the food industry as consumers demanded improved flavor, texture, color, and nutritional benefits. The popularity of low-carbohydrate and low-sugar diets in the early 2000s prompted many manufacturers to develop low-carb dressing lines. For example, in 2004, Unilever Best Foods North America released a line of Carb Options Wishbone salad dressings that included ranch and Italian varieties.

Pickle Packers International, Inc., reported that consumption of pickles had more than doubled between the mid-1940s and the early 1990s to an estimated nine pounds per person annually. According to Food Review in May 1996, this figure had decreased to 4.7 pounds by the mid-1990s. The decline in pickle consumption continued in the late 1990s and early 2000s as evidenced by a reported a drop in sales from $1.5 billion in 1998 to $900 million in 2000. In 2001, Vlasic filed for Chapter 11 bankruptcy protection. Heinz North America agreed to pay $195 million for the pickle and barbeque sauce operations of Vlasic. However, investment firm Hicks, Muse, Tate, and Furst counterbid $370 million and ended up owning Vlasic by mid-2001.

Retail sales of sauces and dressings grew 2.7 percent to $7.02 billion in 2002, according to the Association for Dressings and Sauces. Salad dressing sales totaled $3.45 billion in 2002, with mayonnaise accounting for $711 billion of the total. The proliferation of pre-made salad kits and the marketing of salad dressing as a dipping sauce were considered reasons for the boost in salad dressing sales.

Reduced-fat dressing garnered $281.6 million in sales for the salad dressing industry in 2002. According to the Calorie Control Council, low-fat salad dressings, sauces, and mayonnaise were among the top choices of adults who reported using "lite" products. Nearly 60 percent of U.S. consumers chose low-fat options at least occasionally when purchasing salad dressings, sauces, or mayonnaise in the early 2000s. However, low-fat dressing sales had declined 2.8 percent in 2001 and 1.8 percent in 2002, due in part to the popularity of low-carbohydrate diets, which encouraged dieters to consume full-fat dressings in the interest of eating fewer carbohydrates.

Seasonings and salad dressings were valued at $12.3 billion in 2004, increasing to $12.7 billion in 2005, according to the U.S. Census Bureau. Chili sauce, oriental sauces, Mexican sauces, and pepper sauces were the products of choice for consumers during 2006. Mustard gained 1.8 percent in 2006 based on $289.03 million in sales, compared to mayonnaise, which fell 0.2 percent to $745.61 million. Bottled dressings shipments totaled $1.16 million, with dry dressing mixes at $78.5 million, a decrease of six percent from 2005. Reduced or low calorie dressings continued to gain market share with $233.5 million in sales, a 1.4 percent increase compared to the previous year.

New product introductions rebounded in 2006, up 11.1 percent according to Mintel Global New Products Database. Manufacturers of sauces and seasonings expanded their product offerings to include 189 new products in 2006, an increase of 9.9 percent compared to 2005. Of more importance to the industry was that sauces and seasonings continued to capture the third place position for new product introductions. The sauces and seasonings category was responsible for 2,107 of the 17,779 food products offered in 2006. Manufacturers of sauces and seasonings remained focused on the growing trend for organic, all natural, and ethnic varieties.

According to industry statistics, there were an estimated 588 operations primarily engaged in pickling and brining fruits and vegetables and in manufacturing salad dressing, vegetable relishes, sauces, and seasonings, valued at an estimated $15 billion and employing 18,042 workers in 2007. Pickles, sauces, and salad dressings were responsible for 31 percent of market share, which was valued at $11.98 million. Seasonings and sauces, except tomato and dry, represented 14.8 percent of total industry market share, for $413.9 million in shipped products. The salad dressings raw and cooked category, except dry mixes, garnered 12.8 percent of market share with a value of $1.88 million. Other significant categories were vinegar pickles with revenues of $215.7 million; fruit and vegetable relishes with $109.4 million; mayonnaise with $71.8 million; and prepared horseradish with $69.9 million. Most firms in the industry were in California, Texas, and New York.

Based on Pickle Packers International, Inc., data, pickle consumption rebounded to 1990 levels, or nine pounds per person annually. On average, the typical household purchased pickles every 53 days, and further statistics more than 67 percent of households consumed pickles.

Current Conditions

According to a 2010 Dun and Bradstreet report, this industry had 559 firms that combined to employ 15,570 and generate $3.65 billion in revenues. By revenue, Illinois and Ohio led this industry, generating $1.54 billion and $1.06 billion, respectively. Texas and California followed in a distant third and fourth place, with $199 million and $163 million in sales, respectively.

According to the Food Marketing Institute, 85 percent of U.S. consumers were choosing to eat in three or more meals a week in 2009, up from 75 percent in 2008. Such a rise in home-based food preparation is commonly good news for the sauces and salad dressing industries. As a result, overall, the sauces and salad dressing sector bucked the recessionary trend and continued to grow during the late 2000s. For example, according to a report by Refrigerated News, refrigerated salad dressings experienced a 7.8 percent and 10.6 percent increase in volume in 2007 and 2008, respectively.

However, competition was fierce for consumers' attention. According a 2009 survey conducted by Digital Research, reported by Prepared Foods, 53 percent of consumers surveyed reported that they had changed their choice of salad dressing. Forty-nine percent changed brands of pasta sauces. Primarily benefitting were private labels, which appealed to consumers based on price. In fact, according to survey results, of 16 food categories, consumers reported mostly likely to trade down, away from brand names, in the salad dressing category. Twenty-nine percent of respondents said they would only buy a preferred brand of salad dressing if it was on sale or they had a coupon.

The transition to private brands could also be explained by overall slowdown in new product development by the industry leaders during the late 2000s, also. New salad dressing introductions dropped by over 25 percent in 2009, compared to 2008 totals. The number of new sauces introduced fell by just over one percent in 2009.

Also shifting was the product selection. After a tremendous influx of low-cal, low-fat products during the mid-2000s, during the late 2000s, the industry began to offer more salads and sauces that were organic or all natural. Other new popular product offerings included low sodium and gluten-free varieties. Sauces containing yogurt were also on the rise in popularity. Both salad dressings and sauces had similar increases in new offerings of upscale products, which is a result of the very mature nature of lower tiers of the market. Also like salad dressings, sauces experienced an upswing in new offerings of "natural" products. Other sauce trends included preservative free, fresh, gourmet, and gluten free varieties.

Industry Leaders

H.J. Heinz Company L.P. reported earnings for the fiscal year ending in April 2010 of $10.45 billion. Ketchup and sauces accounted for $4.45 billion of the company's fiscal 2010 revenues. To strengthen its global presence, as well as compliment its sauces business, Heinz acquired the Wyko sauce brand in the Netherlands and Benedicta, a French manufacturer of sauces, mayonnaises, and salad dressing in fiscal 2008 and fiscal 2009 respectively.

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News and information about Pickled Fruits and Vegetables, Vegetable Sauces and Seasonings, and Salad Dressings

Resampling of industries.
PPI Detailed Report; January 1, 2001; 700+ words
...elsewhere classified 2015 Poultry and egg processing 2032 Canned specialties 2035 Pickled fruits and vegetables, vegetable sauces and seasonings, and salad dressings 2043 Cereal breakfast foods 2068 Salted and roasted nuts and seeds 2086 Bottled...
Resampling of industries.
PPI Detailed Report; January 1, 2001; 700+ words
...elsewhere classified 2015 Poultry and egg processing 2032 Canned specialties 2035 Pickled fruits and vegetables, vegetable sauces and seasonings, and salad dressings 2043 Cereal breakfast foods 2068 Salted and roasted nuts and seeds 2086 Bottled...
Monthly sector analysis: this sector analysis includes acquisitions and buyouts announced between 1 June and 30 June. UK public offers completed between these dates are included, whereas new and pending offers are excluded. The transactions are classified according to the US SIC code identifying the industry sector in which the target company is principally engaged. (Minority stakes, Monthly sector analysis).
Acquisitions Monthly; July 1, 2003; 700+ words
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Prepared Foods; April 1, 2010; 700+ words
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US Fed News Service, Including US State News; April 8, 2015; 700+ words
...and cooked fruits and vegetables...sauces or pickled in nature...namely, fruit based spreads...fruits and vegetables, fruit and vegetable salads...serve; salads with a meat...vegetable and fruit base. prepared...prepared fruit, ...
Monthly sector analysis.
Acquisitions Monthly; June 1, 2003; 700+ words
...foodstuffs 2035: Pickled fruits and vegetables, salad dressings Zatarain...Manufacture seasonings, (US)--Produce sea- sauces sonings...Frozen fruits, fruit juices, and vegetables HP Bulmer...beverages 2076: Vegetable oil mills...
Monthly sector analysis: this sector analysis includes acquisitions and buyout announced between 1 July and 31 July, UK public offers completed between these dates are included, whereas new and pending offers are excluded. The transactions are classified according to the US sic code identifying the industry sector in which the target company is principally engaged.
Acquisitions Monthly; August 1, 2003; 700+ words
...foodstuffs 2035: Pickled fruits and vegetables, salad dressings Zatarain...Manufacture seasonings, (US)--Produce sea- sauces sonings...Frozen fruits, fruit juices, and vegetables HP Bulmer...beverages 2076: Vegetable oil mills...
Green papaya and mango: unripe fruit takes place of vegetables in salads, entrees.(On Food)(Column)
Nation's Restaurant News; September 29, 2003; 700+ words
...commonplace seasonings these days...the ripe fruit, the green...more like vegetables than fruits. In Thai...for squid salads and salads seasoned...crispy squid salad with lemon grass dressing, green apples...julienned fruit with carrots...spicy peanut ...

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