Bakeries tackle food allergy concerns

Consumers with special dietary needs are becoming the norm rather than the exception. Learn how bakers are developing business with ‘free-from’ products.

“Food allergies” are more than a marketing buzz phrase. They are the future. Americans’ ever-expanding waistlines, heredity, the environment and increased diagnosis of food-related medical conditions, like diabetes and celiac disease (a potentially life-threatening intolerance to gluten), has increased customer awareness of ingredients. As a result, demand for “free-from” products (e.g., gluten-free, dairy-free, sugar-free, etc.), especially baked goods, has begun to swell.

Unlike fads, such as low carb, these are diagnosed or suspected medical conditions that are managed, along with medication in some cases, by controlling intake of specific ingredients.

While few traditional bakeries have embraced the special dietary needs or allergen-free products markets, the specialized bakeries that have are doing well, in terms of strong sales growth and grateful expressions of joy from their customers. Based on the population data, sales performance and the growing adoption of these products by major supermarket chains, these specialty markets are getting closer to becoming mainstream every day.

Or, as Rebecca Reilly, author of Gluten-Free Baking, explained to the New York Times (December 14, 2005), “When you’re told you can’t have something, then it becomes the focus. It’s like the forbidden fruit.’’

That’s why gluten-free, sugar-free, and, for the food sensitive, kosher bakery products are finding leverage among today’s consumers.

Food allergies
About one in 25 Americans suffers from a true food allergy–meaning that ingestion of substances, such as nuts, gluten and lactose, always causes an allergic reaction, according to medical sources cited in the Food Allergies and Intolerances-U.S. report by Mintel International Group of Chicago. In addition, slightly more than one in four Americans are said to suffer from food intolerance, a non-life-threatening condition in which the body is unable to produce enough of the natural digestive chemicals to break down a particular type of food. However, despite the statistics, according to Mintel, one in three believe that they are affected by food ingredients in some way.

In addition, studies conducted during the past five years have shown that the incidence of food allergies are quickly increasing, particularly among children.

Growth market
One of the most common illnesses caused by food is celiac disease. It is not known why, but cases of celiac disease are on the rise. While the condition may be detected at any age, the average age of diagnosis is 44 years. The only treatment for celiac disease is a lifelong avoidance of gluten-based products. Statistics vary, but The University of Maryland Center for Celiac Research in Baltimore found that one in 133 individuals (about 2.2 million Americans) suffer from it, including many who are never tested and fail to make the connection between intense stomach pain and eating gluten. Symptoms of celiac disease include anemia, malnutrition, osteoporosis, central and peripheral nervous system disorders, intestinal lymphomas and other food sensitivities.

“As the awareness and the diagnosis rates for people with food allergies and food intolerances continues to grow, and there’s more press about this, the market is just starting to explode,” says Scott Mandell, president/C.E.O. of Chicago-based Enjoy Life Natural Brands.

Mandell co-founded Enjoy Life, a wholesale bakery specializing in gluten-free products, with partner Bert Cohen several years ago. They were inspired by Cohen’s mother’s medical need for specialized foods. With traditional supermarket chains throughout the country carrying Enjoy Life products, such as Shaw’s, Giant Eagle and Jewel, to name a few, Mandell believes the market is heading mainstream.

“There’s no question about it,” he continues. “The larger grocery store chains see this as a real market. It’s not a fad. It’s not low carb. It’s something that’s here and will be here to stay. People need it for medical reasons.

“The number we’ve seen in the industry is about 25 percent growth annually for food allergy and intolerance products. Our company has seen triple digit annual growth,” he adds.

Trust factor
Because these baked products address health and allergy issues, with potentially severe consequences, Mandell and others say that much diligence is required when producing products for this market.

“You don’t want to take the risk of getting somebody sick. So you have to take extra special precautions if you’re getting into this market,” Mandel says.

Even though there are no formal gluten-free standards (the FDA won’t have them until 2008, at least), Enjoy Life has set its own allergen standard at 10 parts per million for gluten, dairy and nuts. And, it tests regularly. As a result, the company has become the first bakery in the nation to be certified by the Gluten-Free Certification Organization.

“We’re hardcore,” Mandell admits. “It’s what our customers expect from us. It’s a trust factor.”

Due diligence
“We have to be really diligent,” says Cameo LeBrun, president of Crave, a San Francisco-based wheat-, gluten- and milk-free bakery. In addition to practical paranoia about cross-contamination, she has to research and source ingredients more stringently than traditional bakeries, asking her suppliers a lot of hard questions most people don’t have to ask, such as:
• Where does this product come from?
• Does that facility have wheat?
• Do you truck your ingredients with wheat products?
• What do you do to cut down on cross-contamination?

LeBrun, who is gluten intolerant, was both discouraged and inspired by what was available: dry, tasteless product with bad texture. She opened her wholesale bakery 2-1/2 years ago and sells to Whole Foods and local high-end grocery stores: Andronico’s, Draeger’s, Harvest, Real Food Company and other specialty stores. In response to the growing product demand, she says her bakery’s chocolate usage more than doubled in 2005 to 12,100 lbs., from 5,200 lbs. in 2004. Crave uses the chocolate primarily in its signature brownies.

Baking fundamentals apply
Taste still rules for dietary-needs bakers. After “free-from,” the next most important consideration is taste and texture. The product should appeal to everyone, regardless of their health needs.

Lareen Narva, owner of Bittersweet Gluten Free Bakery in Eagan, Minn., has had a wheat allergy for more than 20 years. Her entire family (husband and three children) is allergic to wheat too. She opened the bakery two years ago, and she’s already looking at expansion.

Frequently her customers are people who have eaten regular foods all their lives and have recently had to become gluten free. “People are sick and tired of bad-tasting gluten-free food. It’s been too many years of putting up with what the existing industry had,” she says.

As a result, she says the first question people ask is, “Does it taste real?” Then they ask, “Does it taste good?

”Her products must meet three criteria before she will sell them. 1) It has to look like the product you’re selling. “So it can’t be an icky-looking cookie or a shriveled up this or that,” she says. 2) It has to have moisture. “Because most gluten-free food is dry and grainy.” 3) It needs to taste like the name. “If it says chocolate cherry, it has to taste like chocolate cherry.

” Narva holds strictly to her three criteria when researching and developing product formulas. She says she spent15 years “playing around” with recipes before she finally came up with successful gluten-free baking techniques.

Kosher’s new demand
With the evolution of dietary needs products, another traditional approach, kosher (which is the Hebrew word for fit or proper as it relates to biblical dietary law), is being seen in a new light. Because kosher law forbids meat and milk together, a dairy-free bakery, among other things that are important to people with dietary concerns, can be a kosher bakery.

As Scott Mandell explains, “First, people who looked for kosher products did it mainly for religious reasons. Now, it’s become more of a standard for products being produced in a cleaner, safer environment. A lot of people look for that kosher symbol to give them that reassurance that, again, these products are produced under certain guidelines that are set out.

”Enjoy Life has been kosher since its inception. In order to be kosher certified, Mandell says all of your suppliers need to be kosher certified. Inspecting rabbis visit the bakery to check through all of your ingredients and make sure that everything that you’re getting is kosher.

Bakery equipment also needs to be inspected for kosher certification as well. He estimates that the process of having a bakery certified kosher takes three to six months.

One world
While the inspiration for their products is special dietary needs, bakers agree that the real secret to success in this niche is making products that appeal to everyone, special needs or not. Lareen Narva reports hearing customers complain that, “the gluten-free baked goods taste so good their non-allergic spouses are eating them all up.”

“And that’s our goal. Everybody should be able to enjoy this. It shouldn’t just be for celiacs,” Narva says. “In the big picture, celiacs shouldn’t have to compromise [about] food [quality] because they have this condition.”

Dietary Needs Facts
Obesity
• 40% of the population, 68 million, will be obese by 2010 if Americans continue to gain weight at the current rate.
• Since the 1980s, the proportion of overweight children has steadily increased.
Sources: Centers for Disease Control and Prevention (CDC), National Institute of Children’s Health and Human Development

Allergens
• 2% of adults and 5% of infants and young children in the United States are allergic to some type of food.
• Eight major food allergens account for more than 90 percent of all documented food allergies. They are: milk, eggs, fish, crustacean shellfish, tree nuts, peanuts, wheat and soybeans
• As of January 1, 2006, food manufacturers are required to list the eight major food allergens on their ingredient labels.
Source: FDA’s Food Allergen Labeling and Consumer Protection Act

Gluten
• 2004 retail sales of gluten-free products: $450 million, with projected annual growth of 34% from 2004 to 2006, with projected retail sales of $600 million.
• U.S. sales of gluten-free products have grown steadily by 17% per year since 1999.
• U.S. market for food allergy and intolerance products has nearly doubled since 1999, growing from $947 million in retail sales to more than $1.8 billion in 2003.
• Gluten-free market sales are projected to reach nearly $4 billion by 2008.
Sources: Mintel and “The U.S. Market for Food Allergy and Food Intolerance Products,” published by Packaged Facts, New York City

Diabetes
• 18.2 million Americans, or 6.3% of the U.S. population, have some form of diabetes.
• The more common Type II diabetes, most closely associated with old age, obesity, and other risk factors, can often be controlled without invasive medical attention.
• Diabetes is growing dramatically among blacks and Hispanics, the two largest minority groups in the U.S. The incidence of Type II diabetes among Hispanics, for example, is almost twice as high as that of the general population.
• The incidence of Type II diabetes among children and adolescents is also on the rise.
Source: American Diabetes Association (ADA)