Low-carb craze loses insanity, but it's still strong
By Julie Schmit, USA TODAY
The low-carb craze is claiming casualties — and more are likely — as growth slows.

A year ago, Atkins Nutritionals couldn't crank out low-carb products fast enough. Now, online retailers are discounting them.

A year ago, entrepreneur Brad Saltzman planned to open 12 Los Angeles low-carb stores. Because of poor consumer response, he's sold one and listed his only other on eBay in June for $150,000. No bids came.

Some new low-carb products are starting off slow. One is Pepsi's Edge, the company said last week. "There will be a shakeout," says Matthew Wiant, senior vice president of Atkins, founded by the Atkins diet creator.

Low carb is still strong. Nationwide, sales of foods labeled low carb hit $1.3 billion for the 12 months ended July 10, up 283% from the period a year ago, says researcher ACNielsen. For the 13 weeks ended the same day, however, sales were up just 20% from the previous 13 weeks, when sales were up 122% from the 13 weeks before that. More than 10% of adults follow some Atkins diet vs. 3.8% 16 months ago.

Anheuser-Busch last week cited its new low-carb Michelob Ultra, in part, for a solid quarter and 1.9% jump in domestic sales to wholesalers. T.G.I. Friday's recently expanded its low-carb menu. Dreyer's Grand Ice Cream just dished up $70 million for low-fat, low-carb Silhouette Brands.

The question no longer seems to be whether the low-carb craze has topped out but where it will settle. Anheuser-Busch expects it to stop hurting beer consumption next year. Kellogg CEO Carlos Gutierrez last week said it had peaked but that carb-rich products had yet to recover.

Atkins' Wiant expects two-thirds of products introduced in the past year to be gone within two years. Mark Swartzberg, beverage analyst for Legg Mason, has more hope for low-carb beers than low-carb soft drinks.

Brad Haley, marketing chief for Carl's Jr. and Hardee's restaurants, expects low carb to become quietly ubiquitous. "If you don't have it, people will go elsewhere," he says. Carl's Jr. and Hardee's introduced lettuce-wrapped burgers last year and have added more low-carb items since. Sales have leveled, but the products attracted new customers, Haley says.

As often happens when industries grow superfast, little players suffer first when growth slows. Sales at HealthyLifeStyles, with two California low-carb stores, are down 35% from the peak late last year, President Rick Branchini says.

Saltzman jumped into low carb just when big foodmakers and supermarkets did — hurting specialty stores. He counts his losses at about $200,000. "The market changed — fast," he says.

"quietly ubiquitous" That's us!

I get a little annoyed when people measure the 'popularity' of low-carbing soley based on supermarket sales of these pretend low-carb products.

It's not about that at all.

I've been musing on a different kind of low-carb store. What I'd love to have would be a store that has a top-quality meat counter, like the old butcher stores, plus a limited amount of good produce and great dairy including local cheeses. Kind of like a Whole Foods light with all of the carby stuff taken out and a focus on fresh, quality food without trans fats and offering some of the fatful stuff that regular stores no longer sell, like quality lard that's not hydrogenated. Around here I could get a decent amount of local and organic producers but that's not true everywhere. A small selection of artificially low-carb food could be offered, but the focus would be on real food.

What do you think? I've mainly just been thinking about what kind of store I'd like to shop in. I have no idea if something like this could even be viable. Probably only in a more upscale area because the fresher, local, organic stuff would be more expensive. But with the focus on real food, you could also attract people who aren't doing low carb but just want good food.

Anyone have a background in grocery stores that could comment on the idea? To me it makes more sense than a store of just artificially low-carb stuff.

Plane crazy

I feel the same way. And a great take out food counter would definitely be a plus.

The problem I see with low-carb stores is that they sell mostly low-carb junk foods. They look like 7-11's in concept. In the stores here, you can barely buy a plain macadamia nut!

If they expanded their focus, almost anyone could shop there and they would see that it's not a "meat diet". It looks bad on the LC WOL to have low-carb stores filled with junk.

Karen

Good idea, I like the take-out counter. I know I would probably go to a place like that almost daily. The big problem I see from the point of view of running such a place is the extra overhead to analyze the total carbs in each dish. But I guess if you used a respected low-carb cookbook, you could use their numbers.

Hmmmmm.

Plane Crazy

I'd shop there.

While you're at it, stock some raw pet food too!

The problem I saw with the low carb store I visited was prices were just horrible. They only stocked low carb stuff... cereals, candy, cooking supplies and so on. It was all stuff I could buy on the internet for much cheaper. Now a store that sold good whole foods, veggies, berries, dairy, meat and also had a supply of the best of the best low carb foods would be much better IMHO.

Are you talking about a cookbook with recipes you would use or a cookbook program that calculates for you when you put in your recipes? If you use recipes from a cookbook, I think there are copywrite laws you have to be careful of. Karen may be able to give some tips on that.

But there are some very good cookbook/recipe programs that calculate nutrients for you pretty well. I like Now You're Cooking. It uses the USDA tables and does pretty well. It's sometimes a little cumbersome, but I like the control I get from it.

I also find that calculating on gram weights is a lot easier than using cups and teaspoons, etc.

Just a couple cents there.

Hmmmmm, maybe one like..... Karen's, perhaps???

That brings up a question that's a little off topic, but relevant to the statement above. Let's say I did open such an establishment and used, say, Karen's book as the source of the recipes for food I was selling, and used the nutritional information from the recipe in the book. Would I be violating copyright laws to publicize the nutritional information? I don't think it would be a violation to use the recipes to make food I sell. It might be an infrigement of some kind to advertise the fact that I make food from Karen's cookbook without her permission, but if I use the book as the source of my food, I think it's a grayer area.

Just curious.

Plane Crazy

I doubt it, PlaneCrazy. If you photocopied pages out of the book and handed them out, that would be an infringement. But citing some numbers from a book... can't believe that would be.

No, it's not copyright violation.

The way to make take out food work is to have super accurate recipes - all ingredients are weighed - good staff, and food portioned by weight only. When people bought a container of food, the scale could be programmed to print the nutrition count per 10 grams for example or per oz. on the label.

Setting it all up would take work but once it's done, it's a breeze.

Karen

I think DebPenny is right. I'm not sure, but if you directly use a copyrighted recipe for a product to sell... you may have to get the authors permission and/or pay a fee.