Because of spam, I personally moderate all comments left on my blog. However, because of health issues, I will not be able to do so in the future.

If you have a personal question about LI or any related topic you can send me an email at I will try to respond.

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In addition, my old website, Planet Lactose, has been taken down because of the age of the information. Unfortunately, that means links to the site on this blog will no longer work.

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Sunday, October 26, 2008

Here's How Tiny the Milk Alternative Market Is

It's great being able to walk into a supermarket or health food establishment and find shelves and sections of fairy-free and other specialty food products these days. It sure wasn't like that 30 years when I first learned I was lactose intolerant.

It's kinda hard to appreciative how good we have it today. Few of the alternatives have really great taste. Variety is limited. Most stores don't stock all the flavors. Many companies sell regionally rather than nationally. Those in live in rural areas surely have less availability than those living in large cities.

Our good fortune is relative. And precarious. Although you can't usually tell from the packages of food, the companies that are in the milk alternative industry are mostly somewhere between tiny and on-the-brink. With a recession coming on, or here, or a looming possibility, some of your favorite companies might go under.

I was reminded of this by a stock analyst's report on Lifeway Foods. I've posted about the company several times, most recently in Grab Your Own Frozen Kefir Boutique Franchise.

The analyst is dubious about the company's stock price. I have absolutely no knowledge of whether this is a good evaluation or not. I was more struck about the fuzzy chart that appears about halfway down the page, TABLE I: DAIRY AND HEALTH/FUNCTIONAL FOOD PUBLIC COMPARABLES.

If you blow it up large enough to read, you can see it contains some of the major names in the field, including Hain, Dean, and Tofutti. Dean is the largest company mentioned, and its market cap - the total value of all its stock - is about $3 billion, and that includes many conventional milk companies and products. For comparison, Kraft, the maker of Cool Whip, has a market cap of $60 billion. Nestle's makes Coffeemate and its market cap is about $150 billion.

Tofutti, which has been in the business for 30 years, with good years and bad, and makes nothing but milk alternative products, has a market cap of $12 million. That's $0.012 billion. Kraft could buy Tofutti out of the change in the vending machines at its headquarters.

I hope Tofutti lasts another 30 years, at least. But I wouldn't be a bit surprised to read that any specialty foods company is having serious problems in today's economies. We're a tiny niche market. Those are hurt first and worst.

Don't start to panic yet. But see what alternatives to the alternatives might exist for you, just in case.

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