Getting Mushrooms on the Menu

1. Getting Mushrooms on the Menu Non-Commercial Steve Solomon, FSInsights

2. Market Overview $88.4 Billion Industry…Self-Op and Managed Services

3. Industry Overview –Contract Management Companies (FSMs) Non-commercial is an $80B industry

4. Industry Overview – K-12 Schools 31MM students participate in National School Lunch program 11MM in National School Breakfast program 3.5% growth projected

5. Dissecting K-12 • Different opportunities • Meal cycle-- (subsidized) • A la Carte—Expanded items not on the lunch menu • K-6 Examples: Fruit and Fruit Snacks • High School: Yogurts, Fruit, Vegetables, Muffins, Pizza, Chips and more • Balancing act between what kids will eat and nutrition • Many kids consume half of their daily calories at school

6. Key Trends – Legislating Wellness • Widespread public concern about childhood obesity has provided impetus to new nutritional programs like Michelle Obama’s “Let’s Move” • Popular foods like juices/soft drinks/chips are under fire • Nutritious foods like Mushrooms are relevant, but navigating the system is tricky

7. Mushroom Recipes On Let’s Move Website (USDA) Anytime Pizza Barley Pilaf Basic Quiche Brussel Sprouts with Mushroom Sauce Chicken Ratatouille Enchilada Rice 5-Happiness Fried Noodles Green Bean and Mushroom Medley Green Bean Saute • Mushroom Barley Soup • Scrambled Tofu • Sloppy Garden Joes • Spanish Omelet • Spinach and Mushroom Enchilada Casserole • Mushroom and Beef Stir Fry • Summer Salad • Tortilla Pizza • Zesty Skillet Zucchini

8. Key Trends – Breakfast • Since 1955, number of school breakfasts served each year has grown nearly 50 percent • Continues to increase because of the nutritional benefit of breakfast • Most significant issue remains time

9. Key Trends – Meatless Options • 64% of school nutrition directors say they serve Vegetarian options • 20.5% of school nutrition directors offer a Vegan meal School Nutrition Operations Report, School Nutrition Association, 2009

10. What Meatless Dish Is Served Most In Schools? What Is Second? • PBJ • Grilled Cheese • Cheese or Vegetable Pizza • Mac ‘n Cheese • Salads • Yogurt • Pasta with Red Sauce

11. The Opportunity For Mushrooms • Insight: With this administration, healthier foods will be given more opportunities than ever. While much of the work will come from USDA, schools will gain more flexibility to purchase products. Example: Salad bars may be put into every school…but they won’t necessarily feature the same ingredients. • Selling Tips: • 1.Educate local school foodservice directors on the nutritional advantages of Mushrooms • Leverage the fresh opportunity and the popularity at retail and foodservice • Play up a local angle if you can…it is in vogue to adopt schools • See if your Distributor has a School Specialist

12. Industry Overview—Campus Dining The surge in higher education enrollment has been ongoing for almost two decades continues, with a record 18MM+ students enrolled in colleges and universities this year

13. Key Trends—Campus Dining • Demographic Shift • By 2012, 30 states will be experiencinga decline or no growth in their annual number of high school graduates • 65% of the population growth over the next 15 years will be ethnic minority groups • Historically less likely to enter college • Will enroll in higher than ever numbers • Women already outnumber men and will soon approach 60% • Multi-National Population • U.S. students are being replaced by international students as we educate the world • More cosmopolitan, more diversity, more cultures

14. Key Trends—Campus Dining • Greatest Variety of Food in Any Segment • Many students away from home for the first time—need comfort food • International population demands foods from home • Campus dining has been on the leading edge of ethnic foods • Pizza and Fried Foods co-exist with Organic and Vegetarian • Students want to experiment as well as learn about the history and origins of food • Specific diets…Gluten Free • Social Conciousness • Locavores • Organics • Everything Green

15. Sodexo Case History • Recipes and Promotion on College Campuses (as well as other accounts) • Variety of Dayparts and Cuisines • Like other Colleges, uses Fresh and primarily Whites • Supports with Education

21. Insight: Foodservice Directors go out of their way to give students what they want. Food at school is supposed to be part of the background, with studies taking precedent. This, though, makes colleges the most important place for confluence of ethnic foods and for building food habits that will last a lifetime. Plus, it is a significant volume opportunity as students eat 2-3 meals a day on campus. • Selling Tips: One of the single biggest volume opportunities for Mushrooms • Use a local angle if you can…everyone is close to a college • Do a demo for students…they will love being exposed to different mushrooms and the education will last well into adulthood • Showcase the versatility of Mushrooms…they fit into almost every cuisine and all of them are at colleges • Save them money by showing how Mushrooms substitute for meat • Showcase Mushrooms role in Gluten-Free The Opportunity For Mushrooms

22. Newest Sell Sheet • Harvard and Big Ten Promotions • Selling Tips • Recipes For Colleges

23. Industry Overview – Healthcare Sales growth in hospitals is occurring in the cafeteria, as opposed to patient feeding.

24. Key Trends – Healthcare • Competing with Brown Baggersand Other Restaurants • To displace the “brown bag option,” hospital cafes are trying to be more appealing to a workforce that tends to be largely female and middle-aged, interested in: • Healthful options • Meal occasion opportunities that facilitate socialization • Pizza, Grill and Deli stations • Also high population of ethnic staff

25. Key Trends – Healthcare • Nutrition • Look for higher quality, fresh foods brought into the operation vs. highly processed, packaged foods • Comfort is important, but nutrition trumps all • CCRCs are Booming • CCRCs have only a quarter the sales of the nursing home segment, but are growing almost three times as fast Mather LifeWays

26. The Opportunity For Mushrooms • Insight: Cafeteria feeding is just like restaurants, but with a healthier influence. Hospitals have more money to spend here, and the food needs to be better. Foodservice is one of the top drivers of guest and staff satisfaction. • Selling Tips: • Mushrooms fit extremely well in this segment…whether on a salad bar, a pizza or a sandwich • Salads are the biggest seller • Healthcare operators like to run loyalty promotions…”eat 4 veggie meals per week and get one free” • Purchasing more complex because it is usually through your Distributor AND a Healthcare Buying Group • Many distributors have Healthcare specialists--be sure they are educated on the nutritional value and other benefits of Mushrooms

27. Industry Overview – On-Premise Dining Foodservice programs in on-premise dining (business and industry) are primarily run by FSMs. They have better handles on cost controls, necessary because the numbers of employees being fed is descreasing.

28. Key Trends—On-Premise • As Distinct As the Employers They Work For • White-collar businesses feature more sophisticated dining services than technical/blue-collar businesses. • Large companies use their foodservice as a point of difference • Consumers are very demanding because the meals are subsidized and they want products that they may not buy at home

29. Key Trends—On-Premise • Promoting Wellness • Leading edge of organics, local sourcing and green • Nutrition is key—concern about employee health costs • Direct correlation to bottom line and waist line • Tying gyms and holistic health to feeding • Meatless is strong because of changing habits and social bias “We wanted to get their attention, so we subsidized the salad bar at a higher level and took their chocolate away.” --Tim Crimmins, General Mills

30. Key Trends—On-Premise • Food Variety is Key • Focus on keeping employees in the building -- increases productivity • Multi-ethnic…extremely adventurous diners • Constantly looking to expand • Breakfast growing • Take-home and retail remain a moving target • Catering/meeting business is significant "The old cafeteria model doesn't work anymore,. Employees expect their company's café to be at least as good as what they'd get at an independent eatery. The bottom line is, you're in the restaurant business. --Ron Paul, Technomic

31. Hallmark Cisco Hearst Hallmark ARAMARK

32. The Opportunity For Mushrooms • Insight: Variety is key in On-Premise Dining. These outlets are more sophisticated, adult extensions of the Campus segment…. international foods, heavy promotions and nutritional demands. Here, the employee is the driver of all food choices. • Implication: • If you are local or have an interesting point of difference, use it • Like colleges, education is important, so offer up demos and programs to broaden food sensibilities • On-premise is normally run by FSMs who depend large distributors. Again, be sure you know your distributor nutritional specialist • Showcase Mushrooms as a meat substitute…a more economical and nutritional way to deliver ethnic flavors • Stretched economically…so sell versatility

33. Questions? Thank You