United States country snapshot

Market overview

Canada's #1 trade partner registered e-commerce sales exceeding $50 billion in 2020 for packaged food and beverage products.

Valued at Can$35 billion, the United States Packaged Food e-commerce market is second largest in the world, behind only China.

There were five product categories that exceeded Can$2.5 billion in imports by the United States in 2019.

Double-digit Compound Annual Growth Rate (CAGR) growth was seen over the review period for e-commerce sales across all four packaged food and beverage sectors.

Market size and e-commerce share
Metric Value Rank (of 10)
Total Packaged Food and Beverage Market in 2020 Can$1,031.7 billion 1st
E-commerce Channel Size of Total Packaged Food and Beverage in 2020 Can$52.1 billion 2nd
E-commerce Channel Share of Total Packaged Food and Beverage in 2020 5.1% 5th
Size of Canadian Packaged Food and Beverage Imports in 2019 Can$22.4 billion 1st
Market snapshot for packaged food and beverages in the United States (2020; Can$ billion)
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Category Category total E-commerce E-commerce share of category total
Packaged Food $619.6 $35.2 5.7%
Non-Alcoholic Beverages $190.2 $3.7 2.0%
Alcoholic Drinks $173.1 $3.4 2.1%
Pet Food $48.7 $10.8 22.2%

Source: Euromonitor International

Leading import and e-commerce product categories

Top five Canadian packaged food and beverage products imported by the United States (2019)
Product Category Imports from Canada (2019, Can$ million) Historic CAGR* (2014-2019)
Savoury Snacks $3,919.0 15.8%
Processed Meat and Seafood $3,652.1 9.5%
Chocolate and Confectionary 2,626.4 7.0%
Food Preparations $2,548.5 7.0%
Fats and Oils $2,540.7 5.3%
*CAGR: Compound Annual Growth Rate
Top five packaged food and beverage products sold in the United States e-commerce landscape (2020)
Product Category E-commerce Channel Sales (2020; Can$ million) Share of E-commerce of all distribution (2020) Historic E-commerce CAGR* (2015-2020)
Pet Food $10,825.6 22.2% 55.2%
Ready Meals $10,321.9 17.0% 52.6%
Baby Food $3,339.7 31.0% 52.9%
Savoury Snacks $3,302.9 4.3% 45.8%
Confectionary $2,775.8 5.6% 35.4%
*CAGR: Compound Annual Growth Rate
Industry split of packaged food and beverage e-commerce channel sales in the United States (2020)
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Category Packaged food and beverage e-commerce channel sales in the United States
Packaged Food 66%
Non-Alcoholic Beverages 7%
Alcoholic Drinks 6%
Pet Food 21%
Total Can$52.1 billion

Ready Meals sales via e-commerce exceeded Can$10 billion as COVID-19 altered American lifestyles and eating habits.

Comparative analysis of select products imported by the United States and how these product categories perform in the United States e-commerce landscape (2020)
Product Category Value of Canadian imports by the United States (Can$ million) E-commerce channel sales Can$ million E-commerce channel share (%) of all distribution channels in 2020
Beer 154 824 0.7%
Wine 56 1,971 4.3%
Spirits 590 658 1.0%
Carbonates and Bottled Water 397 1,233 1.0%
Hot Drinks 660 1,521 6.2%
Confectionary 2,025 2,756 5.6%
Pet Food 328 10,826 22.2%
Processed Meat and Seafood 3,652 1,669 2.7%
Processed Fruits and Vegetables 659 951 4.0%
Ready Meals/ Food Preparations 2,548 10,322 17.0%
Savoury Snacks 3,919 3,303 4.3%
Dairy 174 2,207

2.2%

Fats and Oils 2,541 388 6.4%

Source: Euromonitor International (e-commerce channel sales) and UN Comtrade (Canadian import data)

Sector snapshot

Packaged food

Historically, the United States has lagged behind most other developed markets in terms of online grocery penetration, but the pandemic has rapidly accelerated the pace of adoption, to the point where year-on-year food and drink e-commerce sales grew 119% in 2020, and COVID-19 caused a particularly large spike across packaged food categories in 2020.

For example, ready meals sold through e-commerce increased by Can$4 billion from 2019-20 to reach Can$10 billion sold through the online channel.

Non-alcoholic beverages

Hot drinks have done well via e-commerce (Can$1.5 billion in 2020 sales) because coffee and tea are dry, shelf-stable goods which are relatively easy to ship.

E-commerce is expected to continue growing into the forecast period, boosted by higher rates of at-home consumption. This is bolstered by the fact that many independent tea and coffee shops diverted sales of their original blends to online channels during the crisis, often offering monthly subscription deliveries.

Alcoholic drinks

E-commerce registered positive growth prior to the pandemic but had yet to take off for alcohol like it did with other consumer goods.

Potential growth had been slowed by the cost of shipping voluminous and heavy beverages, restrictive regulations governing interstate sales of alcohol, in addition to the consumer preference for tapping into the knowledge of an expert salesperson in store when purchasing more premium alcoholic beverages.

Pet food

E-commerce sales of pet food in the United States neared Can$11 billion in 2020, more than twice the size of the second largest market (China at Can$4.6 billion).

E-commerce continues to gain share from other distribution channels in pet care. As pet food can be bulky in nature and requires replenishment at regular intervals, subscription-based shopping models have been growing in popularity. Programs such as Chewy Autoship or Amazon Subscribe & Save offer both convenience and attractive pricing for pet owners.

Industry dynamics and opportunities

E-commerce size and growth

Size of packaged food and beverage e-commerce market in the United States (2015 to 2020; Can$ million)
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Market 2015 2020 Historic CAGR*
Packaged Food $6,004 $35,200 41.1%
Non-Alcoholic Beverages $1,490 $3,715 18.9%
Alcoholic Drinks $1,618 $3,367 19.0%
Pet Food $1,146 $10,826 55.2%
*CAGR: Compound Annual Growth Rate

Source: Euromonitor International

Competitive environment

Company market share concentration in the United States packaged food and beverage market (2020)
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Category All Other Companies Top 5 Companies
Packaged Food 81% 19%
Non-Alcoholic Beverages 46% 54%
Alcoholic Drinks 32% 69%
Pet Food 28% 72%

Source: Euromonitor International

Key e-commerce websites

Rank (SKUs[1] on Via) Packaged Food Non-Alcoholic Beverages Alcoholic Drinks Pet Food
1 Amazon (80.3 thousand SKUs) Amazon (43.1 thousand) Binny's (11.3 thousand) Amazon (16.0 thousand)
2 Walmart (11.6 thousand) Walmart (4.1 thousand) Hy-Vee (1.7 thousand) Chewy (9.6 thousand)
3 Harris Teeter (11.5 thousand) Harris Teeter (2.1 thousand) Wegmans (1.5 thousand) Petco (7.2 thousand)
4 Giant Eagle (10.3 thousand) Fred Meyer (2.0 thousand) Harris Teeter (1.1 thousand) PetSmart (4.9 thousand)
5 Wegmans (10.2 thousand) Giant Eagle (1.9 thousand) Walmart (0.9 thousand) Walmart (3.7 thousand)

1: SKU data comes from Euromonitor International's proprietary Via data extraction tool, and was extracted in March 2021

Key highlights for Canadian producers

Packaged food

Savoury, salty snack imports from Canada and sales via e-commerce both exceed $3 billion; processed meat and seafood is another category with significant imports and greater demand brought on by more at-home meal preparation.

Non-alcoholic beverages

Coffee and tea could be shipped directly from Canada to the United States through e-commerce subscription customers.

Alcoholic drinks

Canadian Whisky accounted for 23% of total Whiskies sales in the United States, reaching Can$3.8 billion; to consider for partnerships, there is increasing use of pure play alcoholic drinks delivery services such as Drizzly and Cocktail Courier by US consumers.

Pet food

Chewy.com is the #2 site for pet care e-commerce in the United States and would be a pure play partner; in contrast, a marketplace such as Amazon (#1 site for Pet Care) includes a lot of third-party sellers, many of which are located internationally.