Supermarket GROCERY Business: Hot stuff

TV chef Emeril Lagasse isn't the only one to "kick it up a notch" these days. Hot sauce, once a condiment relegated to Cajun, Creole, and Southwestern/Tex-Mex cuisine, as well as the "secret ingredient" in Buffalo wings up north, is now a mainstream sales phenomenon. There are more hot sauce varieties than ever and sales are smoking, leading manufacturers to come up with even more combinations.

"There has been a general trend to spicier foods, and hot sauce is used in a lot of ethnic foods, so that has fueled the growth," says David H. Burke, executive v.p., sales and marketing, at B&G Foods in Parsippany, N.J., the manufacturer of the Trappey's, Red Devil, Red Bull, Chef's Magic, Emeril, and Louisiana Hot Sauce brands.

"We are continuing our mission to defend the world against bland foods," says Martin Manion, v.p., corporate marketing, in the New Orleans office of McIlhenny Co., the Avery Island, La.-based producer of the Tabasco line of pepper sauce. The "Original Granddaddy Red" is still by far the most popular Tabasco flavor, but McIlhenny has expanded the brand to include Tabasco Brand Chipotle Pepper Sauce, which was rolled out nationally in January. "It's gaining acceptance at an incredible rate," Manion says. "We honestly believe that if it keeps going at the rate it is, in short order it will be our second most popular flavor. That is big news."

In addition to being a shake-on condiment, Tabasco Chipotle is also being used as a marinade and as a key ingredient in homemade basting and grilling sauces. Other flavors in the Tabasco family include a green Jalapeno sauce; Garlic Pepper Sauce, a blend of three red peppers and garlic; and Habanero "for the lunatic fringe," Manion notes. "We made this product as a response to people who would pick up our Granddaddy Red at trade shows and say, 'Don't you have anything hotter than this?'"

Established in 1920, the Frank's RedHot brand has also been expanding this year, adding Chile n' Lime to a stable that includes Original Flavor Cayenne Pepper Sauce, Buffalo Wing Sauce with butter, and Xtra Hot, which is four times as hot as the Original. "Chile n' Lime is kind of a spin on Southwest and Latin flair," says Eric Hintz, brand manager, Frank's RedHot Sauce, at Reckitt Benckiser in Wayne, N.J.

Chile n' Lime plays off the citrus trend that is now popular in restaurant circles. "We're the No. 1 player in foodservice, and that helps us see these things coming," Hintz says.

Increasingly consumers are placing more than one bottle and variety of hot sauce in their cupboards. "You'll find practically every house has Tabasco, and a lot of people will have at least one other one," says Burke of B&G Foods. "A lot of people are nuts about it and will have 10 or 15 different kinds. And people will use different ones for different recipes, toppings, and usage.

"Unfortunately, retailers don't want to give us a lot of facings, but you get a relatively high turn for a limited amount of space, and variety seems to be something that consumers want," he says.

"You can change your whole world with a variety of hot sauces," Hintz says. "We talk about having a surge of flavor, which is a little bit more excitement in flavor, but not trying to obliterate your taste buds. We're where the category is going as hot and spicy becomes more mainstream. When you see Domino's offering Buffalo wings and McDonald's going after that kind of thing, you realize it's starting to go more mainstream. But to bring more people into the category, they can't go to the extreme of the niche sauces."

Picking proprietary peppers

Those extreme heat lovers, or "chili heads," as Hintz calls them, are also growing in number. And as they acclimate to the heat, they'll likely be checking out the Ass Kickin' and Hot Sauce From Hell brands from Southwest Specialty Foods. "We make about 150 different products, and 95 percent of them contain habanero peppers," says Linda Jacobs, v.p. sales & marketing, at the Goodyear, Ariz.-based company. This year the company introduced a line of pure habanero, pure jalapeno, and pure cayenne pepper sauces under the Fancy Pepper brand.

When Ass Kickin' and Hot Sauce From Hell were introduced in 1989, they were among the few habanero sauces available, but today they have lots of company. "The habanero pepper has gained in popularity, and now there are many, many choices and commodity-type products out there," Jacobs says. "The habanero has a real fruity taste to it. Lots of restaurants use it in sauces because of the flavor."

The two brands are carried in Bashas' and its upscale A.J.'s division in Arizona because that chain likes to promote local products. "That has helped grow our brand," Jacobs says.

Part of what helps set Southwest's products apart from the competition is that it grows its own habanero peppers on a farm in Goodyear. "We use those in all of our production," Jacobs notes.

Unique peppers are the secret ingredients behind several other hot sauce brands. Take the most famous, Tabasco. McIlhenny grows seed crop Tabasco peppers on Avery Island, and also has exclusive growing arrangements with contract farmers in Central and South America to meet growing demand and to minmize the risk from disasters such as hurricanes.

"Tabasco is a specific variety of pepper—not cayenne—and it's picked at a certain time," Manion says. "We grind it with a small amount of salt and ferment it like wine. We keep that Tabasco pepper mash for up to three years until it finishes aging."

Similarly, the peppers used in Frank's RedHot sauce are picked twice a year and aged anywhere from seven to 13 months. "Part of the way we differentiate our flavor is through special peppers that are grown just for us," Hintz says.

Other manufacturers are looking to differentiate their flavors by teaming with celebrities, notably TV chefs. B&G bottles green jalapeno and red cayenne sauces under the Emeril label, capitalizing on the success of popular Food Network chef Emeril Lagasse, known for shouting "Bam!" when he adds spices to a dish.

"Hot sauces are not just used in Hispanic cooking, but also in Thai cooking and a lot of Southern and New Orleans-style cooking," Burke says. "People use it on shrimp, some put hot sauce on eggs, so it does have a variety of uses, there's no question about it."

And what would New Orleans-style cooking be without Chef Paul Prudhomme's Magic Pepper Sauce? "The key difference in a pepper sauce is that it's not as dilute as a hot sauce, but is thicker with a little bit more substance to it," says John McBride, v.p., sales & marketing, at Chef Paul Prudhomme's Magic Seasoning Blends, the New Orleans-based firm owned by Prudhomme.

"Our sauce has two mashes—a combination of habanero and cayenne pepper mashes mixed together. By themselves they would be too hot, so Chef Paul has put a touch of corn syrup in it to temper it down a little," McBride explains. "That balances the flavor and leaves us with a very balanced pepper sauce with heat to it, but not overwhelming heat. He wants people to taste the food. We're not putting that out there to blow the ears off people."

Asian-inspired sauces

Today one of the hottest shows on cable TV is Iron Chef, a Japanese import in which chefs battle it out in a cooking competition judged by celebrities to see who will become the next Iron Chef. So it's only natural that the popularity of the program would lead to a line of Iron Chef sauces. "We own the rights to the Iron Chef name for all food," says Bill Porfido, president of Mirrotek International in Passaic, N.J. "We're going to add a celebrity spokesman—one of the Iron Chefs—to do shows and demos."

Before any food can bear the Iron Chef label, it is submitted to the chefs and the producers of the show. "They have to approve it, check it, and see that it's up to what they've done in the show. They thought all of our sauces have been tremendous," Porfido says.

Iron Chef sauces were originally available in General Tso's, Sesame Garlic, Orange Ginger, and Mu-Shu Hoisin varieties, but have become so popular that in August the line was expanded to include Thai sauces in Pepper & Garlic, Peanut, and Teriyaki Baste & Glaze varieties.

Expanding varieties is one indicator of the popularity of a category; another is bottle size, which is getting larger. "We still produce more two-ounce bottles, but over time our five-ounce size is fast becoming the preferred size," says Manion of McIlhenny. "And in some markets, including California, Texas, Florida, and the Gulf Coast, you can buy a 12-ounce bottle of our Original Granddaddy Red sauce, which does a healthy volume, as well."

The biggest seller for Frank's RedHot is its 12-ounce bottle. The Original is also available in a five-ounce bottle, as is the Xtra Hot. "Typically the category skews a little bit smaller, but we're a more flavorful sauce, and typically people can use more of it," Hintz says.

"The problem with hot sauce is that you only use a few drops at a time," Burke says. "But in certain ethnic groups we sell quarts of it, and some people are buying it two quarts at a time. And there are some places down south where the retailers are selling it by the gallon," he says.

Gallon bottles of hot sauce? That's sure to set condiment aisle sales on fire.
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