Pricing focus and volatility will continue in 2026

Pricing focus and volatility will continue in 2026

Stay with your category as prices change

This is our 10^th trend for 2026. Production of raw materials has been challenged, geo political issues and consumer demand continue to impact prices of inputs. Some are going up and some have even gone down. Producers and processors need to stay very close to these changes, as retailers are watching them. If your competition has moved up and you do not, your customers wonder why not and you will risk getting the increase in the future when you really need it. If your competition are going down and you are not, you might get challenged on your costing.

Our SKUFood trends are different. We focus on the entire value chain and look for insights to help you as you navigate through another year in this challenging industry. There are several sources for trends to help you understand what is happening with consumers. They are important and we encourage you to consider how they impact your target market and your products.

The roller coaster ride continues

The focus on food prices will continue through 2026. Everyone in the value chain believe they are paying too much. Producers and processors see inputs going up, retailers believe the prices they have to pay are too high and consumers cannot believe what their groceries cost. You do wonder who is making the money.

We probably can’t answer the question about who is making the money but we can tell you everyone will continue to be focused on pricing in 2026.

Just this week the price of oil has rocketed up past $100 per barrel and the price at the gas station has increased accordingly. Your trucking company has responded and you are probably getting emails from packaging suppliers and many others to tell you that they have to take a price increase to offset the rising cost of doing business. If you are a primary producer the cost and availability of fertilizer could be impacted just as you see the snow melting.

Tariffs have moved off the front page (even if we do not read newspapers any more), but they are still there. Just two weeks ago the President of the US threatened global tariffs of 10% to react to the Supreme Court decision against their first justification for tariffs. Keep a close watch on that as it plays out.

Unfortunately, this looks like the world we will be in for the foreseeable future. There will continue to be pressure on cost of goods and complaints from consumers they are paying too much.

Some areas to focus on to navigate the madness

Make sure someone in your business is watching commodity prices that impact your products and your category. They will fluctuate. It does not always mean you need to run to your customer for a price increase. You should be managing purchases and doing the best you can to slow down buying as prices go up and buy as much as possible when prices come down. Nobody has a crystal ball but you can make informed decisions.

Tariffs and another impact on pricing almost as challenging as commodity prices. Despite the Supreme Court ruling, they are controlled by one person who continues to be committed to this form of tax to bring jobs back to US. If this global tariff does go into effect, it could have an impact on any inputs you are buying from US or come through US from another place like Asia.

You have heard us say go to the stores often. This is more important than ever. Someone in your business should be watching retail prices. If your category is moving up then you should consider if this is right for your pricing. The strategy of waiting and trying to get the increase later does not usually work. On the flip side, if your category is decreasing you need to understand if your cost of goods has been reduced and if you should be sharing some of this with your customer. If your cost has not changed something is missing because your competition is able to go down. A big example of this is the recent decision from Hostess Frito Lay to reduce prices by 15%. If you are in the salty snack category you can be assured your customers are expecting something from you.

If your cost of goods really does go down consider an increase in trade spend before you reduce your everyday selling price. You can participate in more programs, get signage and perhaps off shelf displays. This can be much better for driving sales than .40 lower every day in your regular spot with no sign.

Your sales people should be very clear on the windows your customers will accept price increases. These are more formal than ever so you need to get the work done on time and submitted. It is never an enjoyable process but you need to get the right price for your products.

Work to maintain some flexibility in your business. We know people complain about smaller packages, but sometimes it is the right decision. There is no rule that says jam must be 500ml. If you have the ability to make changes you can manage the pricing better and keep your product competitive on the shelf. In some categories the entire line up of national brands are smaller so your product will look very expensive on the shelf.

Communicate with your customers more than ever

This is the time to communicate with your customers about all of these issues. They might not all be light hearted conversations but they are necessary ones. Keep them informed. They might understand the impact on your business. Food and beverage is a global business. Just this week I was talking to someone who shared how trucking was going up but demand in the middle east is way down because they can’t even get there. Excess product means prices on some things might go down.

One opportunity when you communicate is let them know when you win. If you are able to negotiate a locked in price for packaging or a buy in of an ingredient to keep your price stable let them know. Retailers think they are the only people in the value chain trying to force lower prices. They might not congratulate you but you should gain some respect and they know you are fighting to keep prices in line.

These are challenging times but there has never been a better opportunity for Canadian products at home and in export markets. As CUSMA negotiations start to happen and our Prime Minister is called a governor, Canadian consumers will maintain their desire for Canadian products. As the war in the middle east and aggression like annexing Greenland or Cuba is in the news the rest of the world will be looking for Canadian products too. If you have an event coming up we are delivering more keynotes and workshops to help producers and processors sell more in this new world.

I do have travel coming up to Toronto, Regina, Saskatoon, Vancouver and Guelph so if you want to connect or have an event in any of these locations give me a call or send me an email.

 Peter

SKUFood Recipes for Success Podcast

In this episode of SKUFood Recipes for Success, we sit down with Peter Neal, co-founder of Neal Brothers Foods and a passionate advocate for mental health and human-centred leadership.

For more than three decades, Peter has helped build one of Canada’s most respected family-owned CPG brands, known for their signature tortilla chips and salsas which has grown to encompass over 50 products. Alongside growing Neal Brothers Foods, he also took on the complex challenge of distribution in Canada, forming Jonluca Neal, a leading natural food distributor representing over 200 brands across the country.

In our conversation, Peter shares how Neal Brothers evolved from a small family venture into a national Canadian brand, and how core values like integrity, authenticity, and care have guided every stage of growth. We explore what it really takes to scale in Canadian retail, why strong brand foundations matter, and how owning both brand and distribution creates strategic advantage.
We also touch on Peter’s commitment to mental health advocacy and why resilience, people-first leadership, and open conversations about well-being are essential for long-term success in today’s food industry.

This episode offers insight not just into building great products, but into building a brand that stands for something. Whether you’re a food entrepreneur, CPG founder, or industry leader, this conversation delivers perspective, inspiration, and practical lessons for the long haul.

If you would like to be a guest send us a note. We are always working on the upcoming episodes.

There are a lot of opportunities for Ontario food and beverage products. Whether it is close to home or new markets, consumers want these products which means retailers want them in stores. A spot on the shelf and a great product is no guarantee of success. Join us for 5 action packed sessions to ensure you know how to sell that great product you have. We will focus on consumers, customers, pricing, channel partners, promotion plans and so much more. Really excited to be part of this program for Ontario food and beverage businesses.

Excited to have the opportunity to be in the room with producers and processors in Saskatoon on March 26^th. We are going to talk about “Selling the in the new world”. So many things changing which is a challenge but also lots of opportunities. We believe this is the best time for Canadian products to get on the shelf at home and in export markets. Demand is great but you need to be ready to take advantage and have your business ready to succeed. We will talk about consumers, alignment with retailers, retail plan to sell your great products and how to build trust with the market.

Retail Readiness Workshop for Food, Beverage & Ingredient Processors – March 26

Middle East war impact on food prices

As we discussed earlier, the recent eruption of war in the middle east is having an immediate impact on the price of food and beverages. From transportation to packaging to inputs like fertilizer, it only seems to go up. It is amazing how fast it oil goes up but slow to come back down. They always talk inventory but One has to assume the gas we are paying for now was purchased when oil was cheaper…

With the focus on Canadian food and beverage we wanted to share a program we have developed with Alain Bosse, the Kilted Chef. We partner to share insights about Canadian food and beverage at conferences and events. We talk about where products come from, share insights about some hidden gems and of course Chef Alain has great tips for using the products at home. This is designed to be entertaining and engaging. Not just for food industry audiences, it works for everyone.