A decade ago, Ashley Thompson created the ready-to-eat overnight oats company Mush — a brand that bills itself as a healthier breakfast with nutrient-dense ingredients, free of fillers and additives.
The Chicago-based company has sold more than 200 million cups, and its appeal among shoppers caught the attention of its retail partner Whole Foods, who last year requested Mush to also create protein bars to be sold at the grocery chain.
“What we’re seeing unfold right now is one of the greatest transformations of any industry in America, and one of the most important, which is the food and beverage industry,” Thompson said.
Major manufacturers like Chicago-based giant Kraft Heinz share shelf space with independent upstarts like Mush. But consumers are increasingly shifting their attention away from legacy brands toward healthier, independent labels, experts and companies say. That shift has brought considerable growth for Chicago’s smaller food brands like Mush and Farmer’s Fridge — and it’s pushing big companies like Kraft Heinz to pivot.
In September, Kraft Heinz announced it would split into two separate companies to accelerate its growth amid waning consumer interest. The move comes 10 years after Heinz merged with Kraft, creating one of the largest food and beverage companies in the world.
The food industry’s transformation has been ramping up over the last five years, according to experts.
“There’s a move toward transparency, clean labels and less processed foods in such a way that you even see the big giants leaning into those,” Ernest Baskin, assistant professor and chair of the food, pharma and health care department at Saint Joseph’s University in Pennsylvania, said.
Protein, for example, has become a major priority, he said, leading brands to develop their own products. Starbucks is one company to incorporate protein into its products, launching protein lattes and protein cold foam drinks in September.
Weight loss medication in the form of GLP-1, like Ozempic and Wegovy, has become wildly popular, causing consumers to be more intentional about what they eat, Farmer’s Fridge founder Luke Saunders said. Farmer’s Fridge makes premade meals like fresh salads and wraps.
“Even before GLP‑1, the fresh section of the grocery store was growing several times faster than the center of the store,” Saunders said, referring to shelf-stable goods.
The White House’s Make America Healthy Again agenda, spearheaded by Health and Human Services Secretary Robert F. Kennedy Jr., has also gained popularity for trying to steer Americans away from processed foods.
Morningstar analyst Erin Lash said in her November notes on Kraft Heinz that consumers have a waning “appetite for less healthy center‑store fare,” and the company’s split could add costs without improving its competitive edge or consumer-perception problems. But Kraft Heinz plans to spend more on product innovation, cleaner ingredients and marketing, according to Lash.
Changing consumer perception could still be a problem. On Tuesday, San Francisco’s city attorney filed a lawsuit against some of the largest snack food companies, such as Kraft Heinz and Chicago-based Mondelez International, saying they manufacture addictive ultra-processed foods that’s sickening consumers.
Kraft Heinz didn’t return a request for comment.
The Centers for Disease Control and Prevention released a report in August that said ultra-processed foods account for about 55% of the average daily calorie intake. When broken down by age, youth aged 1 to 18 consumed a higher percentage of calories at 61.9%, compared to 53% for those aged 19 and older.
“Shifting even a few percentage points a year represents billions of dollars [away from ultra-processed foods],” Saunders said.
Faster product launches
Independent brands like Mush are able to launch a new product, such as their protein bar, within a few months, which speaks to “the agility of independent brands versus bigger food conglomerates,” Thompson said.
“We’re not mired down by hundreds of brands all in different life stages,” she said. “At a smaller startup, we’ve got leaner teams, quicker communication, which leads to faster and often better decision making.”
But some big brands are making changes to be more nimble. Earlier this year, Kraft Heinz launched TasteMaker, an AI-powered platform that helps cut down the time and costs to creating marketing content.
Kraft Heinz CEO Carlos Abrams-Rivera said in the companies third quarter earnings call that TasteMaker “enables content creation at record speeds. What once took eight weeks now takes just eight hours — and we are only scratching the surface of what is possible.”
Mush, which has 150 employees, is sold at 17,500 retailers, recently expanding to Walmart.
“People are eating more intentionally. They’re moving away from processed foods and gravitating toward cleaner, simpler, nutrient‑dense food … because they want to be healthy,” Thompson said. Changing consumer trends has been “rattling big food,” she added. “They’re not well-positioned for this.”
Large companies with popular products are often hesitant to change their offerings too much, Baskin said.
“With these legacy brands, companies tend to be very, very conservative with them because they tend to have a core, stable group of consumers that are attracted to them for specific things and for a specific brand persona,” he said.
Pitching authenticity
Simple Mills, a Chicago-based gluten-free snack and baking mix company, has grown steadily every year by focusing on recognizable ingredients with no fillers, artificial flavorings, coloring, sweeteners or preservatives, Chief Mission, Innovation and Marketing Officer Michelle Lorge said.
Simple Mills Chief Marketing Officer Anna Gensch said most of the cracker and snack aisle in a grocery store has wheat- or rice-based products, offering little diversity. She said Simple Mills helps consumers diversify their diets with ingredients like almond and seed flours.
Since its founding in 2012, Simple Mills has grown steadily over the years. In 2024, the company noted a 14% increase in net sales, compared to the previous year.
Farmer’s Fridge has been growing “fast for 12 years while other businesses are shrinking,” Saunders said.
The company distributes its fresh salads and bowls through its proprietary vending machines and with retailers like Target, Walmart and Jewel-Osco.
Thompson, of Mush, said marketing plays a large role in drawing customers, particularly for independent brands.
“Consumers really want authenticity,” she said. “They want to understand why this company came to exist, who the founder is, what they’re attempting to do. Smaller independent brands know how to get that story out in a very real way through social media.”
Abin Kuriakose, chief innovation officer at World Business Chicago, said food manufacturing is the Chicago area’s largest industry, and the sector is growing.
“We’ve seen an incredible diversification of products and more options than ever for consumers. Corporates and startups are in a race to meet that demand,” Kuriakose said.
And corporations are more open to connecting with startups through venture arms, partnerships and events because they want to understand what’s happening in the marketplace, he said.
These connections can also lead to acquisitions, which can help give legacy brands a larger presence in the healthy food market.
Chicago-based supplement brand Vital Proteins was acquired by Nestlé Health Science, a division of Switzerland-based conglomerate Nestlé, in a deal that closed in 2022. More recently, Simple Mills was acquired by Flowers Foods, owner of brands such as Dave’s Killer Bread, Wonder and Nature’s Own, for $795 million in January.
“Startups test new trends in the market, and the ones that do well get picked up by larger conglomerates,” Baskin said.
Thompson said consumers shifting towards whole, nutrient-dense foods was years in the making.
“This was my biggest wish,” she said. “And it’s literally taking place right now.”