In a move indicative of shifting consumer preferences and industry trends, Flowers Foods, Inc. – one of the largest producers of packaged bakery foods in the US, with 2023 net sales of $5.1bn – has announced the acquisition of Simple Mills for $795 million in cash.
The strategic transaction directly addresses the growing demand for better-for-you (BFY) snacks, a category experiencing unprecedented growth.
“With leading market positions and abundant white space for future growth, Simple Mills perfectly fits our strategy of adding compelling brands in better-for-you segments that complement and diversify our existing portfolio,” said Ryals McMullian, chairman and CEO of Flowers Foods. “Equally important, the brand’s mission aligns with Flowers’ values centred on honesty and integrity, respect and inclusion, and sustainability.”
Simple Mills, founded in 2012 by Katlin Smith, quickly established itself as a leader in the natural food sector. The Chicago-based company’s products – ranging from crackers and cookies to snack bars and baking mixes – are crafted with simple, nutrient-dense ingredients such as nut, seed, and vegetable flours. This focus on quality and innovation has propelled significant growth; in 2024, Simple Mills generated $240m in net sales, marking a 14% year-over-year increase and outperforming broader market growth trends.
The rise of better-for-you snacking
The BFY snacks market has emerged as one of the fastest-growing sectors in food. Grand View Research valued the global BFY snacks market at $47.04bn in 2023 and projects a compound annual growth rate of 7.6% between 2024 and 2030. This rapid expansion reflects a fundamental shift in consumer priorities, where snacking increasingly aligns with health, wellness, and sustainability values.
“The pandemic jumpstarted the way consumers think about wellness – not just physical, but also mental and social,” said Brian Choi, CEO of the Food Institute, during a recent webinar on consumer snacking trends.
Data from Mondelēz and the Food Institute highlight a rise in snack consumption and a shift away from traditional meals. Many younger consumers now demand snacks that deliver functional benefits, such as improved gut health, enhanced cognition, or sustained energy. This evolution stems from better access to nutritional research, an ageing population, and Gen Z’s holistic approach to health. Additionally, the increasing adoption of GLP-1 drugs has driven demand for nutrient-dense snacks.
The BFY market has evolved beyond calorie or carb reduction to prioritise functionality. Products offering benefits like immune support, menopause relief, and metabolic health are now commonplace. The Specialty Food Association’s 2024-2025 report predicts that adaptogens, nootropics, healthy fats, and botanicals will continue to gain traction in a wide array of products, from baked goods and chocolates to sparkling teas.
Protein, too, remains a focal point for consumers.
“We’ve found that 56% of US consumers know the benefits of protein for their health,” said Jenny Zegler, director of Food and Drink for Mintel. “This awareness has made protein an enduring trend that consumers gravitate toward because protein is nutritious, filling, and available in a variety of foods and drinks.”
Sustainability is also becoming a crucial factor influencing purchasing decisions, as consumers increasingly prioritise brands that demonstrate environmental responsibility through ethical sourcing, reduced packaging waste, and carbon footprint reduction.
Flowers Foods’ acquisition strategy reflects an understanding of these trends and a commitment to staying competitive in an evolving market.
Simple Mills’ role in Flowers’ growth strategy
Simple Mills will operate as an independent subsidiary of Flowers Foods, maintaining its leadership team and existing operations in Chicago, Illinois, and Mill Valley, California. This autonomy ensures the brand retains its identity and mission while benefiting from Flowers’ resources to drive distribution, innovation, and awareness.
“With Flowers' resources, we will be well positioned to broaden distribution, accelerate innovation, and amplify brand awareness, while advancing our mission,” said Smith. “Flowers has a strong track record of fostering growth in its acquired companies while stewarding and protecting their brand promise.”
The acquisition is expected to immediately enhance Flowers’ net sales and adjusted EBITDA growth. It also diversifies Flowers’ revenue base, increasing its exposure to the high-growth snacking category. With Simple Mills, Flowers’ branded retail sales are projected to rise to 66% of total net sales on a pro forma basis, solidifying its position in the market.
“Katlin and the Simple Mills team have built a remarkable business, and we look forward to collaborating with them to generate continued growth while preserving the brand’s integrity and staying true to its unmatched quality and taste,” added McMullian.
The transaction, subject to regulatory approval, is expected to close in the first quarter of 2025. Financial and legal support for the deal came from RBC Capital Markets, Jones Day, Piper Sandler, and Ropes & Gray LLP.