Cashing in on the booming wheat-free market
To wheat or not to wheat? It's a question on the minds of many. Whether out of necessity or a desire to be in step with the latest food trend, more people are buying gluten-free products. Manufacturers and restaurants have taken note, but there's still space for entrepreneurs.
"There's definitely money to be made in the gluten-free market," said Beckee Moreland, director of gluten-free industry initiatives for the National Foundation for Celiac Awareness (NFCA).
As of January, 30 percent of U.S. adults said they wanted to either reduce the amount of gluten in their diet or eliminate it altogether, according to a report by NPD Group.
And in the past year, the frequency of diners ordering gluten- or wheat-free menu items more than doubled from four years earlier—translating into more than 200 million instances, according to NPD.
(Read more: Two New Yorkers find a fortune in meatballs)
Already a $4.2 billion market, gluten-free foods are expected to have sales of more than $6.6 billion by 2017, according to market researcher Packaged Facts.
NFCA estimates that 3 million Americans have celiac disease, an autoimmune condition triggered by gluten protein, and that another 18 million have nonceliac gluten sensitivity. The only treatment is to avoid consuming the protein—which means 21 million potential customers.
"Of that estimated number, 83 percent have not yet been diagnosed," Moreland said. "So if you think the market is big now, there's a lot more room for growth."
With manufacturers such as Pillsbury, Kellogg's and Barilla now providing gluten-free selections, the accessibility of products has expanded from health food stores to supermarkets and grocery chains throughout the country.
Dining-out options are increasing, too. According to a report by market research group Mintel, gluten-free mentions on menus almost tripled between 2009 and 2012.
Rose's Wheat-Free Bakery and Café, in Evanston, IIl., opened in 2007, before the gluten-free movement caught on. Owner Rose O'Carroll got interested in the idea because she and her daughter are both gluten-sensitive.
But after five years, the first-time owner was so deeply in debt that last December she posted a note telling customers that Christmas Eve would be the business' last day.
They begged her to stay open, saying the bakery was their only outlet for good, gluten-free food.
Moreland at NFCA wasn't surprised by that reaction.
"Being able to order a fresh doughnut whenever you want it is something a lot of people take for granted," she said. "When you finally have that option, people appreciate it a lot and remain very loyal to the business that offers that."
Luckily for Rose's and its fans, serial entrepreneur Marcus Lemonis caught wind of the scheduled closure and wrote a $200,000 check to keep the bakery open.
But he didn't just invest. The host of CNBC Prime's "The Profit" took charge to put the business back on track. Under his direction, traffic is up 35 percent and Rose's is expected to make $100,000 this year.
(Read more: What (not) to do when turning around a business)
Rose's is the only gluten-free eatery in all of Illinois, said Lemonis, who plans to open a second location with a similar look and feel 15 miles north in a couple of months.
But that's just the beginning.
"I wouldn't have done this if I didn't think I could open 50 of them," he said. "If it takes $10 million to do it, that doesn't bother me because I believe in the concept."
Moreland provided five major tips to any entrepreneur thinking of opening a bakery, café or restaurant dedicated to serving gluten-free foods.
1. Do your homework Educate yourself about the customers, ingredients, logistics, service and rollout. She suggested completing the GREAT Kitchens training course run by the NFCA.
2. Understand the guidelines. Read theFood and Drug Administratin's gluten-free labeling ruling, which defines the term and standards for "gluten-free" products.
3. Connect with the community. People with gluten-related disorders eat gluten-free every meal, every day. They want to have confidence that their food is safe and that you can effectively and accurately communicate what you are offering.
4. Verify and source your ingredients. Confirm that every component of every product is gluten-free. If you are using gluten-free flours such as sorghum, rice, potato, millet, quinoa or amaranth, make sure they have no contact with grains containing gluten.
5. Boost the nutrition. Because many gluten-free products are devoid of fiber and essential nutrients, one new trend is to increase their nutritional value by adding grains, seeds and nuts.
—By CNBC's Jeanine Ibrahim