Published on: November 25, 2019
Snack foods are available in various forms, including packaged and ready-to-eat snack foods, other semi-processed food such as snacks pellets, chilled chicken nuggets, etc. which needs to be baked or fried before consumption as well as items that are made at homes such as chopped vegetables or fruits. We categorize the snacks food market as a part of the overall packaged foods and meats market. The packaged foods and meats products market covers manufacturers or food processing vendors that are involved in food processing to eliminate microorganisms and to extend shelf life. The global food and beverage market was valued at USD 7.93 trillion in 2018 and is expected to grow at a moderate pace.
Our reports on the snacks market provide a holistic analysis, market size and forecast, trends, growth drivers, and challenges, as well as vendor analysis covering around 50 vendors.
In 2018, the global snacks market size was estimated to be around USD 600 billion and growing at a CAGR of over 3% for the past three years. The snack food market is forecasted to grow at a moderate growth rate over the next five years and cross USD 730 billion by 2024.
Some underlying factors are expected to drive growth in the snack food market during the forecast period. Our analysis identifies the following factors to be driving the growth in the snack food market:
There is a growing demographic shift in consumer lifestyle in emerging markets such as India and China, which is one of the key drivers for the growth in the global snacks market. The profile of the urban consumer is changing in these markets with an increase in the working population, more women entering the workforce, growing urbanization, rise in disposable income, smaller households due to nuclear family, and fast-paced lifestyle. These factors are making people eat on the go rather than cook a healthy full course meal at home and is driving the ready-to-eat snacks food segment. Also, there is a growing trend of people to snacks on bakery food items such as sandwiches, fruited hot cross buns, snacks fruit pies, cream pies, custard snacks pies, chicken patties, salty snacks such as potato chips and coconut chips as well as meat-based snacks such as dried meat chips, etc. in between meals or replace a regular meal with these snacks.
Rising health consciousness by consumers is now leading shoppers to seek healthy and natural snacks such as fruits and vegetables that fuel them for their day and helps them meet their health and fitness goals. Snacks food companies are introducing healthy snacks that do not compromise on taste and affordability to cater to this market segment.
There is a growing shift in the way people are consuming food globally. A few decades earlier, people had a predictable eating pattern of having three large regular meals prepared at home and snacked sparingly in between meals. Now the trend has changed due to changes in taste and lifestyle. People are replacing meals with several on-the-go snacking and are even replacing meals altogether. Moreover, snacking today is not restricted to children and youth, but it is increasingly consumed across different age groups. Offering products that suit the tastes of various age-groups provides a massive opportunity for the snacks food industry. Also, branded snack products are now penetrating semi-rural and rural markets in emerging market countries leading to an expansion in the consumer base.
The snacks food industry is continuously innovating on their product offerings as they are catering to consumers of various age groups as well as socioeconomic backgrounds. Consumers in developed countries with more refined taste and food requirements prefer to shop from delicatessen or deli stores that sell a selection of fine, unusual, or foreign prepared food and snacks items. With the growing economic prosperity in emerging markets, there is an increase in deli stores in countries such as India and China that cater to the affluent and upper-middle-class consumers. On the other hand, the snacks food industry is also targeting the poor in the rural and urban markets in India and other emerging markets by making these packaged snacks products readily available in smaller mom-and-pop stores, canteens, and small shops in multiple pack sizes including smaller sizes which costs less and are affordable by this segment.
Meanwhile, the vendors operating in the market face numerous challenges in increasing their sales and improving profitability. Some of those challenges are:
There is a rising health consciousness among the urban population due to the sedentary lifestyle they lead, and due to the increasing incidence of lifestyle diseases. Consumers are now restricting their intake of processed snack foods, which are usually high in salt and sugar as consumers are becoming more aware of the harmful effects of consuming higher quantities of sugar, salt and saturated fat as it can lead to heart diseases. Snacks foods such as cakes, biscuits, pastries, pies, quiches, sausage rolls, croissants, ice creams, chocolate, and chocolate spreads contain a high amount of saturated fat and health agencies such as NHS have provided guidelines to limit the amount of saturated fat that can be consumed per day. The NHS guidelines limit the consumption of saturated fat to 30g and 20g for the average man and woman aged between 19-64 respectively. Similar guidelines are also provided by health agencies in other developed markets.
The food processing sector is extensively regulated globally. Non-compliance can result in serious penalties, and loss of business, e.g. Nestlé S.A. instant noodles brand Maggi was banned in India by the national food regulator FSSAI in 2015 and the company was asked to withdraw the product from the shop shelves as it was found to contain lead content beyond the permissible limits. The government in various countries are planning to impose snacks tax discourages people from excessive snacking as it leads to obesity. For example, there is a proposal in the UK to introduce a 20% snack tax on biscuits, cakes, and sweets. Implementation of snacks tax may affect the prices of snacks, which will deter consumers from the purchase of such products affecting the growth of the snacks food industry.
While most of the revenues generated by the snacks food industry are from the developed markets such as North America and Europe, the next wave of growth in the sector is likely to come from emerging markets such as India and China. Although India and other emerging markets offer a huge market potential for the snacks food market, the industry faces challenges in terms of basic infrastructure such as lack of adequate cold storage warehouses and inefficient supply chain and logistics services especially for perishable goods in these markets which impedes the growth of the snacks food industry.
We provide a detailed analysis of around 50 vendors operating in the snacks market, including some of the prominent vendors such as The snacks market analysis report highlights Conagra Brands, Inc, PepsiCo, Inc. Ferrero, The Hershey Company, Hostess Brands, LLC, Britannia Industries Limited, CSC Brand LP., Unilever, Grupo Bimbo, S.A.B. de C.V., Hain Celestial, Tiger Brands, J. M. Smucker Company, The Kraft Heinz Company, McCain Foods Limited, Tyson Foods, Inc., Mondelēz International, Inc., General Mills, Inc., Nestlé S.A. The Kellogg Company, and Lamb Weston Holdings, Inc. as among the leading vendors in the global snack food market. Consolidation of existing manufacturing plants, mergers, and acquisitions are some of the business and market penetration strategies being adopted by manufacturers in the global snack foods market.
Some of the key developments mentioned in our snacks market report include:
Backed with competitive intelligence and benchmarking, our snacks market research on the cheese market is designed to provide entry support, customer and M&A assessment, as well as go-to-market strategy support.
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