Health snack food production set to soar as Aussies seek healthier options
Experts at IBISWorld predicted the top trends in snack food production and retail.
With Australians navigating increasingly busier lifestyles, leaving less time to prepare and eat home-made meals, the overall consumption of snack foods is increasing – with business information analysts at IBISWorld forecasting Australia’s Snack Food Manufacturing and Health Snack Food Production industries will generate combined revenue of over $3.0 billion in 2015-16.
While traditional Snack Food Manufacturing continues to generate the greatest overall revenue, IBISWorld identified the Health Snack Food Production industry as growing at the faster pace over the past five years, increasing by an annualised average of 3% – despite revenue growth being somewhat hampered through the grocery supply chain due to downward pressure on prices.
IBISWorld senior industry analyst Ryan Lin, said, “Snack food options have expanded beyond traditional snacks – such as potato chips and biscuits made with standard white flour – over the past five years as consumers become increasingly health conscious and seek higher quality snack foods.”
Health snack foods are expected to make up a greater share of consumer snacking habits.
“However, there has also been a tangible shift towards premium snack foods, such as gourmet-flavoured chips, alongside those perceived to be healthier options or that respond to specific dietary requirements - such as low fat, low salt, low sugar, organic, gluten-free, dairy-free, vegan and so forth,” Lin said.
“While potato chips remain the most popular form of snack food, increasing consumer demand for healthier options manufactured by Australia’s Health Snack Food Production Industry – including dried fruits and nuts, which account for 42.8% of industry revenue; muesli bars (29.1%); protein bars (17.4%), and other items such as fruit and vegetable bars (10.7%) – is anticipated to drive growth and deliver both challenges and opportunities for industry players.”
IBISWorld highlighted Australia’s Biscuit Manufacturing, Potato Chip Production, Cake and Pastry Manufacturing and Chocolate and Confectionary Manufacturing industries as key sectors impacted by the trend towards premium and healthier snack food options.
“While timely and clever product innovation will help drive some growth for traditional snack industries, this will be tempered by an increase in availability of healthy substitutes,” Lin said.
Supermarkets and Grocery Stores will be the biggest retail benefactors of increased snack food consumption, particularly as each supermarket chain looks to expand their private-label product portfolios.
The growing demand for cheaper private-label products has resulted in more shelf space for these items, with private-label specialist ALDI leading the charge, followed by Woolworths and Coles. “Woolworths has already had strong success with its health-conscious Macro Wholefoods and Macro Organic private-label brands, and are expected to continue leveraging this success to gain a greater foothold in the health snack food market,” Lin said.
