Intense competition will continue to define the industry. This will be reflected in price-based competition and an increased emphasis on the regular introduction of new products.
Los Angeles, CA (PRWEB) October 11, 2011
Revenue from frozen yogurt stores reached $1.6 billion in 2011. Revenue has increased strongly due to the growing popularity of frozen yogurt chains, such as Pinkberry, Red Mango, and Yogurtland. According to a new IBISWorld research report, demand is expected to jump in 2012 and will remain robust beyond as the economy improves, the unemployment rate declines and consumers begin to spend money on eating out. Senior Industry Analyst Nima Samadi adds, “Intense competition will continue to define the industry. This will be reflected in price-based competition and an increased emphasis on the regular introduction of new products. Most chains will introduce new healthy food alternatives and expand their current product lines. Moreover, over the next five years, industry profitability will remain strong because of higher sales volumes and resumed domestic expansion. Operators that experience stagnant profit margins domestically will likely double down on international expansion to grow bottom line returns. Key areas include Asia and the Middle East.”
Frozen yogurt stores are the fifth largest product segment in the broader coffee and snack shops sector. They currently make up approximately 6% of sector revenue, or $1.59 billion. Coffee shops are the largest coffee and snack shop product segment. The proportion of industry revenue that comes from coffee shops has increased over the last ten years due to the rapid proliferation of coffee shops and cafes across the US and the rise in popularity of major coffee shop chains such as Starbucks. Coffee shops make up $6.6 billion of the revenue Americans spend on snack foods from specialty stores.
Doughnut stores are the second largest product segment in this industry. They currently make up approximately $4.8 billion of industry revenue. The proportion of industry revenue that comes from donut shops has decreased over the last ten years, largely due to the health concerns associated with eating unhealthy foods like donuts. However, Samadi adds that “the fall has been dampened by the success and growth major donut chains such as Dunkin' Donuts and Krispy Kreme have experienced over the last decade”. Ice cream shops are the third largest product segment in this industry. They currently make up approximately $4.2 billion of industry revenue. The proportion of industry revenue that comes from ice cream shops has decreased Samadi says, because of “health concerns, as well as the growth in popularity of easily substitutable foods such as frozen yogurt.”
Bagel stores are the fourth largest product segment in the industry. They currently make up approximately $4.0 billion of industry revenue. The proportion of industry revenue that comes from bagel shops has increased over the last ten years. This is due to the growing popularity of bagels as well as their introduction into new markets over the last ten years.
For more information visit IBISWorld’s Frozen Yogurt industry report
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