The industry has been buoyed by strong brand loyalty commanded by the major companies
Melbourne, Australia (PRWEB) December 22, 2012
Over the five years through 2012-13, the Frozen Cake and Pastry Manufacturing industry has performed remarkably well. According to IBISWorld Industry analyst Suzannah Rowley, “it has defied challenges posed by the global economic downturn, a shift towards value conscious spending and a high level of market saturation”. The industry has been buoyed by the strong brand loyalty commanded by the industry's major companies and its ability to accommodate dramatic shifts in consumers spending by catering to different markets. These factors combined have contributed to the 2.4% annualised revenue growth over the past five years. These factors are also expected to boost revenue 3.0% in 2012-13 to total $582.5 million. The main obstacles to industry performance have been the rise of supermarket private labels and the increase in purchase costs over the past five years. Volatile spikes in prices of key inputs, such as wheat and sugar, were due to supply disruption on the domestic and global markets.
Industry revenue is expected to grow over the next five years. “Overall demand is expected to rise for the industry due to an improvement in economic conditions, rising disposable incomes and positive consumer sentiment”, says Rowley. Sales to non-traditional retail markets such as petrol stations, convenience stores and food service operators are also expected to grow alongside the increasing demand for convenience and the gradual increase in expenditure on cafes, restaurants and hotels. Some of the more lucrative opportunities supporting profit growth over the next five years will include an expansion of niche category products such as organic low-fat frozen pastries or cakes, and the growth of export markets. The main constrains to growth over this period will be the ongoing increase in the market share of private label products sold in supermarkets and increases in production costs owing to unfavourable movements in commodity prices.
The Frozen Cake and Pastry Manufacturing industry in Australia has a high level of market share concentration. While the industry does have a number of small and medium-size players, the majority of the industry's revenue is made by Patties Foods, Sara Lee and Mrs Mac's. The industry has consolidated over the past decade as all major players have expanded through acquisition and product development. Patties Foods in particular has strengthened its position within the market through the acquisition of the Four'N Twenty and Nanna's brands in 2003. Aggressive marketing has also entrenched the market-leading position of many top brands.
For more information, visit IBISWorld’s Frozen Cake and Pastry Manufacturing report in Australia industry page.
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IBISWorld industry Report Key Topics
Businesses in this industry manufacture an array of frozen bakery products, such as frozen cakes and pies.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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