Although the industry is in the mature stage of its life cycle, some segments have grown dramatically, such as fair trade coffee and tea, premium and organic coffee and green tea
Melbourne, Australia (PRWEB) August 17, 2012
The Tea, Coffee and Other Food Manufacturing industry is typified by great diversity in its product range and levels of value added. According to IBISWorld industry analyst, Steven Connell, “the industry has remained resilient despite a deteriorating economic climate, waning consumer confidence and volatile commodity prices largely due to the staple and inexpensive nature of its products”. Although the industry is in the mature stage of its life cycle, some segments have grown dramatically, such as fair trade coffee and tea, premium and organic coffee and green tea. Changing lifestyles and consumption patterns have prompted manufacturers to be innovative with their product lines to stimulate sales and renew demand. In the five years through 2012-13, industry revenue is expected to increase by 2.4% per annum. In 2012-13, industry revenue is forecast to grow by 2.4% to total $8.72 billion.
The Tea, Coffee and Other Food Manufacturing industry has a low level of market share concentration. Industry concentration has increased over the past five years as major players like Nestle, Mars and Unilever have actively pursued merger and acquisition initiatives. Today, fewer manufacturers are serving wider geographic markets as improvements in transportation, ownership consolidation and the extension of the shelf life of products enable them to reduce costs by centralising production facilities. Connell adds, “the consolidation of ownership is expected to increase in the next five years due to acquisitions, continued product innovation, strong brand loyalty and aggressive marketing initiatives”. However, concentration varies between product segments.
Revenue growth should be supported in the five years to 2017-18 by the gradually improving economic climate and favourable consumer trends. The Tea, Coffee and Other Food Manufacturing industry will also be aided by moderating commodity prices, an increase in demand for prepared meals, advancements in technology and production, and lower labour costs. Furthermore, the focus on high-protein, low-sugar diets will stimulate demand for green tea, ground coffee and artificial sweeteners, which have shown strong signs of promise over the past five years. However, the rising prevalence of private-label products will weigh on industry growth.
For more information, visit IBISWorld’s Tea, Coffee and Other Food Manufacturing report in Australia industry page.
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IBISWorld industry Report Key Topics
This industry consists of establishments that manufacture food products not elsewhere classified, including coffee, tea, dressings, seasonings, flavourings, herbs, spices, yeast, yeast extracts, ice, honey, salt and prepared meals. Manufacturers in this industry procure raw materials and process them into various finished products that are subsequently sold to wholesalers, retailers and related food manufacturers.
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
About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.