IBISWorld Market Research
Increasing competition is slowing revenue growth for frozen pizza producers.
Melbourne, Australia (PRWEB) October 12, 2013
Demand for the Frozen Pizza Production industry has cooled over the past five years. In the early part of the period, competition from imported pizzas hindered growth in domestic production. According to IBISWorld industry analyst Emily Witham, "downturns in industry revenue were fought off by product innovation, aimed at increasing the customer base and overcoming external competition." As a result, industry revenue is expected to grow at a compound annual rate of 1.9% over the five years through 2013-14. However, increased competition has reduced the average price and profit margins for the industry. The industry is struggling to maintain its strength, with revenue forecast to grow by only 0.9% over 2013-14.
The greatest challenge for the industry is the increasing trend of health consciousness. The industry has been battling with pizza's stigma as an unhealthy dining option. In response, it has innovated new products that aim to portray a gourmet or healthier image. The inclusion of frozen pizzas specialised for dietary requirements has also been an area of considerable growth. The rise of time poor consumers as the number of full-time employees increases has been favourable for the industry due to the convenience of frozen pizza. However, this has not been without an increased threat from growth in many healthier ready-made meals. "The growth of the major supermarkets' private labels has not bypassed the frozen pizza segment," says Witham. The increase in demand from supermarkets for private-label pizza has increased production of private-label pizza. This has been a major contributing factor to the reduction of the industry's profit margins as the supermarkets have squeezed the industry for lower prices. The industry has a high level of market share concentration, with the two largest players - McCain Foods (Aust) Pty Ltd and Dr. Oetker Australia Pty Ltd – accounting for the majority of industry revenue.
Over the next five years, the Frozen Pizza Production industry is expected to face increased external competition from healthier ready-made meals and the growing fresh pizza business. Growth in gourmet pizza shops and convenient stores like Dominos Pizzas are expected to remain major threats to the industry. There is the potential for growth in product innovation and export developments in the growing Asian markets.
For more information, visit IBISWorld’s Frozen Pizza Production report in Australia industry page.
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IBISWorld Industry Report Key Topics
This industry produces frozen pizzas that are distributed to grocery wholesalers, supermarkets and retail food stores.
Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
International Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance
Key Statistics
Industry Data
Annual Change
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