Convenient nutrition: Time-poor consumers sustain demand for the industry's products
London, United Kingdom (PRWEB) June 18, 2013
The strength of the Fruit & Vegetable Processing industry has been tested over the past five years by the deteriorating economic climate, rising production costs and thinner profit margins. Tighter household budgets meant people have been choosing to cook at home instead of eating out, which supported demand for processed food ingredients to some extent. However, weak consumer confidence translated into cautious spending and consumers traded down their food purchases, choosing low-cost items over more expensive products. Industry players have had to compete with aggressive promotions and discounting by major retailers, which fought hard to maintain and expand their customer bases during the recession.
Fortunately, the industry has proven resilient in the face of such conditions, due to social trends such as busier lifestyles and greater workloads. According to IBISWorld industry analyst Steven Connell, “these factors have created a mainstream market of time-poor consumers who depend heavily on convenience products”. This has boosted demand for many processed fruit and vegetable products, such as pre-cut frozen vegetables and ready-made salads. Over the past five years, revenue for the Fruit & Vegetable Processing industry is estimated to decline at a compound annual rate of just 0.1%. In 2013-14, revenue is projected to increase by 2.4% to £2.4 billion.
Industry revenue is forecast to return to growth over the next five years through 2018-19 as the economy recovers and social trends underpin demand for processed fruit and vegetables. Connell adds, “rising health consciousness and the persistence of time constraints are expected to fuel demand for high-quality, convenient food, thus offsetting some of the difficult trading conditions over the next five years”. Profit margins will come under pressure from rising fruit and vegetable costs and the increasing encroachment of own labels. Players that react quickly to market conditions and take a proactive approach to differentiating their products may be able to capitalise on the growth opportunities presented by trends such as eco-consumerism.
The UK Fruit & Vegetable Processing industry has a medium level of market share concentration with the four largest players generating just under 60% of industry revenue. Major companies include Bakkavor Group, McCain Foods, Iglo Foods and H J Heinz.
For more information on the Fruit & Vegetable Processing industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.
IBISWorld industry Report Key Topics
Fruit and vegetable processors slice, roast, bottle, can, preserve, quick-freeze and quick-dry fruit and vegetables. Industry products include jams, roasted nuts, pastes and preserved produce. The industry also produces perishable prepared foods, including packaged salads, peeled or cut vegetables and tofu. Ready-made frozen and canned goods are not covered by this industry.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalisation & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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