A detailed research for Snack Food Industry. Just a general research..

1. FIRST
RESEARCH
FAHAD IQBAL

2. FIRST RESEARCH
• Leading provider of industry intelligence tools
• Help sales and marketing teams perform faster and
smarter, opening doors and closing more deals
• Outreach efforts with up-to-date industry information that
demonstrates a thorough understanding of your
prospects’ challenges and opportunities
• The following is a sample of a First Research Industry
Report

3. SNACK FOOD
MANUFACTURING

4. INDUSTRY OVERVIEW
• Companies in this industry make snack foods such as nuts,
chips, and popcorn, as well as peanut butter
• Industry generates about $300 Billion in revenue worldwide
• Largest Market : Europe and US
• Fastest Growing: Asia, Eastern Europe, Latin America
• US Snack Foods includes about 500 companies with annual
revenue of $27 Billion

5. COMPETITIVE
LANDSCAPE
• Demand driven by consumer tastes and health
considerations
• Profitability depends on efficient operations, effective
marketing and strong sales force
• Industry is highly concentrated
• Top 50 companies account for 90% of industry revenue

6. PRODUCTS, OPERATIONS
& TECHNOLOGY

7. PRODUCTS, OPERATIONS
& TECHNOLOGY
Major Products:
• Corn chips, bulk nuts, peanut butter, popcorn, potato chips
After Production:
• Rejected Potatoes (Animal feed)
• Starch (Starch processors)

8. Technology:
• Advanced quality control measures (sensors)
• Quality control managers
• Multiple manufacturing plants (cost reduction)
• Advancement in creating crunchier chips
• Genetically modified potatoes

9. SALES AND
MARKETING
Typical Customers:
• Grocery wholesalers, warehouse club stores, vending
machine distributors, convenience stores
• Major sales channels:
• Independent distributors, third-party brokers, internal sales
force, direct store delivery

10. Marketing:
• TV, radio ads, coupons in newspaper, magazines, internet
• Customer service operations (help lines for suggestions or
reporting)
• Websites

11. FINANCE AND
REGULATIONS
• Cash flow is steady throughout the year
• Companies enter multi-year contracts with key suppliers
to limit costs
• Gross margins: 30% to 40%
• Finished good inventory sale: 60 days
• Receivables: 30-45days

12. REGULATIONS
• Industry is highly regulated by federal and state
governments
• FDA oversees food safety
• Food allergic labeling and consumer protection act
FALCPA
• OSHA manages workplace safety
• EPA monitor environmental protections
• Government taxes for controlling snack consumptions

13. INTERNATIONAL
INSIGHTS
• Generates $300 billion revenue
• $380 billion by 2017
• Europe is largest snack food manufacturing region and US is
second
• Competition is fierce: small companies compete with
regional multinational companies
• MNCs create new flavors to match regional taste preferences
• Less healthy products in US are more popular in Asia

14. HUMAN RESOURCES
• Hourly wages are slightly lower than national average
• Workers must have basic mechanical and technical skills
• Online education for managers
• Annual injury rate are 50% higher than national average

15. CRITICAL ISSUES
Volatile ingredients prices
• Increase in price due to poor farm yield
• Prices of white potatoes fluctuate 25% to 50% every year
Highly competitive industry
• Cookies, candies, crackers, energy bars
• Private labeling offerings

16. BUSINESS
CHALLENGES
Vulnerability to regulations
• Increased awareness of obesity, ingredients
• Usage of word “Natural” on labels
Dependence on large customers
• Buying power in hands of large supermarkets
Dependence on consumer tastes
Cost of product innovation

17. BUSINESS TRENDS
• Healthier products
• Private label category grows
• Shrinking display space

18. INDUSTRY
OPPORTUNITIES
• Boosting convenience stores
• Reinventing nuts
• Promoting sustainability
• Spicier flavorings