Marketing research on the snack foods market in 2010 UK...
Market Report Plus 2010
20th Edition January 2010 Edited by Sophie Worth ISBN 978-1-84729-564-4
Snack Foods
Snack Foods
Foreword
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Snack Foods
Contents
Contents Executive Summary
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1. Market Definition
3
REPORT COVERAGE....................................................................................................................3 MARKET SECTORS.......................................................................................................................3 MARKET TRENDS.........................................................................................................................3 Health Issues....................................................................................................................................3 Flavours............................................................................................................................................4 ‘Do us a Flavour’.............................................................................................................................5
ECONOMIC TRENDS....................................................................................................................5 Population.......................................................................................................................................5 Table 1.1: UK Resident Population Estimates by Sex (000), Mid-Years 2004-2008...........5 Gross Domestic Product................................................................................................................5 Table 1.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m), 2004-2008..............................................................................................................................6 Inflation...........................................................................................................................................6 Table 1.3: UK Rate of Inflation (%), 2004-2008.......................................................................7 Unemployment...............................................................................................................................7 Table 1.4: Actual Number of Unemployed Persons in the UK (million), 2004-2008.........7 Household Disposable Income....................................................................................................8 Table 1.5: UK Household Disposable Income Per Capita (£), 2004-2008............................8
MARKET POSITION......................................................................................................................8 The UK..............................................................................................................................................8 Table 1.6: Consumer Expenditure on Food and Non-Alcoholic Drink (£m), 2004-2008........................................................................................................................................9 Europe..............................................................................................................................................9
2. Market Size
11
THE TOTAL MARKET................................................................................................................11 Manufacturers’ Sales ..................................................................................................................11 Table 2.1: UK Manufacturers’ Sales of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007.............................................................................................................11
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Table 2.2: Net Supply of Prepared or Preserved Potatoes Including Crisps in the UK (£000), 2004-2007.........................................................................................................................12 Retailers’ Sales .............................................................................................................................12 Table 2.3: The Total UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2005-2009.................................................................................................................12 Figure 2.1: The Total UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2005-2009.................................................................................................................13
BY MARKET SECTOR.................................................................................................................13 Figure 2.2: The Total UK Snack Foods Market by Sector by Value at Current Prices (%), 2009........................................................................................................................................14 Potato Crisps.................................................................................................................................14 Table 2.4: The UK Potato Crisps Sector by Value at Current Prices (£m at rsp and %), 2005-2009....................................................................15 Figure 2.3: The UK Potato Crisps Sector by Value at Current Prices (£m at rsp), 2005-2009.................................................................................15 Other Savoury Snacks..................................................................................................................16 Table 2.5: The UK Other Savoury Snacks Sector by Value at Current Prices (£m at rsp and %), 2005-2009....................................................................16 Figure 2.4: The UK Other Savoury Snacks Sector by Value at Current Prices (£m at rsp), 2005-2009................................................................17 Snack Nuts.....................................................................................................................................17 Table 2.6: The UK Snack Nuts Sector by Value at Current Prices (£m at rsp and %), 2005-2009....................................................................18 Figure 2.5: The UK Snack Nuts Sector by Value at Current Prices (£m at rsp), 2005-2009.................................................................................18
OVERSEAS TRADE......................................................................................................................19 General Overview........................................................................................................................19 Table 2.7: UK Manufacturers’ Imports and Exports of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007..................................................19 Imports...........................................................................................................................................19 Table 2.8: UK Manufacturers’ Imports of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007.............................................................................................................20 Exports............................................................................................................................................20 Table 2.9: UK Manufacturers’ Exports of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007.............................................................................................................20 Leatherhead Food International Ltd Export Figures............................................................21
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3. Industry Background
Contents
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RECENT HISTORY.......................................................................................................................23 NUMBER OF COMPANIES.......................................................................................................23 Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Turnover Sizeband (£000, number and %), 2009.....................................................................................................23
EMPLOYMENT............................................................................................................................24 Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Employment Sizeband (number and %), 2009................................................................................................................24
REGIONAL VARIATIONS IN THE MARKETPLACE.............................................................25 DISTRIBUTION.............................................................................................................................26 HOW ROBUST IS THE MARKET?...........................................................................................26 LEGISLATION...............................................................................................................................26 KEY TRADE ASSOCIATIONS....................................................................................................27 European Snacks Association.....................................................................................................27 Snack Food Association...............................................................................................................27 Snack, Nut and Crisp Manufacturers Association..................................................................27
ADVISORY AND INFORMATION SERVICES .......................................................................27 The Food Commission (UK) Ltd.................................................................................................27 Food and Drink Federation........................................................................................................27 Food Standards Agency..............................................................................................................28
4. Competitor Analysis
29
THE MARKETPLACE..................................................................................................................29 MARKET LEADERS.....................................................................................................................29 Intersnack Ltd...............................................................................................................................29 Seabrook Crisps Ltd.....................................................................................................................30 Tayto (NI) Ltd................................................................................................................................30 United Biscuits Topco Ltd...........................................................................................................31 Walkers Snack Foods Ltd............................................................................................................32
OUTSIDE SUPPLIERS..................................................................................................................32 Raw Materials...............................................................................................................................32 Snack Processing Equipment.....................................................................................................34 Packaging......................................................................................................................................34
MARKETING ACTIVITY.............................................................................................................35 Main Media Advertising Expenditure......................................................................................35 Table 4.1: Main Media Advertising Expenditure on Savoury Snacks (£000), Years Ending September 2008 and 2009............................................................................................35
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Table 4.2: Main Media Advertising Expenditure on Potato Crisps and Snacks (£000), Year Ending September 2009......................................................................................36 Table 4.3: Main Media Advertising Expenditure on Crispbreads and Crackers (£000), Year Ending September 2009......................................................................................37 Recent Promotions.......................................................................................................................38 Other Marketing Activities........................................................................................................39 Exhibitions ....................................................................................................................................39
5. Brand Strategy
41
RESEARCH FINDINGS................................................................................................................41 Table 5.1: Popularity of Selected Snack Food Brands (% of respondents), 2008 and 2009.........................................................................................41 By Sex..............................................................................................................................................42 Table 5.2: Popularity of Selected Snack Food Brands by Sex (% of respondents), 2009 .............................................................................................43 By Age............................................................................................................................................44 Table 5.3: Popularity of Selected Snack Food Brands by Age (% of respondents), 2009 ............................................................................................44 By Social Grade.............................................................................................................................45 Table 5.4 Popularity of Selected Snack Food Brands by Social Grade (% of respondents), 2009..............................................................................46 By Region ......................................................................................................................................47 Table 5.5: Popularity of Selected Snack Food Brands by Region (% of respondents), 2009........................................................................................48 Table 5.6: Popularity of Selected Snack Food Brands by Remaining Regions (% of respondents), 2009.................................................................49
COMPANIES’ BRANDS..............................................................................................................50 Intersnack......................................................................................................................................50 Largo Food Exports .....................................................................................................................50 Tayto (NI) ......................................................................................................................................50 Tyrrells Potato Chips ...................................................................................................................50 United Biscuits..............................................................................................................................51 Walkers Snack Foods ..................................................................................................................51
TOP BRANDS...............................................................................................................................51 The Guild of Fine Food Great Taste Awards...........................................................................51 Table 5.7: Winners of The Guild of Fine Food Great Taste Awards, 2009........................52
6. Strengths, Weaknesses, Opportunities and Threats
53
STRENGTHS..................................................................................................................................53 WEAKNESSES..............................................................................................................................53 OPPORTUNITIES.........................................................................................................................54
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Contents
THREATS.......................................................................................................................................54
7. Buying Behaviour
55
HOUSEHOLD EXPENDITURE ON FOOD AND DRINK......................................................55 CONSUMER PENETRATION ...................................................................................................55 Potato Crisps, Tortilla and Corn Snacks...................................................................................55 Table 7.1: Penetration of Potato Crisps, Tortilla and Corn Snacks in the Past 12 Months by Frequency (% of adults), 2009.........................................................................55 Nuts and Dried Fruit....................................................................................................................56 Table 7.2: Penetration of Nuts and Dried Fruit in the Past 12 Months by Frequency (% of adults), 2009.........................................................................56 Other Savoury Snacks..................................................................................................................57 Table 7.3: Penetration of Other Savoury Snacks in the Past 12 Months by Frequency (% of adults), 2009 ........................................................................57
8. Current Issues
59
CLOSURES, MERGERS AND ACQUISITIONS ......................................................................59 MBMG............................................................................................................................................59 Tyrrells Potato Chips....................................................................................................................59
BOARD AND SENIOR MANAGEMENT CHANGES............................................................59 PepsiCo UK and Ireland..............................................................................................................59
NEW PRODUCT DEVELOPMENT ..........................................................................................59 McCoy’s..........................................................................................................................................59 Penn State.....................................................................................................................................60 Pringles...........................................................................................................................................60 Tyrrells............................................................................................................................................60 Walkers..........................................................................................................................................60
9. The Global Market
61
EUROPE.........................................................................................................................................61 THE US...........................................................................................................................................61 ASIA PACIFIC ..............................................................................................................................62 SELECTED GLOBAL COMPETITORS .....................................................................................62 Calbee Foods ................................................................................................................................62 Intersnack Knabber-Gebäck ......................................................................................................62 ITC ..................................................................................................................................................63 J&J Snack Foods ...........................................................................................................................63 Largo Food Exports .....................................................................................................................63 Liberation Foods .........................................................................................................................64
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Lorenz Snack-World....................................................................................................................64 PepsiCo...........................................................................................................................................64 Procter & Gamble ........................................................................................................................64 Snack Foods ..................................................................................................................................65 Snyder’s of Hanover....................................................................................................................65
10. Forecasts
67
INTRODUCTION..........................................................................................................................67 The Economy.................................................................................................................................67 Population.....................................................................................................................................67 Table 10.1: Forecast UK Resident Population by Sex (000), Mid-Years 2009-2013.........67 Gross Domestic Product..............................................................................................................68 Table 10.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2009-2013....................................................................................................68 Inflation.........................................................................................................................................68 Table 10.3: Forecast UK Rate of Inflation (%), 2009-2013...................................................69 Unemployment.............................................................................................................................69 Table 10.4: Forecast Actual Number of Unemployed Persons in the UK (million), 2009-2013...................................................................................................69
FORECASTS 2010 TO 2014......................................................................................................70 Table 10.5: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2010-2014................................................................70 Figure 10.1: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2010-2014................................................................71
MARKET GROWTH....................................................................................................................71 Figure 10.2: Growth in the UK Snack Foods Market by Value at Current Prices (£m at rsp), 2005-2014 ..............................................................72
FUTURE TRENDS.........................................................................................................................72 Industry Consolidation................................................................................................................72 Overseas Markets.........................................................................................................................73 Health Issues..................................................................................................................................73
11. Company Profiles
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INTERSNACK LTD.......................................................................................................................76 SEABROOK CRISPS LTD............................................................................................................78 TAYTO (NI) LTD..........................................................................................................................80 UNITED BISCUITS TOPCO LTD................................................................................................82 WALKERS SNACK FOODS LTD...............................................................................................84
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12. Company Financials
87
13. Further Sources
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Associations.................................................................................................................................89 General Sources.........................................................................................................................90 Government Sources ...............................................................................................................91 Other Sources.............................................................................................................................92 Key Note Sources ......................................................................................................................92
Understanding TGI Data
95
Number, Profile, Penetration................................................................................................95 Social Grade.................................................................................................................................96 Standard Region........................................................................................................................96
Key Note Research
97
The Key Note Range of Reports
99
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• “Our taste buds are changing and developing as new flavours and foods become readily available in the UK and Ireland. Everyone has their favourite flavours, but lately people are becoming keen to experiment and try new foods.” Heston Blumenthal, celebrity chef and chief judge in Walkers’ ‘Do us a Flavour’ competition (www.fmb.org.uk)
• “Innovative flavour additions are key for snacks as our extensive research has shown that approximately 30% of all category growth in the latest 52 weeks has come from new flavours being added to existing brands.” Paul Lettice, Trade Communications Officer of Procter & Gamble (www.talkingretail.com, 2nd February 2009)
• “When Jamie Oliver said that because there are a few fat children nobody should be eating crisps, it crucified our business. Schools were banned from stocking crisps and our turnover plummeted from £15m to £12m almost overnight.” Ken Brook-Chrispin, Chairman and Chief Executive of Seabrook Crisps (www.ft.com, 5 May 2009)
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Snack Foods
Executive Summary
Executive Summary This Key Note Market Report Plus examines the UK snack foods market, which comprises potato crisps, other savoury snacks (including tortilla chips, baked snack biscuits and rice- and corn-based snacks) and snack nuts. It excludes sweet snack items, such as chocolate, which are covered in Key Note’s Confectionery Market Report Plus and the Sweet & Salty Snacks Market Assessment. Key Note estimates that, in terms of retail sales, the total value of the market increased by 12% between 2005 and 2009 to reach £2.39bn. An especially strong growth of 8.4% was seen between 2008 and 2009 as manufacturers passed on steep rises in commodity costs for items such as potatoes, sunflower oil and nuts. Manufacturers of snack foods continued to respond to health issues in 2008/2009, reducing salt and fat content in their foods through the introduction of ‘light’ and low-fat variants. Emphasis has been placed on the use of more ‘natural’ ingredients, as well as on baked, rather than fried, goods. Seabrook Crisps has admitted that when celebrity chef Jamie Oliver advised people against eating crisps because of their fat and salt content, it decimated its sales ‘almost overnight’. However, despite most snack foods being relatively low in nutritional value, consumption of them on a regular basis is very high. A Target Group Index (TGI) survey carried out by BMRB International Ltd found that 84.1% of respondents had consumed potato crisps, tortilla or corn snacks in the 12 months ending March 2009, indicating that consumers look upon such foods as indulgent treats. As well as being indulgent, savoury snack foods such as crisps are also an affordable treat. Even at the premium end of the market, products are cheap in comparison to other food treats, such as premium chocolate. In fact, the current recession has helped demand for upmarket products, as there has been an increase in consumers staying in rather than going out and replacing luxuries such as eating out in restaurants with eating snack foods at home. This has also led to retailers giving more shelf space to snack foods, particularly large sharing packs. The hike in commodity costs in 2008/2009 led to hefty price rises in the industry, and there have been corporate casualties as a result. For example, Natural Crisps Ltd was close to administration when it was bought by Tayto Crisps of Northern Ireland in a ‘distress deal’ completed in a week over Christmas 2008. The deal was Tayto’s fourth acquisition in 3 years, following its purchases of Golden Wonder in 2006, Real Crisps in 2007 and Red Mill Snack Foods in 2008. Germany’s Intersnack purchased a 15% stake in Largo Foods (the owner of the Tayto brand in the Republic of Ireland), and is thought to be considering making more acquisitions in the UK market. Further consolidation in an industry currently dominated by Walkers Snack Foods seems likely in the future, especially as the recession continues and companies struggle to survive. Key Note forecasts that the retail sales value of the UK snacks market will increase by 3.6% to £2.48bn in 2010, and will grow by an overall 5.3% between 2010 and 2014 to finish at £2.61bn.
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Executive Summary
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Snack Foods
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Market Definition
1. Market Definition REPORT COVERAGE Snacks can be defined as food consumed at times other than breakfast, lunch and dinner, or as a selection of small items eaten to replace traditional meals. However, for the purpose of this Key Note Market Report Plus, such items are confined to bagged savoury snacks, and the report excludes sweet items, such as sweet biscuits, sugar and chocolate. These items are covered in Key Note’s Confectionery Market Report Plus and Sweet & Salty Snacks Market Assessment. In addition to retail outlets, sales of savoury snacks are made through foodservice outlets, such as coffee shops, public houses (‘pubs’) and canteens. These outlets are not included in this report, but would add considerably to the total value of the market.
MARKET SECTORS Within this report, the snack foods market is divided into three principle sectors, as follows: • potato crisps • other savoury snacks, including tortilla chips, baked snack biscuits and rice- and corn-based snacks • snack nuts.
MARKET TRENDS Health Issues Healthier formulations continue to be a major concern within the food market, particularly for savoury snacks marketed to children. The relatively high fat, salt and sugar content of processed foods, together with the sedentary lifestyle of many consumers, has led to an increasing proportion of overweight and obese people in the Western world. Data from the Department of Health’s Health Survey for England (HSE) shows that, in 2007, 60.8% of adults (aged 16 or over) in England were overweight and, of these, 24% were obese. This represented a slight fall in the proportion of overweight adults (61.6% in 2006); however, the data also showed that obesity had increased in children. In 2007, 28.6% of children (aged between 2 and 10) in England were overweight and, of these, 15.4% were obese.
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In contrast, a survey conducted by the Stroke Association in September 2009 found that, perhaps surprisingly, consumers under the age of 18 were more conscientious than other age groups when it came to checking the salt content of foods before purchasing (21% compared with the national average of less than 10%), but that a high salt content did not deter them from buying products. The Department for Business, Innovation and Skills’ (BIS’) Foresight Tackling Obesities: Future Choices project — the findings of which were published in October 2007 — predicts that, if no action is taken, 60% of men, 50% of women and 25% of children will be obese by 2050. With the threat of possible legal action ever present in today’s litigious society, food manufacturers have responded by offering reduced-fat and -salt alternatives in most categories, including potato crisps and other bagged savoury snacks. However, reformulation of products has closed the gap between ‘healthy’ and regular crisps, as manufacturers reduce the calorie count by introducing different cooking oils and recipe changes. According to Nielsen, in the year ending April 2009, there was a 2.3% drop in the sales value of Walkers Baked (the healthy option) as sales of its core brand rose after it began using healthier cooking oil. Other measures to make savoury products more healthy include the removal of monosodium glutamate and artificial flavourings (see Flavours section below) and colourings. In July 2008, a joint initiative between the UK Government, food manufacturers and advertising agencies was announced to tackle obesity by encouraging the public to eat healthily and take more physical exercise. The £75m Change4Life campaign was 4 years in the making and has the support of an industry consortium, including Tesco, PepsiCo and Kraft. In July 2008, a coalition of companies — including BSkyB, ITV, Tesco, Coca-Cola, Cadbury and AOL — pledged the equivalent of more than £200m in advertising space and services to support the initiative in the run-up to the 2012 Olympic Games (London 2012).
Flavours As palates have become more adventurous, novel new flavours have been introduced to snack foods, often based on ethnic tastes and spicy flavours. There is even a campaign on the social networking website Facebook to bring back the hedgehog-flavoured crisps that were introduced as a joke but enjoyed surprising success in the 1980s. Flavoured with pork fat, the hedgehog-flavoured crisps inevitably led to a charge brought by the Office of Fair Trading (OFT) for false advertising. In another instance, the European Commission attempted to ban Prawn Cocktail- and Smokey Bacon-flavoured snacks on the grounds that they contained artificial sweeteners or other harmful additives. However, according to a survey undertaken by Kettle Chips in 2009, nearly half of the UK adults surveyed voted the classic Cheese & Onion as their favourite crisp flavour. Other findings were that 49% of males preferred Cheese & Onion over any crisp flavour and, while the flavour was most popular in East Anglia and London, it was less so in the South West, where just 33% named it as their favourite.
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Market Definition
‘Do us a Flavour’ In 2008, Walkers Snack Foods ran a competition on its website entitled ‘Do us a Flavour’, inviting the public to suggest a new flavour for its crisps. The company then manufactured the six finalist flavours — Cajun Squirrel; Crispy Duck and Hoisin; Builder’s Breakfast; Onion Bhaji; Fish and Chips; and Chilli and Chocolate — for the public to vote on. In May 2009, the Builder’s Breakfast flavour (which was said to be flavoured with egg, bacon, sausage and beans) was announced as the winner.
ECONOMIC TRENDS Population In 2008, the population of the UK was estimated at 61.4 million — an increase of 0.7% compared with the previous year and 2.6% higher than the 2004 level of 59.8 million. Any rise in population is of benefit to demand for consumer goods as it increases the customer base. However, the fact that the UK has an ageing population will dampen the demand for children’s snack products. The population increase will largely be as a result of immigration, and this may strengthen demand for snacks influenced by cuisines from around the world.
Table 1.1: UK Resident Population Estimates by Sex (000), Mid-Years 2004-2008 2004
2005
2006
2007
2008
Female
30,568
30,741
30,893
31,059
31,232
Male
29,278
29,497
29,694
29,916
30,151
Total
59,846
60,238
60,587
60,975
61,383
-
0.7
0.6
0.6
0.7
% change year-on-year
Source: Monthly Digest of Statistics, November 2009, National Statistics website © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
Gross Domestic Product Gross domestic product (GDP) rose by 3.5% at current prices in 2008, compared with 5.5% in 2007. Figures published by National Statistics in late November 2009 showed that GDP contracted by 0.3% in the third quarter of 2009, revised from a previous estimate of a fall of 0.4%. In the third quarter of 2009, GDP was 5.1% lower than in the corresponding period of 2008, reflecting the state of the economy as the recession dragged on.
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Table 1.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m), 2004-2008 2004
2005
2006
2007
2008
1,202,956
1,254,058
1,325,795
1,398,882
1,448,054
% change year-on-year
-
4.2
5.7
5.5
3.5
Annual chain-linked GDP
1,227,387
1,254,058
1,289,833
1,322,842
1,330,118
% change year-on-year
-
2.2
2.9
2.6
0.6
Current prices
GDP — gross domestic product
Source: Economic & Labour Market Review, November 2009, National Statistics website © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
Inflation As is evident in Table 1.3, inflation fell slightly in 2008, having increased the previous 2 years. Figures published in November 2009 showed that Consumer Price Index (CPI) annual inflation — the Government’s target measure — was 1.5% in October, up from 1.1% in September 2009. As an internationally comparable measure of inflation, the CPI shows that the UK inflation rate in September 2009, at 1.1%, was above the provisional figure for the EU as a whole (0.3%). Retail Price Index (RPI) inflation, which includes housing costs, fell by 0.8% in the year ending October 2009, compared with a fall of 1.4% in September.
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Market Definition
Table 1.3: UK Rate of Inflation (%), 2004-2008
Inflation (%) Percentage point change year-on-year
2004
2005
2006
2007
2008
3.0
2.8
3.2
4.3
4.0
-
-0.2
0.4
1.1
-0.3
Note: inflation is at retail price index (RPI).
Source: Monthly Digest of Statistics, November 2009, National Statistics website © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
Unemployment The latest annual figures released by National Statistics in November 2009 show that the unemployment rate rose to 910,000 in 2008 — a 5.8% increase compared with 2008. This worsened considerably in 2009 as a direct result of the recession, and the latest quarterly figures from National Statistics reveal that the number of people out of work increased by 21,000 to 2.49 million between August and October (not tabulated). However, this was the smallest increase seen since the March-to-May period in 2008, indicating that the worst is over and employers are beginning to hire again. Unemployment is always a lagging factor in a recession, as many businesses cease trading during the economic difficulties, and employers tend to remain cautious for some time after the economy has recovered. However, with savoury snacks being a relatively cheap purchase, unemployment figures are not likely to have as much impact as in other consumer goods sectors.
Table 1.4: Actual Number of Unemployed Persons in the UK (million), 2004-2008
Actual number of claimants (million) % change year-on-year
2004
2005
2006
2007
2008
0.85
0.86
0.95
0.86
0.91
-
1.2
10.5
-9.5
5.8
Source: Monthly Digest of Statistics, November 2009, National Statistics website © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
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Household Disposable Income Bank interest rates are at an all-time low and, in a further attempt to kick-start consumer spending, the standard rate of VAT was reduced to 15% on 1st December 2008. However, it will revert to 17.5% on 1st January 2010 in a move that could curtail any growth in consumer spending on high-priced items, but will not be expected to make any difference to demand for low-ticket snacks. The latest Retail Sales Monitor from the British Retail Consortium (BRC) shows that UK retail sales values for October 2009 rose by 3.8% on a like-for-like basis from October 2008, when sales had fallen 2.2%. However, food sales growth slowed further, largely reflecting lower food price inflation. Nevertheless, any indication of a return in consumer confidence will be encouraging for the snack food industry, where Christmas sales of premium indulgent snacks are so important. According to the latest figures from National Statistics, UK household disposable income increased by 4.1% to £14,921 in 2008 (compared with 2007), and rose by an overall 14.1% over the 5-year review period.
Table 1.5: UK Household Disposable Income Per Capita (£), 2004-2008
Household disposable income (£) % change year-on-year
2004
2005
2006
2007
2008
13,078
13,572
13,952
14,331
14,921
-
3.8
2.8
2.7
4.1
Source: Economic & Labour Market Review, November 2009, National Statistics website © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
MARKET POSITION The UK Consumer expenditure on food and non-alcoholic drink rose by 8.8% in 2008, compared with the previous year — a much sharper increase than has been recorded in recent years. Expenditure on savoury snacks as considered in this report is estimated to have amounted to 2.8% of total expenditure on food and non-alcoholic drink in 2008 (not tabulated).
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Market Definition
Table 1.6: Consumer Expenditure on Food and Non-Alcoholic Drink (£m), 2004-2008
Expenditure (£m) % change year-on-year
2004
2005
2006
2007
2008
65,156
67,138
69,510
72,313
78,680
-
3.0
3.5
4.0
8.8
Source: Consumer Trends, Quarter 2 2009, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
The latest figures available for the first half of 2009 show that expenditure on food and non-alcoholic drink continued to rise and was 4.8% higher in the first 6 months of 2009 than in the comparable period in 2008.
Europe Overall, the EU savoury snacks market is estimated by Key Note to have increased by 4% to €11.3bn in 2008. The latest detailed figures from the European Snacks Association (ESA) related to 2007, when potato chips (crisps) accounted for more than a third (34.3%) of the total value of savoury snacks and nuts. The snack nuts sector has seen significant growth in some Western EU markets, but declines in the Eastern EU have reduced the sector’s overall growth. In 2005 (the latest figures available), the UK accounted for around 21% of the total value of the EU savoury snacks market, with Germany representing 13%; Spain 10% to 11%; France and Italy 8% to 9% each; Scandinavia (excluding Norway) 6%; and Belgium and the Republic of Ireland 3% each. The market leader in savoury snacks across Western Europe is PepsiCo, which owns the Frito-Lay and Walkers brands.
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Market Size
2. Market Size THE TOTAL MARKET Manufacturers’ Sales Unlike other sectors of UK manufacturing, manufacturers’ sales of ‘prepared or preserved potatoes, including crisps’ have risen in value over recent years. According to National Statistics’ Products of the European Community (PRODCOM) publication, sales increased by an overall 8.5% — from £827.2m to £897.7m — between 2004 and 2007 (the latest years for which figures are available).
Table 2.1: UK Manufacturers’ Sales of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007
Value (£000) % change year on year
2004
2005
2006
2007
827,192
841,446
892,378
897,689
-
1.7
6.1
0.6
Source: PRODCOM, PRA15310, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
PRODCOM also provides import and export statistics for prepared or preserved potatoes, including crisps. By adding the total value of UK imports to the value of domestic manufacturers’ sales and deducting the total value of UK exports, figures are arrived at showing the value of the UK’s net supply of these products, as shown in Table 2.2.
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Table 2.2: Net Supply of Prepared or Preserved Potatoes Including Crisps in the UK (£000), 2004-2007
Value (£000)
2004
2005
2006
2007
837,303
844,635
891,159
888,235
-
0.9
5.5
-0.3
% change year-on-year
Source: PRODCOM, PRA15310, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
Retailers’ Sales Key Note estimates that UK retail sales of snack foods were worth £2.39bn in 2009 — an increase of 8.4% compared with the previous year (as a result of manufacturers passing on steep rises in commodity costs) and a rise of 12% on the 2005 total of £2.13bn. The strongest growth was seen in the potato crisps sector, the value of which increased by 14.6% between 2005 and 2009.
Table 2.3: The Total UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2005-2009
Potato crisps Other savoury snacks Snack nuts Total % change year-on-year
2005
2006
2007
2008
2009
938.0
942.0
944.0
980.0
1,075.0
1,005.0
1,010.0
1,015.0
1,022.0
1,110.0
190.5
192.0
194.5
203.0
205.0
2,133.5
2,144.0
2,153.5
2,205.0
2,390.0
-
0.5
0.4
2.4
8.4
rsp — retail selling prices
Source: Key Note
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Market Size
In recent years, the ‘better-for-you’ healthier sector has driven growth, but the gap between regular products and healthier products has narrowed as manufacturers have begun to reformulate their standard products (i.e. through the use of ‘lighter’ cooking oils). Manufacturers’ concentration on premium sharing snacks has also contributed towards growth, as staying in has become ‘the new going out’ as a result of the recession. However, the recession has also driven many consumers to the value end of the market, so demand has remained fairly buoyant across the board.
Figure 2.1: The Total UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2005-2009 2,500
Potato crisps Other savoury snacks
2,250
Snack nuts
2,000 1,750 1,500 1,250 1,000 750 500 250 0 2005
2006
2007
2008
2009
rsp — retail selling prices
Source: Key Note
BY MARKET SECTOR Figure 2.2 illustrates the market share held by each sector of the snack foods market in 2009. Other savoury snacks represented the largest proportion of the market (46.4%), mainly because this category incorporates various different types of products, such as tortilla chips, baked snack biscuits, and rice- and corn-based snacks. Potato crisps was the second-largest sector of the market, with 45% in 2009, followed by the nuts category with 8.6%.
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Figure 2.2: The Total UK Snack Foods Market by Sector by Value at Current Prices (%), 2009
Snack nuts 8.6%
Potato crisps 45.0% Other savoury snacks 46.4%
Source: Key Note
Potato Crisps In 2007, Europe’s potato prices more than doubled after the previous year’s hot summer saw production slumping by up to 15% in key producing countries such as Germany, the Netherlands and Great Britain. On the whole, crisp manufacturers in the UK absorbed the additional costs. The wet summer of 2008 pushed prices of potatoes up again, and this was coupled with a steep rise in the price of sunflower oil. Manufacturers absorbed some of the increases, but had no alternative but to increase retail prices, resulting in a sharp rise in shelf prices in 2008 and 2009. Less was seen of discount offers such as ‘buy one, get one free’ (BOGOF), which had been a characteristic of the market before. Traditional potato crisps remain the single largest product category of the snack foods market as defined in this report, accounting for a 45% share in 2009. Key Note estimates that the retail sales value of potato crisps increased by 9.7% to £1.08bn in 2009, and grew by 14.6% over the 5-year review period.
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Market Size
Table 2.4: The UK Potato Crisps Sector by Value at Current Prices (£m at rsp and %), 2005-2009 2005
2006
2007
2008
2009
938
942
944
980
1,075
-
0.4
0.2
3.8
9.7
45.0
43.9
43.8
44.4
45.0
Value (£m) % change year-on-year % share of total market rsp — retail selling prices
Source: Key Note
Cheese and Onion-flavoured crisps are said to be the nation’s favourite flavour, having overtaken Ready Salted, and sales of the former are valued at more than £250m. However, Salt and Vinegar-flavoured crisps have declined in popularity in recent years. Manufacturers are concentrating on relaunching and/or promoting retro brands, since it is cheaper than launching a new product, and benefits from the fact that brands such as Hula Hoops and Monster Munch will already have a fan base as many consumers will remember them nostalgically from their own childhoods.
Figure 2.3: The UK Potato Crisps Sector by Value at Current Prices (£m at rsp), 2005-2009 1,100 1,075 1,050 1,025 1,000 975 950 925 900 2005
2006
2007
2008
2009
rsp — retail selling prices
Source: Key Note
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Other Savoury Snacks Other savoury snacks are those that are not wholly or exclusively made from potatoes, potato flour or potato starch, but can be, for example, dough-, wheat-, starch- or rice flour-based. Products include traditional extruded and pelleted snacks (such as Procter & Gamble’s Pringles range, which are made from reconstituted potato), tortilla products (i.e. Walkers Doritos), baked snacks (such as Mini Cheddars and Twiglets) and rice- and corn-based snacks (i.e. Quaker’s Snack-a-Jacks). Like potato crisps, other savoury snacks suffered a decline in sales values earlier in the decade in the backlash against unhealthy products, but sales have since recovered due to manufacturers’ new product development (NPD) of healthier options, as well as the trend towards sharing packs of premium snacks. Key Note estimates that the combined retail sales value of the products included in the other savoury snacks sector accounted for 46.4% of the total market in 2009, and that retail sales of other savoury snacks increased by 10.4% between 2005 and 2009 to reach a value of £1.11bn.
Table 2.5: The UK Other Savoury Snacks Sector by Value at Current Prices (£m at rsp and %), 2005-2009
Value (£m) % change year-on-year % share of total market
2005
2006
2007
2008
2009
1,005
1,010
1,015
1,022
1,110
-
0.5
0.5
0.7
8.6
47.1
47.1
47.1
46.3
46.4
rsp — retail selling prices
Source: Key Note
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Market Size
Figure 2.4: The UK Other Savoury Snacks Sector by Value at Current Prices (£m at rsp), 2005-2009 1,130 1,120 1,110 1,100 1,090 1,080 1,070 1,060 1,050 1,040 1,030 1,020 1,010 1,000 990 980 2005
2006
2007
2008
2009
rsp — retail selling prices
Source: Key Note
Snack Nuts Nuts are perceived as a healthier alternative to other savoury snacks, and the category has grown in value and volume in the past, at the expense of other products in the market. However, the sector is susceptible to supply disruptions, as crops can be in short supply due to factors outside of manufacturers’ control, such as frost damage to crops and farmers’ price hikes. UK buyers of peanuts have also been hit by the low value of sterling as peanuts — which have escalated in price anyway — are sold in US dollars. Peanuts now account for an estimated, and declining, 40% share of the snack nuts sector by value. Own-label products are significant in the sector, and their value now accounts for more than two-thirds of the total. However, sales of all nuts are highly seasonal, and around 30% of the sector’s retail sales value for any year is earned in the final quarter in the run-up to Christmas. Key Note estimates that retail sales of snack nuts increased by an overall 7.6% between 2005 and 2009, to reach a value of £205m. However, sales are estimated to have increased by just 1% between 2008 and 2009, when the sector’s market share dropped to a 5-year low of 8.6%
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Table 2.6: The UK Snack Nuts Sector by Value at Current Prices (£m at rsp and %), 2005-2009
Value (£m)
2005
2006
2007
2008
2009
190.5
192.0
194.5
203.0
205.0
-
0.8
1.3
4.4
1.0
8.9
9.0
9.0
9.2
8.6
% change year-on-year % share of total market rsp — retail selling prices
Source: Key Note
A recent lack of innovation and NPD in the snack nuts sector has caused it to stagnate a little, and manufacturers are seeking to re-energise the category with introductions of sweet nut lines (such as peanut clusters), which fall outside the scope of this report. Moreover, some brands of nuts are largely or exclusively sold through foodservice outlets — such as public houses (‘pubs’), hotels, coffee shops, cafés and canteens — sales from which would significantly increase the overall value of the sector.
Figure 2.5: The UK Snack Nuts Sector by Value at Current Prices (£m at rsp), 2005-2009 210.0 207.5 205.0 202.5 200.0 197.5 195.0 192.5 190.0 187.5 185.0 2005
2006
2007
2008
2009
rsp — retail selling prices
Source: Key Note
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Market Size
OVERSEAS TRADE General Overview The value of UK imports of prepared or preserved potatoes, including crisps, decreased between 2004 and 2007, while that of exports showed year-on-year increases. This resulted in the trade deficit seen in 2004 and 2005 changing to a surplus in 2006 and 2007, and one which increased by £8.2m between 2006 and 2007.
Table 2.7: UK Manufacturers’ Imports and Exports of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007 Imports
Exports
Balance of Trade
2004
50,815
40,704
-10,111
2005
48,512
45,323
-3,189
2006
49,921
51,140
1,219
2007
49,197
58,651
9,454
Source: PRODCOM, PRA15310, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
Imports Imports from countries outside of the EU are fairly insignificant in value, and accounted for just 0.9% of the total in 2007. Between 2004 and 2007, the UK’s imports of prepared or preserved potatoes were greater than its exports to EU markets.
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Table 2.8: UK Manufacturers’ Imports of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007 Intra-EU Imports
Extra-EU Imports
Total
2004
49,861
954
50,815
2005
47,843
669
48,512
2006
49,558
363
49,921
2007
48,774
423
49,197
Source: PRODCOM, PRA15310, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
Exports Although most export trade is with EU countries, non-EU markets are becoming increasingly important to UK manufacturers of prepared or preserved potatoes. For example, the value of such exports rose by 66.5% between 2004 and 2007, while the value of exports to EU countries increased by 37.3% over the same period.
Table 2.9: UK Manufacturers’ Exports of Prepared or Preserved Potatoes Including Crisps (£000), 2004-2007 Intra-EU Exports
Extra-EU Exports
Total
2004
31,274
9,430
40,704
2005
33,234
12,089
45,323
2006
37,453
13,687
51,140
2007
42,950
15,701
58,651
Source: PRODCOM, PRA15310, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
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Leatherhead Food International Ltd Export Figures According to research carried out for the Food and Drink Federation (FDF) by Leatherhead Food International Ltd in June 2009, UK exports of crisps — a more limited category than the ‘prepared or preserved potatoes, including crisps’ classification seen in the National Statistics figures previously — increased in value by 26.4% to £47.5m between 2007 and 2008, continuing several years of high growth. The largest market was the Republic of Ireland, exports to which were worth £25.8m in 2008, representing an increase of 23.9% compared with 2007. However, it was the export markets of Italy and Germany that recorded the highest growth rates between 2007 and 2008, at 84.4% and 41.5%, respectively. More recent figures published by Leatherhead Food Research (the trading name of Leatherhead Food International) in October 2009 showed that UK exports of crisps had risen in value by 13.7% to £27.3m in the first 6 months of 2009, compared with the same period in 2008. The Republic of Ireland remained the largest market — to which exports of crisps rose in value by 35.5%, compared with the first half of 2008 — while exports to Denmark showed a growth rate of 200.7% over the same period.
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Industry Background
3. Industry Background RECENT HISTORY Potato crisps were invented in 1853 by an exasperated American-Indian hotel chef in Saratoga Springs, New York, who responded to repeated complaints from a customer that his chips were too thick by cutting the potatoes wafer thin. The guest was said to be very enthusiastic about the crisp, paper-thin potatoes, and they soon became a staple of American menus. The first British potato crisps were manufactured by a Mr Carter in 1913, but were first mass produced when Frank Smith of Cricklewood formed the Smith’s Potato Crisps Company Ltd in 1920 — the company that would eventually become part of Walkers Snack Foods. Potato crisps are manufactured from thinly sliced fresh potatoes (or occasionally other vegetables) that are lightly fried in oil or oven-baked and then sprinkled with flavourings. Different types of oils and flavourings have been introduced over the years, and many products have been reformulated to make them healthier. The 1970s saw the introduction of extruded products whereby, for example, ground corn is squeezed through a small shaped opening, expanding as it heats up into soft, light pieces that are then baked in an oven to make them crisp.
NUMBER OF COMPANIES According to National Statistics’ UK Business: Activity, Size and Location publication, there were 60 UK VAT- and/or pay-as-you-earn (PAYE)-based enterprises engaged in the processing and preserving of potatoes in 2009. Of these, 41.7% had a turnover in excess of £1m, and a quarter reported a revenue of more than £5m — an unusually high proportion.
Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Turnover Sizeband (£000, number and %), 2009 Number of Enterprises
% of Total
0-49
10
16.7
50-99
5
8.3
100-249
10
16.7
250-499
5
8.3
Turnover Sizeband (£000)
Table continues...
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Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Turnover Sizeband (£000, number and %), 2009 ...table continued Number of Enterprises
% of Total
5
8.3
1,000-4,999
10
16.7
5,000+
15
25.0
Total
60
100.0
Turnover Sizeband (£000) 500-999
Source: UK Business: Activity, Size and Location 2009, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
EMPLOYMENT Of the 60 UK VAT- and/or PAYE-based enterprises engaged in the processing and preserving of potatoes in 2009, exactly half employed fewer than ten people. At the other end of the scale, a third of the enterprises were large companies with 100 or more employees.
Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Employment Sizeband (number and %), 2009 Number of Enterprises
% of Total
0-4
25
41.7
5-9
5
8.3
10-19
5
8.3
20-49
5
8.3
50-99
0
0.0
Number of Employees
Table continues...
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Industry Background
Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Employment Sizeband (number and %), 2009 ...table continued Number of Enterprises
% of Total
100-249
10
16.7
250+
10
16.7
Total
60
100.0
Number of Employees
Source: UK Business: Activity, Size and Location 2009, National Statistics © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
REGIONAL VARIATIONS IN THE MARKETPLACE There are thousands of different types of potatoes grown around the world. Around 80 different varieties of potatoes are grown commercially in the UK in principal growing areas that include Yorkshire, Lincolnshire, Norfolk, the East Midlands, Shropshire, Devon and Cornwall. Varieties commonly used in the manufacturing of crisps include Hermes, Saturna and Rosetta. According to National Statistics’ 2009 UK Business: Activity, Size and Location report, the highest concentration of companies involved in the processing and preserving of potatoes were to be found in Northern Ireland (33.3%) and the East Midlands (16.7%). Peanuts are widely grown in India, the People’s Republic of China (PRC), the US, Argentina and West and South Africa. India also grows significant crops of cashew nuts, while pistachios commonly come from Iran, the US and Turkey. As for consumption of savoury snacks, according to a NEMS Market Research survey conducted in November 2009 (see Chapter 5 — Brand Strategy), respondents living in the West Midlands proved to be the most avid regular buyers of savoury snacks.
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DISTRIBUTION Key Note estimates that the major grocery multiples account for around two-thirds of the value of retail sales of potato crisps, snack nuts and other bagged savoury snacks, while the ongoing recession has seen discounters, such as Aldi and Lidl, taking market share from the more upmarket chains. A high level of discounting generally hinders potential growth in the value of sales, but the snacks category does benefit from impulse buying, particularly when crisps, etc. are placed alongside sandwiches and other lunch items by the front entrance of the store. Supermarkets are also encroaching on the convenience market by opening smaller town-centre stores. A wide range of other outlets are important in the market as there is a high degree of impulse buying. These include: confectioners, tobacconists and newsagents (CTNs); kiosks; and garage forecourts. Such outlets frequently charge more than the supermarket chains for snack products.
HOW ROBUST IS THE MARKET? The recession may have increased demand for savoury snacks at the value end of the market, but the premium end survives well as consumers consider snacks an affordable treat. In fact, the market for savoury snacks is likely to benefit from a recession as people cut back on going out and begin entertaining at home more frequently, which may encourage them to purchase snack foods for sharing. Consumers may also indulge in comfort eating when times are hard, and begin making packed lunches for work or school, of which savoury snacks are often a part. However, certain measures — such as an advertising ban on ‘junk food’ to children and the restrictions on crisps and snacks in schools — have had an adverse effect on demand for children’s snack products.
LEGISLATION Legislation relating to the production and selling of foodstuffs aims to protect human life and health, and protect consumers’ interests, with due regard for the protection of animal health and welfare, plant health and the environment. Principal legislation involving food production and processing includes the Food Safety Act 1990, Food Safety Regulations 1995, the Price Marking Order 1999 and the Food Labelling Regulations 1996. As well as adhering to the UK’s own laws, food suppliers must conform to precise rules at the European Community level.
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Industry Background
KEY TRADE ASSOCIATIONS European Snacks Association The European Snacks Association (ESA) was founded in 1956 and is Europe’s only trade organisation dedicated to the advancement of the savoury snacks industry on behalf of its members at national, European and international levels. The ESA’s official journal, The Snacks Magazine, is published quarterly, and the Association also organises SNACKEX — Europe’s largest snacks trade show.
Snack Food Association Founded in 1937, the US-based Snack Food Association (SFA) is the international trade association of the snack food industry, representing more than 400 companies worldwide involved in the manufacture and supply of snacks. The SFA also organises the SNAXPO exhibition.
Snack, Nut and Crisp Manufacturers Association Based in London, the Snack, Nut and Crisp Manufacturers Association (SNACMA) represents the interests of the savoury snack industry in the UK. Its members are responsible for more than 90% of all savoury snacks produced and sold, including branded and own-label products. The Association is controlled by a Board of Directors, comprising the Chief Executive Officers (CEOs) and Managing Directors (MDs) of each operating member company, which include Walkers, Kettle Crisps, Tayto, Procter & Gamble and United Biscuits.
ADVISORY AND INFORMATION SERVICES The Food Commission (UK) Ltd The Food Commission (UK) Ltd is the UK’s leading independent watchdog on food issues. The Commission has been campaigning for healthier and safer food for more than 10 years, and is largely funded by public subscriptions and donations.
Food and Drink Federation The Food and Drink Federation (FDF) promotes the food and drink manufacturing industry’s views, and works to build consumer confidence in the food chain as a whole.
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Food Standards Agency The Food Standards Agency (FSA), which became operational in April 2000, aims to keep professionals and the public fully informed about nutritional issues and food hygiene, and to maintain public confidence in the food industry, from which it is independent. One of the Agency’s initiatives is the operation of a cooking bus, which travels to schools and holiday clubs throughout the UK. On the bus, fully qualified teachers teach children about healthy eating and food safety, and children can join in cooking sessions. The concept was developed in partnership with Focus on Food, which was formed to promote and strengthen the status of practical food education in primary and secondary schools.
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Competitor Analysis
4. Competitor Analysis THE MARKETPLACE The UK snack foods industry is highly concentrated and is dominated by PepsiCo’s Frito-Lay subsidiary, which owns Walkers Snack Foods Ltd in the UK. Procter & Gamble is another strong player, with its one snack brand of Pringles generating annual revenues in excess of $1bn. However, there are numerous smaller companies, such as Burts Potato Chips and Tyrrells Potato Chips, that have established a firm position in the premium market, and hand-cooked upmarket products are pioneered and led by Kettle Chips.
MARKET LEADERS Intersnack Ltd Company Structure Intersnack Ltd is a part of Germany-based Intersnack Knabber-Gebäck GmbH, which has had a presence in the UK since 1990. In January 2007, Intersnack acquired Union Snack Ltd — makers of the leading pretzel brand, Penn State — for an undisclosed sum and, in November 2008, it was reported that the company was interested in buying a larger stake in Largo Food Exports (which owns the Tayto name in the Republic of Ireland) to add to its existing holding.
Current and Future Developments In addition to its leading Penn State brand, Intersnack supplies own-brand snacks to Marks & Spencer, Sainsbury’s, Tesco and Waitrose, as well as to airlines and train companies. Its Pom-Bear extruded snack is popular for its lack of wheat, gluten, artificial colours, flavours and preservatives. In June 2009, Intersnack Knabber-Gebäck acquired Percy Dalton’s Famous Peanut Co Ltd — a Haverhill-based producer of nut, seed and dried fruit products.
Financial Results In the year ending 31st December 2008, Intersnack Ltd increased its turnover to £24.9m, compared with £22.8m in the previous year. However, a pre-tax loss of £565,000 was incurred in 2008, compared with a pre-tax profit of £668,000 in 2007.
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Seabrook Crisps Ltd Company Structure The family-owned business of Seabrook Crisps Ltd has been producing crisps in the north of England since 1945. The brand now outsells all others, excepting Walkers, in this area of the country.
Current and Future Developments Despite the recession, Seabrook Crisps has reported ongoing record sales figures, with volumes up by 66% following the addition of 5,000 national stockists (including 50 Waitrose stores in the south of England) and an investment of £4m in new production lines. The company employs more than 100 people and is forecasting further growth throughout 2010, with annual sales expected to rise from 170 million bags to 233 million by October 2010. This will be partly due to ASDA’s decision to stock Seabrook brands in 292 of its stores after finding that it was outperforming Walkers in some Yorkshire branches. Seabrook Crisps has been the Official Crisp of the Yorkshire County Cricket Club (YCCC) since 2008. Seabrook has also benefited from a product placement campaign, as the crisps are served in the public houses (‘pubs’) in the ITV soap operas Coronation Street and Emmerdale, exposing the brand to consumers outside the north of England.
Financial Results In the year ending 30th September 2008, Seabrook Crisps Ltd reported a turnover of £15.4m (compared with just under £13m in 2007) and a pre-tax profit of £750,000 (compared with a pre-tax loss of £1.9m in the previous year).
Tayto (NI) Ltd Company Structure Tayto (NI) Ltd is the long-established market leader in the snacks industry in Northern Ireland. The family-owned business, which is based in Tandragee in County Armagh, was founded by Thomas Hutchinson in 1956. With its string of recent acquisitions, Tayto is now among the largest crisp and snack manufacturers in the UK.
Current and Future Developments In January 2009, the Tayto group acquired Jonathan Crisp — the Staffordshire-based supplier of hand-fried crisps — for undisclosed terms. Jonathan Crisp is the trading name of Natural Crisps Ltd, and promotes its products as ‘crisps for snobs’. The acquisition was described as a ‘distress purchase’, and was completed in just 1 week. The deal was Tayto’s fourth acquisition in 3 years, following its purchases of Golden Wonder in 2006, Real Crisps in 2007 and Red Mill Snack Foods in 2008.
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Tayto plans to close its Red Mill snack foods factory in Wednesbury in the West Midlands by the end of 2011, which will lead to the loss of 300 jobs. The closure is part of the company’s plans to transfer production to its Corby site, partly due to the loss of a lucrative contract to produce Procter & Gamble’s Pringles Minis, which had been carried out by Tayto since its acquisition of Golden Wonder. The long-term future of the Corby plant had been unclear; however, in October 2008, it was announced that further jobs were to be created at the site.
Financial Results In the 53-week period ending 5th July 2008, Tayto (NI) Ltd recorded a turnover of £26.2m and a pre-tax profit of £371,000. This compared to a turnover of just under £24m and a pre-tax loss of £143,000 in the preceding 52 weeks.
United Biscuits Topco Ltd Company Structure United Biscuits was founded in 1948 and now employs approximately 8,500 people worldwide. In October 2006, the company agreed a £1.6bn takeover deal with Paribas Affaires Industrielles (PAI) and US-based equity-investment firm Blackstone Group. (United Biscuits TopCo Ltd is the name of the company that comprises the Board of the controlling shareholders of the United Biscuits group.)
Current and Future Developments United Biscuits has 15 factories in the UK, France, Belgium and the Netherlands, and it also sells its products in North America, the Middle East, Africa and Australia. The company has reported being adversely affected by a shift to private-label food products in the markets of Northern Europe. In its interim statement for the first half of 2009, United Biscuits reported double-digit sales growth in its international markets, with particularly strong performances being seen in West Africa, Australia and the Middle East. The company also acquired a manufacturing facility in India, in anticipation of a market launch there; however, it is said to be considering plans to outsource up to 125 of the 750 jobs at its Aintree factory to India.
Financial Results In the 53-week period ending 3rd January 2009, United Biscuits Topco Ltd reported a turnover of just over £1.2bn, compared with £1.14bn in the previous 52 weeks. The company suffered a pre-tax loss of £16.6m in 2008, compared with a loss of £11.2m in 2007.
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Walkers Snack Foods Ltd Company Structure Walkers Snack Foods Ltd traces its origins to a pork butchery business founded in Leicester in the 1880s that diversified into making potato crisps when meat was in short supply after the Second World War. Walkers merged with its rival Smiths in 1979, before PepsiCo Inc of the US acquired both companies in 1989. Walkers is now the UK’s leading manufacturer of savoury snacks, claiming a 60% share of the market, with around 11 million people eating its products that are manufactured at 15 sites across the UK.
Current and Future Developments In July 2009, Walkers Snack Foods announced the creation of 50 jobs at its crisps factory in Leicester, following a £2m investment in new equipment. It has said that it is committed to continuing investment in its site in Beaumont Leys, Leicester, which is its largest UK site, employing nearly 2,000 people. Walkers Snack Foods has added its Builder’s Breakfast variant as a permanent flavour. The product, which is intended to taste like egg, sausage, bacon and beans, won the public vote in the company’s ‘Do us a Flavour’ competition (see Marketing Activity section later in this chapter).
Financial Results In the year ending 27th December 2008, Walkers Snack Foods Ltd reported a turnover of £223.5m and a pre-tax profit of £31.1m. In the previous year, the company had a turnover of £196.9m and a pre-tax profit of just over £30m.
OUTSIDE SUPPLIERS Raw Materials Potatoes Approximately four tonnes of potatoes are required to make one tonne of potato crisps, and, every year, UK farmers grow 6.5 million tonnes of potatoes, of which around 550,000 tonnes are used in the manufacture of potato crisps. Additionally, 150,000 tonnes of potatoes are imported for this purpose from the rest of Europe, especially from Spain, France and Italy. The price and supply of potatoes is quickly affected by conditions outside of the industry’s control, such as droughts or heatwaves. For example, the wet summer of 2008 pushed potato prices up. Quality control and wastage are key issues for potato industries across the five Northwest European Potato Grower (NEPG) countries. Despite lower yields in Germany, Belgium and Holland, overall production for 2009 is likely to be higher than in 2008.
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Among the suppliers of potatoes to the UK’s retail, catering and processing sectors is Greenvale AP, which has sites in the major potato growing areas of Shropshire, Berwickshire and Cambridgeshire. Another is QV Foods, which is a wholly owned subsidiary of AH Worth & Co Ltd — a family business based in Lincolnshire. In February 2009, QV Foods took over the management of the Cambridgeshire site of MBM Produce Ltd, and the remaining of the latter’s business went into administration in July 2009 (see Chapter 8 — Current Issues). RS Cockerill (York) Ltd claims to be one of the UK’s largest suppliers of potatoes to the processing industry, supplying in excess of 100,000 tonnes to crisp manufacturers each year, which equates to one in six packets of potato crisps sold in the UK.
Nuts Peanuts used in savoury snacks are primarily sourced from India and the People’s Republic of China (PRC), which together account for more than half of the world’s production. Other major peanut growing countries include the US, Senegal, Sudan, Brazil, Argentina, South Africa, Malawi and Nigeria. Usually, snack peanuts are shelled, roasted (sometimes in oil), blanched and salted. Iran, the US and Turkey are among the principal suppliers of pistachio nuts, while cashews are native to Brazil, but are now produced in more than 30 countries, including Vietnam, Nigeria and India. UK Snacks Ltd (trading as Nageena) and Puyang Tianli Nuts Co Ltd are among the companies supplying to the global snack nuts industry.
Corn and Wheat The French company Groupe Limagrain is one of the world’s leading producers of seeds, especially in Europe, where the group is the top producer of corn, wheat and other seeds. The company has also extended its reach by supplying flour and other bakery ingredients through its subsidiary, Limagrain Céréales Ingrédients. For extruded products, ingredients are blended together and passed through a cooking extruder where they are cooked and formed into a dense pellet. Following extrusion, cooking and forming, the pellets are dried and distributed to a snack processor where they are expanded or puffed by immersion in hot oil or other heating methods. The snacks manufacturer then seasons, packs and sells the ready-to-eat snack to retailers.
Oils and Fats Vegetable oils are almost always used for savoury snacks and are usually derived from soya, sunflower, rapeseed, groundnut and palm oil. South American countries, Malaysia and Indonesia are among the regions exporting oils. New British Palm Oil has struck a 2-year deal to supply United Biscuits with palm oil from sustainable sources. United Biscuits hopes to obtain all the oil it uses from sustainable sources by the end of 2011, and this new deal means that it will be two-thirds of the way towards hitting that target by mid-2010. It is the first supply agreement signed for New Britain’s UK refinery in Liverpool, which is due to be completed in spring 2010.
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Competitor Analysis
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Flavours and Seasonings Seasonings are specially blended from a variety of ingredients to provide the flavours for savoury snacks, which are passed through a rotating flavour drum to be evenly sprinkled with salt or other flavours. Kerry Group PLC is a major supplier of flavourings, seasonings and coating systems to snack manufacturers, and it operates manufacturing, sales and technical centres across Europe, North and South America, Australia, New Zealand and Asia. It employs more than 20,000 people and supplies 15,000 food produsts, food ingredients and flavour products to customers in more than 140 countries worldwide. Other suppliers include the Swiss Group Givaudan SA, which acquired the UK flavour and fragrance business of Quest International from ICI PLC in March 2007, and Savoury Flavours Ltd, which acquired fellow UK flavouring company Imarco Food Ingredients in July 2007. The US company McCormick and Company Inc was established in 1889 and supplies liquid, paste and powder flavourings. Its sales revenue in the year ending 30th November 2008 reached $3.18bn — the first time it had topped $3bn, representing an increase of 8.9% compared with the previous year.
Snack Processing Equipment Savoury snacks are fed from a conveyor belt into a hopper and automatically weighed into portions. They are then dropped into packets or other such containers, which are then sealed. Suppliers of processing equipment to the snack foods industry include Baker Perkins Ltd, FMC Food Tech (now part of the Chicago-based JBT Corporation), Flo-Mech Ltd and Extrusion-Link Ltd. In May 2008, Middlesex-based Wright Machinery Ltd merged with the US company PPM Technologies, and the new company is known as PPM/Wright Machinery Ltd. Other suppliers of processing equipment to the savoury snacks industry include the German Hastamat GmbH, Lalesse Extrusion BV of the Netherlands, and the US Heat & Control Inc, which has a UK operation in West Lothian, Scotland.
Packaging Bristol-based Kliklok-Woodman is a leading international packaging machinery supplier and a part of the US Klikwood Corporation. The business traces its origins to the 1940s when it worked closely with Herman Lay (founder of HW Lay Co [forerunner of Frito-Lay]) to develop the first automated potato chip packaging system. Other suppliers of packaging and weighing equipment include Flo-Mech Ltd, Hastamat GmbH, PPM/Wright Machinery and Blueprint Automation Ltd, which has a European headquarters in the Netherlands and a sales office in Lincolnshire.
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MARKETING ACTIVITY Main Media Advertising Expenditure According to Nielsen Media Research (NMR), main media advertising on all food amounted to £507.4m in the year ending September 2009, compared with £554.3m in the previous year. Expenditure on foodstuffs of relevance to this report accounted for 5.5% of this total and, at £27.7m, represented an increase of 35.3% compared with the £20.5m seen in the previous year. NMR divides the savoury snack foods market into three categories, as specified in Table 4.1. In the year ending September 2009, the potato crisps and snacks sector had by far the largest share of advertising expenditure (£21.3m), followed by the crispbreads and crackers category, which spent £6.4m on its advertising over the same period. Advertising on dips and dipper snacks had a value of £51,000 in 2009, but this category recorded no above-the-line main media advertising expenditure in the previous year.
Table 4.1: Main Media Advertising Expenditure on Savoury Snacks (£000), Years Ending September 2008 and 2009 2008
2009
Potato crisps and snacks
16,267
21,251
Crispbreads and crackers
4,197
6,377
-
51
20,464
27,679
Dips and dipper snacks Total Source: Nielsen Media Research
Potato Crisps and Snacks Potato crisps and snacks is the category benefiting from the most main media advertising expenditure, accounting for more than three-quarters (76.8%) of the total in the year ending September 2009. Market leader, Walkers, is by far the biggest spender in this category, with its above-the-line spending alone accounting for 41% of the total expenditure. Other brands supported by advertising budgets of significance were Pringles (£3.2m), Phileas Fogg (£1.9m) and KP (£1.6m). The low level of sub-threshold spending reflects the dominance of the big-name brands in the category.
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Competitor Analysis
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Table 4.2: Main Media Advertising Expenditure on Potato Crisps and Snacks (£000), Year Ending September 2009 Walkers Crisps
4,110
Red Sky Crisps
2,147
Sensations
1,159
Doritos Corn Chips and Dips
741
Doritos
452
Snack foods
114
Total Walkers
8,723
Pringles Crisps
1,772
Select range
1,379
Total Pringles
3,151
Phileas Fogg snack product range
1,935
KP McCoys
831
Hula Hoops
797
Total KP
1,628
Kettle Foods Kettle Chips
1,296
Ryvita Limbos Range
1,159
McVities Mini Cheddars
490
Go Ahead! snack range
375
Total McVities
865
Table continues...
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Competitor Analysis
Table 4.2: Main Media Advertising Expenditure on Potato Crisps and Snacks (£000), Year Ending September 2009 ...table continued Quaker Snack’A’Jacks
718
Kraft Ritz Crackers
695
Marmite Rice Cakes
536
Spar Snacks Sub-threshold brands Total
95 450 21,251
Source: Nielsen Media Research
Crispbreads and Crackers Main media advertising expenditure on crispbreads and crackers stood at £6.4m in the year ending September 2009, representing an increase of 51.9% compared with the previous year. Kellogg’s was the biggest spender, with its Special K Mini Breaks variety accounting for 47.3% of the total expenditure in this category. The Ryvita Company — a subsidiary of Associated British Foods (ABF) — accounted for a further 39.4% of the total in 2009.
Table 4.3: Main Media Advertising Expenditure on Crispbreads and Crackers (£000), Year Ending September 2009 Kellogg’s Special K Mini Breaks
3,014
Ryvita Product Range
2,406
Jacobs Cream Crackers
530
Kallo Rice Cakes
142
Ryvita Crispbread Range
106
Sub-threshold brands
179
Total
6,377
Source: Nielsen Media Research
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Competitor Analysis
Snack Foods
Dips and Dipper Snacks Just £51,000 of sub-threshold spending was invested in the promotion of dips and dipper snacks in the year ending September 2009, while none was recorded in the previous year.
Recent Promotions United Biscuits The newly relaunched premium snack brand Phileas Fogg was promoted by a £3m television campaign by United Biscuits in March/April 2009, which was repeated later in the year. In addition to this, retailers were supported by in-store activity for the brand. Another United Biscuits brand, Hula Hoops, was featured in a television campaign featuring finger puppets in July/August 2009. In conjunction with the advertisement, United Biscuits ran a competition whereby entrants were invited to make their own finger puppet film and upload it to the Hula Hoops website in the first ever Golden Hoop Film Awards. Five winners were rewarded with family holidays to Hollywood. As part of a £1.5m investment in the brand for 2009, United Biscuits ran a television campaign for McCoy’s in June 2009, positioning the brand as ‘THE crisp for men’, following on from a similar promotion in 2008. The 2009 campaign also included a new website and on-pack promotion to raise awareness of the brand and increase sales.
Walkers In June 2009, Walkers launched a multi-million pound television advertising campaign for its ‘Gary’s Great Trips’ on-pack promotion. The 9-week campaign — which featured ex-footballer Gary Lineker and television presenter Cat Deeley — promoted the opportunity to collect points from sales of Walkers Crisps that could be exchanged for discounts on leisure activities around Great Britain, including days out at top UK theme parks and National Trust venues.
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Other Marketing Activities ‘Do us a Flavour’ In 2008, Walkers Snack Foods ran a ‘Do us a Flavour’ competition on its website, inviting people to suggest a new flavour for its crisps. The competition attracted 1.2 million entries, from which judges (including television chef Heston Blumenthal who is renowned for the unusual flavours on his restaurant menu) decided on six finalists: Cajun Squirrel; Crispy Duck and Hoisin; Builder’s Breakfast; Onion Bhaji; Fish and Chips; and Chilli and Chocolate. Walkers then manufactured and retailed all six flavours and invited the public to vote for their favourite. In May 2009, the winner was announced as Builder’s Breakfast — a flavour combination of egg, bacon, sausage and beans. The creator of the flavour won £50,000 and a 1% share of Walkers’ future sales. The five runners up received a £10,000 prize.
Great British Flavoured Crisps To mark the introduction of its Great British crisps (see Chapter 8 — Current Issues), Tyrrells is inviting suggestions for definitions of ‘Great Britishness’, for which it is offering winners a monthly line up of British-themed prizes, including classic car weekends, luxury Featherdown Farm stays and Baileys Homes & Gardens vouchers.
Doritos During May 2009, Walkers ran a promotion whereby purchasers of its Doritos brand had the chance to win a daily prize of a holiday to Las Vegas for two with free flights, 4 nights at the Planet Hollywood Resort and £250 spending money. The competition coincided with the launch of the new Flamin’ Cheeseball Doritos flavour.
Exhibitions Anuga Anuga is one of the world’s most prestigious trade fairs for food and beverages, and is held in alternate years in October in Cologne, Germany. All food sectors, including snacks, and their suppliers are represented. The 30th Anuga event was held in October 2009, and attracted around 153,500 trade visitors from more than 180 countries. Around 61% of visitors came from countries outside Germany, and visitor turnout from the Middle East was particularly high, having increased by more than 30% compared with the 2007 exhibition. 6,522 suppliers from 97 countries were exhibited in 2009.
International Food and Drink Exhibition The biennial International Food and Drink Exhibition (IFE) is held at London’s ExCeL Centre. The 2009 event attracted more than 22,000 exhibitors. There is also an IFE staged in Warsaw, Poland every other year, with the next scheduled to take place in May 2011.
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Competitor Analysis
Snack Foods
Sandwich & Snack Show Around 9,000 visitors and 300 exhibitors are expected to turn out for the 11th Sandwich & Snack Show, which will be held over 2 days in February 2010 in Paris, France. It is organised by Reed Expositions.
SNACKEX Organised by the European Snacks Association (ESA), the 13th SNACKEX trade show and conference attracted 120 exhibitors from 75 countries when it was held in Berlin, Germany in June 2009. The next event will be SNACKEX Asia, which will be staged at the China National Convention Center in Beijing in May 2010.
SNAXPO SNAXPO is the world’s largest trade show devoted exclusively to the snack food industry. It is an annual event organised by the US Snack Food Association (SFA), and showcases the latest equipment, technology, ingredients, products and services aimed at improving snack manufacturers’ operations. The exhibition attracted more than 100 exhibitors and nearly 1,000 visitors in 2009, when it was staged in Florida. The next event will be held over 3 days in March 2010, when it will return to its previous venue of the Fort Worth Convention Center in Texas.
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Brand Strategy
5. Brand Strategy RESEARCH FINDINGS In November 2009, Key Note commissioned NEMS Market Research to conduct a survey on the popularity of selected snack food brands in the UK. The survey profiled 1,000 respondents aged 16 and over, who were asked: “which, if any of the following brands of snack food do you purchase on a regular basis (i.e. at least once a month)?” Table 5.1 reveals the penetration rates for the most popular brands in 2009, and compares the results to those from the previous year’s survey, undertaken in August 2008. The percentage of respondents who had bought none of the named brands regularly decreased between 2008 and 2009, while Walkers remained the most popular brand by far among respondents who did buy brands regularly. However, percentage penetration for the core Walkers brand was lower in 2009 compared with the previous year (57.4% and 59.2%, respectively), as was percentage penetration of its premium Sensations brand. The arguable leader in the premium sector, Kettle Chips, saw its percentage penetration increase in 2009, but so too did supermarket own-brand varieties, confirming the view that the recession is fuelling demand at both the premium and value ends of the market. Other brands that benefited from increased percentage penetration in 2009 were Quavers, Nik Naks, Mini Cheddars, Monster Munch, Penn State, Burts and Seabrook.
Table 5.1: Popularity of Selected Snack Food Brands (% of respondents), 2008 and 2009 2008
2009
Walkers
59.2
57.4
Supermarket own brand
27.0
32.0
Pringles
33.1
27.3
Quavers
24.1
24.7
McCoy’s
24.0
23.8
Mini Cheddars
20.7
23.5
Doritos
26.1
23.0
Hula Hoops
26.0
22.7
Kettle Chips
17.2
21.4
Monster Munch
13.3
18.0
KP Peanuts
19.1
17.7
Table continues...
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Snack Foods
Table 5.1: Popularity of Selected Snack Food Brands (% of respondents), 2008 and 2009 ...table continued 2008
2009
Walkers Sensations
19.6
17.2
Wotsits
18.1
15.0
Seabrook Crisps
8.3
10.9
Nik Naks
9.2
9.6
Chip Sticks
8.8
8.2
Penn State Pretzels
4.1
5.4
Tyrells
3.9
3.8
Burts Crisps
1.2
3.3
23.9
21.5
None of these Weighted sample: 1,000 Base: all adults aged 16+ purchasing at least once a month
Source: Key Note/NEMS Market Research, August 2008 and November 2009
By Sex The popularity of some brands of snack foods was significantly higher among men than women, for example, Walkers Sensations, McCoys (which is specifically marketed towards young men), Kettle Chips, Monster Munch and KP Peanuts. However, supermarket own-brands were more popular among women, as were Quavers, Wotsits, Seabrook, Nik Naks and Penn State. A higher proportion of men than women claimed that they were not frequent consumers of any of these snack food brands (22.1% and 20.8%, respectively).
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Brand Strategy
Table 5.2: Popularity of Selected Snack Food Brands by Sex (% of respondents), 2009 All Adults
Men
Women
Walkers
57.4
57.6
57.2
Supermarket own brand
32.0
30.5
33.4
Pringles
27.3
27.7
26.9
Quavers
24.7
24.2
25.3
McCoy’s
23.8
25.7
21.9
Mini Cheddars
23.5
24.0
23.0
Doritos
23.0
23.0
23.0
Hula Hoops
22.7
23.7
21.7
Kettle Chips
21.4
23.2
19.7
Monster Munch
18.0
20.3
15.7
KP Peanuts
17.7
20.4
15.1
Walkers Sensations
17.2
18.7
15.7
Wotsits
15.0
10.2
19.7
Seabrook Crisps
10.9
9.2
12.5
Nik Naks
9.6
8.7
10.5
Chip Sticks
8.2
10.3
6.2
Penn State Pretzels
5.4
5.0
5.9
Tyrells
3.8
3.8
3.8
Burts Crisps
3.3
4.3
2.3
21.5
22.1
20.8
None of these Weighted sample: 1,000
Base: all adults aged 16+ purchasing at least once a month
Source: Key Note/NEMS Market Research, November 2009
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By Age In 2009, respondents aged 55 and over were by far the least likely to be regular users of any of the brands cited, indicating that savoury snacks are far more popular among younger consumers. Interestingly, percentage penetration for Walkers Sensations was particularly high in the 16 to 19 year-old age group, yet the premium snack’s close rival Kettle Chips had a very low penetration rate of 9% in this age bracket. Supermarket own-brands were by far the most popular among consumers aged between 16 and 24, perhaps due to the high number of university students in these groups, who are likely to be more cost-conscious than older consumers.
Table 5.3: Popularity of Selected Snack Food Brands by Age (% of respondents), 2009 All Adults
16-19
20-24
25-34
35-44
45-54
55-64
65+
Walkers
57.4
79.8
59.0
70.1
67.4
56.6
42.5
38.1
Supermarket own brand
32.0
55.7
47.6
30.9
37.0
29.3
25.2
19.8
Pringles
27.3
23.3
32.3
41.3
29.7
24.8
21.5
17.9
Quavers
24.7
32.1
16.9
39.0
38.3
20.6
17.9
7.4
McCoy’s
23.8
36.9
38.1
32.7
26.7
22.5
17.5
7.5
Mini Cheddars
23.5
31.5
19.9
26.0
30.3
19.3
21.8
17.9
Doritos
23.0
23.5
27.4
31.5
30.8
29.6
15.0
6.0
Hula Hoops
22.7
37.9
23.7
33.8
31.9
20.6
14.8
4.9
Kettle Chips
21.4
9.0
40.5
36.4
21.5
22.0
15.7
8.6
Monster Munch
18.0
23.6
41.8
39.0
20.8
8.5
6.4
0.4
KP Peanuts
17.7
22.5
17.9
17.9
19.2
20.0
18.5
11.7
Walkers Sensations
17.2
50.0
39.2
17.3
17.8
14.9
9.0
2.9
Wotsits
15.0
16.7
13.1
27.4
27.0
11.7
5.5
1.8
Seabrook Crisps
10.9
11.5
10.9
12.3
14.3
12.8
7.4
6.8
Nik Naks
9.6
9.1
14.7
16.0
15.4
6.0
6.3
2.0
Chip Sticks
8.2
12.1
1.7
13.4
10.8
8.3
3.6
5.2
Table continues...
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Brand Strategy
Table 5.3: Popularity of Selected Snack Food Brands by Age (% of respondents), 2009 ...table continued All Adults
16-19
20-24
25-34
35-44
45-54
55-64
65+
Penn State Pretzels
5.4
14.5
0.0
10.5
6.7
4.0
3.1
1.2
Tyrells
3.8
0.0
0.0
10.4
5.1
3.2
0.4
2.3
Burts Crisps
3.3
0.0
0.0
9.7
3.0
2.3
1.3
2.5
21.5
6.9
15.9
16.5
11.9
20.4
31.1
37.2
None of these Weighted sample: 1,000
Base: all adults aged 16+ purchasing at least once a month
Source: Key Note/NEMS Market Research, November 2009
By Social Grade Respondents in social grade A were noticeably less likely to eat any of the specified brands on a regular basis in 2009. In fact, the only brands that showed a lower penetration rate among any other grade were Doritos, Kettle Chips and Burts, which were least likely to be a chosen snack among respondents in group E. Group E also had generally low penetration rates, perhaps because this category includes retired people who, as seen in Table 5.3, tend to be less interested in savoury snacks than younger consumers. Generally speaking, C1s, C2s and Ds were the most avid consumers of the specified brands of snacks, with the exceptions of Pringles (which proved most popular among respondents in grade B) and Kettle Chips (for which the highest percentage penetration was among C1 consumers).
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Table 5.4 Popularity of Selected Snack Food Brands by Social Grade (% of respondents), 2009 All Adults
A
B
C1
C2
D
E
Walkers
57.4
31.8
55.7
47.4
67.6
67.4
52.5
Supermarket own brand
32.0
10.2
25.3
32.5
38.5
35.3
23.4
Pringles
27.3
9.1
37.0
25.9
27.0
26.6
22.7
Quavers
24.7
5.8
21.7
20.8
31.2
31.5
18.4
McCoy’s
23.8
4.1
21.4
21.2
31.5
30.5
10.2
Mini Cheddars
23.5
10.1
13.6
22.7
26.9
34.3
20.7
Doritos
23.0
16.2
26.2
25.3
22.2
26.8
12.4
Hula Hoops
22.7
5.8
23.4
22.5
24.7
26.5
16.5
Kettle Chips
21.4
8.6
21.4
30.0
23.0
15.4
5.5
Monster Munch
18.0
2.9
16.1
18.0
21.5
24.8
6.9
KP Peanuts
17.7
9.6
16.0
13.5
19.5
21.7
22.8
Walkers Sensations
17.2
8.9
18.0
17.3
17.7
19.7
13.6
Wotsits
15.0
2.9
16.1
18.0
21.5
24.8
6.9
Seabrook Crisps
10.9
4.1
9.4
7.3
16.0
10.8
10.1
Nik Naks
9.6
2.9
3.4
12.0
10.9
12.6
6.9
Chip Sticks
8.2
0.0
9.5
7.6
7.5
15.0
4.0
Penn State Pretzels
5.4
0.0
7.1
4.1
8.1
2.5
4.1
Tyrells
3.8
0.0
4.0
4.4
4.1
5.2
0.5
Burts Crisps
3.3
1.7
3.2
3.6
4.3
2.5
1.2
21.5
63.1
21.6
22.0
17.0
15.7
29.4
None of these Weighted sample: 1,000
Base: all adults aged 16+ purchasing at least once a month
Source: Key Note/NEMS Market Research, November 2009
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Brand Strategy
By Region As is apparent in Tables 5.5 and 5.6, respondents living in the West Midlands frequently showed the highest percentage penetration of snacks, while their counterparts in the East Midlands showed the lowest in several instances. Geographic variations of note include: • Percentage penetration of Pringles in the North was more than twice that recorded in the East Midlands. • Those in the East Midlands showed a marked preference for Mini Cheddars, while completely shunning Burts Crisps and Penn State Pretzels. • Percentage penetration for KP peanuts was highest in Scotland and lowest in Wales. • Percentage penetration for Walkers Sensations ranged from a paltry 7.9% in the South West to 32.7% in the West Midlands. • Respondents in the brand’s heartland of the North West saw Seabrooks recording a percentage penetration of 29.4%, compared with a low of just 1.9% in Greater London. • At 43.1%, percentage penetration of Monster Munch in the West Midlands was way above the national average of 18%. • Supermarket own-brand snacks were most popular in the East Midlands and least in the North. • The South West had the highest penetration of consumers who claimed to eat none of the listed snacks on a regular basis (35.5%), while those living in Wales were the least likely to make this statement (14.1%).
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Snack Foods
Table 5.5: Popularity of Selected Snack Food Brands by Region (% of respondents), 2009
All Adults
East Anglia
East Midlands
Greater London
North
North West
Scotland
Walkers
57.4
56.5
58.9
57.3
73.0
54.2
64.5
Supermarket own brand
32.0
28.4
44.5
40.1
21.3
32.0
34.3
Pringles
27.3
21.7
16.7
26.6
34.4
31.9
32.4
Quavers
24.7
21.8
13.9
25.4
29.4
28.4
27.7
McCoy’s
23.8
19.3
28.9
20.9
25.0
29.7
25.6
Mini Cheddars
23.5
23.3
32.5
25.8
21.8
25.3
23.6
Doritos
23.0
18.5
13.8
25.7
32.7
21.0
31.2
Hula Hoops
22.7
35.1
11.5
28.8
18.7
25.8
29.3
Kettle Chips
21.4
19.0
16.6
26.4
20.9
10.2
20.6
Monster Munch
18.0
6.8
19.3
22.2
34.3
13.8
22.6
KP Peanuts
17.7
19.3
12.6
13.1
18.4
22.2
26.6
Walkers Sensations
17.2
10.9
21.4
18.4
14.1
23.3
27.3
Wotsits
15.0
15.3
16.2
9.8
21.1
13.8
23.4
Seabrook Crisps
10.9
10.0
7.4
1.9
13.3
29.4
9.7
Nik Naks
9.6
9.9
2.4
4.9
24.7
8.8
12.8
Chip Sticks
8.2
8.8
15.8
8.2
11.7
5.3
4.1
Penn State Pretzels
5.4
4.6
0.0
7.1
3.5
2.2
9.8
Tyrells
3.8
2.8
2.5
6.5
2.3
1.4
1.7
Burts Crisps
3.3
2.3
0.0
5.0
2.3
2.2
3.6
21.5
18.5
24.4
18.5
19.0
23.4
17.8
None of these Weighted sample: 1,000
Base: all adults aged 16+ purchasing at least once a month
Source: Key Note/NEMS Market Research, November 2009
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Brand Strategy
Table 5.6: Popularity of Selected Snack Food Brands by Remaining Regions (% of respondents), 2009
All Adults
South East
South West
Wales
West Midlands
Yorkshire and Humberside
Walkers
57.4
52.3
49.6
64.7
55.4
56.2
Supermarket own brand
32.0
25.3
24.4
31.4
38.8
27.0
Pringles
27.3
23.5
16.9
26.0
33.8
34.1
Quavers
24.7
16.9
22.3
20.1
43.3
25.8
McCoy’s
23.8
26.7
22.3
17.3
21.8
22.1
Mini Cheddars
23.5
22.0
17.4
17.6
25.5
21.6
Doritos
23.0
17.3
19.5
20.4
36.1
21.3
Hula Hoops
22.7
16.7
15.4
10.9
35.5
14.4
Kettle Chips
21.4
30.7
14.4
19.2
37.1
12.8
Monster Munch
18.0
12.3
18.3
7.2
43.1
9.9
KP Peanuts
17.7
16.0
12.8
12.4
18.8
21.2
Walkers Sensations
17.2
11.7
7.9
8.7
32.7
10.3
Wotsits
15.0
11.2
16.7
12.6
30.2
6.7
Seabrook Crisps
10.9
2.9
3.1
7.0
3.1
31.1
Nik Naks
9.6
10.3
10.2
4.9
24.1
2.6
Chip Sticks
8.2
7.1
11.2
6.3
15.1
4.3
Penn State Pretzels
5.4
8.6
4.8
1.5
12.8
0.8
Tyrells
3.8
4.3
6.9
0.7
11.9
0.0
Burts Crisps
3.3
2.9
0.7
2.0
12.8
0.5
21.5
27.2
35.5
14.1
16.2
21.6
None of these Weighted sample: 1,000
Base: all adults aged 16+ purchasing at least once a month
Source: Key Note/NEMS Market Research, November 2009
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COMPANIES’ BRANDS Intersnack Intersnack’s brands of savoury snacks are Pom-Bear (bear-shaped crisps for children), Chio and Penn State Pretzels. Following its acquisition of Percy Dalton’s Famous Peanut Co Ltd, Intersnack has introduced a Your Nuts range, which revitalises the 80-year old brand. A new image and slogan were designed to appeal to a younger target market, while still retaining its quality heritage.
Largo Food Exports Owned by Largo Foods in the Republic of Ireland (but not in Northern Ireland), the Tayto name is synonymous with crisps to the Irish public, and the company’s founder is said to have been responsible for the development of the first Cheese and Onion-flavoured crisp, although other sources attribute this to Golden Wonder. According to Nielsen MarketTrack in June 2009, the Original Irish Crisp is Ireland’s number one snack food brand. Other Tayto products include Mighty Munch, Snax and Chipsticks. In June 2009, Tayto revealed that its new healthy low-calorie snack range, Real D’Lites, had generated more than £100,000 in sales over the preceding 3 months.
Tayto (NI) Tayto (NI) Ltd owns the Tayto brand, other than in the Republic of Ireland. Tayto’s ranges include Rough Cuts, Fusion and Advantage. Other company brands include Golden Wonder and Jonathan Crisp, and Tayto’s 2008 acquisition of Red Mill added the Mr Porky and Transform-A-Snack brands to its portfolio.
Tyrrells Potato Chips Tyrrells supplies its handmade crisps to farm shops, delicatessens, independent stores and national retailers, including Waitrose and Sainsbury’s. In addition to its vegetable crisps, which include Parsnip and Mixed Root varieties, Tyrrells produces Thai Chilli Rice Crackers and Wasabi Coated Peanuts. September 2009 saw the introduction of Tyrrell’s Great British flavoured crisps, with flavours that included Welsh Rarebit and Beef Wellington. Tyrrells Potato Chips appeared at position 97 in the 2008 Sunday Times ‘Fast Track 100’ of fastest-growing private UK companies.
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United Biscuits United Biscuits’ brands of savoury snacks include KP, Hula Hoops, Phileas Fogg and McCoys. The latter, which targets the male market, is the UK’s third largest crisp and snack brand (after Walkers Crisps and Pringles), with sales valued at around £90m. In 2009, United Biscuits reformulated its Wheat Crunchies and Nik Naks to be free of artificial colours and monosodium glutamate (MSG), and it has also reduced the saturated fat content of both by 60%. KP Nuts Spicy Chilli has also been totally stripped of MSG.
Walkers Snack Foods Walkers is the largest snack brand in the UK, claiming around 23% of the crisp market and holding third place in Nielsen’s league table of grocery brands. Its brands include Quavers, Sensations, Wotsits, Doritos and Red Sky, as well as standard Walkers crisps, Walkers Lite and Walkers Max. Walkers was acquired by PepsiCo in 1989, which now controls around 60% of the UK crisps and snacks market. Monster Munch — a favourite in the 1970s — was relaunched in September 2008 and, according to Nielsen, the Walkers-owned retro brand is now in the UK’s top-twenty snacks, with annual sales of £35m. In October 2009, it was announced that PepsiCo was to relaunch the Walkers festive crisp range in the UK in a bid to boost Christmas sales. The seasonal variations will include a six-pack of limited-edition flavours: Turkey and Stuffing; Ham and Mustard; and Cheese and Pickle.
TOP BRANDS The Checkout Nielsen Top 100 Brands is based on data taken from Nielsen’s Scantrack Service, which monitors weekly sales from a nationwide network of EpoS checkout scanners. Brands of relevance to this report that are included in the 2008 league table are Walkers Crisps at number 3 (unchanged from 2007), Pringles at 32 (up from 41 in 2007), McCoy’s Crisps (74), Doritos (86), Walkers Sensations (89) and Hula Hoops (91). Of these, Doritos and Hula Hoops were new entrants in 2008, while Quavers dropped from the top-100 brands.
The Guild of Fine Food Great Taste Awards Each year, The Guild of Fine Food stages its Great Taste Awards. In 2009, there were around 4,873 foods entered that were judged on a one-, twoor three-star system. The following table shows those winners of relevance to this report, with Tyrrells’ Beetroot Chips receiving a two-star award, and the others receiving one star.
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Table 5.7: Winners of The Guild of Fine Food Great Taste Awards, 2009 Product
Entrant
Pipers No Salt Crisps
Pipers Crisps Ltd
Naked Potato Chips
Tyrrells Potato Chips Ltd
Category Plain potato crisps
Flavoured potato crisps Sea Salt & Aspall Cider Vinegar
Crisps of vegetables other than potatoes
Fairfields Farm Crisps
Pipers West Country Cheddar & Onion
Pipers Crisps Ltd
Pipers Sea Salt & Indian Black Pepper
Pipers Crisps Ltd
Pipers Biggleswade Sweet Chilli Crisps
Pipers Crisps Ltd
Horseradish & Sour Cream
Salty Dog Brands Ltd
Parsnip Chips with Rosemary
Tyrrells Potato Chips Ltd
Beetroot Chips
Tyrrells Potato Chips Ltd
Mixed Root Vegetable Chips Tyrrells Potato Chips Ltd Savoury cocktail snacks Rosie’s Savoury Bagel Chips
Broadway Bagels
Cocktail nuts
Wasabi Peanuts
Tyrrells Potato Chips Ltd
Kiln Roasted Bayou Nuts
Olives Et Al Ltd
Fortnum & Mason Sultry Smokey Nuts
Olives Et Al Ltd
Source: The Guild of Fine Food, www.finefoodworld.co.uk
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Strengths, Weaknesses, Opportunities and Threats
6. Strengths, Weaknesses, Opportunities and Threats STRENGTHS • Savoury snacks are popular with all ages. • They are an affordable treat. • There are a number of strong brands in the market. • Savoury snacks can be part of a weekly grocery shop and are also subject to impulse purchases. • New product development (NPD) is ongoing and the savoury snacks industry is continuing to invest confidently in NPD, despite the recession. • An established trend of snacking in between meals, or even replacing set meals with snacks, encourages sales of products. • UK consumers’ tastes are becoming ever more adventurous and manufacturers are developing increasingly exotic flavours. • The recession has driven growth in value products, but the premium end of the market is also being sustained by increased home consumption.
WEAKNESSES • The European market for savoury snacks is dominated by Frito Lay and Walkers Snack Foods. • It is difficult for new niche operators to compete against the major players, such as Walkers, for shelf space in store. • Savoury snacks are commonly perceived as unhealthy and being high in fat and salt. • Demand for nuts is seasonal and centred on the Christmas period. • The price, availability and quality of ingredients, such as potatoes, grain and oil, can fluctuate considerably. • Savoury snacks are no longer widely available in schools, canteens or vending machines. • No sooner do newly introduced proprietary brands prove a success, than retailers introduce their own-brand lower-priced versions, helping to curb value growth in the overall market. • Discounting is still a feature of the market; for example, Tesco was selling Pringles and Mini Cheddars for half price in the run up to Christmas 2009.
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Snack Foods
OPPORTUNITIES • People sacrificing nights out for home entertainment may spend more on premium snacks as treats. • The recession has led to people taking packed lunches to work and school rather than eating out. • Manufacturers, including Walkers, are investing in display equipment and supporting independent stores’ merchandising in an attempt to revitalise the impulse market. • Unusual flavours and retro brands are both showing good growth potential. The latter is attractive to manufacturers as it is a cheaper option than NPD and has an already-aware market. • With the 2010 football World Cup taking place in South Africa, some manufacturers are developing African-influenced flavours. • It has been suggested that the ban on smoking in public places imposed in England in 2007 has led smokers to eat more snacks in public houses (‘pubs’) as an alternative to smoking outdoors. • Manufacturers are constantly bringing out different packaging types and sizes aimed at the ‘on-the-go’ market, children’s market and the adult sharing market. • Manufacturers are increasingly promoting natural ingredients, such as wholegrains, nuts and seeds, in their savoury snacks. • Overseas markets, such as Eastern Europe and the Middle East, are areas where snack food producers can increase sales. • Manufacturers are pushing their ‘sharing’ format larger bags to capitalise on people entertaining at home and because they offer better profit margins.
THREATS • The snacks industry has been hit by huge commodity price rises that are having to be passed on to consumers at a time when food budgets are already stretched. • The supply market for raw materials can be volatile. • With an ongoing emphasis on health issues and obesity, many parents are choosing healthier alternatives, such as fruit, over savoury snacks for their children. • The advertising of food to children is subject to strict regulation. • An ageing population may prove detrimental to demand as children and young adults tend to be the most enthusiastic consumers of savoury snacks.
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Buying Behaviour
7. Buying Behaviour HOUSEHOLD EXPENDITURE ON FOOD AND DRINK According to National Statistics’ Family Spending report, UK households had an average expenditure of £459.20 a week in 2007, of which £48.10 was spent on food and non-alcoholic drink. Among the 10% of the population in the highest disposable income bracket, this figure equated to 7% of their weekly income, whereas for those in the lowest bracket, the percentage was 14%. More than two-thirds of this food budget was spent in the large supermarket chains.
CONSUMER PENETRATION Potato Crisps, Tortilla and Corn Snacks A BMRB International Ltd Target Group Index (TGI) survey — conducted in 2009 to ascertain respondents’ snacking habits — found that 84.1% of respondents had eaten potato crisps, tortilla or corn snacks in the preceding year, compared with 85% in the previous year. The percentage penetration of those eating a packet every day also decreased in 2009. Women showed a higher percentage penetration than men (85.7% and 82.5%, respectively).
Table 7.1: Penetration of Potato Crisps, Tortilla and Corn Snacks in the Past 12 Months by Frequency (% of adults), 2009 Consumption Yes
84.1
No
15.9
Frequency of Consumption Once a day or more
10.2
2 or 3 times a week
23.9
Once a week
15.1
2 or 3 times a month
15.5
Once a month Less than once a month
7.4 10.6
Source: Target Group Index (TGI), © BMRB International Ltd, 2009
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Snack Foods
Respondents aged between 35 and 44 were the most likely to indulge in potato crisps and other snacks, although percentage penetration was still as high as 70.9% among the over-65s, who were the least likely to eat potato and corn snacks. However, it was those in the youngest age group (between 15 and 19) who proved most likely to eat a packet a day, compared with just 3.5% of over 65s. Eating at least one packet of crisps a day was least likely among the A social grade, with percentage penetration rising from A to C2 and D, before dropping down again among those in group E. Respondents in East Anglia, Scotland, the North and the East and West Midlands were the most likely to eat crisps once a day, while their counterparts in Greater London were the least likely to do so. Respondents were also asked whether they usually bought regular or low-fat variants of potato crisps, and as many as 65% favoured the former, compared with 23.3% who were more likely to opt for low-fat brands. In the low-fat category, percentage penetration was 28.1% for women and 18.3% for men, and both were lower in 2009 than in a similar survey conducted in 2008. Percentage penetration of low-fat variants ranged from just 19.8% among those aged between 15 and 19, to 24.9% for those between 45 and 54, and were most likely to be chosen by those in the regions that generally ate more crisps anyway (Scotland, the North, East Anglia and the Midlands) and least likely by those in Yorkshire. Those in the A and B social grades showed the highest percentage penetration for low-fat variants, and those in the D and E groups had the lowest penetration rate. Regular variants saw percentage penetration as high as 76.8% among young adults aged between 25 and 34, compared with just 40.7% among the over 65s.
Nuts and Dried Fruit In the 2009 survey, less than half the respondents had eaten nuts and/or dried fruit in the past 12 months, and the products were more popular among women than men. Those aged between 45 and 54 were the most likely to have eaten them, while the under-25s were the least likely to have done so. There was a direct correlation between consumption and social grade, with percentage penetration decreasing from the A through to the E grade.
Table 7.2: Penetration of Nuts and Dried Fruit in the Past 12 Months by Frequency (% of adults), 2009 Consumption Yes
42.8
No
32.2
Table continues...
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Buying Behaviour
Table 7.2: Penetration of Nuts and Dried Fruit in the Past 12 Months by Frequency (% of adults), 2009 ...table continued Frequency of Consumption Once a day or more
3.5
2 or 3 times a week
6.8
Once a week
5.8
2 or 3 times a month
8.3
Once a month
5.9
Less than once a month
11.5
Source: Target Group Index (TGI), © BMRB International Ltd, 2009
Consumption of nuts and/or dried fruit was fairly infrequent, with most respondents eating them less than once a month. The most popular variety of nuts was salted, followed by dry roasted and unsalted.
Other Savoury Snacks Less than half of the respondents had eaten other savoury snacks in the 12 months prior to the 2009 survey. This was considerably lower than the 54.2% percentage penetration seen in 2008. However, the survey only covers adults (aged 16+), and it is younger children who are probably more inclined to indulge more heavily in savoury snacks, particularly gimmicky ones, than regular crisps and nuts.
Table 7.3: Penetration of Other Savoury Snacks in the Past 12 Months by Frequency (% of adults), 2009 Consumption Yes
43.3
No
56.7
Frequency of Consumption Once a day or more
1.0
2 or 3 times a week
4.7
Once a week
6.4
Table continues...
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Table 7.3: Penetration of Other Savoury Snacks in the Past 12 Months by Frequency (% of adults), 2009 ...table continued Frequency of Consumption (cont.) 2 or 3 times a month
9.6
Once a month
6.9
Less than once a month
13.0
Source: Target Group Index (TGI), © BMRB International Ltd, 2009
Percentage penetration among men, at 40.3%, was much lower than the 46.2% seen among women respondents, but both sexes were equally likely to eat savoury snacks on a daily basis. The most likely respondents to be consumers of other savoury snacks were those aged between 35 and 54, while they were least popular with those aged over 55. Most respondents ate other savoury snacks less than once a month, but those who ate such products on a daily basis were most likely to be in the youngest age group. Those in the D and E social grades tended to be the most avid consumers of other savoury snacks on a daily basis, as were respondents in East Anglia and the West Midlands. Regardless of the frequency of consumption, it was residents of East Anglia and the South West who were the most likely to have indulged in other savoury products in the preceding 12 months.
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Current Issues
8. Current Issues CLOSURES, MERGERS AND ACQUISITIONS MBMG MBMG was the trading name of the company formed in 2006 by the amalgamation of MBM Produce Ltd and FW Gedney. It supplied retailers, processors, wholesalers, caterers, large foodservice operatives and the export market with a wide range of fresh vegetables, fruit and salads, as well as more than 600,000 tonnes of potatoes. However, in July 2009, MBM Produce Ltd (trading as MBMG) went into administration. It continued to trade for a short time, but failure to sell its sites in Lincolnshire and Norfolk resulted in their closure, with the loss of 84 jobs amid uncertainty over whether growers would be paid for outstanding invoices. However, management of its Cambridgeshire site was taken over by QV Foods in February 2009, and remains open.
Tyrrells Potato Chips In March 2008, the independent crisp brand Tyrrells sold a majority stake to private-equity firm Langholm Capital, which owns Dorset Cereals, in a deal that valued the company at around £40m.
BOARD AND SENIOR MANAGEMENT CHANGES PepsiCo UK and Ireland In September 2009, the President of PepsiCo UK and Ireland, Salman Amin, was promoted to the role of Executive Vice President Sales and Marketing, leaving his position in London to take up the global role in New York. Amin was replaced by Richard Evans — the former General Manager of Walkers Snack Foods.
NEW PRODUCT DEVELOPMENT McCoy’s In 2009, United Biscuits added a new Sizzling King Prawn variant to its McCoy’s range of crisps. In August 2009, it introduced a limited edition of McCoy’s Pub Grub in two new flavours — Lamb and Mint; and Roast Beef and Horseradish.
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Penn State In November 2009, the UK’s leading pretzel brand, Penn State, launched its Baked Deli Chip in Morrisons supermarkets across the country. Baked rather than fried, the snack comes in two flavours — Spicy Jalfrezi and Spicy Teriyaki — and their launch was accompanied by sampling in Morrisons stores.
Pringles In February 2009, Procter & Gamble added a new Zesty Lime an’ Chilli variant to its Pringles range.
Tyrrells In September 2009, Tyrrells launched its Great British flavoured crisps to coincide with the first day of British Food Fortnight — a campaign promoting food from the UK. The three variants of Welsh Rarebit, Beef Wellington and Pork & Apple will be on sale for 12 months exclusively with Tyrrells’ independent retail customers.
Walkers Walkers helped retailers maximise Christmas 2009 sales of snacks and crisps by introducing Sharing 99 pence (p) Value Bags of its best-selling products, including Doritos Tangy Cheese and Monster Munch Roast Beef.
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The Global Market
9. The Global Market EUROPE Despite Germany having the largest population in Europe, its consumption of savoury snacks is behind that of the UK, which accounts for more than a fifth of the value of the European market. Crisps are said to have first been produced commercially in Germany in 1951 — around 30 years later than in the UK — when Heinz Flessner began the Stateside Potato Chip Company, the primary market of which was US soldiers stationed in the country. Within a decade, Flessner had two factories and was well established in the consumer market. Eastern European savoury snack markets have the most potential for growth, and the market is currently led by potato crisps. The leading players in Eastern Europe include: PepsiCo Inc; Intersnack Knabber-Gebäck GmbH & Co KG; and Lorenz Bahlsen Snack-World GmbH & Co KG Germany. Pringles is arguably the largest pan-European brand, as Walkers crisps are known under the Lays and Ruffles names in the rest of Europe. Other territorially exclusive brands include Funny Frisch in Germany. Pretzels are particularly popular in Germany and Austria, but their popularity is not so established outside of German-speaking countries.
THE US According to the 2009 State of the Industry report presented by Information Resources Inc (IRI) at the 2009 SNAXPO exhibition, while snack foods are still important to US consumers, an increasing number — as many as 79% — are looking for the best value. After snack purchases declined during 2007 and the first quarter of 2008, their sales value increased by 1.1% in the fourth quarter of 2008, compared with the same period in 2007. IRI surveys showed that 26.5% of consumers claimed to be snacking less frequently, and that 47.5% had cut back on their snacking expenditure over this period. 54.3% said that they were buying on value, not necessarily their favourite brand, with 46% of shoppers increasing their private-label purchases between 2007 and 2008. Private-label volume increased by 8% and dollar sales were up 6%, according to IRI. The Senior Vice President of IRI, Sally Lyons Wyatt, said that consumer interest in ‘healthier-for-you’ snack products continues to grow, but that 47% of shoppers want to eat what tastes good rather than what is necessarily healthy, and two-thirds of snack purchases remain indulgent snacks. At the same event, NPD Group told a SNAXPO audience that, while many Americans are looking for the lowest price possible when they buy food, convenience and taste are still important. While ‘better-for-you’ snack purchases increased considerably, taste remained the most important reason for snack foods being purchased, and it was also said that dieting trends were at an all-time low, despite the rising incidence of obesity in the US.
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The Global Market
Snack Foods
ASIA PACIFIC Rising average annual incomes, increased exposure to Western and international cuisines and greater availability of goods in supermarkets are combining to increase sales of savoury snacks in Asia. For example, in the past, snacks in the People’s Republic of China (PRC) were dried seeds and nuts, but Western influences have more recently resulted in a wider array of new savoury snacks being introduced to the country. Procter & Gamble and PepsiCo have made significant inroads into Asian markets; however, because of local taste preferences, domestic industries remain competitive. Australia’s retail market for savoury snacks was valued at more than Aus$2bn in 2008, and more than half of this value was accounted for by the sale of potato crisps, or chips as they are commonly known. The market is dominated by PepsiCo, which has grown through acquisitions, including Sakata Rice Snacks in 2005 and The Smiths Snack Food Company in 1998. Despite a perception of Australians having a healthy, outside-oriented lifestyle, the country also has an obesity problem, with the proportion of overweight or obese children, particularly, increasing at an alarming rate. The results of the 2007/2008 National Health Survey by the Australian Bureau of Statistics (ABS) reveal that one in four children aged between 5 and 17 is now overweight or obese. As in the UK, this is resulting in increased demand for healthier products.
SELECTED GLOBAL COMPETITORS Calbee Foods Tokyo-based Calbee Foods is a savoury snack producer with factories throughout Japan. It was established as the Matsuo Food Processing Co Ltd in 1949 in Hiroshima, and changed its name to Calbee Foods & Confectionery Co Ltd in 1955, and again to Calbee Foods Co Ltd in 1973. In 1970, a US subsidiary of Calbee America Inc was established, while Calbee has since expanded into Thailand, the PRC and Hong Kong. In its financial year ending March 2009, Calbee Foods saw revenue increase by 3.6% compared with the previous year, while net profit was more than five times higher than in the year ending March 2008. However, 2008 saw exceptionally low net profit, and the net profit for 2008/2009 was still lower than in 2006/2007.
Intersnack Knabber-Gebäck The Intersnack group was founded in 1995 as a result of a merger between the Convent Group and Wolf-Bergstrasse. Headquartered in Cologne, Germany and with a base in County Durham in the UK, the company has more than 4,000 employees globally, and is among Europe’s leading suppliers of fried and baked savoury snacks. Its brands, which include Chio, Goldfischli and Wolf, are also prominent in Eastern Europe, while it is best known for its Pom-Bear fried potato snacks and Penn State pretzels in the UK.
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The Global Market
During 2009, Intersnack made a significant investment in its Bastini subsidiary, increasing production speeds and doubling capacity at a newly-built factory in the Netherlands. Bastini manufactures some of the best-known snacks in the Netherlands, and also produces own-brand snacks for many leading European retailers. The new factory — which manufactures extruded snacks, pellet snacks and several varieties of popcorn — replaces a former unit that was badly damaged by fire.
ITC ITC is one of India’s largest companies and is involved in diversified markets including cigarettes, hotels, confectionery, apparel and personal care. ITC employs in excess of 26,000 people at more than 60 locations across India. Its Bingo range of potato chips and snacks is the first serious national level competitor to Frito-Lay in the Indian savoury snack market. ITC saw its pre-tax profit increase by 26% in the quarter ending 30th September 2009, compared with the same period in 2008.
J&J Snack Foods Based in New Jersey, J&J Snack Foods is a manufacturer, marketer and distributor of branded snack foods and beverages for food service and retail supermarket customers in the US. It was founded in 1972 and has expanded through subsequent acquisitions, including that of SnackWorks LLC — a manufacturer of pretzels — in 2005. The company’s sales for the fiscal year ending 27th September 2008 increased by 11% to $629.4m, compared with the previous year, but net earnings, which were adversely affected by rises in the cost of raw materials, were down by 13% to $27.9m.
Largo Food Exports In the Republic of Ireland, the Tayto brand name is owned by Largo Food Exports Ltd, which bought the business from C&C Group PLC in 2006 for €62m. Largo was founded in 1983 and is based in Ashbourne in the Republic of Ireland. The company has plants in Ashbourne and Donegal, as well as one in the Czech Republic. In 2007, a 15% stake in Tayto was sold to the German Intersnack group for €15m, and it has been reported that the latter could be interested in increasing that share. The Tayto business in the Republic of Ireland is actively pursuing growth in overseas markets, and has entered a joint venture in Libya, which it hopes will lead to Tayto entering other North African markets, such as Algeria. Largo Food Exports had a turnover of €89.8m in 2007, on which a pre-tax loss of €7.4m was incurred.
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Liberation Foods Liberation Foods was established in 2007 and is part owned by the farmers of the nuts it sells. More than 22,000 smallholder producers from co-operatives in Asia, Africa and Latin America own a collective share of 42% of the company, maximising their returns and thereby offering a more secure future for them and their families. Through Liberation’s supply chain, farmers sell directly to retailers in Europe, which include Waitrose and Oxfam. In addition to snacks, Liberation also supplies fresh Fairtrade nuts to Sainsbury’s, Morrisons and Tesco for their own-brand ranges.
Lorenz Snack-World The origins of Lorenz Snack-World are in a German company founded in 1889. In 1993, the existing Group restructured into sweet and savoury divisions — the latter being called Bahlsen Picanterie, before changing its name to Lorenz Snack-World in 2001. Headquartered in Neu-Isenburg, Lorenz Snack-World also has operations in Poland, Austria, Croatia and Russia, and its brands — which include Crunchips, Saltletts, Curly and Country Chips — are sold around the world.
PepsiCo PepsiCo comprises PepsiCo Americas Foods (PAF), PepsiCo Americas Beverages (PAB) and PepsiCo International (PI). PAF includes Frito-Lay North America, Quaker Foods North America and all Latin America food and snack businesses; PAB includes PepsiCo Beverages North America and all Latin American beverage businesses; and PI comprises all PepsiCo businesses in the UK, Europe, Asia, the Middle East and Africa. In early 2009, PepsiCo realigned certain countries within PI, resulting in its businesses in Turkey and certain central Asia markets becoming part of the UK & Europe sub-division (UKEU), which was renamed the Europe division. These countries were formerly part of the Middle East, Africa & Asia sub-division (MEAA), which was renamed the Asia, Middle East & Africa division. In 2008, PepsiCo had a net revenue of $43.3bn (compared with $39.5bn in 2007) and a net income of $5.1bn (compared with $5.7bn in the previous year). In October 2008, the company announced plans to cut 3,300 jobs globally, responding to an unprecedented fall in US soft drink sales.
Procter & Gamble From its origins as a small family-run soap and candle company established in 1837, Procter & Gamble (P&G) now employs around 138,000 people and markets to consumers in more than 180 countries. Its products range from household cleaners and laundry care to prescription drugs and fine fragrances. It has around 23 brands that generate more than $1bn in sales revenue annually, one of which is Pringles. The snack brand went into production in the US in 1964, but began its global expansion in 1990. It is now available around the world in 45 flavours and in different size formats.
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In May 2009, Procter & Gamble’s UK operation was dealt a blow in the Court of Appeal when it lost a legal battle with HM Revenue & Customs over its Pringles snack. Foods are normally exempt from paying tax, with the exception of potato crisps, and the High Court had agreed with Procter & Gamble that Pringles were not classified as crisps, and were therefore not liable for VAT. However, the Court of Appeal overruled that decision on the grounds that a Pringle contained ‘enough potato content for it to be a reasonable view that it is made from potato’ (Lord Justice Jacob), and Procter & Gamble will be forced to pay out tens of millions of pounds as a result. In its 2008/2009 financial year, Procter & Gamble reported a sales revenue of $79.02bn, compared with $81.75bn in the previous year. Operating income was slightly reduced from $16.64bn in 2007/2008 to $16.12bn in 2008/2009.
Snack Foods As the owner of Snack Brands Australia, Snack Foods Ltd is one of the largest suppliers of snack foods in Australia, and the main competitor to the PepsiCo subsidiary The Smith’s Snackfood Company. When the latter was acquired by PepsiCo’s Frito-Lay, the Australian Competition and Consumer Commission directed it to divest a range of brands, which included Cheezels, Thins and Tasty Jacks, as well as several manufacturing facilities under a package named Snack Brands Australia. This was acquired by Dollar Sweet Holdings (now Snack Foods Ltd). In April 2008, Snack Brands Australia acquired the Samboy brand, which had been all but discontinued approximately 4 years previously. A campaign for its return included a page on the social networking website Facebook, which generated around 8,000 members. Samboy was consequently relaunched in 2009.
Snyder’s of Hanover The origins of Snyder’s of Hanover date back to 1909 when the Hanover Canning Company — Snyder’s parent company until 1980 — began producing pretzels for the Hanover Pretzel Company. William V Snyder began modernising the company in 1940 and, when distribution of its products stretched across Virginia, Pittsburgh, Pennsylvania and New York, the company extended the shelf life of its products by packing them in innovative aluminium foil bags. The company now also produces tortilla chips, crisps and popcorn, but remains best known for pretzels. It employs around 2,250 people and has annual revenues in the region of $750m. In November 2009, Snyder’s announced that it had abandoned plans for a merger with Utz Quality Foods because a protracted approval process by the Federal Trade Commission looked likely. The two family-owned companies operate five factories between them, which are major employers in Hanover, Pennsylvania.
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Forecasts
10. Forecasts INTRODUCTION The Economy There are tentative signs of a growth in consumer confidence. Figures published by National Statistics in late October 2009 showed that sales volumes in the 3 months ending September 2009 increased by 0.9% compared with the previous quarter.
Population According to National Statistics, the population of the UK is projected to increase from 61.8 million in 2009 to 63.5 million by 2013. Any such increase in the size of the population bodes well for demand for consumer goods, including savoury snacks, and an ageing population will continue to ensure more emphasis on premium adult snacks rather than those aimed at a diminishing child population — the most avid consumers of snacks. Some of the population increase will come from net migration. Ethnic food is already firmly established in the restaurant and retail sectors, and there are pockets of ethnic concentrations in areas of the UK where shops selling ethnic foods and flavourings will also appeal to the indigenous population.
Table 10.1: Forecast UK Resident Population by Sex (000), Mid-Years 2009-2013 2009
2010
2011
2012
2013
Female
31,420
31,614
31,807
32,001
32,196
Male
30,374
30,609
30,842
31,073
31,302
Total
61,794
†62,222
62,649
63,074
63,498
0.7
0.7
0.7
0.7
0.7
% change year-on-year
† — does not sum due to rounding by source
Source: Population Projections Database (2008-based projections), National Statistics website © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen’s Printer for Scotland)
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Gross Domestic Product The UK’s gross domestic product (GDP) contracted by 4.5% 2009, but is expected to return to growth (albeit a minimal one of 1.1%) in 2010. However, the economic growth seen in recent quarters comes from a low base, and has been largely reliant on financial stimulus packages. These will have to end at some stage in the future, and this could necessitate tax and/or interest rate increases that are likely to affect consumer demand. As it is, the rate of VAT is due to return to its previous level in January 2010, having been at the reduced rate of 15% since December 2008.
Table 10.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2009-2013 2009
2010
2011
2012
2013
Gross domestic product growth (%)
-4.5
1.1
2.0
2.3
2.7
Percentage point change year-on-year
-
5.6
0.9
0.3
0.4
Source: Forecasts for the UK Economy, November 2009, Treasury Independent Average © Crown copyright
Savoury snack manufacturers have had to contend with rising costs of wheat, maize, flour, potatoes and crude oil, as well as an increase in the amount of land given over to biofuel production. Regular savoury snack purchasers feeling pressure on their disposable incomes may be reluctant to give up buying snacks altogether, but the steep rises that manufacturers have had to pass on may result in demand being price-sensitive as consumers opt for less premium own-brand snacks.
Inflation The inflation rate in 2009 is expected to be negative at -0.7%, before recovering gradually in the remaining 4 years of the forecast period to finish at 3.1% in 2013.
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Table 10.3: Forecast UK Rate of Inflation (%), 2009-2013 2009
2010
2011
2012
2013
Inflation (%)
-0.7
2.5
2.5
2.9
3.1
Percentage point change year-on-year
-4.7
3.2
0.0
0.4
0.2
Note: inflation is at retail price index (RPI).
Source: Forecasts for the UK Economy, November 2009, Treasury Independent Average © Crown copyright
Unemployment Unemployment is forecast by the Treasury to increase by 72.5% to 1.6 million by the end of 2009, and will peak at 1.9 million in 2010 and 2011 before beginning a slow recovery. However, many economists consider these figures to be too optimistic, as the most recent report from National Statistics revealed that 2.5 million people were out of work in the 3 months ending September 2009. Unemployment is always a lagging factor during recessions, mainly because companies remain cautious in their recruitment for some time after the economy recovers.
Table 10.4: Forecast Actual Number of Unemployed Persons in the UK (million), 2009-2013 2009
2010
2011
2012
2013
Actual number of claimants (million)
1.57
1.90
1.90
1.79
1.63
% change year-on-year
72.5
21.0
0.0
-5.8
-8.9
Source: Forecasts for the UK Economy, November 2009, Treasury Independent Average © Crown copyright
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FORECASTS 2010 TO 2014 2008/2009 saw a sharp rise in retail prices as manufacturers could no longer absorb escalating commodity costs. The consequential increase in the value of the market is not expected to be sustained at the same level in the immediate future, but factors contributing to market growth will include the developments made by manufacturers to reduce fat and salt levels, through healthier raw materials and cooking processes, and the increase in snacking occasions, such as working lunches. While the recession has increased demand for the premium products that many feel are an affordable luxury (particularly if foregoing an evening out), there is no doubt that many consumers will continue to economise by opting for cheaper own-brand products. The football World Cup (to be held in South Africa in 2010) and the Olympic Games in 2012 (London 2012) will be closely followed by many on television — a prime occasion for snacking on which manufacturers will capitalise. According to the European Snacks Association (ESA), several exhibitors attending SNACKEX in June 2009 were demonstrating products with African-influenced seasonings in preparation for the World Cup. Such positive factors are expected to contribute to an increase in market value of savoury snacks, and Key Note forecasts that the market will grow in value by 3.6% to £2.48bn in 2010. Overall, the snack foods market is expected to increase by 5.3% over the 5-year forecast period to reach a retail sales value of £2.61bn by 2014. The potato crisps sector is forecast to experience by far the highest level of growth over this period (8.5% compared with 2.8% in the ‘other savoury snacks’ sector and 2.2% in the snack nuts category).
Table 10.5: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2010-2014 2010
2011
2012
2013
2014
Potato crisps
1,088.0
1,104.0
1,124.0
1,145.0
1,180.0
Other savoury snacks
1,180.0
1,200.0
1,216.0
1,219.5
1,213.5
207.0
208.0
210.0
211.0
211.5
2,475.0
2,512.0
2,550.0
2,575.5
2,605.0
3.6
1.5
1.5
1.0
1.1
Snack nuts Total % change year-on-year rsp — retail selling prices
Source: Key Note
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Figure 10.1: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (£m at rsp), 2010-2014 Potato crisps Other savoury snacks
2,500
Snack nuts 2,250 2,000 1,750 1,500 1,250 1,000 750 500 250 0 2010
2011
2012
2013
2014
rsp — retail selling prices
Source: Key Note
MARKET GROWTH Figure 10.2 illustrates the actual and forecast growth in the total snack foods market. Key Note estimates that the value of the market will increase by an overall 22.1% between 2005 and 2014 to reach a value of £2.61bn.
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Figure 10.2: Growth in the UK Snack Foods Market by Value at Current Prices (£m at rsp), 2005-2014 2,700 2,650 2,600 2,550 2,500 2,450 2,400 2,350 2,300 2,250 2,200 2,150 2,100 2,050 2,000 2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
rsp — retail selling prices
Source: Key Note
FUTURE TRENDS Industry Consolidation 2009 was a particularly difficult year for the food industry in general, as cash-strapped consumers looked to save money during the worst of the recession. The snack foods market has also been hard hit by huge rises in commodity costs for items such as potatoes, peanuts and sunflower oil. Consequently, there have been corporate casualties that competitors have been quick to snap up. This trend is likely to continue into 2010, as any recovery from the recession will be gradual, and snack companies with access to funds are likely to take advantage of distress purchases, meaning that the industry will see further consolidation.
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Overseas Markets The food and drink industries of the ten countries that joined the EU in 2004 have been transformed by the expansion of Europe’s borderless market, while the process is also evident in Bulgaria and Romania, which joined in 2007. Turkey is endeavouring to accede to the EU and benefit from the single market but manufacturers are also looking further afield for new markets to penetrate as the incidence of snacking increases in, for example, Latin America and North Africa. Largo Foods of the Republic of Ireland has a joint venture in Libya and has set up a production facility in Tripoli to avoid the fact that imported snack foods into the country carry a 20% duty. Certainly, as the food industry becomes ever more global, it is likely that UK manufacturers may increasingly set up local production facilities to bypass such regulations and take advantage of lower production costs.
Health Issues The healthier ranges of lower-fat and lower-sodium content have been drivers of growth in savoury snacks over recent years, and the sector is subject to significant new product development (NPD), even if critics argue that ‘better-for-you’ alternatives compromise on taste. In fact, with manufacturers turning their efforts to developing healthier formulations through the use of different cooking oils, etc., the divide between regular and ‘healthy’ is likely to continue to narrow as sales of the former cannibalise those of the latter, to some extent.
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Company Profiles
11. Company Profiles INTRODUCTION The following section contains financial profiles of some of the principal companies identified as operating within the market sector discussed in this report. The financial results of some of the important names within the sector may not be reported if: • their principal activities are so varied that their results are not considered applicable to the survey • they are no longer trading as separate companies • their financial data are very out of date.
DEFINITIONS A company which has a ‘Y’ consolidated value has filed consolidated accounts for the relevant year. † — denotes that the growth rate calculation is invalid, because the figures either move from positive to negative or from negative to positive.
Turnover (Sales) This includes all income derived from the principal activities of the firm, net of VAT. It encompasses UK sales, exports and overseas and intercompany sales.
Pre-Tax Profit The net trading profit figure after deduction of all operating expenses, including depreciation and finance charges but before deduction of tax, dividends, subventions or group relief, and other appropriations. Where applicable, it will include the share of profits and losses of associated companies. Items described by the company as exceptional are included; extraordinary items are excluded.
Profit Margin Pre-tax profit expressed as a percentage of sales.
Average Remuneration Total employee remuneration divided by the number of employees.
Sales per Employee Sales divided by the number of employees.
FURTHER INFORMATION For more detailed financial information telephone ICC Customer Services on: 020-7426 8855
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INTERSNACK LTD Registered Office
Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company
Unit BT95-4 Tanfield Lea Industrial Estate Stanley County Durham, DH9 9XS Telephone: 0118-958 0163 01237998 18/12/75 Intersnack International BV Intersnack Knabber-Gerback Unternehmensverwaltungs GmbH & Co
Previous Name(s) and Date(s) of Change Vico Foods (UK) Ltd (18/04/00) Janeshourne Ltd (31/12/76)
Principal Activities A group engaged in import and distribution of snack products.
SIC Code 51390, Non-specialised wholesale of food, beverages and tobacco.
Structure Intersnack UK is a part of the Germany-based Intersnack Knabber-Gebäck GmbH, and has its headquarters in County Durham. It owns a stake in the Irish company Largo Food Exports Ltd, which owns the Tayto brand in the Republic of Ireland.
Brand Information Intersnack brands include Pom-Bear, Mr Mash and Penn State pretzels. In June 2009, it also acquired Percy Dalton’s Famous Peanut Co. Ltd — a supplier of branded and own-brand nut, seed and dried fruit products.
Recent Developments In June 2009, Intersnack UK ran a competition whereby entrants suggested their perfect night in. Winners were treated to a return flight for two to New York and a 4-night stay in one of the City’s hotels.
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FINANCIAL PROFILE Year End Weeks Consolidated
31/12/08 52 Y
31/12/07 52 Y
31/12/06 52 N
31/12/05 52 N
24,919 9.24 700 2.81
22,811 126.21 1,196 5.24
10,084 413 4.10
-
-565 † -2.27 299
668 -26.43 2.93 1,619
908 226.62 9.00 937
278 297
242 21,475 102,971 -2,335 61,802
219 20,922 104,160 3,050 72,845
55 26,491 183,345 16,509 20,945
53 23,453 5,245 21,340
14,956 -3.78 -5,709 1.01 0.71
15,953 4.19 -5,674 1.10 0.86
1,152 78.82 589 1.43 1.27
1,131 24.58 -22 1.65 1.45
Sales Sales (£000) % change year-on-year Exports (£000) Exports/Sales (%)
Profits Pre-Tax Profit (£000) % change year-on-year Profit Margin (%) Operating Profit (£000)
Employees Number of Employees Average Employee Remuneration (£) Sales per Employee (£) Profit per Employee (£) Capital Employed per Employee (£)
Balance Sheet/Ratios Capital Employed (£000) Return on Capital (%) Net Worth (£000) Current Ratio Liquidity Ratio
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SEABROOK CRISPS LTD Registered Office
Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company
Seabrook House Duncombe Street Bradford West Yorkshire, BD8 9AJ Telephone: 01274-546 405 00472391 31/08/49 RJJ Management Ltd Seabrook Group Ltd
Previous Name(s) and Date(s) of Change Seabrook Potato Crisps Ltd (26/08/04)
Principal Activities The manufacture and distribution of potato crisps.
SIC Code 15310, Processing and preserving of potatoes.
Structure The family-owned business of Seabrook Crisps has been producing crisps in the North of England since 1945.
Brand Information Seabrook now outsells all brands except Walkers in Yorkshire, Lancashire and north east England. Brands include Seabrook and Hot & Spicy.
Recent Developments Seabrook Crisps is experiencing ongoing record sales figures, having added 5,000 national stockists (including 50 Waitrose stores in the south of England) and invested £4m in new production lines.
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FINANCIAL PROFILE Year End Weeks Consolidated
30/09/08 52 N
30/09/07 52 N
30/09/06 52 N
30/09/05 52 N
15,389 18.64 -
12,971 -13.76 -
15,041 -5.71 -
15,952 -
750 † 4.87 725
-1,924 † -14.83 -1,998
580 -42.63 3.86 518
1,011 6.34 970
2 7,694,500 375,000 1,573,000
119 19,630 109,000 -16,168 21,429
147 20,415 102,320 3,946 27,918
151 20,298 105,642 6,695 25,132
3,146 23.84 3,101 1.89 1.72
2,550 -75.45 2,550 1.71 1.51
4,104 14.13 3,908 2.79 2.63
3,795 26.64 3,515 2.12 1.99
Sales Sales (£000) % change year-on-year Exports (£000) Exports/Sales (%)
Profits Pre-Tax Profit (£000) % change year-on-year Profit Margin (%) Operating Profit (£000)
Employees Number of Employees Average Employee Remuneration (£) Sales per Employee (£) Profit per Employee (£) Capital Employed per Employee (£)
Balance Sheet/Ratios Capital Employed (£000) Return on Capital (%) Net Worth (£000) Current Ratio Liquidity Ratio
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TAYTO (NI) LTD Registered Office Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company
Castle Factory Tandragee County Armagh, BT62 2AB NI003670 06/04/56 None Manderley Food Group Ltd
Previous Name(s) and Date(s) of Change None.
Principal Activities The manufacture and distribution of potato crisps and snack foods.
SIC Code 15310, Processing and preserving of potatoes.
Structure Tayto (NI) Ltd is the long-established market leader in the snacks industry in Northern Ireland. The family-owned concern, based in County Armagh, was founded in 1956. Tayto has made various acquisitions in recent years, including Golden Wonder and, more recently, Jonathan Crisp.
Brand Information Brands include Tayto, Golden Wonder, Mr Porky pork scratchings and Jonathan Crisp. (The Tayto name in the Republic of Ireland is owned by Largo Food Exports, in which the German snack company Intersnack Knabber-Gebäck GmbH & Co. KG has a share.)
Recent Developments Following Tayto’s acquisition of Red Mill Snack Foods in 2008, it has been disclosed that the Red Mill factory in Wednesbury will close by 2011. Production is to move to the company’s base in Corby, where it is understood that there will be opportunities for some of the 300-plus employees facing redundancy from the Wednesbury factory.
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FINANCIAL PROFILE Year End Weeks Consolidated
05/07/08 53 N
30/06/07 52 N
01/07/06 52 N
02/07/05 52 N
26,196 9.25 -
23,978 -0.46 -
24,089 21.59 -
19,812 -
371 † 1.42 890
-143 † -0.60 350
178 † 0.74 809
-762 -3.85 -301
374 18,885 68,721 973 52,024
382 18,128 62,770 -374 36,945
381 17,808 63,226 467 36,281
386 14,653 51,326 -1,974 34,070
19,457 1.91 10,382 1.32 1.12
14,113 -1.01 10,466 0.90 0.72
13,823 1.29 9,452 0.88 0.71
13,151 -5.79 9,435 0.88 0.68
Sales Sales (£000) % change year-on-year Exports (£000) Exports/Sales (%)
Profits Pre-Tax Profits (£000) % change year-on-year Profit Margin (%) Operating Profit (£000)
Employees Number of Employees Average Employee Remuneration (£) Sales per Employee (£) Profit per Employee (£) Capital Employed per Employee (£)
Balance Sheet/Ratios Capital Employed (£000) Return on Capital (%) Net Worth (£000) Current Ratio Liquidity Ratio
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UNITED BISCUITS TOPCO LTD Registered Office
Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company
Hayes Park Hayes End Road Hayes Middlesex, UB4 8EE 05957921 05/10/06 United Biscuits Luxco SCA United Biscuits Luxco SCA
Previous Name(s) and Date(s) of Change Precis (2648) Ltd (17/11/06)
Principal Activities A group engaged in the manufacture and sale of a wide range of food products including biscuits and savoury snacks.
SIC Codes 15820, Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes. 15310, Processing and preserving of potatoes.
Structure United Biscuits (UB) was founded in 1948 following the merger of two Scottish family businesses — McVitie & Price and MacFarlane Lang. In October 2006, UB agreed a £1.6bn takeover deal with Paribas Affaires Industrielles (PAI) and US-based equity investment firm Blackstone Group.
Brand Information UB’s brands of relevance to this report include McCoy’s, Phileas Fogg, Twiglets, Hula Hoops, KP, Mini Cheddars, Skips, Nik Naks and go ahead!
Recent Developments In 2009, UB acquired a manufacturing facility in India in anticipation of a market launch in the country. It is also said to be considering plans to outsource up to 125 of the 750 jobs at its Aintree factory to India.
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FINANCIAL PROFILE Year End Weeks Consolidated
03/01/09 53 Y
29/12/07 52 Y
1,201,400 5.17 -
1,142,300 -
-16,600 † -1.38 128,400
-11,200 -0.98 150,600
8,477 28,530 139,051 -1,921 201,852
8,726 26,003 130,908 -1,284 190,821
1,711,100 -0.95 -1,239,700 1.09 0.92
1,665,100 -0.67 -1,154,900 1.10 0.93
Sales Sales (£000) % change year-on-year Exports (£000) Exports/Sales (%)
Profits Pre-Tax Profit (£000) % change year-on-year Profit Margin (%) Operating Profit (£000)
Employees Number of Employees Average Employee Remuneration (£) Sales per Employee (£) Profit per Employee (£) Capital Employed per Employee (£)
Balance Sheet/Ratios Capital Employed (£000) Return on Capital (%) Net Worth (£000) Current Ratio Liquidity Ratio
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WALKERS SNACK FOODS LTD Registered Office
Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company
1600 Arlington Business Park Theale Reading Berkshire, RG7 4SA Telephone: 0118-930 6666 02333074 09/01/89 PepsiCo Holdings PepsiCo Inc
Previous Name(s) and Date(s) of Change Walkers Snack Foods Ltd (23/04/99) Walkers Smiths Snack Foods Ltd (01/01/95) Walkers Crisps Holdings Ltd (04/11/92) Precis (679) Ltd (06/06/89)
Principal Activities The manufacture of snack products for fellow group companies.
SIC Code 15310, Processing and preserving of potatoes.
Structure Walkers was established as a pork butchery business in the 1880s, and it diversified into making potato crisps when meat was in short supply after the Second World War. Walkers merged with Smiths in 1979, and the US-based PepsiCo Inc acquired both companies in 1989. Walkers is now the UK’s leading manufacturer of savoury snacks.
Brand Information Walkers crisps come in a wide variety of flavours, and the company also manufactures healthier variants — Walkers Lights and Walkers Baked — as well as premium ranges, Walkers Max and Sensations. Other brands owned by the company include Quavers, Monster Munch, Wotsits and Doritos.
Recent Developments In July 2009, Walkers Snack Foods announced the creation of 50 jobs at its crisps factory in Leicester, following a £2m investment in new equipment. It has said that it is committed to continuing investment in its site in Beaumont Leys, Leicester, which is its largest UK site employing nearly 2,000 people. Walkers has added its Builder’s Breakfast variant as a permanent flavour following the ‘Do us a Flavour’ competition that invited people to invent a new flavour for its crisps.
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FINANCIAL PROFILE Year End Weeks Consolidated
27/12/08 52 N
29/12/07 52 N
30/12/06 52 N
31/12/05 53 N
223,481 13.47 -
196,947 13.03 -
174,238 5.80 -
164,688 -
31,052 3.39 13.89 14,381
30,034 70.54 15.25 10,123
17,611 † 10.11 1,802
-13,037 -7.92 -14,940
3,001 31,364 74,469 10,347 195,352
2,777 36,923 70,921 10,815 202,863
2,696 32,604 64,628 6,532 186,113
2,824 28,313 57,217 -4,529 174,232
586,252 5.30 490,320 0.73 0.68
563,350 5.33 461,823 2.82 2.78
501,761 3.51 398,904 0.41 0.36
492,031 -2.60 392,022 0.62 0.57
Sales Sales (£000) % change year-on-year Exports (£000) Exports/Sales (%)
Profits Pre-Tax Profit (£000) % change year-on-year Profit Margin (%) Operating Profit (£000)
Employees Number of Employees Average Employee Remuneration (£) Sales per Employee (£) Profit per Employee (£) Capital Employed per Employee (£)
Balance Sheet/Ratios Capital Employed (£000) Return on Capital (%) Net Worth (£000) Current Ratio Liquidity Ratio
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Company Financials
12. Company Financials The following companies, listed in alphabetical order, are taken from the ‘my ICC’ database. ICC’s links with Companies House mean that when the latest accounts for a company are made available, they can be incorporated on our database and be ready for inclusion in Key Note Market Report Plus. A short delay occurs at Companies House between receipt of documents and their public release. As this delay can be longer, the availability of accounts can sometimes be affected. It should be noted that the financial results for certain companies are not restricted to sales of the products covered by this report.
Turnover (£000)
Pre-Tax Profit (£000)
Year End
Bahlsen Ltd
21,626
2,425
31/12/08
Bobby’s Foods PLC
34,640
495
30/09/08
Bombay Halwa Ltd
16,393
521
31/12/08
90
-1,433
26/12/08
45,906
-2,449
31/12/08
4,996
-397
31/12/08
24,919
-565
31/12/08
68
3
28/03/08
58,997
10,878
30/09/08
7,931
9,754
31/03/08
Natco Foods Ltd
55,994
169
31/12/08
Pasta Foods Ltd
21,646
99
02/05/09
Percy Dalton’s Famous Peanut Co Ltd
27,421
-1,556
30/03/08
Prima Quality Foods PLC
11,323
182
31/03/09
Red Mill Snack Foods Ltd
47,581
-1,024
30/06/08
RM Curtis & Company Ltd
20,257
165
31/12/08
S&B Herba Foods Ltd
88,065
7,366
31/12/08
Seabrook Crisps Ltd
15,389
750
30/09/08
Sun Valley Ltd
26,227
-259
31/12/08
Tayto (NI) Ltd
26,196
371
05/07/08
Trigon Snacks Ltd
18,286
60
31/12/08
Company
Del Monte Foods International Ltd Discovery Foods Ltd Highlander Snacks Ltd Intersnack Ltd Kent Bacon Dryers Ltd Kettle Foods Ltd Napier Brown Holdings Ltd
© Key Note Ltd 2010
87
Company Financials
Snack Foods
Turnover (£000)
Pre-Tax Profit (£000)
Year End
Unilever Bestfoods UK Ltd
141,995
49,775
31/12/08
United Biscuits (UK) Ltd
999,400
60,900
03/01/09
United Biscuits Topco Ltd
1,201,400
-16,600
03/01/09
Walkers Snack Foods Ltd
223,481
31,052
27/12/08
Company
Name changes: — W Jordan (Cereals) Ltd is now W Jordan & Son (Silo) Ltd Non-trading: — G Costa & Company Ltd — PepsiCo Foods & Beverages International Ltd — Sunscoop Products Ltd — Union Snack Ltd
88
© Key Note Ltd 2010
Snack Foods
Further Sources
13. Further Sources Associations British Retail Consortium 21 Dartmouth Street London, SW1H 9BP Telephone: 020-7854 8900 Fax: 020-7854 8901 http://www.brc.org.uk European Snacks Association 6 Catherine Street London, WC2B 5JJ Telephone: 020-7420 7220 Fax: 020-7420 7221 E-mail:
[email protected] http://www.esa.org.uk The Food Commission (UK) Ltd 94 White Lion Street London, N1 9PF http://www.foodcomm.org.uk Food and Drink Federation 6 Catherine Street London, WC2B 5JJ Telephone: 020-7836 2460 Fax: 020-7836 0580 E-mail:
[email protected] http://www.fdf.org.uk
Snack Food Association 1600 Wilson Boulevard Suite 650 Arlington, VA 22209 US Telephone: 001-70 3836 4500 Fax: 001-70 3836 8262 http://www.sfa.org Snack, Nut and Crisp Manufacturers Association 6 Catherine Street London, WC2B 5JJ Stroke Association Stroke House 240 City Road London, EC1V 2PR Telephone: 020-7566 0300 Fax: 020-7490 2686 E-mail:
[email protected] http://www.stroke.org.uk
The Guild of Fine Food Station Road Wincanton Somerset, BA9 9FE Telephone: 01963-824 464 Fax: 01963-824 651 http://www.finefoodworld.co.uk
© Key Note Ltd 2010
89
Further Sources
Snack Foods
General Sources BMRB International Ealing Gateway 26-30 Uxbridge Road Ealing London, W5 2BP Telephone: 020-8433 4000 Fax: 020-8433 4001 http://www.bmrb.co.uk ICC Ltd Field House 72 Oldfield Road Hampton Middlesex, TW12 2HQ Telephone: 020-8481 8800 Fax: 020-8941 6014 E-mail:
[email protected] http://www.icc.co.uk http://www.icc-credit.co.uk ICC provides in-depth, business-critical information for risk and credit decision-making. A range of flexible online tools provide access to the most comprehensive content on all UK and Irish businesses. ICC offers access to information through high-speed online delivery tools: • my ICC • my ICC credit management • Plum.
90
The data include: • access to over 370 million original document images • information on individual directors, shareholders, stakeholders and consumers • information on limited and non-limited companies • analysed financial, risk and business information reports • industry information for benchmarking. Nielsen Media Research Atrium Court The Ring Bracknell Berkshire, RG12 1BZ Telephone: 01344-469 100 Fax: 01344-469 102 E-mail: mediacommunicationuk @nielsen.com http://www.nielsenmedia.co.uk NEMS Market Research 22-23 Manor Way Belasis Hall Technology Park Billingham, TS23 4HN Telephone: 01642-373 355 Fax: 01642-373 350 http://www.nemsmr.co.uk
© Key Note Ltd 2010
Snack Foods
Further Sources
Government Sources Australian Bureau of Statistics ABS House 45 Benjamin Way Belconnen, ACT 2617 Australia http://www.abs.gov.au Department for Business, Innovation and Skills 1 Victoria Street London, SW1H 0ET http://www.foresight.gov.uk • Foresight Tackling Obesities: Future Choices
HM Treasury 1 Horse Guards Road London, SW1A 2HQ Telephone: 020-7270 4558 Fax: 020-7270 4861 http:/www.hm-treasury.gov.uk • Forecasts for the UK Economy, November 2009
European Commission 8 Storey’s Gate London, SW1P 3AT Telephone: 020-7973 1992 http://ec.europa.eu
National Statistics 1 Drummond Gate London, SW1V 2QQ Telephone: 020-7533 5888 Fax: 01633-812 599 http://www.statistics.gov.uk • Consumer Trends, Quarter 2 2009 • Economic & Labour Market Review, November 2009 • Family Spending 2008 • Monthly Digest of Statistics, November 2009 • Population Projections Database (2008-based projections) • PRODCOM PRA15310 • UK Business: Activity, Size and Location 2009
Food Standards Agency Aviation House 125 Kingsway London, WC2B 6NH Telephone: 020-7276 8000 http://www.food.gov.uk
Office of Fair Trading Fleetbank House 2-6 Salisbury Square London, EC4Y 8JX Telephone: 020-7211 8000 http://www.oft.gov.uk
Department of Health Richmond House 79 Whitehall London, SW1A 2NS • Health Survey for England
© Key Note Ltd 2010
91
Further Sources
Snack Foods
Other Sources Information Resources Inc Eagle House Bracknell Berkshire, RG12 1HS Telephone: 01344-746 000 Fax: 01344-746 001 http://www.infores.co.uk Leatherhead Food International Ltd Randalls Road Leatherhead Surrey, KT22 7RY Telephone: 01372-376 761 Fax: 01372-386 228 E-mail:
[email protected] http://www.leatherheadfood.com
Nielsen Nielsen House London Road Headington, Oxford, OX3 9RX Telephone: 01865-742 742 Fax: 01865-732 461 http://www.nielsen.com • Nielsen MarketTrack • Nielsen ScanTrack NPD Group 900 West Shore Road Port Washington, NY 11050 Telephone: 001-51 6625 0700 Fax: 001-86 6444 1411 E-mail:
[email protected] http://www.npd.com
Key Note Sources Key Note Ltd Field House 72 Oldfield Road Hampton Middlesex, TW12 2HQ Telephone: 020-8481 8750 Fax: 020-8783 0049 E-mail:
[email protected] http://www.keynote.co.uk
Key Note Market Reports • Bread & Bakery Products • Soup Market £460 each Invaluable aids to anyone needing to gain a highly detailed understanding of a specific market for more informed decision-making.
92
Key Note Market Reports Plus • Biscuits & Cakes • Canned Foods • Chilled Foods • Confectionery • Fast Food & Home Delivery Outlets • Frozen Foods • Ice Creams & Frozen Desserts • Ready Meals • Sauces & Spreads £605 each Concentrating on more dynamic consumer markets, these offer the same incisive market intelligence as Market Reports, but include additional chapters and primary research data.
© Key Note Ltd 2010
Snack Foods
Further Sources
Key Note Market Reviews • Catering Market • Food Market £750 each Focusing on the bigger picture, Key Note Market Reviews are designed to inform you of developments and opportunities across entire industry sectors.
Key Note Market Assessments • Cooking & Eating Habits • Diet Foods • Functional Foods • Healthy Eating • Low-Fat & Low-Sugar Foods • Sweet & Salty Snacks • Trends in Food Shopping £899 each Providing in-depth strategic analysis and including primary research, these premium reports examine the scope, dynamics and shape of key UK and European markets, with a particular focus on financial services, consumer and lifestyle sectors.
Key Note Market Focus Reports £699 each/£999 set of 10 volumes Please contact
[email protected] for sector-specific individual volume prices. Top Markets and Market Forecasts add a further dimension to the Key Note range, providing an in-depth, strategic and global view of key industries. Compiled using Key Note Market Reports, Market Report Plus and Market Assessments published in the previous year, Top Markets and Market Forecasts are an indispensable and authoritative mini business library, providing a one-stop shop for all your research needs. Other Market Focus reports are created in conjunction with specialist authors, consultancies and industry experts whose wealth of knowledge is vital in publishing this type of report.
Key Note Financial Survey Reports • Baking Industry • Food Processors • Frozen Food Industry • Grocery Wholesalers & Supermarkets £420 each For each key industry sector, there is a detailed Financial Survey report, bringing you invaluable financial information and contact details. You can choose from approximately 90 industry sectors where thousands of companies are profiled in each report.
© Key Note Ltd 2010
93
Further Sources
Snack Foods
Key Note Business Ratio Reports
Key Note Bespoke Data Service
• Confectionery Manufacturers • The Food Ingredients Industry • Frozen Food Distributors • Frozen Food Producers • Grocery Wholesalers £365 each
As well as choosing the companies you want to analyse, you can also choose exactly what performance information you need on them — with our Bespoke Data Service. We will be able to provide you with information covering the companies, sectors, performance figures, ratios and other data items specific to your individual requirements alone. Even historical figures can be provided.
Over 148 titles evaluating each UK industry sector. They compare, contrast, analyse and comment on the financial performance of the leading companies in each marketplace.
Key Note UKplc Report UKplc is an indispensible guide for managers and for those interested in gaining a greater insight into the financial performance of an average company operating in each of the main industries in the UK. Providing up-to-date information and analysis, the publication will allow the reader to gain a greater level of market intelligence as well as a good knowledge of the current state of the UK industry.
Key Note Regional Leads Reports £420 For each region of Great Britain, there is a detailed Regional Leads Report, bringing you invaluable financial information and contact details for thousands of companies, which are profiled in each report.
Contact us for more information:
[email protected]
Key Note Carnet A service that offers a discount on multiple report purchases. Contact us for further details:
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Key Note Research Consultancy We can offer a full-service bespoke solution for any research requirements not covered by the published report range. Our comprehensive market research and information consultancy service is managed in house. Contact us for more information:
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You can also choose from these further services:
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© Key Note Ltd 2010
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Understanding TGI Data
Understanding TGI Data TGI tables, produced by BMRB International Ltd, are generally based on one of the following groups: • Households — a private household consists of either one person living alone or a group of people, usually, but not always, members of one family, who live together and whose food and other household expenses are managed as one unit. • Adults — any person aged 15 or over. • Housewives — a member of a private household who is solely or mainly responsible for the household duties.
Number, Profile, Penetration Tables used in Key Note reports may give figures for the Number, Profile, and/or Penetration. These terms are explained in the following table. The total number of adults, housewives, households, etc.
Across
Table Heading Population
All housewives
The % of 15-24 year-olds, etc. who are users.
Number (000)
20,371
13,535
Profile (%) 100.0
Penetration (%) 66.4
Age 15-24 25-34 Social Grade AB C1 Region
This is the projected number of people in each subgroup who use the product.
1,045
7.7
0.03
2,697
19.9
12.1
Down The % of each subgroup who are users. Each subgroup should total 100% vertically.
.0
61.5
.0
71.9
Greater London
2,557
10.4
55.2
Source: Target Group Index, © BMRB International, 1995
TGI data used in Key Note reports are broken down by age, social grade and standard region.
© Key Note Ltd 2010
95
Understanding TGI Data
Snack Foods
Social Grade This is normally based on the occupation of the Head of the Household, or if the Head of the Household is retired, their former occupation. If this information is not available, social grade is based on environmental factors such as type of dwelling, amenities in the home, presence of domestic help, etc. Social grade is assessed by the interviewer when collecting the information and is, therefore, based on information given personally and verbally by the respondent. Social grade is checked by BMRB’s coding and editing office. The following table broadly defines the six social grades used. The relationship between social grade and net income of the Head of the Household is a complex one and readers should note that income is not determinant of social grade. Social Grade Social Status
Head of Household’s Occupation
A
Upper middle class
Higher managerial, administrative or professional
B
Middle class
Intermediate managerial, administrative or professional
C1
Lower middle class
Supervisory or clerical and junior managerial, administrative or professional
C2
Skilled working class
Skilled manual workers
D
Working class
Semi and unskilled workers
E
Those at lowest levels of subsistence (no other earner)
State pensioners or widows
Standard Region This is as defined by the Registrar-General.
96
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Key Note Research
Key Note Research Key Note is a leading supplier of market information, publishing an extensive range of consumer, industrial, business-to-business and services titles. With over 25 years’ experience, Key Note represents clear, concise, quality market information. For all reports, Key Note undertakes various types of research: Online searching is carried out by product code or free search method, and covers the period from the last edition of the report to the current day. The internal ’my ICC’ service is used to select company information relevant to the particular report. The financial information extracted may then be backed up by further online searching on particular companies. Trade sources, such as trade associations, trade journals and specific company contacts, are invaluable to the Key Note research process. Secondary data are provided by Kantar Media (TGI) and Nielsen Media Research for consumer/ demographic information and advertising expenditure, respectively. In addition, various official publications published by National Statistics, etc. are used for essential background data and market trends. Interviews are undertaken by Key Note for various reports, either face-to-face or by telephone. This provides qualitative data (‘industry comment’) to enhance the statistics in reports; questionnaires may also be used. Field research is commissioned for various consumer reports and market reviews, and is carried out by NEMS Market Research. Key Note estimates are derived from statistical analysis and trade research carried out by experienced research analysts. Up-to-date figures are inserted where possible, although there will be some instances where a realistic estimate cannot be made or external sources request that we do not update their figures. Key Note Editorial, 2010
© Key Note Ltd 2010
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Key Note Research
98
Snack Foods
© Key Note Ltd 2010
Snack Foods
The Key Note Range of Reports
The Key Note Range of Reports Key Note publishes over 180 titles each year, across both the Key Note and Market Assessment product ranges. The total range covers consumer, lifestyle, financial services and industrial sectors. Title
Edition
Published
Access Control
10
2008
Accountancy
13
2009
Aerospace
12
2003
Agrochemicals & Fertilisers
3
2002
Air Freight
2
2005
Airlines
21
2010
Airports
14
2010
Animal Feedstuffs
11
2001
3
2008
Automatic Vending
24
2010
Automotive Services
7
2010
19
2009
14
2009
2
2007
Betting & Gaming
22
2009
Biscuits & Cakes
16
2009
Book Publishing
19
B
Baths & Sanitaryware Bearings
Published
23
2009
9
2001
Closed-Circuit Television
11
2009
Clothing Manufacturing
15
2008
Clothing Retailing
7
2009
Commercial Radio
8
2004
Commercial Vehicles
15
2009
Computer Hardware
8
2010
Computer Services
8
2008
Cinemas & Theatres
A
Autoparts
Edition
Cigarettes & Tobacco
Market Reports and Reports Plus
Arts & Media Sponsorship
Title
Computer Software
7
2008
28
2010
4
2000
17
2010
4
2009
Contract Catering & Foodservice Management
21
2010
Contract Cleaning
Confectionery Consumer Internet Usage Consumer Magazines Contraception
21
2010
Cooking Sauces & Food Seasonings
3
2008
2007
Corporate & Promotional Giftware
3
2008
6
2007
22
2009
8
2010
15
2008
3
2004
Bookselling
16
2009
Corporate Hospitality
Bread & Bakery Products
24
2009
Cosmetics & Fragrances
Breakfast Cereals
14
2009
Cosmetic Surgery
Breweries & the Beer Market
27
2008
Courier & Express Services
Bricks & Tiles
15
2008
D
5
2010
Dark Spirits & Liqueurs
Builders’ Merchants
16
2008
Building Contracting
10
2009
Debt Management (Commercial & Consumer)
Building Materials
13
2008
9
2008
14
2009
Bridalwear
Bus & Coach Operators Business Press C
Cable & Satellite TV
10
2004
Camping & Caravanning
13
2002
Canned Foods
17
2009
Carpets & Floorcoverings
16
2009
Catering Equipment
13
2010
Chemical Industry
13
2010
Childrenswear
8
2009
Chilled Foods
15
2009
China & Earthenware
27
2010
© Key Note Ltd 2010
5
2008
Defence Equipment
11
2010
Design Consultancies
3
2000
Digital Broadcasting
4
2009
Digital Communications
1
2009
Digital TV
2
2003
19
2009
Direct Marketing Discount Retailing Disposable Paper Products Document Imaging Systems Domestic Heating Dry Cleaning & Laundry Services
7
2009
13
2009
1
2007
14
2009
5
2005
99
The Key Note Range of Reports
Title
Snack Foods
Edition
Published
E
Title
Edition
Published
Household Appliances (Brown Goods)
11
2008
Household Appliances (White Goods)
16
2008
Household Detergents & Cleaners
16
2009
Household Furniture
18
2008
Electrical Contracting
9
2009
Electrical Wholesale
5
2009
Electricity Industry
6
2009
Electronic Component Distribution
12
2002
Electronic Component Manufacturing
11
2002
I
4
2003
Ice Creams & Frozen Desserts
14
2010
5
2009
Industrial Fasteners
8
2001
12
2003
Industrial Pumps
5
2000
8
2001
12
2009
8
2005
IT Security
9
2009
IT Training
12
2009
25
2009
7
2009
Electronic Games Equipment for the Disabled Equipment Leasing Estate Agents
17
2008
Industrial Valves
Ethnic Foods
15
2009
Insurance Companies
2009
Internet Usage in Business
Exhibitions & Conferences
11
F
Factoring & Invoice Discounting Fast Food & Home Delivery Outlets The Film Industry
2
2003
23
2008
Jewellery & Watches
J
4
2002
K
11
2000
Kitchenware
8
2006
14
2010
Fitted Kitchens
7
2007
Football Clubs & Finance
4
2009
Footwear
16
2009
Franchising
12
2010
8
2004
Freight Forwarding
17
2009
Frozen Foods
24
2009
Fruit Juices & Health Drinks
12
2008
Fruit & Vegetables
21
2009
6
2009
13
2009
5
2009
Giftware
18
2009
Glassware
15
2009
Greetings Cards Plus
25
2009
15
2010
9
2009
22
2003
Finance Houses Fire Protection Equipment Fish & Fish Products
Free-To-Air TV
Further & Higher Education G
Garden Equipment Gas Industry
H
Hand Luggage & Leather Goods Health Clubs & Leisure Centres Health Foods Heating, Ventilating & Air Conditioning
9
2002
Home Furnishings
19
2009
Home Shopping
13
2009
Horticultural Retailing
17
2008
Hotels
24
2009
Housebuilding
19
2009
100
L
Laboratory Equipment
9
2008
14
2002
9
2010
10
2003
1
2005
Meat & Meat Products
20
2009
Medical Equipment
17
2009
Lighting Equipment Lingerie M
Management Consultants Market Forecasts
Metal Recycling
5
2009
23
2009
Mobile Phones
7
2010
Mobile Telecommunications
2
2007
2
2007
Milk & Dairy Products
N
Natural Products New Media Marketing
3
2002
17
2008
2
2008
21
2008
5
2009
Ophthalmic Goods & Services
16
2008
OTC Pharmaceuticals
14
2010
Own Brands
12
2007
Newspapers Non-Metal Recycling O
Office Furniture Offshore Oil & Gas Industry
© Key Note Ltd 2010
Snack Foods
Title
The Key Note Range of Reports
Edition
Published
Edition
Published
6
2010
Take Home Trade
17
2008
Packaging (Glass)
13
Packaging (Metals & Aerosols)
12
2008
Telecommunications
21
2007
2003
Timber & Joinery
19
2008
Packaging (Paper & Board) Packaging (Plastics)
14
2008
Toiletries
23
2010
15
2010
Tourist Attractions
5
2001
Paper & Board Manufacturing
14
2002
Toys & Games
23
2009
Personal Banking
11
2000
Training
18
2009
Photocopiers & Fax Machines
14
2005
Plant Hire
13
2007
Travel Agents & Overseas Tour Operators
22
2009
10
2003
Tyre Industry
4
2008
Poultry
3
2008
V
Power Tools
5
2007
Vehicle Security
9
2010
Premium Lagers, Beers & Ciders
8
2009
Videoconferencing
4
2007
8
2005
P
Packaging (Food & Drink)
Plastics Processing
Title T
Printing
15
2010
Video & DVD Retail & Hire
Private Healthcare
20
2009
W
7
2009
Wallcoverings & Ceramic Tiles
17
2006
26
2010
Waste Management
10
2010
5
2010
7
2008
Windows & Doors
19
2008
Wine
20
2009
1
2005
Catering Market
21
2009
Clothing & Footwear Industry
12
2008
UK Computer Market
11
2004
Construction Industry
Protective Clothing & Equipment Public Houses
Water Industry
R
Rail Travel Ready Meals
11
2009
Recruitment Agencies (Permanent)
10
2010
Recruitment Agencies (Temporary & Contract)
10
2010
3
2009
Restaurants
24
2009
Retail Chemists & Drugstores
16
2010
Road Haulage
22
2009
Sauces & Spreads
11
2008
Shopfitting
14
2009
Short Break Holidays
4
2001
Slimming Market
8
2000
Renewable Energy
White Spirits
S
Small Domestic Electrical Appliances
12
2010
Snack Foods
20
2010
Soft Drinks (Carbonated & Concentrated)
17
2008
3
2009
Sports Clothing & Footwear
12
2009
Sports Equipment
15
2009
Sports Sponsorship
7
2009
24
2008
Soup Market
Stationery (Personal & Office)
© Key Note Ltd 2010
Market Reviews
11
2009
Contracted-Out Services
3
2007
Defence Industry
7
2003
Distribution Industry
10
2009
DIY & Home Improvements Industry
11
2009
Drinks Market
18
2008
Energy Industry
8
2010
Film Market
2
2009
Food Industry
19
2009
Healthcare Market
10
2005
Insurance Industry
10
2009
The Legal Services Market
1
2005
15
2005
Leisure in the Home
2
2008
Leisure Outside the Home
2
2008
Local Government Services
3
2010
Mechanical Handling
1
2001
Motor Industry
12
2008
Music Industry
2
2010
Office Equipment Industry
9
2010
Packaging (Food & Drink) Industry
1
2003
Leisure & Recreation Market
101
The Key Note Range of Reports
Title
Snack Foods
Edition
Published
Passenger Travel in the UK
5
2007
Pharmaceuticals Industry
6
2008
Process Plant Industry
1
2000
13
2010
Railway Industry
2
2006
Security Industry
13
2010
Sports Market
13
Travel & Tourism Market
Publishing Industry
UK Internet Market
Title
Edition
Published
Customer Loyalty in Financial Services
2000
Customer Magazines & Contract Publishing
2009
Customer Relationship Management
2008
2010
Customer Services in Financial Organisations
2010
16
2009
C2DE Consumer
2008
1
2009
Market Assessment Reports
D
Diet Foods
2009
DINKY Market
2007
2008
Direct Insurance
2010
Activity Holidays
2009
Direct Mortgages
2008
Advertising Agencies
2007
All-Inclusive Holidays
2000
Domestic Lighting and Electrical Products
2000
Alternative Healthcare
2010
Domestic Telecommunications
2006
Audio-Visual Retailing
2000
E
A
ABC1 Consumer
B
Baby Foods
2006
Baby Products
2008
Baths and Showers
2000
Beds, Bedrooms and Upholstered Furniture
2000
Betting and Gaming
2002
Book Retailing on the Internet
2007
Bottled Water
2003
Bridalwear
2002
Business Postal Services
2008
B2B Marketing
2008
Business Travel Market
2008
C
E-Commerce: The Internet Grocery Market
2009
E-Commerce: The Internet Leisure & Entertainment Market
2008
Electronic Banking
2008
EMU — The Impact on the UK Financial Services Industry
2003
E-Recruitment
2006
E-Shopping
2002
Estate Agents and Services
2010
Ethnic Foods
2002
European Electricity Industry
2007
European Gas Industry
2007
European Long-Term Insurance
2008
European Oil & Gas Industry
2007
Cable and Satellite Services
2002
European Renewable
2008
Charity Funding
2005
Energy Industry
2008
Childcare
2008
European Short Breaks
2008
Children’s Publishing
2008
European Telecommunications
2002
Clothing Retailers
2000
European Tourist Attractions
2009
Coffee & Sandwich Shops
2009
Commercial Dynamics in Financial Services
European Trends in Food Shopping
2009
2005
European Water Industry
2007
Commercial Insurance for Small Businesses
2009
Extended Financial Families
2005
Condiments and Sauces
2008
Consumer Credit & Debt
2007
Contact Centres
2010
Contraception
2002
Cooking & Eating
2009
Cross-Border Shopping
2000
Cruise Market
2008
102
© Key Note Ltd 2010
Snack Foods
Title
The Key Note Range of Reports
Edition
Published
F
Financial Services Marketing to ABs
Title
Edition
Published
L
2006
Lifestyle Magazines
2008
Low-Fat & Reduced-Sugar Foods
2008
The Luggage Market
2000
Financial Services Marketing to ABC1s
2000
Financial Services Marketing to BCs
2009
Marketing to Children 4-11
2003
Financial Services Marketing to C1C2DEs
Marketing in the Digital Age
2009
2006
Media Marketing
2010
Financial Services Marketing to DEs
Medical & Health Insurance
2007
2009
Men and Women’s Buying Habits
2008
Financial Services Marketing to Over 60s
2004
Men’s Toiletries & Fragrances
2008
Millennium Youth
2002
Mobile Marketing
2009
Motor Finance
2008
Financial Services Marketing to the Affluent
2009
Financial Services Marketing to the Retired and Elderly
2007
Financial Services Marketing to Start-Up Businesses and the SelfEmployed
2003
Financial Services Organisations on the Internet
2009
The Fish Industry
2001
Forecourt Retailing
2010
Functional Foods
2010
Funding in Higher Education
2002
G
General Insurance
2010
Generation Y
2007
Global Waste Management
2007
Green and Ethical Consumer
2008
Grey Consumer
2009
H
Healthy Eating
2008
Holiday Purchasing Patterns
2009
Home Entertainment
2008
Hot Beverages
2009
I
In-Car Entertainment
2000
Independent Financial Advisers
2008
Individual Savings Accounts
2005
Insurance Prospects
2008
Internet Advertising
2009
Internet Service Providers
2005
Issues and Challenges in the UK Life Assurance Market
2002
Issues in Higher Education Funding IT Recruitment
© Key Note Ltd 2010
M
N
The Newspaper Industry
2005
Non-Food Sales in Supermarkets
2008
Nutraceuticals
2008
O
Off-Trade Spirits
2004
Opticians & Optical Goods
2010
Organic Baby & Toddler Care
2007
Organic Food & Drink
2010
OTC Pharmaceuticals
2000
Over-40s Consumer
2005
Over-50s Consumer
2009
P
Pay TV
2004
Pension Extenders
2002
Pensions
2009
Personal Banking
2003
Personal Lines Insurance
2010
Personal Loans
2008
Pet Market
2009
Planning for Retirement
2008
Plastic Cards in Europe
2005
Plus-Size Fashion
2009
Private Sector Opportunities in Education
2001
Public Relations Industry
2007
Public Transport
2001
R
The Railway Industry
2004
Ready Meals
2001
2006
Recycling and the Environment
2000
2010
Retail Credit
2000
Retail Development
2001
Rural Economy
2009
103
The Key Note Range of Reports
Title
Snack Foods
Edition
Published
S
Title
Edition
Published
U
Savings & Investments
2007
Utilities
Saving Trends in the Eurozone
2002
V
Singles Market
2009
Vegetarian Foods
2009
Shopping Centres
2008
Vehicle Breakdown Services
2010
Short Breaks
2004
Slimming Market
2009
Vitamins, Minerals & Supplements
2009
Small Businesses & Banks
2010
W
Small Office Home Office Consumer
2001
Small Office Home Office Products
2001
The Soup Market
2001
Sponsorship
2000
Supermarket Own Label
2009
Supermarket Services
2007
Sweet & Salty Snacks
2009
2007
White Goods
2000
Women Over 45
2007
Working Women
2009
T
Teenage Fashionwear
2008
Teenage & Pre-Teen Magazines
2009
Teleworking
2003
Trends in Food Shopping
2008
Trends in Leisure Activities
2007
Tweenagers
2005
© Key Note Ltd 2010 All rights reserved. No part of this publication may be reproduced, copied, stored in an electronic retrieval system or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988. Published by Key Note Ltd, 5th Floor, Harlequin House, 7 High Street, Teddington, Richmond Upon Thames, TW11 8EE. Telephone: 0845-504 0452 Stringent efforts have been made by Key Note to ensure accuracy. However, due principally to the fact that data cannot always be verified, it is possible that some errors or omissions may occur; Key Note cannot accept responsibility for such errors or omissions. Details supplied by Key Note should only be used as an aid, to assist the making of business decisions, not as the sole basis for taking such decisions. Under the new Privacy and Electronic Communications Regulations 2004, it is unlawful for a business to make an unsolicited sales & marketing call to a corporate subscriber if it is either registered with CTPS or has requested NOT to receive such calls. Key Note Ltd holds and regularly updates (every 28 days) its data in accordance with the regulations and ensures that its data are compliant, as of the date created. It is the responsibility of the caller to ensure that these data are up to date; Key Note Ltd does not hold itself liable for any subsequent legalities. If you have any queries regarding the CTPS legislation you may find the following website useful: www.ico.gov.uk
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