Food Industry subjects | Confectionery, Sugar industry » Market Analysis of Confectionery

Source: http://www.doksinet Market Analysis of CONFECTIONERY Trends Remains one of the most stable segments within the global food industry. • Recession-resistant nature stems from price-point attractiveness nearly everyone can afford a piece of candy as well as availability, variety and portability. Strong trend lines and growth curves. While all of these demand higher price points, consumers still perceive these products as a good value: Confectionery Sales • U.S confectionery generated $345 billion at retail • Generating an estimated $21.1 billion in US retail sales, chocolate remains the largest sub-category in confectionery. Chocolate sales increased 29 percent in 2014 • Premium chocolate sales grew nearly 11 percent in 2014. • With a sales increase of 2.1 percent in 2014, non-chocolate US confectionery sales reached $10.4 billion • Dark chocolate sales increased 8 percent in 2014, but milk chocolate remains the largest chocolate segment in the

U.S • Gum generated $3.1 billion in US retail sales in 2014, with sugarless making up 84 percent of all gum sales. • Seasonal candy (candy that has unique seasonal packaging, shapes, colors or flavors) accounts for more than $7.2 billion each year (about 21 percent of annual sales) • Roughly an 8-9 month buying cycle. – – – – – Fruity candy Sour candy Gummies Bites/Minis Taffy • MARKET DRIVERS IN U.S CONFECTIONERY Incremental growth (in millions) Non-Chocolate Gum The global growth of snacking has expanded the confectionery universe, as evidenced by the industry’s two largest confectionery shows: Confectionery & Snack Markets: Sales data collected from the 2015 State of the Industry, National Candy Association (NCA). Chocolate There’s been significant consolidation across manufacturers, retailers and distributors. • ISM in Cologne, Germany • Sweets & Snacks Expo • Top performers in non-chocolate candy in 2014 include:

• premium sector • organic and all-natural sector • chewy candies • snack bars and nuts • better-for-you confections • medicated confections (vitamin gummies and the like) Fruit $133 (52%) Dark $102 (8%) Pieces $168 (5%) Nuts $104 (3%) Fruitflavored $109 (7%) Gummies $82 (7%) Peg Candy $110 (7%) Small Value Pack $133 (10%) Breath Fresheners $825 (8.1%) Regular Gum $528 (0.7%) Sugarless Gum $2,700 (1.1%) Source: NCA Syndicated data anlaysitics 52 weeks ending 12/28/2014 The Hershey Co.’s acquisition of Krave, a meat snack company, last year, provides an excellent example of how a major confectionery company recognizes that snacking opportunities can include everything from chocolate to chewy beef snacks. Private-Label Sales: • Huge in Europe with nearly half of all confections sold being store brands Sour $110 (15%) Breath Fresheners $62 (8%) • A niche sub-segment of U.S confectionery sales, under 3%. Still, drug store chains have

begun offering their versions of specific confections in their stores. Upticks – Projected Growth in U.S: • • • • • seasonal sales premium chocolate organic confections medicated confections chewy candies Source: http://www.doksinet Market Analysis of CONFECTIONERY 2015/2020 U.S CONFECTIONERY SALES 2015 Sales (billions) % annual gain 2020* Sales (billions) CAGR growth Chocolate $21.1 $3.1 $23.3 2.8% Non-chocolate $10.7 $3.7 $11.6 0.30% Gum $3.1 $1.0 $321.0 0% Total $34.5 $3.2 $38.1 0.9% Category *includes inflation Source: NCA Projections/Department of Commerce/Euromintor International Globally, a resurgence is evident in the Asia Pacific region, Eastern Europe and parts of South America. The United States, the world’s largest national market, remains solid. GLOBAL CONFECTIONERY MARKET (in $billions) Estimated 2015 Sales Estimated 2014 Sales % Gain Western Europe $52.60 $51.70 1.7 Asia Pacific $38.80 $36.00 7.7 North America

$35.90 $34.90 2.8 Latin America $23.90 $19.60 22 Eastern Europe $17.70 $16.40 7.9 Middle East/Africa $10.90 $9.40 16 Australasia $4.10 $4.00 2.5 $183.50 $172.00 6.6 Region World Source: Euromonitor International Ltd. 2015 State of Retailing Confectionery Channel Sales: • • • • • • • grocery: 22%, largest channel for confectionery mass merchandise outlets: 21% convenience stores: 16% club stores: 13% drug stores: 9% confectionery stores: 5% value/dollar stores: 4% Seasonal: Confectionery is a seasonal powerhouse for U.S retailers, growing nearly 8.5 percent during the Valentine’s Day, Easter, Halloween and Winter Holiday seasons in 2014 over 2013. Online Purchasing: about 30 percent of shoppers have purchased candy online • • • • online candy store: 44% online retailer that also sells candy: 29% grocery store with an online presence: 10% other online outlet: 16%