Report examines global food and beverage market trends
Reportlinker.com announces that a new market research report is available: Global Food and Beverage Survey 2012-2013: Market Trends, Buyer Spend and Procurement Strategies in the Global Food and Beverage Industry.
The report by Canadean analyzes how global food and beverage industry companies'' procurement expenditure, business strategies, and practices are set to change in 2012-2013.
Executives from the global food and beverage industry expect increased levels of industry consolidation, with 46% of respondents anticipating that there will be either a ''significant increase'' or an ''increase'' in mergers and acquisition (M&A) activity over the next 12 months.
M&A activity is expected to increase as a result of the lack of credit availability, increasing cost pressures, new consolidation opportunities, and the weak liquidity position of many small companies. The need to manage new cost or demand pressures, repay debts, comply with procedures, reduce operational expenses, and attain economies of scale, is also expected to drive M&A activity in the global food and beverage industry.
Global food and beverage industry respondents identify China to be the most important region for growth among emerging markets, along with India and the Middle East. Furthermore, India and the Middle East are considered the two most important emerging markets by respondents from food manufacturing companies, while India and Brazil are identified as the two most important emerging markets by respondents from beverage manufacturing companies, with strong economic growth in both countries, along with high demand for processed and healthy foods and increased consumption of branded beverages such as wine, beer, coffee, juice, and dairy products among consumers, making them attractive to foreign investors.
Among food manufacturers, 59% of respondents rate ''responding to pricing pressure'' as the most important business concern in 2012, while 52% highlight ''cost containment''. Among beverage manufacturers, ''responding to pricing pressure'' and ''market uncertainty'' are considered the most significant business challenges in 2012, according to 65% and 48% of respective respondents. Furthermore, respondents from global food and beverage industry companies, regardless of size, consider ''responding to pricing pressure'' and ''market uncertainty'' as the most important leading business concerns.
The average size of the global annual procurement budget among food and beverage industry buyers is forecast at $184.4 million for 2012. A comparison of global procurement budgets by operating region shows that global food and beverage industry buyers with leading operations in North America have the highest average procurement budgets in 2012, at $167.7 million.
The optimism level in the global food manufacturing sector is expected to be fuelled by increased consumer demand towards health and wellness oriented food products. In the case of global beverage manufacturing sector, it is due to an increased customer demand in emerging markets mainly China and India, demand for organic products, and adoption of sustainable sourcing strategies by beverage companies.
An analysis of responses by food manufacturing companies reveals that ''new product development'', ''machinery and equipment purchase'', and ''IT infrastructure development'' will record a significant increase in capital expenditure over the next 12 months.
An analysis of responses by beverage manufacturing companies reveals that ''new product development,'' ''IT infrastructure development,'' and ''machinery and equipment purchase'' will record a significant increase in capital expenditure over the next 12 months.
66% of food manufacturer respondents project an increase in investment toward ''new product development'', with an increasing focus on new flavors and product features. For example, in order to expand its snack business in the US, PepsiCo snack brand Doritos announced the introduction of its new product ''Doritos JACKED tortillas'' in March 2012. These tortilla chips are 40% larger than its predecessor and are available in two distinct flavors, Enchilada Supreme and Smoky Chipotle BBQ.
Global food and beverage industry suppliers plan to increase capital expenditure on ''new product development'' over the next 12 months. For example, in January 2012, Key Technology, a supplier of machineries, introduced a new, redesigned ''Auto Dryer'' for eliminating surface water from fresh-cut produce while enabling continuous line flow. The new dryer is effective in removing moisture from fresh-cut produce gently and consistently, to improve product quality and extend shelf life.
According to 37% of respondents from food manufacturing companies, and 33% from beverage manufacturing companies, the head counts in their organizations are expected to increase steadily by up to 2% in 2012. However, 34% of respondents from food manufacturing companies and 36% from beverage manufacturing companies anticipate ''no change'' in recruitment activity in 2012, which indicates that slow economic development in developed countries and market uncertainty could reduce recruitment activity.