Biscuit Industry in Australia

Biscuit Industry in Australia
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Institution
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INDUSTRY IN AUSTRALIA
Executive Summary
The Australian Biscuits Industry has been facing a lot of challenges recently especially on high imports which have reduced the profit margin of the industry. The industry is forecast to decline in the next five years if serious strategies are not adopted to deal with these issues. The main focus of this report is based on market analysis and market segmentation of the Biscuit Company in Australia. The report will also indicate analysis of the macro environment analysis of the company and some of its strength, weaknesses, opportunities, and threats via SWOT Analysis. In the first part of this report, the market size and the market growth will be illustrated to assist people to have a clear understanding of the industry. When it comes to the market size and market growth of the company, the revenue earned will be illustrated and some of the products and the company manufactures. Secondly, the report will also focus on the biggest brand and the well-known brand of biscuit which has the majority market size and the largest market growth globally. The mission statement of the brand will also be established and well as its SWOT Analysis. The paper will recommend ways in which the industry can improve their products like manufacturing biscuits which are free from gluten ingredients and using less fat and sodium.
Table of Contents
Introduction………………………pg. 4
Market Analysis…………………….pg 5
Market Size……………………….pg 6
Market Share and Market Segmentation………pg. 6
Geography segmentation………..pg. 7
SWOT Analysis………..pg. 10
Macro environment Analysis (PESTEL ANALYSIS)……….pg 9
Recommendations…………page 12
Conclusions……….pg 13
Appendixes……………….pg. 14
Introduction
This report focuses on the market segmentation and market analysis of the Biscuit industry in Australia. For the past six years, the biscuit industry of Australia has become large. Some of the Australian brands have become famous in many countries around the globe. These brands are like Arnott’s, Paradise, and Kraft. However, due to various economic development that has been witnessed a lot of changes have occurred in this industry. The market share, size, and growth of consumers have adjusted. The Australian Biscuit Industry consists of various establishments that manufacture biscuits. In Australia, biscuits are considered as food ((Market line Industry Profile, 2015). Arnott’s has become one of the biggest brands of biscuits in Australia. Kraft has also started a new subsidiary and although it belongs to Sydney. Some of these changes have made the industry to thrive more.
The biscuit Industry in Australia started in the 1950s and one of its popular brands were Sunshine and Kraft. But over the past 50 years, the company has come with various brands with different tastes and different flavors. This means that when the taste of customers increases the industry is forced to come up with new flavors. Customers are also given a chance of choosing from different flavors like vanilla, chocolate, and orange. Tim Tam of Arnett’s is one of the most popular brand and it is known worldwide. Due to the fast development of the biscuit industry, the Australian Government has taken an initiative of establishing a council of grocery and foods to aid the company by giving them chances of improving and developing their products (Davidson, 2016). This initiative that has been taken by the government has affected the industry positively. The market of the biscuit has continued to grow stronger every day and it’s full of competition. While trying to forecast, it is believed that in the coming ten years, the industry will have developed a variety of brands and they will be brought to the market. Customers will be given more chances to choose and companies will be more lucrative and there will be more competitors.
Market Analysis
Over the past few recent years, the Australian biscuit industry has grown although over the past five years the industry has faced a lot of challenges. Some of the factors that are affecting the industry change in the dietary of consumers, volatile input prices and raise in the external competition. Additionally, nutrition and health concerns have also affected these demand of these products because Majority of the Australians have reduced the consumption of high-calorie foods like chocolates, cookies, and biscuits. Due to increased availability of products like nut-based snacks and yoghurt products, the sales of biscuits have continued to erode overtime (Huis, 2013). There are claims that natural and organic products are considered as a major trend for the customers especially those that prefer healthier snacks are getting more educated. For example from 2018 to 2019 the revenue of the industry is expected to fall by 3.3% that is $780 million between one year. The expected drop in the current year is 3.0% (Pride, Ferrell, Lukas, Niininen, & Schembri, 2015).
In 2014, the Industry earned $865.9 million as the total revenues and this represents a compound annual growth rate of 2.2% from 2010 to 2014 compared to the Japanese and the Chinese markets with the annual growth rate of 0.9% and 6.4% (Pride, Ferrell, Lukas, Niininen, & Schembri, 2015). In 2014, the consumption of biscuits increased by 1.1%. Supermarkets and hypermarkets made some of the highest sales in 2014 whereby they channeled $652.4m which was equivalent to 75, 4% the overall market share. Sales through independent retailers made 70.1 million which was equivalent to 8.1% (Pride, Ferrell, Lukas, Niininen, & Schembri, 2015).
Market Size
In 2009 the size of the Australian Biscuit Market was worth 1.2 billion dollars whereby there were 113, 286.6 tons of biscuits sold. In 2014 the Australian market grew by 1.1% and they reached a volume of 91.1 million kilograms. Therefore form 2010 to 2014, its growth rate was 1.1%.
Year

Million Kilograms

Growth in percentage

2010



2011

87.1

1.2%

2012

88.1

1.2%

2013

89.2

1.1%

2014

91.1

1.1%

Market Segmentation
Chocolate cookies are one of the largest market segments in the Australian Biscuits Markets. Chocolate cookies account for 24.4% on the total market total value.
On the other hand plain cookies segments takes 16.5% of the market share value.
Category

2010

2011

2012

2013

2014

Chocolate cookies
Plain cookies

26.9%
16.1%

26.2%
16.2%

25.4%...