Frozen Food Industry

A Game of two Halves

Agenda
Overview of industry. Current Market & Recent History. What is shaping the industry Strategies been adopted Where does the industry go from here.

Overview of Industry
In 2008 Frozen food is a 100 billion by retail industry. In 2009 the Industry grew to 109.8 Billion which shows it is recession proof. There are 9 categories of products in the industry including Ice cream, Frozen vegetables, Potatoes products, deserts, fish & poultry. The Global industry can however be divided in 2. the developed west & the Developing East

East meets West

Market growth is driven by growth in price rather than volumes Dominated Strategy is one of consolidation and the Premiunisation of Products Market growth is driven by volume and high units sales with low price. Dominated Strategy is one of market penetration and Development

Current Industry position

Huge level of involvement leading to low market share. Largest market share is Unilever with almost 4% followed by Nestle with 3.2% Unilever concentrates on Ice cream market only after divesting of other brands. In excess of 70% of sales is done through retail mainly supermarkets. Growth in Private Or own brand products.

Life cycle of Industry ( Ice Cream)

Market Drivers
PESTEL needs to be adapted to LoNGPESTEL, in which local, National and Global issues are considered. Similarly in examining the Industry under Porters Five Forces we must split the Industry east & west.

East meets West

Market growth is driven by growth in price rather than volumes Dominated Strategy is one of consolidation and the Premiunisation of Products Market growth is driven by volume and high units sales with low price. Dominated Strategy is one of market penetration and Development

LoNGPESTLE
LOCAL NATIONAL GLOBAL POLITICAL Food Hygiene standards Labelling requirement on source of & type ingredients used Growing concern on Obesity and Food safety.

ECONOMIC

increase in disposable income

recession impact on spending habits

Currency fluctuations and Economic instability

SOCIAL

Local population growth Demographic change (e.g. Dietary changes and ageing population) concerns. Lactose intolerance, Kosher food etc.

LoNGPESTLE. Continued
LOCAL NATIONAL GLOBAL TECHNOLOGICAL Improvements in local Country wide Technology International technological technologies e.g. e.g. Distribution chain breakthroughs e.g. Natural availability of replacements for artificial colours Refrigeration etc.

ENVIRONMENTAL

Local waste issues

national weather impacting on demand

Global climate change CFC gases and other agents used in Frozen food industry

LEGAL

Local taxes & Food Hygiene laws

National law on using GM foods etc.

International Trade agreements

Porters 5 Forces

Success of Strategies
Many different strategies been used with mixed results. Unilever playing where it can win? Nestles Brand association. Mars & Marvel McCain's associated products development Northern Foods & Birds Eye premiumisation. Iceland, market substitution. East grow the market, west Grow the price

Opportunities & Threats

Predictions
Further developments in the eastern markets India is growing by 7% PA. while china has grown by 140% in last 4 year. Consolidation within industry where Product lines will be taken over as a cash cow by Investors. Premiunisation of Products will increase in West. Growth of Private/ Own Brand in short term

Frozen Food Industry

Thanks for your attention and We now welcome your questions and comments