Snack Food Manufacturers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 570 snack food manufacturers in the US produce a variety of salty snacks, including nuts, chips, popcorn, pretzels, peanut butter, and other grain or seed-based snack foods. Related product categories include dried and dehydrated foods and confectionary products. The industry does not include crackers or cookies.

Health Concerns

The nutritional content of traditional salty snacks, such as chips and pretzels, has come under public scrutiny, due to the connections between processed foods and the rising incidence of obesity, diabetes, and heart disease.

Large Firms Dominate

The snack food industry is highly concentrated; the 50 largest companies account for 86% of revenue, and the top four companies account for 50%.

Industry size & Structure

The average snack food manufacturer employs 103 workers and generates $69 million annually.

    • The snack food manufacturing industry consists of about 570 firms that employ 58,900 workers and generate $39.5 billion annually.
    • The industry is highly concentrated; the top 50 companies account for 86% of industry revenue.
    • The biggest firms with snack food manufacturing operations are multi-national companies with large portfolios of food and beverage products and include Pepsico (Frito-Lay), Kraft-Heinz (Planters), and Campbell Soup (Snyder’s-Lance, Emerald).
    • Roasted nut and peanut butter manufacturers account for 42% of firms and 37% of industry revenue.
    • Other snack food manufacturers account for 58% of firms and 63% of revenue.
                                    Industry Forecast
                                    Snack Food Manufacturers Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Oct 27, 2022 - FDA to Redefine “Healthy” Food
                                    • Sugary and other snacks currently marketed to consumers as “healthy” may lose that designation under the Food and Drug Administration’s proposed updated definition of the marketing term “healthy.” The FDA in September announced it is updating the marketing term "healthy" to reflect what has been learned about what makes a wholesome diet since 1994 when the agency last revisited the issue. Crucially, there is currently no limit on added sugars under the existing definition — an omission that the agency believes is inconsistent with current nutrition science. However, snacks such as trail mixes which don’t qualify under the current definition may qualify under the proposed rule. The FDA also is researching a symbol that manufacturers could display on the front of packaging to show the product meets the updated definition of "healthy."
                                    • Makers of buttery cookies and crackers are paying more for the key ingredient as high costs for dairy farmers and a labor shortage at processing plants drive up the price of butter, The Wall Street Journal reported in September 2022.. In January, the average price of butter was $3.67 per pound, according to the Federal Reserve Bank of St. Louis. In September, it was up to $4.70 per pound. The rising cost of feed and shortage of farm labor has made dairy farming more expensive and led to a decrease in milk production (down 1.4% in January 2022 from the prior year), according to the US Department of Agriculture. Unfavorable weather has also been a drag on growth. The amount of butter in US cold storage facilities at the end of July was the lowest since 2017, according to the USDA.
                                    • Snack sales have been on the rise since the onset of the pandemic and don’t show many signs of slowing, according to CNN Business. Many major snack brands posted double-digit sales growth in the second quarter of 2022, including Cheetos, Doritos, Smartfood, PopCorners, and Pirate Booty. While some of the dollar sales growth is due to inflation, snacking has also grown as consumers increasingly eat several smaller meals each day rather than a few large ones. The US snack foods market is expected to reach $150.6 billion in 2022, up from $116.6 billion in 2017, according to Euromonitor.
                                    • Amid higher prices for ingredients, packaging, and other inputs, some consumer packaged goods manufacturers have decreased product weight, quantity, or size to reduce costs. Known as “shrinkflation,” downsized products for the same price come at a time when inflation-pinched consumers are hypervigilant about getting the most for their dollar. According to a recent survey by Morning Consult, nearly two-thirds of shoppers are worried about shrinkflation. To cope with shrinkflation, nearly half of consumers say they’ve switched brands, and/or bought generic brands. A third have switched to buying in bulk, and 30% have stopped buying specific brands. Of all major grocery categories, snacks are most affected by shrinkflation, with 55% of shoppers reporting they have noticed the phenomenon in the snack space.
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