Market Trend
The leisure food market has been steadily expanding since 2012. From 2012 to 2018, the market size has increased by 38.6% in total, and it is estimated that the snack industry will grow to 600billion RMB (approx. $90bn) in 2020 [1].
Category Potential
Although the candy and chocolate sector's market size is estimated to be over 80bm RMB, the growth rate is much lower than in other categories. Thus, this sector is probably limited to the development of companies.
Categories like cakes possess the most significant market size, meanwhile, unlike candy and chocolate, its growth rate is higher at around 14%, and the market concentration is lower at approximately 17.3% [2]. It represents high development potential and is much friendly for market competition. Similarly, a decentralized category like nuts with over 10% annual growth also reflects high potential.
***Market size usually based on estimation, the results may differ from the estimation methods, analysts, etc. The relative size of different categories can be used for comparison, but the value of a particular category may differ from the actual data when viewed separately.
Case Study: Nuts Sector
Additionally, due to the COVID-19 pandemic, most consumers tend to think about purchasing and eating more healthy foods, nuts are considered as one of them. Consequently, this category ranked No.1 in online sales.
The age distribution of consumers in the nut market is similar to the normal distribution. People aged 25 to 34 are the primary consumers. When the age of consumers leaves this range, the consumption power shows a downward trend. The farther away, the lower the ratio.
On the other hand, among the provinces that buy the most nut products, the proportion in southern cities is significantly higher than that in northern cities. It is worth mentioning that Jiangsu and Guangdong are two of the most economically developed cities in China.
Channel Sales Performance
The rapid development of e-commerce in recent years pushes the leisure food to occupy higher and higher market share in the online channel. However, offline sales still dominate the whole market.
In 2018, there are 92% of the customers preferring to purchase leisure food in offline channels.
Domestic Head Players
Three Squirrels, BeStore, and Be & Cherry are three major brands in China's snack industry. In terms of omnichannel performance, the market share of Three Squirrels is the highest, above 15%, followed by Be & Cherry and BeStore, at around 10% and 5%, respectively [3]. Although offline stores dominate the whole leisure food market, these brands focus on online channel layout, and the strong online sales performance proved it.
In the first quarter of this year, the overall leisure food market increased by 16.9% compared to last year. According to the market performance, Three Squirrels, Be & Cherry, and BeStore occupied the top 3, respectively. The YoY growth rates of these three all exceeded the industry average. Among them, BeStore showed a one-up growth, at nearly 40% increase, more than twice as much as Be & Cherry.
Three Squirrels
Be & Cherry
BeStore
Disclaimer: All data used in this article are from MobTech, China Industry Information Website, Yicai, Alibaba, Frost & Sullivan, Ministry of Commerce (China).
