Snack Foods 2010 Keynote

Market Report Plus 2010
20th Edition January 2010 Edited by Sophie Worth ISBN 978-1-84729-564-4
Snack Foods
Snack Foods
Foreword
In todays competitive business environment, knowledge and understanding of your marketplace is essential. With over 30 years experience producing highly respected off-the-shelf publications, Key Note has built a reputation as the number one source of UK market information. Below are just a few of the comments our business partners and clients have made on Key Notes range of reports. "The Chartered Institute of Marketing encourages the use of market research as an important part of a systematic approach to marketing. Key Note reports have been available in the Institutes Information and Library Service for many years and have helped our members to build knowledge and understanding of their marketplace and their customers." The Chartered Institute of Marketing "We have enjoyed a long-standing relationship with Key Note and have always received an excellent service. Key Note reports are well produced and are always in demand by users of the business library. "Having subscribed to Market Assessment reports for a number of years, we continue to be impressed by their quality and breadth of coverage." The British Library "Key Note reports cover a wide range of industries and markets they are detailed, well written and easily digestible, with a good use of tables. They allow deadlines to be met by providing a true overview of a particular market and its prospects." NatWest "Accurate and relevant market intelligence is the starting point for every campaign we undertake. We use Key Note because they have a report on just about every market sector you can think of, and the information is comprehensive, reliable and accurate." J Walter Thompson "Market Assessment reports provide an extremely comprehensive source of information for both account handling and new business research, with excellent, clear graphics." Saatchi & Saatchi Advertising
James Donovan Managing Director Key Note Limited
Key Note Ltd 2010
Snack Foods
Contents
Contents
Executive Summary 1. Market Definition 1 3
REPORT COVERAGE....................................................................................................................3 MARKET SECTORS.......................................................................................................................3 MARKET TRENDS.........................................................................................................................3

Health Issues....................................................................................................................................3 Flavours............................................................................................................................................4 Do us a Flavour.............................................................................................................................5
ECONOMIC TRENDS....................................................................................................................5
Population.......................................................................................................................................5 Table 1.1: UK Resident Population Estimates by Sex (000), Mid-Years 2004-2008...........5 Gross Domestic Product................................................................................................................5 Table 1.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (m), 2004-2008..............................................................................................................................6 Inflation...........................................................................................................................................6 Table 1.3: UK Rate of Inflation (%), 2004-2008.......................................................................7 Unemployment...............................................................................................................................7 Table 1.4: Actual Number of Unemployed Persons in the UK (million), 2004-2008.........7 Household Disposable Income....................................................................................................8 Table 1.5: UK Household Disposable Income Per Capita (), 2004-2008............................8
MARKET POSITION......................................................................................................................8
The UK..............................................................................................................................................8 Table 1.6: Consumer Expenditure on Food and Non-Alcoholic Drink (m), 2004-2008........................................................................................................................................9 Europe..............................................................................................................................................9
2. Market Size
11
THE TOTAL MARKET................................................................................................................11

Manufacturers Sales ..................................................................................................................11 Table 2.1: UK Manufacturers Sales of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007.............................................................................................................11
Key Note Ltd 2010
Contents
Snack Foods
Table 2.2: Net Supply of Prepared or Preserved Potatoes Including Crisps in the UK (000), 2004-2007.........................................................................................................................12 Retailers Sales .............................................................................................................................12 Table 2.3: The Total UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2005-2009.................................................................................................................12 Figure 2.1: The Total UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2005-2009.................................................................................................................13
BY MARKET SECTOR.................................................................................................................13
Figure 2.2: The Total UK Snack Foods Market by Sector by Value at Current Prices (%), 2009........................................................................................................................................14 Potato Crisps.................................................................................................................................14 Table 2.4: The UK Potato Crisps Sector by Value at Current Prices (m at rsp and %), 2005-2009....................................................................15 Figure 2.3: The UK Potato Crisps Sector by Value at Current Prices (m at rsp), 2005-2009.................................................................................15 Other Savoury Snacks..................................................................................................................16 Table 2.5: The UK Other Savoury Snacks Sector by Value at Current Prices (m at rsp and %), 2005-2009....................................................................16 Figure 2.4: The UK Other Savoury Snacks Sector by Value at Current Prices (m at rsp), 2005-2009................................................................17 Snack Nuts.....................................................................................................................................17 Table 2.6: The UK Snack Nuts Sector by Value at Current Prices (m at rsp and %), 2005-2009....................................................................18 Figure 2.5: The UK Snack Nuts Sector by Value at Current Prices (m at rsp), 2005-2009.................................................................................18
OVERSEAS TRADE......................................................................................................................19
General Overview........................................................................................................................19 Table 2.7: UK Manufacturers Imports and Exports of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007..................................................19 Imports...........................................................................................................................................19 Table 2.8: UK Manufacturers Imports of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007.............................................................................................................20 Exports............................................................................................................................................20 Table 2.9: UK Manufacturers Exports of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007.............................................................................................................20 Leatherhead Food International Ltd Export Figures............................................................21
Key Note Ltd 2010
Snack Foods
Contents
3. Industry Background
23
RECENT HISTORY.......................................................................................................................23 NUMBER OF COMPANIES.......................................................................................................23

Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Turnover Sizeband (000, number and %), 2009.....................................................................................................23
EMPLOYMENT............................................................................................................................24
Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Employment Sizeband (number and %), 2009................................................................................................................24
REGIONAL VARIATIONS IN THE MARKETPLACE.............................................................25 DISTRIBUTION.............................................................................................................................26 HOW ROBUST IS THE MARKET?...........................................................................................26 LEGISLATION...............................................................................................................................26 KEY TRADE ASSOCIATIONS....................................................................................................27
European Snacks Association.....................................................................................................27 Snack Food Association...............................................................................................................27 Snack, Nut and Crisp Manufacturers Association..................................................................27
ADVISORY AND INFORMATION SERVICES .......................................................................27

The Food Commission (UK) Ltd.................................................................................................27 Food and Drink Federation........................................................................................................27 Food Standards Agency..............................................................................................................28
4. Competitor Analysis
29
THE MARKETPLACE..................................................................................................................29 MARKET LEADERS.....................................................................................................................29

Intersnack Ltd...............................................................................................................................29 Seabrook Crisps Ltd.....................................................................................................................30 Tayto (NI) Ltd................................................................................................................................30 United Biscuits Topco Ltd...........................................................................................................31 Walkers Snack Foods Ltd............................................................................................................32
OUTSIDE SUPPLIERS..................................................................................................................32
Raw Materials...............................................................................................................................32 Snack Processing Equipment.....................................................................................................34 Packaging......................................................................................................................................34
MARKETING ACTIVITY.............................................................................................................35
Main Media Advertising Expenditure......................................................................................35 Table 4.1: Main Media Advertising Expenditure on Savoury Snacks (000), Years Ending September 2008 and 2009............................................................................................35
Key Note Ltd 2010
Contents
Snack Foods
Table 4.2: Main Media Advertising Expenditure on Potato Crisps and Snacks (000), Year Ending September 2009......................................................................................36 Table 4.3: Main Media Advertising Expenditure on Crispbreads and Crackers (000), Year Ending September 2009......................................................................................37 Recent Promotions.......................................................................................................................38 Other Marketing Activities........................................................................................................39 Exhibitions ....................................................................................................................................39
5. Brand Strategy
41
RESEARCH FINDINGS................................................................................................................41
Table 5.1: Popularity of Selected Snack Food Brands (% of respondents), 2008 and 2009.........................................................................................41 By Sex..............................................................................................................................................42 Table 5.2: Popularity of Selected Snack Food Brands by Sex (% of respondents), 2009 .............................................................................................43 By Age............................................................................................................................................44 Table 5.3: Popularity of Selected Snack Food Brands by Age (% of respondents), 2009 ............................................................................................44 By Social Grade.............................................................................................................................45 Table 5.4 Popularity of Selected Snack Food Brands by Social Grade (% of respondents), 2009..............................................................................46 By Region ......................................................................................................................................47 Table 5.5: Popularity of Selected Snack Food Brands by Region (% of respondents), 2009........................................................................................48 Table 5.6: Popularity of Selected Snack Food Brands by Remaining Regions (% of respondents), 2009.................................................................49
COMPANIES BRANDS..............................................................................................................50
Intersnack......................................................................................................................................50 Largo Food Exports .....................................................................................................................50 Tayto (NI) ......................................................................................................................................50 Tyrrells Potato Chips ...................................................................................................................50 United Biscuits..............................................................................................................................51 Walkers Snack Foods ..................................................................................................................51
TOP BRANDS...............................................................................................................................51
The Guild of Fine Food Great Taste Awards...........................................................................51 Table 5.7: Winners of The Guild of Fine Food Great Taste Awards, 2009........................52
6. Strengths, Weaknesses, Opportunities and Threats
53
STRENGTHS..................................................................................................................................53 WEAKNESSES..............................................................................................................................53 OPPORTUNITIES.........................................................................................................................54
Key Note Ltd 2010
Snack Foods
Contents
THREATS.......................................................................................................................................54
7. Buying Behaviour
55
HOUSEHOLD EXPENDITURE ON FOOD AND DRINK......................................................55 CONSUMER PENETRATION ...................................................................................................55

Potato Crisps, Tortilla and Corn Snacks...................................................................................55 Table 7.1: Penetration of Potato Crisps, Tortilla and Corn Snacks in the Past 12 Months by Frequency (% of adults), 2009.........................................................................55 Nuts and Dried Fruit....................................................................................................................56 Table 7.2: Penetration of Nuts and Dried Fruit in the Past 12 Months by Frequency (% of adults), 2009.........................................................................56 Other Savoury Snacks..................................................................................................................57 Table 7.3: Penetration of Other Savoury Snacks in the Past 12 Months by Frequency (% of adults), 2009 ........................................................................57
8. Current Issues
59
CLOSURES, MERGERS AND ACQUISITIONS ......................................................................59

MBMG............................................................................................................................................59 Tyrrells Potato Chips....................................................................................................................59
BOARD AND SENIOR MANAGEMENT CHANGES............................................................59

PepsiCo UK and Ireland..............................................................................................................59
NEW PRODUCT DEVELOPMENT ..........................................................................................59

McCoys..........................................................................................................................................59 Penn State.....................................................................................................................................60 Pringles...........................................................................................................................................60 Tyrrells............................................................................................................................................60 Walkers..........................................................................................................................................60
9. The Global Market
61
EUROPE.........................................................................................................................................61 THE US...........................................................................................................................................61 ASIA PACIFIC ..............................................................................................................................62 SELECTED GLOBAL COMPETITORS .....................................................................................62
Calbee Foods ................................................................................................................................62 Intersnack Knabber-Gebck ......................................................................................................62 ITC ..................................................................................................................................................63 J&J Snack Foods ...........................................................................................................................63 Largo Food Exports .....................................................................................................................63 Liberation Foods .........................................................................................................................64
Key Note Ltd 2010
Contents
Snack Foods
Lorenz Snack-World....................................................................................................................64 PepsiCo...........................................................................................................................................64 Procter & Gamble ........................................................................................................................64 Snack Foods ..................................................................................................................................65 Snyders of Hanover....................................................................................................................65
10. Forecasts
67
INTRODUCTION..........................................................................................................................67
The Economy.................................................................................................................................67 Population.....................................................................................................................................67 Table 10.1: Forecast UK Resident Population by Sex (000), Mid-Years 2009-2013.........67 Gross Domestic Product..............................................................................................................68 Table 10.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2009-2013....................................................................................................68 Inflation.........................................................................................................................................68 Table 10.3: Forecast UK Rate of Inflation (%), 2009-2013...................................................69 Unemployment.............................................................................................................................69 Table 10.4: Forecast Actual Number of Unemployed Persons in the UK (million), 2009-2013...................................................................................................69
FORECASTS 2010 TO 2014......................................................................................................70

Table 10.5: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2010-2014................................................................70 Figure 10.1: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2010-2014................................................................71
MARKET GROWTH....................................................................................................................71
Figure 10.2: Growth in the UK Snack Foods Market by Value at Current Prices (m at rsp), 2005-2014 ..............................................................72
FUTURE TRENDS.........................................................................................................................72
Industry Consolidation................................................................................................................72 Overseas Markets.........................................................................................................................73 Health Issues..................................................................................................................................73
11. Company Profiles
75
INTERSNACK LTD.......................................................................................................................76 SEABROOK CRISPS LTD............................................................................................................78 TAYTO (NI) LTD..........................................................................................................................80 UNITED BISCUITS TOPCO LTD................................................................................................82 WALKERS SNACK FOODS LTD...............................................................................................84
Key Note Ltd 2010
Snack Foods
Contents
12. Company Financials 13. Further Sources
87 89
Associations.................................................................................................................................89 General Sources.........................................................................................................................90 Government Sources ...............................................................................................................91 Other Sources.............................................................................................................................92 Key Note Sources ......................................................................................................................92
Understanding TGI Data
95
Number, Profile, Penetration................................................................................................95 Social Grade.................................................................................................................................96 Standard Region........................................................................................................................96
Key Note Research The Key Note Range of Reports
97 99
Key Note Ltd 2010
Contents
Snack Foods
Key Note Ltd 2010
Snack Foods
Our taste buds are changing and developing as new flavours and foods become readily available in the UK and Ireland. Everyone has their favourite flavours, but lately people are becoming keen to experiment and try new foods.
Heston Blumenthal, celebrity chef and chief judge in Walkers Do us a Flavour competition (www.fmb.org.uk)
Innovative flavour additions are key for snacks as our extensive research has shown that approximately 30% of all category growth in the latest 52 weeks has come from new flavours being added to existing brands.
Paul Lettice, Trade Communications Officer of Procter & Gamble (www.talkingretail.com, 2nd February 2009)
When Jamie Oliver said that because there are a few fat children nobody should be eating crisps, it crucified our business. Schools were banned from stocking crisps and our turnover plummeted from 15m to 12m almost overnight.
Ken Brook-Chrispin, Chairman and Chief Executive of Seabrook Crisps (www.ft.com, 5 May 2009)
Key Note Ltd 2010
Snack Foods
Executive Summary
Executive Summary
This Key Note Market Report Plus examines the UK snack foods market, which comprises potato crisps, other savoury snacks (including tortilla chips, baked snack biscuits and rice- and corn-based snacks) and snack nuts. It excludes sweet snack items, such as chocolate, which are covered in Key Notes Confectionery Market Report Plus and the Sweet & Salty Snacks Market Assessment. Key Note estimates that, in terms of retail sales, the total value of the market increased by 12% between 2005 and 2009 to reach 2.39bn. An especially strong growth of 8.4% was seen between 2008 and 2009 as manufacturers passed on steep rises in commodity costs for items such as potatoes, sunflower oil and nuts. Manufacturers of snack foods continued to respond to health issues in 2008/2009, reducing salt and fat content in their foods through the introduction of light and low-fat variants. Emphasis has been placed on the use of more natural ingredients, as well as on baked, rather than fried, goods. Seabrook Crisps has admitted that when celebrity chef Jamie Oliver advised people against eating crisps because of their fat and salt content, it decimated its sales almost overnight. However, despite most snack foods being relatively low in nutritional value, consumption of them on a regular basis is very high. A Target Group Index (TGI) survey carried out by BMRB International Ltd found that 84.1% of respondents had consumed potato crisps, tortilla or corn snacks in the 12 months ending March 2009, indicating that consumers look upon such foods as indulgent treats. As well as being indulgent, savoury snack foods such as crisps are also an affordable treat. Even at the premium end of the market, products are cheap in comparison to other food treats, such as premium chocolate. In fact, the current recession has helped demand for upmarket products, as there has been an increase in consumers staying in rather than going out and replacing luxuries such as eating out in restaurants with eating snack foods at home. This has also led to retailers giving more shelf space to snack foods, particularly large sharing packs. The hike in commodity costs in 2008/2009 led to hefty price rises in the industry, and there have been corporate casualties as a result. For example, Natural Crisps Ltd was close to administration when it was bought by Tayto Crisps of Northern Ireland in a distress deal completed in a week over Christmas 2008. The deal was Taytos fourth acquisition in 3 years, following its purchases of Golden Wonder in 2006, Real Crisps in 2007 and Red Mill Snack Foods in 2008. Germanys Intersnack purchased a 15% stake in Largo Foods (the owner of the Tayto brand in the Republic of Ireland), and is thought to be considering making more acquisitions in the UK market. Further consolidation in an industry currently dominated by Walkers Snack Foods seems likely in the future, especially as the recession continues and companies struggle to survive. Key Note forecasts that the retail sales value of the UK snacks market will increase by 3.6% to 2.48bn in 2010, and will grow by an overall 5.3% between 2010 and 2014 to finish at 2.61bn.
Key Note Ltd 2010
Executive Summary
Snack Foods
Key Note Ltd 2010
Snack Foods
Market Definition
1. Market Definition
REPORT COVERAGE
Snacks can be defined as food consumed at times other than breakfast, lunch and dinner, or as a selection of small items eaten to replace traditional meals. However, for the purpose of this Key Note Market Report Plus, such items are confined to bagged savoury snacks, and the report excludes sweet items, such as sweet biscuits, sugar and chocolate. These items are covered in Key Notes Confectionery Market Report Plus and Sweet & Salty Snacks Market Assessment. In addition to retail outlets, sales of savoury snacks are made through foodservice outlets, such as coffee shops, public houses (pubs) and canteens. These outlets are not included in this report, but would add considerably to the total value of the market.
MARKET SECTORS
Within this report, the snack foods market is divided into three principle sectors, as follows: potato crisps other savoury snacks, including tortilla chips, baked snack biscuits and rice- and corn-based snacks snack nuts.
MARKET TRENDS
Health Issues
Healthier formulations continue to be a major concern within the food market, particularly for savoury snacks marketed to children. The relatively high fat, salt and sugar content of processed foods, together with the sedentary lifestyle of many consumers, has led to an increasing proportion of overweight and obese people in the Western world. Data from the Department of Healths Health Survey for England (HSE) shows that, in 2007, 60.8% of adults (aged 16 or over) in England were overweight and, of these, 24% were obese. This represented a slight fall in the proportion of overweight adults (61.6% in 2006); however, the data also showed that obesity had increased in children. In 2007, 28.6% of children (aged between 2 and 10) in England were overweight and, of these, 15.4% were obese.
Key Note Ltd 2010
Market Definition
Snack Foods
In contrast, a survey conducted by the Stroke Association in September 2009 found that, perhaps surprisingly, consumers under the age of 18 were more conscientious than other age groups when it came to checking the salt content of foods before purchasing (21% compared with the national average of less than 10%), but that a high salt content did not deter them from buying products. The Department for Business, Innovation and Skills (BIS) Foresight Tackling Obesities: Future Choices project the findings of which were published in October 2007 predicts that, if no action is taken, 60% of men, 50% of women and 25% of children will be obese by 2050. With the threat of possible legal action ever present in todays litigious society, food manufacturers have responded by offering reduced-fat and -salt alternatives in most categories, including potato crisps and other bagged savoury snacks. However, reformulation of products has closed the gap between healthy and regular crisps, as manufacturers reduce the calorie count by introducing different cooking oils and recipe changes. According to Nielsen, in the year ending April 2009, there was a 2.3% drop in the sales value of Walkers Baked (the healthy option) as sales of its core brand rose after it began using healthier cooking oil. Other measures to make savoury products more healthy include the removal of monosodium glutamate and artificial flavourings (see Flavours section below) and colourings. In July 2008, a joint initiative between the UK Government, food manufacturers and advertising agencies was announced to tackle obesity by encouraging the public to eat healthily and take more physical exercise. The 75m Change4Life campaign was 4 years in the making and has the support of an industry consortium, including Tesco, PepsiCo and Kraft. In July 2008, a coalition of companies including BSkyB, ITV, Tesco, Coca-Cola, Cadbury and AOL pledged the equivalent of more than 200m in advertising space and services to support the initiative in the run-up to the 2012 Olympic Games (London 2012).
Flavours
As palates have become more adventurous, novel new flavours have been introduced to snack foods, often based on ethnic tastes and spicy flavours. There is even a campaign on the social networking website Facebook to bring back the hedgehog-flavoured crisps that were introduced as a joke but enjoyed surprising success in the 1980s. Flavoured with pork fat, the hedgehog-flavoured crisps inevitably led to a charge brought by the Office of Fair Trading (OFT) for false advertising. In another instance, the European Commission attempted to ban Prawn Cocktail- and Smokey Bacon-flavoured snacks on the grounds that they contained artificial sweeteners or other harmful additives. However, according to a survey undertaken by Kettle Chips in 2009, nearly half of the UK adults surveyed voted the classic Cheese & Onion as their favourite crisp flavour. Other findings were that 49% of males preferred Cheese & Onion over any crisp flavour and, while the flavour was most popular in East Anglia and London, it was less so in the South West, where just 33% named it as their favourite.
Key Note Ltd 2010
Snack Foods
Market Definition
Do us a Flavour
In 2008, Walkers Snack Foods ran a competition on its website entitled Do us a Flavour, inviting the public to suggest a new flavour for its crisps. The company then manufactured the six finalist flavours Cajun Squirrel; Crispy Duck and Hoisin; Builders Breakfast; Onion Bhaji; Fish and Chips; and Chilli and Chocolate for the public to vote on. In May 2009, the Builders Breakfast flavour (which was said to be flavoured with egg, bacon, sausage and beans) was announced as the winner.
ECONOMIC TRENDS
Population
In 2008, the population of the UK was estimated at 61.4 million an increase of 0.7% compared with the previous year and 2.6% higher than the 2004 level of 59.8 million. Any rise in population is of benefit to demand for consumer goods as it increases the customer base. However, the fact that the UK has an ageing population will dampen the demand for childrens snack products. The population increase will largely be as a result of immigration, and this may strengthen demand for snacks influenced by cuisines from around the world.
Table 1.1: UK Resident Population Estimates by Sex (000), Mid-Years 2004-2008

2004 Female Male Total % change year-on-year 30,568 29,278 59,846 2005 30,741 29,497 60,238 0.7 2006 30,893 29,694 60,587 0.6 2007 31,059 29,916 60,975 0.6 2008 31,232 30,151 61,383 0.7
Source: Monthly Digest of Statistics, November 2009, National Statistics website Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
Gross Domestic Product

Gross domestic product (GDP) rose by 3.5% at current prices in 2008, compared with 5.5% in 2007. Figures published by National Statistics in late November 2009 showed that GDP contracted by 0.3% in the third quarter of 2009, revised from a previous estimate of a fall of 0.4%. In the third quarter of 2009, GDP was 5.1% lower than in the corresponding period of 2008, reflecting the state of the economy as the recession dragged on.
Key Note Ltd 2010
Market Definition
Snack Foods
Table 1.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (m), 2004-2008
2004 Current prices % change year-on-year Annual chain-linked GDP % change year-on-year
GDP gross domestic product
2005 1,254,058 4.2
2006 1,325,795 5.7
2007 1,398,882 5.5
2008 1,448,054 3.5
1,202,956 -
1,227,387 -
1,254,058 2.2
1,289,833 2.9
1,322,842 2.6
1,330,118 0.6
Source: Economic & Labour Market Review, November 2009, National Statistics website Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
Inflation
As is evident in Table 1.3, inflation fell slightly in 2008, having increased the previous 2 years. Figures published in November 2009 showed that Consumer Price Index (CPI) annual inflation the Governments target measure was 1.5% in October, up from 1.1% in September 2009. As an internationally comparable measure of inflation, the CPI shows that the UK inflation rate in September 2009, at 1.1%, was above the provisional figure for the EU as a whole (0.3%). Retail Price Index (RPI) inflation, which includes housing costs, fell by 0.8% in the year ending October 2009, compared with a fall of 1.4% in September.
Key Note Ltd 2010
Snack Foods
Market Definition
Table 1.3: UK Rate of Inflation (%), 2004-2008

2004 Inflation (%) Percentage point change year-on-year 3.0 2005 2.8 -0.2 2006 3.2 0.4 2007 4.3 1.1 2008 4.0 -0.3
Note: inflation is at retail price index (RPI).
Unemployment
The latest annual figures released by National Statistics in November 2009 show that the unemployment rate rose to 910,000 in 2008 a 5.8% increase compared with 2008. This worsened considerably in 2009 as a direct result of the recession, and the latest quarterly figures from National Statistics reveal that the number of people out of work increased by 21,000 to 2.49 million between August and October (not tabulated). However, this was the smallest increase seen since the March-to-May period in 2008, indicating that the worst is over and employers are beginning to hire again. Unemployment is always a lagging factor in a recession, as many businesses cease trading during the economic difficulties, and employers tend to remain cautious for some time after the economy has recovered. However, with savoury snacks being a relatively cheap purchase, unemployment figures are not likely to have as much impact as in other consumer goods sectors.
Table 1.4: Actual Number of Unemployed Persons in the UK (million), 2004-2008

2004 Actual number of claimants (million) % change year-on-year 0.85 2005 0.86 1.2 2006 0.95 10.5 2007 0.86 -9.5 2008 0.91 5.8
Key Note Ltd 2010
Market Definition
Snack Foods
Household Disposable Income

Bank interest rates are at an all-time low and, in a further attempt to kick-start consumer spending, the standard rate of VAT was reduced to 15% on 1st December 2008. However, it will revert to 17.5% on 1st January 2010 in a move that could curtail any growth in consumer spending on high-priced items, but will not be expected to make any difference to demand for low-ticket snacks. The latest Retail Sales Monitor from the British Retail Consortium (BRC) shows that UK retail sales values for October 2009 rose by 3.8% on a like-for-like basis from October 2008, when sales had fallen 2.2%. However, food sales growth slowed further, largely reflecting lower food price inflation. Nevertheless, any indication of a return in consumer confidence will be encouraging for the snack food industry, where Christmas sales of premium indulgent snacks are so important. According to the latest figures from National Statistics, UK household disposable income increased by 4.1% to 14,921 in 2008 (compared with 2007), and rose by an overall 14.1% over the 5-year review period.
Table 1.5: UK Household Disposable Income Per Capita (), 2004-2008

2004 Household disposable income () % change year-on-year 13,078 2005 13,572 3.8 2006 13,952 2.8 2007 14,331 2.7 2008 14,921 4.1
Source: Economic & Labour Market Review, November 2009, National Statistics website Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
MARKET POSITION
The UK
Consumer expenditure on food and non-alcoholic drink rose by 8.8% in 2008, compared with the previous year a much sharper increase than has been recorded in recent years. Expenditure on savoury snacks as considered in this report is estimated to have amounted to 2.8% of total expenditure on food and non-alcoholic drink in 2008 (not tabulated).
Key Note Ltd 2010
Snack Foods
Market Definition
Table 1.6: Consumer Expenditure on Food and Non-Alcoholic Drink (m), 2004-2008
2004 Expenditure (m) % change year-on-year 65,156 2005 67,138 3.0 2006 69,510 3.5 2007 72,313 4.0 2008 78,680 8.8
Source: Consumer Trends, Quarter 2 2009, National Statistics Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
The latest figures available for the first half of 2009 show that expenditure on food and non-alcoholic drink continued to rise and was 4.8% higher in the first 6 months of 2009 than in the comparable period in 2008.
Europe
Overall, the EU savoury snacks market is estimated by Key Note to have increased by 4% to 11.3bn in 2008. The latest detailed figures from the European Snacks Association (ESA) related to 2007, when potato chips (crisps) accounted for more than a third (34.3%) of the total value of savoury snacks and nuts. The snack nuts sector has seen significant growth in some Western EU markets, but declines in the Eastern EU have reduced the sectors overall growth. In 2005 (the latest figures available), the UK accounted for around 21% of the total value of the EU savoury snacks market, with Germany representing 13%; Spain 10% to 11%; France and Italy 8% to 9% each; Scandinavia (excluding Norway) 6%; and Belgium and the Republic of Ireland 3% each. The market leader in savoury snacks across Western Europe is PepsiCo, which owns the Frito-Lay and Walkers brands.
Key Note Ltd 2010
Market Definition
Snack Foods
10
Key Note Ltd 2010
Snack Foods
Market Size
2. Market Size
THE TOTAL MARKET
Manufacturers Sales
Unlike other sectors of UK manufacturing, manufacturers sales of prepared or preserved potatoes, including crisps have risen in value over recent years. According to National Statistics Products of the European Community (PRODCOM) publication, sales increased by an overall 8.5% from 827.2m to 897.7m between 2004 and 2007 (the latest years for which figures are available).
Table 2.1: UK Manufacturers Sales of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007
2004 Value (000) % change year on year 827,192 2005 841,446 1.7 2006 892,378 6.1 2007 897,689 0.6
Source: PRODCOM, PRA15310, National Statistics Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
PRODCOM also provides import and export statistics for prepared or preserved potatoes, including crisps. By adding the total value of UK imports to the value of domestic manufacturers sales and deducting the total value of UK exports, figures are arrived at showing the value of the UKs net supply of these products, as shown in Table 2.2.
Key Note Ltd 2010
11
Market Size
Snack Foods
Table 2.2: Net Supply of Prepared or Preserved Potatoes Including Crisps in the UK (000), 2004-2007
2004 Value (000) % change year-on-year 837,303 2005 844,635 0.9 2006 891,159 5.5 2007 888,235 -0.3
Retailers Sales
Key Note estimates that UK retail sales of snack foods were worth 2.39bn in 2009 an increase of 8.4% compared with the previous year (as a result of manufacturers passing on steep rises in commodity costs) and a rise of 12% on the 2005 total of 2.13bn. The strongest growth was seen in the potato crisps sector, the value of which increased by 14.6% between 2005 and 2009.
Table 2.3: The Total UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2005-2009
2005 Potato crisps Other savoury snacks Snack nuts Total % change year-on-year
rsp retail selling prices
2006 942.0 1,010.0 192.0 2,144.0 0.5
2007 944.0 1,015.0 194.5 2,153.5 0.4
2008 980.0 1,022.0 203.0 2,205.0 2.4
2009 1,075.0 1,110.0 205.0 2,390.0 8.4
938.0 1,005.0 190.5 2,133.5 -
Source: Key Note
12
Key Note Ltd 2010
Snack Foods
Market Size
In recent years, the better-for-you healthier sector has driven growth, but the gap between regular products and healthier products has narrowed as manufacturers have begun to reformulate their standard products (i.e. through the use of lighter cooking oils). Manufacturers concentration on premium sharing snacks has also contributed towards growth, as staying in has become the new going out as a result of the recession. However, the recession has also driven many consumers to the value end of the market, so demand has remained fairly buoyant across the board.
Figure 2.1: The Total UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2005-2009
2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 500 250 0 2005 2006 2007 2008 2009 Potato crisps Other savoury snacks Snack nuts
Source: Key Note
BY MARKET SECTOR
Figure 2.2 illustrates the market share held by each sector of the snack foods market in 2009. Other savoury snacks represented the largest proportion of the market (46.4%), mainly because this category incorporates various different types of products, such as tortilla chips, baked snack biscuits, and rice- and corn-based snacks. Potato crisps was the second-largest sector of the market, with 45% in 2009, followed by the nuts category with 8.6%.
Key Note Ltd 2010
13
Market Size
Snack Foods
Figure 2.2: The Total UK Snack Foods Market by Sector by Value at Current Prices (%), 2009
Snack nuts 8.6%
Potato crisps 45.0% Other savoury snacks 46.4%
Source: Key Note
Potato Crisps
In 2007, Europes potato prices more than doubled after the previous years hot summer saw production slumping by up to 15% in key producing countries such as Germany, the Netherlands and Great Britain. On the whole, crisp manufacturers in the UK absorbed the additional costs. The wet summer of 2008 pushed prices of potatoes up again, and this was coupled with a steep rise in the price of sunflower oil. Manufacturers absorbed some of the increases, but had no alternative but to increase retail prices, resulting in a sharp rise in shelf prices in 2008 and 2009. Less was seen of discount offers such as buy one, get one free (BOGOF), which had been a characteristic of the market before. Traditional potato crisps remain the single largest product category of the snack foods market as defined in this report, accounting for a 45% share in 2009. Key Note estimates that the retail sales value of potato crisps increased by 9.7% to 1.08bn in 2009, and grew by 14.6% over the 5-year review period.
14
Key Note Ltd 2010
Snack Foods
Market Size
Table 2.4: The UK Potato Crisps Sector by Value at Current Prices (m at rsp and %), 2005-2009
2005 Value (m) % change year-on-year % share of total market
2006 942 0.4 43.9
2007 944 0.2 43.8
2008 980 3.8 44.4
2009 1,075 9.7 45.0
938 45.0
Source: Key Note
Cheese and Onion-flavoured crisps are said to be the nations favourite flavour, having overtaken Ready Salted, and sales of the former are valued at more than 250m. However, Salt and Vinegar-flavoured crisps have declined in popularity in recent years. Manufacturers are concentrating on relaunching and/or promoting retro brands, since it is cheaper than launching a new product, and benefits from the fact that brands such as Hula Hoops and Monster Munch will already have a fan base as many consumers will remember them nostalgically from their own childhoods.
Figure 2.3: The UK Potato Crisps Sector by Value at Current Prices (m at rsp), 2005-2009
1,100 1,075 1,050 1,025 1,000 975 950 925 900 2005 2006 2007 2008 2009
Source: Key Note
Key Note Ltd 2010
15
Market Size
Snack Foods
Other Savoury Snacks

Other savoury snacks are those that are not wholly or exclusively made from potatoes, potato flour or potato starch, but can be, for example, dough-, wheat-, starch- or rice flour-based. Products include traditional extruded and pelleted snacks (such as Procter & Gambles Pringles range, which are made from reconstituted potato), tortilla products (i.e. Walkers Doritos), baked snacks (such as Mini Cheddars and Twiglets) and rice- and corn-based snacks (i.e. Quakers Snack-a-Jacks). Like potato crisps, other savoury snacks suffered a decline in sales values earlier in the decade in the backlash against unhealthy products, but sales have since recovered due to manufacturers new product development (NPD) of healthier options, as well as the trend towards sharing packs of premium snacks. Key Note estimates that the combined retail sales value of the products included in the other savoury snacks sector accounted for 46.4% of the total market in 2009, and that retail sales of other savoury snacks increased by 10.4% between 2005 and 2009 to reach a value of 1.11bn.
Table 2.5: The UK Other Savoury Snacks Sector by Value at Current Prices (m at rsp and %), 2005-2009
2006 1,010 0.5 47.1
2007 1,015 0.5 47.1
2008 1,022 0.7 46.3
2009 1,110 8.6 46.4
1,005 47.1
Source: Key Note
16
Key Note Ltd 2010
Snack Foods
Market Size
Figure 2.4: The UK Other Savoury Snacks Sector by Value at Current Prices (m at rsp), 2005-2009
1,130 1,120 1,110 1,100 1,090 1,080 1,070 1,060 1,050 1,040 1,030 1,020 1,010 1,000 990 980 2005 2006 2007 2008 2009
Source: Key Note
Snack Nuts
Nuts are perceived as a healthier alternative to other savoury snacks, and the category has grown in value and volume in the past, at the expense of other products in the market. However, the sector is susceptible to supply disruptions, as crops can be in short supply due to factors outside of manufacturers control, such as frost damage to crops and farmers price hikes. UK buyers of peanuts have also been hit by the low value of sterling as peanuts which have escalated in price anyway are sold in US dollars. Peanuts now account for an estimated, and declining, 40% share of the snack nuts sector by value. Own-label products are significant in the sector, and their value now accounts for more than two-thirds of the total. However, sales of all nuts are highly seasonal, and around 30% of the sectors retail sales value for any year is earned in the final quarter in the run-up to Christmas. Key Note estimates that retail sales of snack nuts increased by an overall 7.6% between 2005 and 2009, to reach a value of 205m. However, sales are estimated to have increased by just 1% between 2008 and 2009, when the sectors market share dropped to a 5-year low of 8.6%
Key Note Ltd 2010
17
Market Size
Snack Foods
Table 2.6: The UK Snack Nuts Sector by Value at Current Prices (m at rsp and %), 2005-2009
2006 192.0 0.8 9.0
2007 194.5 1.3 9.0
2008 203.0 4.4 9.2
2009 205.0 1.0 8.6
190.5 8.9
Source: Key Note
A recent lack of innovation and NPD in the snack nuts sector has caused it to stagnate a little, and manufacturers are seeking to re-energise the category with introductions of sweet nut lines (such as peanut clusters), which fall outside the scope of this report. Moreover, some brands of nuts are largely or exclusively sold through foodservice outlets such as public houses (pubs), hotels, coffee shops, cafs and canteens sales from which would significantly increase the overall value of the sector.
Figure 2.5: The UK Snack Nuts Sector by Value at Current Prices (m at rsp), 2005-2009
210.0 207.5 205.0 202.5 200.0 197.5 195.0 192.5 190.0 187.5 185.0 2005 2006 2007 2008 2009
Source: Key Note
18
Key Note Ltd 2010
Snack Foods
Market Size
OVERSEAS TRADE
General Overview
The value of UK imports of prepared or preserved potatoes, including crisps, decreased between 2004 and 2007, while that of exports showed year-on-year increases. This resulted in the trade deficit seen in 2004 and 2005 changing to a surplus in 2006 and 2007, and one which increased by 8.2m between 2006 and 2007.
Table 2.7: UK Manufacturers Imports and Exports of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007
Imports 2004 2005 2006 2007 50,815 48,512 49,921 49,197 Exports 40,704 45,323 51,140 58,651 Balance of Trade -10,111 -3,189 1,219 9,454
Imports
Imports from countries outside of the EU are fairly insignificant in value, and accounted for just 0.9% of the total in 2007. Between 2004 and 2007, the UKs imports of prepared or preserved potatoes were greater than its exports to EU markets.
Key Note Ltd 2010
19
Market Size
Snack Foods
Table 2.8: UK Manufacturers Imports of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007
Intra-EU Imports 2004 2005 2006 2007 49,861 47,843 49,558 48,774 Extra-EU Imports 954 669 363 423 Total 50,815 48,512 49,921 49,197
Exports
Although most export trade is with EU countries, non-EU markets are becoming increasingly important to UK manufacturers of prepared or preserved potatoes. For example, the value of such exports rose by 66.5% between 2004 and 2007, while the value of exports to EU countries increased by 37.3% over the same period.
Table 2.9: UK Manufacturers Exports of Prepared or Preserved Potatoes Including Crisps (000), 2004-2007
Intra-EU Exports 2004 2005 2006 2007 31,274 33,234 37,453 42,950 Extra-EU Exports 9,430 12,089 13,687 15,701 Total 40,704 45,323 51,140 58,651
20
Key Note Ltd 2010
Snack Foods
Market Size
Leatherhead Food International Ltd Export Figures

According to research carried out for the Food and Drink Federation (FDF) by Leatherhead Food International Ltd in June 2009, UK exports of crisps a more limited category than the prepared or preserved potatoes, including crisps classification seen in the National Statistics figures previously increased in value by 26.4% to 47.5m between 2007 and 2008, continuing several years of high growth. The largest market was the Republic of Ireland, exports to which were worth 25.8m in 2008, representing an increase of 23.9% compared with 2007. However, it was the export markets of Italy and Germany that recorded the highest growth rates between 2007 and 2008, at 84.4% and 41.5%, respectively. More recent figures published by Leatherhead Food Research (the trading name of Leatherhead Food International) in October 2009 showed that UK exports of crisps had risen in value by 13.7% to 27.3m in the first 6 months of 2009, compared with the same period in 2008. The Republic of Ireland remained the largest market to which exports of crisps rose in value by 35.5%, compared with the first half of 2008 while exports to Denmark showed a growth rate of 200.7% over the same period.
Key Note Ltd 2010
21
Market Size
Snack Foods
22
Key Note Ltd 2010
Snack Foods
Industry Background
3. Industry Background
RECENT HISTORY
Potato crisps were invented in 1853 by an exasperated American-Indian hotel chef in Saratoga Springs, New York, who responded to repeated complaints from a customer that his chips were too thick by cutting the potatoes wafer thin. The guest was said to be very enthusiastic about the crisp, paper-thin potatoes, and they soon became a staple of American menus. The first British potato crisps were manufactured by a Mr Carter in 1913, but were first mass produced when Frank Smith of Cricklewood formed the Smiths Potato Crisps Company Ltd in 1920 the company that would eventually become part of Walkers Snack Foods. Potato crisps are manufactured from thinly sliced fresh potatoes (or occasionally other vegetables) that are lightly fried in oil or oven-baked and then sprinkled with flavourings. Different types of oils and flavourings have been introduced over the years, and many products have been reformulated to make them healthier. The 1970s saw the introduction of extruded products whereby, for example, ground corn is squeezed through a small shaped opening, expanding as it heats up into soft, light pieces that are then baked in an oven to make them crisp.
NUMBER OF COMPANIES
According to National Statistics UK Business: Activity, Size and Location publication, there were 60 UK VAT- and/or pay-as-you-earn (PAYE)-based enterprises engaged in the processing and preserving of potatoes in 2009. Of these, 41.7% had a turnover in excess of 1m, and a quarter reported a revenue of more than 5m an unusually high proportion.
Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Turnover Sizeband (000, number and %), 2009
Number of Enterprises Turnover Sizeband (000) 0-49 50-99 100-249 250-499 10 5 10 5 16.7 8.3 16.7 8.3 % of Total
Table continues...
Key Note Ltd 2010
23
Industry Background
Snack Foods
Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Turnover Sizeband (000, number and %), 2009
...table continued
Number of Enterprises Turnover Sizeband (000) 500-999 1,000-4,999 5,000+ Total 5 10 15 60 8.3 16.7 25.0 100.0 % of Total
Source: UK Business: Activity, Size and Location 2009, National Statistics Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
EMPLOYMENT
Of the 60 UK VAT- and/or PAYE-based enterprises engaged in the processing and preserving of potatoes in 2009, exactly half employed fewer than ten people. At the other end of the scale, a third of the enterprises were large companies with 100 or more employees.
Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Employment Sizeband (number and %), 2009
Number of Enterprises Number of Employees 0-4 5-9 10-19 20-49 50-99 25 5 5 5 0 41.7 8.3 8.3 8.3 0.0 % of Total
Table continues...
24
Key Note Ltd 2010
Snack Foods
Industry Background
Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Processing and Preserving of Potatoes by Employment Sizeband (number and %), 2009
...table continued
Number of Enterprises Number of Employees 100-249 250+ Total 10 10 60 16.7 16.7 100.0 % of Total
Source: UK Business: Activity, Size and Location 2009, National Statistics Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
REGIONAL VARIATIONS IN THE MARKETPLACE

There are thousands of different types of potatoes grown around the world. Around 80 different varieties of potatoes are grown commercially in the UK in principal growing areas that include Yorkshire, Lincolnshire, Norfolk, the East Midlands, Shropshire, Devon and Cornwall. Varieties commonly used in the manufacturing of crisps include Hermes, Saturna and Rosetta. According to National Statistics 2009 UK Business: Activity, Size and Location report, the highest concentration of companies involved in the processing and preserving of potatoes were to be found in Northern Ireland (33.3%) and the East Midlands (16.7%). Peanuts are widely grown in India, the Peoples Republic of China (PRC), the US, Argentina and West and South Africa. India also grows significant crops of cashew nuts, while pistachios commonly come from Iran, the US and Turkey. As for consumption of savoury snacks, according to a NEMS Market Research survey conducted in November 2009 (see Chapter 5 Brand Strategy), respondents living in the West Midlands proved to be the most avid regular buyers of savoury snacks.
Key Note Ltd 2010
25
Industry Background
Snack Foods
DISTRIBUTION
Key Note estimates that the major grocery multiples account for around two-thirds of the value of retail sales of potato crisps, snack nuts and other bagged savoury snacks, while the ongoing recession has seen discounters, such as Aldi and Lidl, taking market share from the more upmarket chains. A high level of discounting generally hinders potential growth in the value of sales, but the snacks category does benefit from impulse buying, particularly when crisps, etc. are placed alongside sandwiches and other lunch items by the front entrance of the store. Supermarkets are also encroaching on the convenience market by opening smaller town-centre stores. A wide range of other outlets are important in the market as there is a high degree of impulse buying. These include: confectioners, tobacconists and newsagents (CTNs); kiosks; and garage forecourts. Such outlets frequently charge more than the supermarket chains for snack products.
HOW ROBUST IS THE MARKET?

The recession may have increased demand for savoury snacks at the value end of the market, but the premium end survives well as consumers consider snacks an affordable treat. In fact, the market for savoury snacks is likely to benefit from a recession as people cut back on going out and begin entertaining at home more frequently, which may encourage them to purchase snack foods for sharing. Consumers may also indulge in comfort eating when times are hard, and begin making packed lunches for work or school, of which savoury snacks are often a part. However, certain measures such as an advertising ban on junk food to children and the restrictions on crisps and snacks in schools have had an adverse effect on demand for childrens snack products.
LEGISLATION
Legislation relating to the production and selling of foodstuffs aims to protect human life and health, and protect consumers interests, with due regard for the protection of animal health and welfare, plant health and the environment. Principal legislation involving food production and processing includes the Food Safety Act 1990, Food Safety Regulations 1995, the Price Marking Order 1999 and the Food Labelling Regulations 1996. As well as adhering to the UKs own laws, food suppliers must conform to precise rules at the European Community level.
26
Key Note Ltd 2010
Snack Foods
Industry Background
KEY TRADE ASSOCIATIONS

European Snacks Association
The European Snacks Association (ESA) was founded in 1956 and is Europes only trade organisation dedicated to the advancement of the savoury snacks industry on behalf of its members at national, European and international levels. The ESAs official journal, The Snacks Magazine, is published quarterly, and the Association also organises SNACKEX Europes largest snacks trade show.
Snack Food Association

Founded in 1937, the US-based Snack Food Association (SFA) is the international trade association of the snack food industry, representing more than 400 companies worldwide involved in the manufacture and supply of snacks. The SFA also organises the SNAXPO exhibition.
Snack, Nut and Crisp Manufacturers Association

Based in London, the Snack, Nut and Crisp Manufacturers Association (SNACMA) represents the interests of the savoury snack industry in the UK. Its members are responsible for more than 90% of all savoury snacks produced and sold, including branded and own-label products. The Association is controlled by a Board of Directors, comprising the Chief Executive Officers (CEOs) and Managing Directors (MDs) of each operating member company, which include Walkers, Kettle Crisps, Tayto, Procter & Gamble and United Biscuits.
ADVISORY AND INFORMATION SERVICES

The Food Commission (UK) Ltd
The Food Commission (UK) Ltd is the UKs leading independent watchdog on food issues. The Commission has been campaigning for healthier and safer food for more than 10 years, and is largely funded by public subscriptions and donations.
Food and Drink Federation

The Food and Drink Federation (FDF) promotes the food and drink manufacturing industrys views, and works to build consumer confidence in the food chain as a whole.
Key Note Ltd 2010
27
Industry Background
Snack Foods
Food Standards Agency

The Food Standards Agency (FSA), which became operational in April 2000, aims to keep professionals and the public fully informed about nutritional issues and food hygiene, and to maintain public confidence in the food industry, from which it is independent. One of the Agencys initiatives is the operation of a cooking bus, which travels to schools and holiday clubs throughout the UK. On the bus, fully qualified teachers teach children about healthy eating and food safety, and children can join in cooking sessions. The concept was developed in partnership with Focus on Food, which was formed to promote and strengthen the status of practical food education in primary and secondary schools.
28
Key Note Ltd 2010
Snack Foods
Competitor Analysis
4. Competitor Analysis
THE MARKETPLACE
The UK snack foods industry is highly concentrated and is dominated by PepsiCos Frito-Lay subsidiary, which owns Walkers Snack Foods Ltd in the UK. Procter & Gamble is another strong player, with its one snack brand of Pringles generating annual revenues in excess of $1bn. However, there are numerous smaller companies, such as Burts Potato Chips and Tyrrells Potato Chips, that have established a firm position in the premium market, and hand-cooked upmarket products are pioneered and led by Kettle Chips.
MARKET LEADERS
Intersnack Ltd
Company Structure
Intersnack Ltd is a part of Germany-based Intersnack Knabber-Gebck GmbH, which has had a presence in the UK since 1990. In January 2007, Intersnack acquired Union Snack Ltd makers of the leading pretzel brand, Penn State for an undisclosed sum and, in November 2008, it was reported that the company was interested in buying a larger stake in Largo Food Exports (which owns the Tayto name in the Republic of Ireland) to add to its existing holding.
Current and Future Developments

In addition to its leading Penn State brand, Intersnack supplies own-brand snacks to Marks & Spencer, Sainsburys, Tesco and Waitrose, as well as to airlines and train companies. Its Pom-Bear extruded snack is popular for its lack of wheat, gluten, artificial colours, flavours and preservatives. In June 2009, Intersnack Knabber-Gebck acquired Percy Daltons Famous Peanut Co Ltd a Haverhill-based producer of nut, seed and dried fruit products.
Financial Results
In the year ending 31st December 2008, Intersnack Ltd increased its turnover to 24.9m, compared with 22.8m in the previous year. However, a pre-tax loss of 565,000 was incurred in 2008, compared with a pre-tax profit of 668,000 in 2007.
Key Note Ltd 2010
29
Competitor Analysis
Snack Foods
Seabrook Crisps Ltd

Company Structure
The family-owned business of Seabrook Crisps Ltd has been producing crisps in the north of England since 1945. The brand now outsells all others, excepting Walkers, in this area of the country.

Despite the recession, Seabrook Crisps has reported ongoing record sales figures, with volumes up by 66% following the addition of 5,000 national stockists (including 50 Waitrose stores in the south of England) and an investment of 4m in new production lines. The company employs more than 100 people and is forecasting further growth throughout 2010, with annual sales expected to rise from 170 million bags to 233 million by October 2010. This will be partly due to ASDAs decision to stock Seabrook brands in 292 of its stores after finding that it was outperforming Walkers in some Yorkshire branches. Seabrook Crisps has been the Official Crisp of the Yorkshire County Cricket Club (YCCC) since 2008. Seabrook has also benefited from a product placement campaign, as the crisps are served in the public houses (pubs) in the ITV soap operas Coronation Street and Emmerdale, exposing the brand to consumers outside the north of England.
Financial Results
In the year ending 30th September 2008, Seabrook Crisps Ltd reported a turnover of 15.4m (compared with just under 13m in 2007) and a pre-tax profit of 750,000 (compared with a pre-tax loss of 1.9m in the previous year).
Tayto (NI) Ltd

Company Structure
Tayto (NI) Ltd is the long-established market leader in the snacks industry in Northern Ireland. The family-owned business, which is based in Tandragee in County Armagh, was founded by Thomas Hutchinson in 1956. With its string of recent acquisitions, Tayto is now among the largest crisp and snack manufacturers in the UK.

In January 2009, the Tayto group acquired Jonathan Crisp the Staffordshire-based supplier of hand-fried crisps for undisclosed terms. Jonathan Crisp is the trading name of Natural Crisps Ltd, and promotes its products as crisps for snobs. The acquisition was described as a distress purchase, and was completed in just 1 week. The deal was Taytos fourth acquisition in 3 years, following its purchases of Golden Wonder in 2006, Real Crisps in 2007 and Red Mill Snack Foods in 2008.
30
Key Note Ltd 2010
Snack Foods
Competitor Analysis
Tayto plans to close its Red Mill snack foods factory in Wednesbury in the West Midlands by the end of 2011, which will lead to the loss of 300 jobs. The closure is part of the companys plans to transfer production to its Corby site, partly due to the loss of a lucrative contract to produce Procter & Gambles Pringles Minis, which had been carried out by Tayto since its acquisition of Golden Wonder. The long-term future of the Corby plant had been unclear; however, in October 2008, it was announced that further jobs were to be created at the site.
Financial Results
In the 53-week period ending 5th July 2008, Tayto (NI) Ltd recorded a turnover of 26.2m and a pre-tax profit of 371,000. This compared to a turnover of just under 24m and a pre-tax loss of 143,000 in the preceding 52 weeks.
United Biscuits Topco Ltd

Company Structure
United Biscuits was founded in 1948 and now employs approximately 8,500 people worldwide. In October 2006, the company agreed a 1.6bn takeover deal with Paribas Affaires Industrielles (PAI) and US-based equity-investment firm Blackstone Group. (United Biscuits TopCo Ltd is the name of the company that comprises the Board of the controlling shareholders of the United Biscuits group.)

United Biscuits has 15 factories in the UK, France, Belgium and the Netherlands, and it also sells its products in North America, the Middle East, Africa and Australia. The company has reported being adversely affected by a shift to private-label food products in the markets of Northern Europe. In its interim statement for the first half of 2009, United Biscuits reported double-digit sales growth in its international markets, with particularly strong performances being seen in West Africa, Australia and the Middle East. The company also acquired a manufacturing facility in India, in anticipation of a market launch there; however, it is said to be considering plans to outsource up to 125 of the 750 jobs at its Aintree factory to India.
Financial Results
In the 53-week period ending 3rd January 2009, United Biscuits Topco Ltd reported a turnover of just over 1.2bn, compared with 1.14bn in the previous 52 weeks. The company suffered a pre-tax loss of 16.6m in 2008, compared with a loss of 11.2m in 2007.
Key Note Ltd 2010
31
Competitor Analysis
Snack Foods
Walkers Snack Foods Ltd

Company Structure
Walkers Snack Foods Ltd traces its origins to a pork butchery business founded in Leicester in the 1880s that diversified into making potato crisps when meat was in short supply after the Second World War. Walkers merged with its rival Smiths in 1979, before PepsiCo Inc of the US acquired both companies in 1989. Walkers is now the UKs leading manufacturer of savoury snacks, claiming a 60% share of the market, with around 11 million people eating its products that are manufactured at 15 sites across the UK.

In July 2009, Walkers Snack Foods announced the creation of 50 jobs at its crisps factory in Leicester, following a 2m investment in new equipment. It has said that it is committed to continuing investment in its site in Beaumont Leys, Leicester, which is its largest UK site, employing nearly 2,000 people. Walkers Snack Foods has added its Builders Breakfast variant as a permanent flavour. The product, which is intended to taste like egg, sausage, bacon and beans, won the public vote in the companys Do us a Flavour competition (see Marketing Activity section later in this chapter).
Financial Results
In the year ending 27th December 2008, Walkers Snack Foods Ltd reported a turnover of 223.5m and a pre-tax profit of 31.1m. In the previous year, the company had a turnover of 196.9m and a pre-tax profit of just over 30m.
OUTSIDE SUPPLIERS
Raw Materials
Potatoes
Approximately four tonnes of potatoes are required to make one tonne of potato crisps, and, every year, UK farmers grow 6.5 million tonnes of potatoes, of which around 550,000 tonnes are used in the manufacture of potato crisps. Additionally, 150,000 tonnes of potatoes are imported for this purpose from the rest of Europe, especially from Spain, France and Italy. The price and supply of potatoes is quickly affected by conditions outside of the industrys control, such as droughts or heatwaves. For example, the wet summer of 2008 pushed potato prices up. Quality control and wastage are key issues for potato industries across the five Northwest European Potato Grower (NEPG) countries. Despite lower yields in Germany, Belgium and Holland, overall production for 2009 is likely to be higher than in 2008.
32
Key Note Ltd 2010
Snack Foods
Competitor Analysis
Among the suppliers of potatoes to the UKs retail, catering and processing sectors is Greenvale AP, which has sites in the major potato growing areas of Shropshire, Berwickshire and Cambridgeshire. Another is QV Foods, which is a wholly owned subsidiary of AH Worth & Co Ltd a family business based in Lincolnshire. In February 2009, QV Foods took over the management of the Cambridgeshire site of MBM Produce Ltd, and the remaining of the latters business went into administration in July 2009 (see Chapter 8 Current Issues). RS Cockerill (York) Ltd claims to be one of the UKs largest suppliers of potatoes to the processing industry, supplying in excess of 100,000 tonnes to crisp manufacturers each year, which equates to one in six packets of potato crisps sold in the UK.
Nuts
Peanuts used in savoury snacks are primarily sourced from India and the Peoples Republic of China (PRC), which together account for more than half of the worlds production. Other major peanut growing countries include the US, Senegal, Sudan, Brazil, Argentina, South Africa, Malawi and Nigeria. Usually, snack peanuts are shelled, roasted (sometimes in oil), blanched and salted. Iran, the US and Turkey are among the principal suppliers of pistachio nuts, while cashews are native to Brazil, but are now produced in more than 30 countries, including Vietnam, Nigeria and India. UK Snacks Ltd (trading as Nageena) and Puyang Tianli Nuts Co Ltd are among the companies supplying to the global snack nuts industry.
Corn and Wheat

The French company Groupe Limagrain is one of the worlds leading producers of seeds, especially in Europe, where the group is the top producer of corn, wheat and other seeds. The company has also extended its reach by supplying flour and other bakery ingredients through its subsidiary, Limagrain Crales Ingrdients. For extruded products, ingredients are blended together and passed through a cooking extruder where they are cooked and formed into a dense pellet. Following extrusion, cooking and forming, the pellets are dried and distributed to a snack processor where they are expanded or puffed by immersion in hot oil or other heating methods. The snacks manufacturer then seasons, packs and sells the ready-to-eat snack to retailers.
Oils and Fats

Vegetable oils are almost always used for savoury snacks and are usually derived from soya, sunflower, rapeseed, groundnut and palm oil. South American countries, Malaysia and Indonesia are among the regions exporting oils. New British Palm Oil has struck a 2-year deal to supply United Biscuits with palm oil from sustainable sources. United Biscuits hopes to obtain all the oil it uses from sustainable sources by the end of 2011, and this new deal means that it will be two-thirds of the way towards hitting that target by mid-2010. It is the first supply agreement signed for New Britains UK refinery in Liverpool, which is due to be completed in spring 2010.
Key Note Ltd 2010
33
Competitor Analysis
Snack Foods
Flavours and Seasonings

Seasonings are specially blended from a variety of ingredients to provide the flavours for savoury snacks, which are passed through a rotating flavour drum to be evenly sprinkled with salt or other flavours. Kerry Group PLC is a major supplier of flavourings, seasonings and coating systems to snack manufacturers, and it operates manufacturing, sales and technical centres across Europe, North and South America, Australia, New Zealand and Asia. It employs more than 20,000 people and supplies 15,000 food produsts, food ingredients and flavour products to customers in more than 140 countries worldwide. Other suppliers include the Swiss Group Givaudan SA, which acquired the UK flavour and fragrance business of Quest International from ICI PLC in March 2007, and Savoury Flavours Ltd, which acquired fellow UK flavouring company Imarco Food Ingredients in July 2007. The US company McCormick and Company Inc was established in 1889 and supplies liquid, paste and powder flavourings. Its sales revenue in the year ending 30th November 2008 reached $3.18bn the first time it had topped $3bn, representing an increase of 8.9% compared with the previous year.
Snack Processing Equipment

Savoury snacks are fed from a conveyor belt into a hopper and automatically weighed into portions. They are then dropped into packets or other such containers, which are then sealed. Suppliers of processing equipment to the snack foods industry include Baker Perkins Ltd, FMC Food Tech (now part of the Chicago-based JBT Corporation), Flo-Mech Ltd and Extrusion-Link Ltd. In May 2008, Middlesex-based Wright Machinery Ltd merged with the US company PPM Technologies, and the new company is known as PPM/Wright Machinery Ltd. Other suppliers of processing equipment to the savoury snacks industry include the German Hastamat GmbH, Lalesse Extrusion BV of the Netherlands, and the US Heat & Control Inc, which has a UK operation in West Lothian, Scotland.
Packaging
Bristol-based Kliklok-Woodman is a leading international packaging machinery supplier and a part of the US Klikwood Corporation. The business traces its origins to the 1940s when it worked closely with Herman Lay (founder of HW Lay Co [forerunner of Frito-Lay]) to develop the first automated potato chip packaging system. Other suppliers of packaging and weighing equipment include Flo-Mech Ltd, Hastamat GmbH, PPM/Wright Machinery and Blueprint Automation Ltd, which has a European headquarters in the Netherlands and a sales office in Lincolnshire.
34
Key Note Ltd 2010
Snack Foods
Competitor Analysis
MARKETING ACTIVITY
Main Media Advertising Expenditure
According to Nielsen Media Research (NMR), main media advertising on all food amounted to 507.4m in the year ending September 2009, compared with 554.3m in the previous year. Expenditure on foodstuffs of relevance to this report accounted for 5.5% of this total and, at 27.7m, represented an increase of 35.3% compared with the 20.5m seen in the previous year. NMR divides the savoury snack foods market into three categories, as specified in Table 4.1. In the year ending September 2009, the potato crisps and snacks sector had by far the largest share of advertising expenditure (21.3m), followed by the crispbreads and crackers category, which spent 6.4m on its advertising over the same period. Advertising on dips and dipper snacks had a value of 51,000 in 2009, but this category recorded no above-the-line main media advertising expenditure in the previous year.
Table 4.1: Main Media Advertising Expenditure on Savoury Snacks (000), Years Ending September 2008 and 2009
2008 Potato crisps and snacks Crispbreads and crackers Dips and dipper snacks Total Source: Nielsen Media Research 16,267 4,197 20,464 2009 21,251 6,377 51 27,679
Potato Crisps and Snacks

Potato crisps and snacks is the category benefiting from the most main media advertising expenditure, accounting for more than three-quarters (76.8%) of the total in the year ending September 2009. Market leader, Walkers, is by far the biggest spender in this category, with its above-the-line spending alone accounting for 41% of the total expenditure. Other brands supported by advertising budgets of significance were Pringles (3.2m), Phileas Fogg (1.9m) and KP (1.6m). The low level of sub-threshold spending reflects the dominance of the big-name brands in the category.
Key Note Ltd 2010
35
Competitor Analysis
Snack Foods
Table 4.2: Main Media Advertising Expenditure on Potato Crisps and Snacks (000), Year Ending September 2009
Walkers Crisps Red Sky Crisps Sensations Doritos Corn Chips and Dips Doritos Snack foods Total Walkers Pringles Crisps Select range Total Pringles Phileas Fogg snack product range KP McCoys Hula Hoops Total KP Kettle Foods Kettle Chips Ryvita Limbos Range McVities Mini Cheddars Go Ahead! snack range Total McVities 490 375 865 831 797 1,628 1,296 1,159 1,772 1,379 3,151 1,935 4,110 2,147 1,159 741 452 114 8,723
Table continues...
36
Key Note Ltd 2010
Snack Foods
Competitor Analysis
Table 4.2: Main Media Advertising Expenditure on Potato Crisps and Snacks (000), Year Ending September 2009
...table continued
Quaker SnackAJacks Kraft Ritz Crackers Marmite Rice Cakes Spar Snacks Sub-threshold brands Total Source: Nielsen Media Research 718 695 536 95 450 21,251
Crispbreads and Crackers

Main media advertising expenditure on crispbreads and crackers stood at 6.4m in the year ending September 2009, representing an increase of 51.9% compared with the previous year. Kelloggs was the biggest spender, with its Special K Mini Breaks variety accounting for 47.3% of the total expenditure in this category. The Ryvita Company a subsidiary of Associated British Foods (ABF) accounted for a further 39.4% of the total in 2009.
Table 4.3: Main Media Advertising Expenditure on Crispbreads and Crackers (000), Year Ending September 2009
Kelloggs Special K Mini Breaks Ryvita Product Range Jacobs Cream Crackers Kallo Rice Cakes Ryvita Crispbread Range Sub-threshold brands Total Source: Nielsen Media Research 3,014 2,406 530 142 106 179 6,377
Key Note Ltd 2010
37
Competitor Analysis
Snack Foods
Dips and Dipper Snacks

Just 51,000 of sub-threshold spending was invested in the promotion of dips and dipper snacks in the year ending September 2009, while none was recorded in the previous year.
Recent Promotions
United Biscuits
The newly relaunched premium snack brand Phileas Fogg was promoted by a 3m television campaign by United Biscuits in March/April 2009, which was repeated later in the year. In addition to this, retailers were supported by in-store activity for the brand. Another United Biscuits brand, Hula Hoops, was featured in a television campaign featuring finger puppets in July/August 2009. In conjunction with the advertisement, United Biscuits ran a competition whereby entrants were invited to make their own finger puppet film and upload it to the Hula Hoops website in the first ever Golden Hoop Film Awards. Five winners were rewarded with family holidays to Hollywood. As part of a 1.5m investment in the brand for 2009, United Biscuits ran a television campaign for McCoys in June 2009, positioning the brand as THE crisp for men, following on from a similar promotion in 2008. The 2009 campaign also included a new website and on-pack promotion to raise awareness of the brand and increase sales.
Walkers
In June 2009, Walkers launched a multi-million pound television advertising campaign for its Garys Great Trips on-pack promotion. The 9-week campaign which featured ex-footballer Gary Lineker and television presenter Cat Deeley promoted the opportunity to collect points from sales of Walkers Crisps that could be exchanged for discounts on leisure activities around Great Britain, including days out at top UK theme parks and National Trust venues.
38
Key Note Ltd 2010
Snack Foods
Competitor Analysis
Other Marketing Activities

Do us a Flavour
In 2008, Walkers Snack Foods ran a Do us a Flavour competition on its website, inviting people to suggest a new flavour for its crisps. The competition attracted 1.2 million entries, from which judges (including television chef Heston Blumenthal who is renowned for the unusual flavours on his restaurant menu) decided on six finalists: Cajun Squirrel; Crispy Duck and Hoisin; Builders Breakfast; Onion Bhaji; Fish and Chips; and Chilli and Chocolate. Walkers then manufactured and retailed all six flavours and invited the public to vote for their favourite. In May 2009, the winner was announced as Builders Breakfast a flavour combination of egg, bacon, sausage and beans. The creator of the flavour won 50,000 and a 1% share of Walkers future sales. The five runners up received a 10,000 prize.
Great British Flavoured Crisps

To mark the introduction of its Great British crisps (see Chapter 8 Current Issues), Tyrrells is inviting suggestions for definitions of Great Britishness, for which it is offering winners a monthly line up of British-themed prizes, including classic car weekends, luxury Featherdown Farm stays and Baileys Homes & Gardens vouchers.
Doritos
During May 2009, Walkers ran a promotion whereby purchasers of its Doritos brand had the chance to win a daily prize of a holiday to Las Vegas for two with free flights, 4 nights at the Planet Hollywood Resort and 250 spending money. The competition coincided with the launch of the new Flamin Cheeseball Doritos flavour.
Exhibitions
Anuga
Anuga is one of the worlds most prestigious trade fairs for food and beverages, and is held in alternate years in October in Cologne, Germany. All food sectors, including snacks, and their suppliers are represented. The 30th Anuga event was held in October 2009, and attracted around 153,500 trade visitors from more than 180 countries. Around 61% of visitors came from countries outside Germany, and visitor turnout from the Middle East was particularly high, having increased by more than 30% compared with the 2007 exhibition. 6,522 suppliers from 97 countries were exhibited in 2009.
International Food and Drink Exhibition

The biennial International Food and Drink Exhibition (IFE) is held at Londons ExCeL Centre. The 2009 event attracted more than 22,000 exhibitors. There is also an IFE staged in Warsaw, Poland every other year, with the next scheduled to take place in May 2011.
Key Note Ltd 2010
39
Competitor Analysis
Snack Foods
Sandwich & Snack Show

Around 9,000 visitors and 300 exhibitors are expected to turn out for the 11th Sandwich & Snack Show, which will be held over 2 days in February 2010 in Paris, France. It is organised by Reed Expositions.
SNACKEX
Organised by the European Snacks Association (ESA), the 13th SNACKEX trade show and conference attracted 120 exhibitors from 75 countries when it was held in Berlin, Germany in June 2009. The next event will be SNACKEX Asia, which will be staged at the China National Convention Center in Beijing in May 2010.
SNAXPO
SNAXPO is the worlds largest trade show devoted exclusively to the snack food industry. It is an annual event organised by the US Snack Food Association (SFA), and showcases the latest equipment, technology, ingredients, products and services aimed at improving snack manufacturers operations. The exhibition attracted more than 100 exhibitors and nearly 1,000 visitors in 2009, when it was staged in Florida. The next event will be held over 3 days in March 2010, when it will return to its previous venue of the Fort Worth Convention Center in Texas.
40
Key Note Ltd 2010
Snack Foods
Brand Strategy
5. Brand Strategy
RESEARCH FINDINGS
In November 2009, Key Note commissioned NEMS Market Research to conduct a survey on the popularity of selected snack food brands in the UK. The survey profiled 1,000 respondents aged 16 and over, who were asked: which, if any of the following brands of snack food do you purchase on a regular basis (i.e. at least once a month)? Table 5.1 reveals the penetration rates for the most popular brands in 2009, and compares the results to those from the previous years survey, undertaken in August 2008. The percentage of respondents who had bought none of the named brands regularly decreased between 2008 and 2009, while Walkers remained the most popular brand by far among respondents who did buy brands regularly. However, percentage penetration for the core Walkers brand was lower in 2009 compared with the previous year (57.4% and 59.2%, respectively), as was percentage penetration of its premium Sensations brand. The arguable leader in the premium sector, Kettle Chips, saw its percentage penetration increase in 2009, but so too did supermarket own-brand varieties, confirming the view that the recession is fuelling demand at both the premium and value ends of the market. Other brands that benefited from increased percentage penetration in 2009 were Quavers, Nik Naks, Mini Cheddars, Monster Munch, Penn State, Burts and Seabrook.
Table 5.1: Popularity of Selected Snack Food Brands (% of respondents), 2008 and 2009
2008 Walkers Supermarket own brand Pringles Quavers McCoys Mini Cheddars Doritos Hula Hoops Kettle Chips Monster Munch KP Peanuts 59.2 27.0 33.1 24.1 24.0 20.7 26.1 26.0 17.2 13.3 19.1 2009 57.4 32.0 27.3 24.7 23.8 23.5 23.0 22.7 21.4 18.0 17.7
Table continues...
Key Note Ltd 2010
41
Brand Strategy
Snack Foods
Table 5.1: Popularity of Selected Snack Food Brands (% of respondents), 2008 and 2009
...table continued
2008 Walkers Sensations Wotsits Seabrook Crisps Nik Naks Chip Sticks Penn State Pretzels Tyrells Burts Crisps None of these
Weighted sample: 1,000 Base: all adults aged 16+ purchasing at least once a month
2009 17.2 15.0 10.9 9.6 8.2 5.4 3.8 3.3 21.5
19.6 18.1 8.3 9.2 8.8 4.1 3.9 1.2 23.9
Source: Key Note/NEMS Market Research, August 2008 and November 2009
By Sex
The popularity of some brands of snack foods was significantly higher among men than women, for example, Walkers Sensations, McCoys (which is specifically marketed towards young men), Kettle Chips, Monster Munch and KP Peanuts. However, supermarket own-brands were more popular among women, as were Quavers, Wotsits, Seabrook, Nik Naks and Penn State. A higher proportion of men than women claimed that they were not frequent consumers of any of these snack food brands (22.1% and 20.8%, respectively).
42
Key Note Ltd 2010
Snack Foods
Brand Strategy
Table 5.2: Popularity of Selected Snack Food Brands by Sex (% of respondents), 2009
All Adults Walkers Supermarket own brand Pringles Quavers McCoys Mini Cheddars Doritos Hula Hoops Kettle Chips Monster Munch KP Peanuts Walkers Sensations Wotsits Seabrook Crisps Nik Naks Chip Sticks Penn State Pretzels Tyrells Burts Crisps None of these
Men 57.6 30.5 27.7 24.2 25.7 24.0 23.0 23.7 23.2 20.3 20.4 18.7 10.2 9.2 8.7 10.3 5.0 3.8 4.3 22.1
Women 57.2 33.4 26.9 25.3 21.9 23.0 23.0 21.7 19.7 15.7 15.1 15.7 19.7 12.5 10.5 6.2 5.9 3.8 2.3 20.8
57.4 32.0 27.3 24.7 23.8 23.5 23.0 22.7 21.4 18.0 17.7 17.2 15.0 10.9 9.6 8.2 5.4 3.8 3.3 21.5
Source: Key Note/NEMS Market Research, November 2009
Key Note Ltd 2010
43
Brand Strategy
Snack Foods
By Age
In 2009, respondents aged 55 and over were by far the least likely to be regular users of any of the brands cited, indicating that savoury snacks are far more popular among younger consumers. Interestingly, percentage penetration for Walkers Sensations was particularly high in the 16 to 19 year-old age group, yet the premium snacks close rival Kettle Chips had a very low penetration rate of 9% in this age bracket. Supermarket own-brands were by far the most popular among consumers aged between 16 and 24, perhaps due to the high number of university students in these groups, who are likely to be more cost-conscious than older consumers.
Table 5.3: Popularity of Selected Snack Food Brands by Age (% of respondents), 2009
All Adults
16-19
20-24
25-34
35-44
45-54
55-64
65+
Walkers Supermarket own brand Pringles Quavers McCoys Mini Cheddars Doritos Hula Hoops Kettle Chips Monster Munch KP Peanuts Walkers Sensations Wotsits Seabrook Crisps Nik Naks Chip Sticks
57.4 32.0 27.3 24.7 23.8 23.5 23.0 22.7 21.4 18.0 17.7 17.2 15.0 10.9 9.6 8.2
79.8 55.7 23.3 32.1 36.9 31.5 23.5 37.9 9.0 23.6 22.5 50.0 16.7 11.5 9.1 12.1
59.0 47.6 32.3 16.9 38.1 19.9 27.4 23.7 40.5 41.8 17.9 39.2 13.1 10.9 14.7 1.7
70.1 30.9 41.3 39.0 32.7 26.0 31.5 33.8 36.4 39.0 17.9 17.3 27.4 12.3 16.0 13.4
67.4 37.0 29.7 38.3 26.7 30.3 30.8 31.9 21.5 20.8 19.2 17.8 27.0 14.3 15.4 10.8
56.6 29.3 24.8 20.6 22.5 19.3 29.6 20.6 22.0 8.5 20.0 14.9 11.7 12.8 6.0 8.3
42.5 25.2 21.5 17.9 17.5 21.8 15.0 14.8 15.7 6.4 18.5 9.0 5.5 7.4 6.3 3.6
38.1 19.8 17.9 7.4 7.5 17.9 6.0 4.9 8.6 0.4 11.7 2.9 1.8 6.8 2.0 5.2
Table continues...
44
Key Note Ltd 2010
Snack Foods
Brand Strategy
Table 5.3: Popularity of Selected Snack Food Brands by Age (% of respondents), 2009
...table continued
All Adults
16-19
20-24
25-34
35-44
45-54
55-64
65+
Penn State Pretzels Tyrells Burts Crisps None of these

Weighted sample: 1,000
5.4 3.8 3.3 21.5
14.5 0.0 0.0 6.9
0.0 0.0 0.0 15.9
10.5 10.4 9.7 16.5
6.7 5.1 3.0 11.9
4.0 3.2 2.3 20.4
3.1 0.4 1.3 31.1
1.2 2.3 2.5 37.2
Base: all adults aged 16+ purchasing at least once a month
By Social Grade
Respondents in social grade A were noticeably less likely to eat any of the specified brands on a regular basis in 2009. In fact, the only brands that showed a lower penetration rate among any other grade were Doritos, Kettle Chips and Burts, which were least likely to be a chosen snack among respondents in group E. Group E also had generally low penetration rates, perhaps because this category includes retired people who, as seen in Table 5.3, tend to be less interested in savoury snacks than younger consumers. Generally speaking, C1s, C2s and Ds were the most avid consumers of the specified brands of snacks, with the exceptions of Pringles (which proved most popular among respondents in grade B) and Kettle Chips (for which the highest percentage penetration was among C1 consumers).
Key Note Ltd 2010
45
Brand Strategy
Snack Foods
Table 5.4 Popularity of Selected Snack Food Brands by Social Grade (% of respondents), 2009
All Adults Walkers Supermarket own brand Pringles Quavers McCoys Mini Cheddars Doritos Hula Hoops Kettle Chips Monster Munch KP Peanuts Walkers Sensations Wotsits Seabrook Crisps Nik Naks Chip Sticks Penn State Pretzels Tyrells Burts Crisps None of these
A 31.8 10.2 9.1 5.8 4.1 10.1 16.2 5.8 8.6 2.9 9.6 8.9 2.9 4.1 2.9 0.0 0.0 0.0 1.7 63.1
B 55.7 25.3 37.0 21.7 21.4 13.6 26.2 23.4 21.4 16.1 16.0 18.0 16.1 9.4 3.4 9.5 7.1 4.0 3.2 21.6
C1 47.4 32.5 25.9 20.8 21.2 22.7 25.3 22.5 30.0 18.0 13.5 17.3 18.0 7.3 12.0 7.6 4.1 4.4 3.6 22.0
C2 67.6 38.5 27.0 31.2 31.5 26.9 22.2 24.7 23.0 21.5 19.5 17.7 21.5 16.0 10.9 7.5 8.1 4.1 4.3 17.0
D 67.4 35.3 26.6 31.5 30.5 34.3 26.8 26.5 15.4 24.8 21.7 19.7 24.8 10.8 12.6 15.0 2.5 5.2 2.5 15.7
E 52.5 23.4 22.7 18.4 10.2 20.7 12.4 16.5 5.5 6.9 22.8 13.6 6.9 10.1 6.9 4.0 4.1 0.5 1.2 29.4
57.4 32.0 27.3 24.7 23.8 23.5 23.0 22.7 21.4 18.0 17.7 17.2 15.0 10.9 9.6 8.2 5.4 3.8 3.3 21.5
46
Key Note Ltd 2010
Snack Foods
Brand Strategy
By Region
As is apparent in Tables 5.5 and 5.6, respondents living in the West Midlands frequently showed the highest percentage penetration of snacks, while their counterparts in the East Midlands showed the lowest in several instances. Geographic variations of note include: Percentage penetration of Pringles in the North was more than twice that recorded in the East Midlands. Those in the East Midlands showed a marked preference for Mini Cheddars, while completely shunning Burts Crisps and Penn State Pretzels. Percentage penetration for KP peanuts was highest in Scotland and lowest in Wales. Percentage penetration for Walkers Sensations ranged from a paltry 7.9% in the South West to 32.7% in the West Midlands. Respondents in the brands heartland of the North West saw Seabrooks recording a percentage penetration of 29.4%, compared with a low of just 1.9% in Greater London. At 43.1%, percentage penetration of Monster Munch in the West Midlands was way above the national average of 18%. Supermarket own-brand snacks were most popular in the East Midlands and least in the North. The South West had the highest penetration of consumers who claimed to eat none of the listed snacks on a regular basis (35.5%), while those living in Wales were the least likely to make this statement (14.1%).
Key Note Ltd 2010
47
Brand Strategy
Snack Foods
Table 5.5: Popularity of Selected Snack Food Brands by Region (% of respondents), 2009
Greater London
East Midlands
East Anglia
North West
All Adults
Scotland
North
Walkers Supermarket own brand Pringles Quavers McCoys Mini Cheddars Doritos Hula Hoops Kettle Chips Monster Munch KP Peanuts Walkers Sensations Wotsits Seabrook Crisps Nik Naks Chip Sticks Penn State Pretzels Tyrells Burts Crisps None of these
57.4 32.0 27.3 24.7 23.8 23.5 23.0 22.7 21.4 18.0 17.7 17.2 15.0 10.9 9.6 8.2 5.4 3.8 3.3 21.5
56.5 28.4 21.7 21.8 19.3 23.3 18.5 35.1 19.0 6.8 19.3 10.9 15.3 10.0 9.9 8.8 4.6 2.8 2.3 18.5
58.9 44.5 16.7 13.9 28.9 32.5 13.8 11.5 16.6 19.3 12.6 21.4 16.2 7.4 2.4 15.8 0.0 2.5 0.0 24.4
57.3 40.1 26.6 25.4 20.9 25.8 25.7 28.8 26.4 22.2 13.1 18.4 9.8 1.9 4.9 8.2 7.1 6.5 5.0 18.5
73.0 21.3 34.4 29.4 25.0 21.8 32.7 18.7 20.9 34.3 18.4 14.1 21.1 13.3 24.7 11.7 3.5 2.3 2.3 19.0
54.2 32.0 31.9 28.4 29.7 25.3 21.0 25.8 10.2 13.8 22.2 23.3 13.8 29.4 8.8 5.3 2.2 1.4 2.2 23.4
64.5 34.3 32.4 27.7 25.6 23.6 31.2 29.3 20.6 22.6 26.6 27.3 23.4 9.7 12.8 4.1 9.8 1.7 3.6 17.8
48
Key Note Ltd 2010
Snack Foods
Brand Strategy
Table 5.6: Popularity of Selected Snack Food Brands by Remaining Regions (% of respondents), 2009
West Midlands Yorkshire and Humberside
South West
South East
All Adults
Wales
Walkers Supermarket own brand Pringles Quavers McCoys Mini Cheddars Doritos Hula Hoops Kettle Chips Monster Munch KP Peanuts Walkers Sensations Wotsits Seabrook Crisps Nik Naks Chip Sticks Penn State Pretzels Tyrells Burts Crisps None of these
57.4 32.0 27.3 24.7 23.8 23.5 23.0 22.7 21.4 18.0 17.7 17.2 15.0 10.9 9.6 8.2 5.4 3.8 3.3 21.5
52.3 25.3 23.5 16.9 26.7 22.0 17.3 16.7 30.7 12.3 16.0 11.7 11.2 2.9 10.3 7.1 8.6 4.3 2.9 27.2
49.6 24.4 16.9 22.3 22.3 17.4 19.5 15.4 14.4 18.3 12.8 7.9 16.7 3.1 10.2 11.2 4.8 6.9 0.7 35.5
64.7 31.4 26.0 20.1 17.3 17.6 20.4 10.9 19.2 7.2 12.4 8.7 12.6 7.0 4.9 6.3 1.5 0.7 2.0 14.1
55.4 38.8 33.8 43.3 21.8 25.5 36.1 35.5 37.1 43.1 18.8 32.7 30.2 3.1 24.1 15.1 12.8 11.9 12.8 16.2
56.2 27.0 34.1 25.8 22.1 21.6 21.3 14.4 12.8 9.9 21.2 10.3 6.7 31.1 2.6 4.3 0.8 0.0 0.5 21.6
Key Note Ltd 2010
49
Brand Strategy
Snack Foods
COMPANIES BRANDS
Intersnack
Intersnacks brands of savoury snacks are Pom-Bear (bear-shaped crisps for children), Chio and Penn State Pretzels. Following its acquisition of Percy Daltons Famous Peanut Co Ltd, Intersnack has introduced a Your Nuts range, which revitalises the 80-year old brand. A new image and slogan were designed to appeal to a younger target market, while still retaining its quality heritage.
Largo Food Exports

Owned by Largo Foods in the Republic of Ireland (but not in Northern Ireland), the Tayto name is synonymous with crisps to the Irish public, and the companys founder is said to have been responsible for the development of the first Cheese and Onion-flavoured crisp, although other sources attribute this to Golden Wonder. According to Nielsen MarketTrack in June 2009, the Original Irish Crisp is Irelands number one snack food brand. Other Tayto products include Mighty Munch, Snax and Chipsticks. In June 2009, Tayto revealed that its new healthy low-calorie snack range, Real DLites, had generated more than 100,000 in sales over the preceding 3 months.
Tayto (NI)
Tayto (NI) Ltd owns the Tayto brand, other than in the Republic of Ireland. Taytos ranges include Rough Cuts, Fusion and Advantage. Other company brands include Golden Wonder and Jonathan Crisp, and Taytos 2008 acquisition of Red Mill added the Mr Porky and Transform-A-Snack brands to its portfolio.
Tyrrells Potato Chips

Tyrrells supplies its handmade crisps to farm shops, delicatessens, independent stores and national retailers, including Waitrose and Sainsburys. In addition to its vegetable crisps, which include Parsnip and Mixed Root varieties, Tyrrells produces Thai Chilli Rice Crackers and Wasabi Coated Peanuts. September 2009 saw the introduction of Tyrrells Great British flavoured crisps, with flavours that included Welsh Rarebit and Beef Wellington. Tyrrells Potato Chips appeared at position 97 in the 2008 Sunday Times Fast Track 100 of fastest-growing private UK companies.
50
Key Note Ltd 2010
Snack Foods
Brand Strategy
United Biscuits
United Biscuits brands of savoury snacks include KP, Hula Hoops, Phileas Fogg and McCoys. The latter, which targets the male market, is the UKs third largest crisp and snack brand (after Walkers Crisps and Pringles), with sales valued at around 90m. In 2009, United Biscuits reformulated its Wheat Crunchies and Nik Naks to be free of artificial colours and monosodium glutamate (MSG), and it has also reduced the saturated fat content of both by 60%. KP Nuts Spicy Chilli has also been totally stripped of MSG.
Walkers Snack Foods

Walkers is the largest snack brand in the UK, claiming around 23% of the crisp market and holding third place in Nielsens league table of grocery brands. Its brands include Quavers, Sensations, Wotsits, Doritos and Red Sky, as well as standard Walkers crisps, Walkers Lite and Walkers Max. Walkers was acquired by PepsiCo in 1989, which now controls around 60% of the UK crisps and snacks market. Monster Munch a favourite in the 1970s was relaunched in September 2008 and, according to Nielsen, the Walkers-owned retro brand is now in the UKs top-twenty snacks, with annual sales of 35m. In October 2009, it was announced that PepsiCo was to relaunch the Walkers festive crisp range in the UK in a bid to boost Christmas sales. The seasonal variations will include a six-pack of limited-edition flavours: Turkey and Stuffing; Ham and Mustard; and Cheese and Pickle.
TOP BRANDS
The Checkout Nielsen Top 100 Brands is based on data taken from Nielsens Scantrack Service, which monitors weekly sales from a nationwide network of EpoS checkout scanners. Brands of relevance to this report that are included in the 2008 league table are Walkers Crisps at number 3 (unchanged from 2007), Pringles at 32 (up from 41 in 2007), McCoys Crisps (74), Doritos (86), Walkers Sensations (89) and Hula Hoops (91). Of these, Doritos and Hula Hoops were new entrants in 2008, while Quavers dropped from the top-100 brands.
The Guild of Fine Food Great Taste Awards

Each year, The Guild of Fine Food stages its Great Taste Awards. In 2009, there were around 4,873 foods entered that were judged on a one-, twoor three-star system. The following table shows those winners of relevance to this report, with Tyrrells Beetroot Chips receiving a two-star award, and the others receiving one star.
Key Note Ltd 2010
51
Brand Strategy
Snack Foods
Table 5.7: Winners of The Guild of Fine Food Great Taste Awards, 2009
Product Category Plain potato crisps Pipers No Salt Crisps Naked Potato Chips Pipers Crisps Ltd Tyrrells Potato Chips Ltd Entrant
Flavoured potato crisps Sea Salt & Aspall Cider Vinegar Pipers West Country Cheddar & Onion Pipers Sea Salt & Indian Black Pepper Pipers Biggleswade Sweet Chilli Crisps Horseradish & Sour Cream
Fairfields Farm Crisps Pipers Crisps Ltd Pipers Crisps Ltd Pipers Crisps Ltd Salty Dog Brands Ltd
Crisps of vegetables other than potatoes
Parsnip Chips with Rosemary Beetroot Chips
Tyrrells Potato Chips Ltd Tyrrells Potato Chips Ltd
Mixed Root Vegetable Chips Tyrrells Potato Chips Ltd Savoury cocktail snacks Rosies Savoury Bagel Chips Broadway Bagels
Cocktail nuts
Wasabi Peanuts Kiln Roasted Bayou Nuts Fortnum & Mason Sultry Smokey Nuts
Tyrrells Potato Chips Ltd Olives Et Al Ltd Olives Et Al Ltd
Source: The Guild of Fine Food, www.finefoodworld.co.uk
52
Key Note Ltd 2010
Snack Foods
Strengths, Weaknesses, Opportunities and Threats
6. Strengths, Weaknesses, Opportunities and Threats

STRENGTHS
Savoury snacks are popular with all ages. They are an affordable treat. There are a number of strong brands in the market. Savoury snacks can be part of a weekly grocery shop and are also subject to impulse purchases. New product development (NPD) is ongoing and the savoury snacks industry is continuing to invest confidently in NPD, despite the recession. An established trend of snacking in between meals, or even replacing set meals with snacks, encourages sales of products. UK consumers tastes are becoming ever more adventurous and manufacturers are developing increasingly exotic flavours. The recession has driven growth in value products, but the premium end of the market is also being sustained by increased home consumption.
WEAKNESSES
The European market for savoury snacks is dominated by Frito Lay and Walkers Snack Foods. It is difficult for new niche operators to compete against the major players, such as Walkers, for shelf space in store. Savoury snacks are commonly perceived as unhealthy and being high in fat and salt. Demand for nuts is seasonal and centred on the Christmas period. The price, availability and quality of ingredients, such as potatoes, grain and oil, can fluctuate considerably. Savoury snacks are no longer widely available in schools, canteens or vending machines. No sooner do newly introduced proprietary brands prove a success, than retailers introduce their own-brand lower-priced versions, helping to curb value growth in the overall market. Discounting is still a feature of the market; for example, Tesco was selling Pringles and Mini Cheddars for half price in the run up to Christmas 2009.
Key Note Ltd 2010
53
Strengths, Weaknesses, Opportunities and Threats
Snack Foods
OPPORTUNITIES
People sacrificing nights out for home entertainment may spend more on premium snacks as treats. The recession has led to people taking packed lunches to work and school rather than eating out. Manufacturers, including Walkers, are investing in display equipment and supporting independent stores merchandising in an attempt to revitalise the impulse market. Unusual flavours and retro brands are both showing good growth potential. The latter is attractive to manufacturers as it is a cheaper option than NPD and has an already-aware market. With the 2010 football World Cup taking place in South Africa, some manufacturers are developing African-influenced flavours. It has been suggested that the ban on smoking in public places imposed in England in 2007 has led smokers to eat more snacks in public houses (pubs) as an alternative to smoking outdoors. Manufacturers are constantly bringing out different packaging types and sizes aimed at the on-the-go market, childrens market and the adult sharing market. Manufacturers are increasingly promoting natural ingredients, such as wholegrains, nuts and seeds, in their savoury snacks. Overseas markets, such as Eastern Europe and the Middle East, are areas where snack food producers can increase sales. Manufacturers are pushing their sharing format larger bags to capitalise on people entertaining at home and because they offer better profit margins.
THREATS
The snacks industry has been hit by huge commodity price rises that are having to be passed on to consumers at a time when food budgets are already stretched. The supply market for raw materials can be volatile. With an ongoing emphasis on health issues and obesity, many parents are choosing healthier alternatives, such as fruit, over savoury snacks for their children. The advertising of food to children is subject to strict regulation. An ageing population may prove detrimental to demand as children and young adults tend to be the most enthusiastic consumers of savoury snacks.
54
Key Note Ltd 2010
Snack Foods
Buying Behaviour
7. Buying Behaviour
HOUSEHOLD EXPENDITURE ON FOOD AND DRINK
According to National Statistics Family Spending report, UK households had an average expenditure of 459.20 a week in 2007, of which 48.10 was spent on food and non-alcoholic drink. Among the 10% of the population in the highest disposable income bracket, this figure equated to 7% of their weekly income, whereas for those in the lowest bracket, the percentage was 14%. More than two-thirds of this food budget was spent in the large supermarket chains.
CONSUMER PENETRATION
Potato Crisps, Tortilla and Corn Snacks
A BMRB International Ltd Target Group Index (TGI) survey conducted in 2009 to ascertain respondents snacking habits found that 84.1% of respondents had eaten potato crisps, tortilla or corn snacks in the preceding year, compared with 85% in the previous year. The percentage penetration of those eating a packet every day also decreased in 2009. Women showed a higher percentage penetration than men (85.7% and 82.5%, respectively).
Table 7.1: Penetration of Potato Crisps, Tortilla and Corn Snacks in the Past 12 Months by Frequency (% of adults), 2009
Consumption Yes No Frequency of Consumption Once a day or more 2 or 3 times a week Once a week 2 or 3 times a month Once a month Less than once a month 10.2 23.9 15.1 15.5 7.4 10.6 84.1 15.9
Source: Target Group Index (TGI), BMRB International Ltd, 2009
Key Note Ltd 2010
55
Buying Behaviour
Snack Foods
Respondents aged between 35 and 44 were the most likely to indulge in potato crisps and other snacks, although percentage penetration was still as high as 70.9% among the over-65s, who were the least likely to eat potato and corn snacks. However, it was those in the youngest age group (between 15 and 19) who proved most likely to eat a packet a day, compared with just 3.5% of over 65s. Eating at least one packet of crisps a day was least likely among the A social grade, with percentage penetration rising from A to C2 and D, before dropping down again among those in group E. Respondents in East Anglia, Scotland, the North and the East and West Midlands were the most likely to eat crisps once a day, while their counterparts in Greater London were the least likely to do so. Respondents were also asked whether they usually bought regular or low-fat variants of potato crisps, and as many as 65% favoured the former, compared with 23.3% who were more likely to opt for low-fat brands. In the low-fat category, percentage penetration was 28.1% for women and 18.3% for men, and both were lower in 2009 than in a similar survey conducted in 2008. Percentage penetration of low-fat variants ranged from just 19.8% among those aged between 15 and 19, to 24.9% for those between 45 and 54, and were most likely to be chosen by those in the regions that generally ate more crisps anyway (Scotland, the North, East Anglia and the Midlands) and least likely by those in Yorkshire. Those in the A and B social grades showed the highest percentage penetration for low-fat variants, and those in the D and E groups had the lowest penetration rate. Regular variants saw percentage penetration as high as 76.8% among young adults aged between 25 and 34, compared with just 40.7% among the over 65s.
Nuts and Dried Fruit

In the 2009 survey, less than half the respondents had eaten nuts and/or dried fruit in the past 12 months, and the products were more popular among women than men. Those aged between 45 and 54 were the most likely to have eaten them, while the under-25s were the least likely to have done so. There was a direct correlation between consumption and social grade, with percentage penetration decreasing from the A through to the E grade.
Table 7.2: Penetration of Nuts and Dried Fruit in the Past 12 Months by Frequency (% of adults), 2009
Consumption Yes No 42.8 32.2
Table continues...
56
Key Note Ltd 2010
Snack Foods
Buying Behaviour
Table 7.2: Penetration of Nuts and Dried Fruit in the Past 12 Months by Frequency (% of adults), 2009
...table continued
Frequency of Consumption Once a day or more 2 or 3 times a week Once a week 2 or 3 times a month Once a month Less than once a month Source: Target Group Index (TGI), BMRB International Ltd, 2009 3.5 6.8 5.8 8.3 5.9 11.5
Consumption of nuts and/or dried fruit was fairly infrequent, with most respondents eating them less than once a month. The most popular variety of nuts was salted, followed by dry roasted and unsalted.
Other Savoury Snacks

Less than half of the respondents had eaten other savoury snacks in the 12 months prior to the 2009 survey. This was considerably lower than the 54.2% percentage penetration seen in 2008. However, the survey only covers adults (aged 16+), and it is younger children who are probably more inclined to indulge more heavily in savoury snacks, particularly gimmicky ones, than regular crisps and nuts.
Table 7.3: Penetration of Other Savoury Snacks in the Past 12 Months by Frequency (% of adults), 2009
Consumption Yes No Frequency of Consumption Once a day or more 2 or 3 times a week Once a week 1.0 4.7 6.4 43.3 56.7
Table continues...
Key Note Ltd 2010
57
Buying Behaviour
Snack Foods
Table 7.3: Penetration of Other Savoury Snacks in the Past 12 Months by Frequency (% of adults), 2009
...table continued
Frequency of Consumption (cont.) 2 or 3 times a month Once a month Less than once a month 9.6 6.9 13.0
Source: Target Group Index (TGI), BMRB International Ltd, 2009
Percentage penetration among men, at 40.3%, was much lower than the 46.2% seen among women respondents, but both sexes were equally likely to eat savoury snacks on a daily basis. The most likely respondents to be consumers of other savoury snacks were those aged between 35 and 54, while they were least popular with those aged over 55. Most respondents ate other savoury snacks less than once a month, but those who ate such products on a daily basis were most likely to be in the youngest age group. Those in the D and E social grades tended to be the most avid consumers of other savoury snacks on a daily basis, as were respondents in East Anglia and the West Midlands. Regardless of the frequency of consumption, it was residents of East Anglia and the South West who were the most likely to have indulged in other savoury products in the preceding 12 months.
58
Key Note Ltd 2010
Snack Foods
Current Issues
8. Current Issues
CLOSURES, MERGERS AND ACQUISITIONS
MBMG
MBMG was the trading name of the company formed in 2006 by the amalgamation of MBM Produce Ltd and FW Gedney. It supplied retailers, processors, wholesalers, caterers, large foodservice operatives and the export market with a wide range of fresh vegetables, fruit and salads, as well as more than 600,000 tonnes of potatoes. However, in July 2009, MBM Produce Ltd (trading as MBMG) went into administration. It continued to trade for a short time, but failure to sell its sites in Lincolnshire and Norfolk resulted in their closure, with the loss of 84 jobs amid uncertainty over whether growers would be paid for outstanding invoices. However, management of its Cambridgeshire site was taken over by QV Foods in February 2009, and remains open.
Tyrrells Potato Chips

In March 2008, the independent crisp brand Tyrrells sold a majority stake to private-equity firm Langholm Capital, which owns Dorset Cereals, in a deal that valued the company at around 40m.
BOARD AND SENIOR MANAGEMENT CHANGES

PepsiCo UK and Ireland
In September 2009, the President of PepsiCo UK and Ireland, Salman Amin, was promoted to the role of Executive Vice President Sales and Marketing, leaving his position in London to take up the global role in New York. Amin was replaced by Richard Evans the former General Manager of Walkers Snack Foods.
NEW PRODUCT DEVELOPMENT

McCoys
In 2009, United Biscuits added a new Sizzling King Prawn variant to its McCoys range of crisps. In August 2009, it introduced a limited edition of McCoys Pub Grub in two new flavours Lamb and Mint; and Roast Beef and Horseradish.
Key Note Ltd 2010
59
Current Issues
Snack Foods
Penn State
In November 2009, the UKs leading pretzel brand, Penn State, launched its Baked Deli Chip in Morrisons supermarkets across the country. Baked rather than fried, the snack comes in two flavours Spicy Jalfrezi and Spicy Teriyaki and their launch was accompanied by sampling in Morrisons stores.
Pringles
In February 2009, Procter & Gamble added a new Zesty Lime an Chilli variant to its Pringles range.
Tyrrells
In September 2009, Tyrrells launched its Great British flavoured crisps to coincide with the first day of British Food Fortnight a campaign promoting food from the UK. The three variants of Welsh Rarebit, Beef Wellington and Pork & Apple will be on sale for 12 months exclusively with Tyrrells independent retail customers.
Walkers
Walkers helped retailers maximise Christmas 2009 sales of snacks and crisps by introducing Sharing 99 pence (p) Value Bags of its best-selling products, including Doritos Tangy Cheese and Monster Munch Roast Beef.
60
Key Note Ltd 2010
Snack Foods
The Global Market
9. The Global Market

EUROPE
Despite Germany having the largest population in Europe, its consumption of savoury snacks is behind that of the UK, which accounts for more than a fifth of the value of the European market. Crisps are said to have first been produced commercially in Germany in 1951 around 30 years later than in the UK when Heinz Flessner began the Stateside Potato Chip Company, the primary market of which was US soldiers stationed in the country. Within a decade, Flessner had two factories and was well established in the consumer market. Eastern European savoury snack markets have the most potential for growth, and the market is currently led by potato crisps. The leading players in Eastern Europe include: PepsiCo Inc; Intersnack Knabber-Gebck GmbH & Co KG; and Lorenz Bahlsen Snack-World GmbH & Co KG Germany. Pringles is arguably the largest pan-European brand, as Walkers crisps are known under the Lays and Ruffles names in the rest of Europe. Other territorially exclusive brands include Funny Frisch in Germany. Pretzels are particularly popular in Germany and Austria, but their popularity is not so established outside of German-speaking countries.
THE US
According to the 2009 State of the Industry report presented by Information Resources Inc (IRI) at the 2009 SNAXPO exhibition, while snack foods are still important to US consumers, an increasing number as many as 79% are looking for the best value. After snack purchases declined during 2007 and the first quarter of 2008, their sales value increased by 1.1% in the fourth quarter of 2008, compared with the same period in 2007. IRI surveys showed that 26.5% of consumers claimed to be snacking less frequently, and that 47.5% had cut back on their snacking expenditure over this period. 54.3% said that they were buying on value, not necessarily their favourite brand, with 46% of shoppers increasing their private-label purchases between 2007 and 2008. Private-label volume increased by 8% and dollar sales were up 6%, according to IRI. The Senior Vice President of IRI, Sally Lyons Wyatt, said that consumer interest in healthier-for-you snack products continues to grow, but that 47% of shoppers want to eat what tastes good rather than what is necessarily healthy, and two-thirds of snack purchases remain indulgent snacks. At the same event, NPD Group told a SNAXPO audience that, while many Americans are looking for the lowest price possible when they buy food, convenience and taste are still important. While better-for-you snack purchases increased considerably, taste remained the most important reason for snack foods being purchased, and it was also said that dieting trends were at an all-time low, despite the rising incidence of obesity in the US.
Key Note Ltd 2010
61
The Global Market
Snack Foods
ASIA PACIFIC
Rising average annual incomes, increased exposure to Western and international cuisines and greater availability of goods in supermarkets are combining to increase sales of savoury snacks in Asia. For example, in the past, snacks in the Peoples Republic of China (PRC) were dried seeds and nuts, but Western influences have more recently resulted in a wider array of new savoury snacks being introduced to the country. Procter & Gamble and PepsiCo have made significant inroads into Asian markets; however, because of local taste preferences, domestic industries remain competitive. Australias retail market for savoury snacks was valued at more than Aus$2bn in 2008, and more than half of this value was accounted for by the sale of potato crisps, or chips as they are commonly known. The market is dominated by PepsiCo, which has grown through acquisitions, including Sakata Rice Snacks in 2005 and The Smiths Snack Food Company in 1998. Despite a perception of Australians having a healthy, outside-oriented lifestyle, the country also has an obesity problem, with the proportion of overweight or obese children, particularly, increasing at an alarming rate. The results of the 2007/2008 National Health Survey by the Australian Bureau of Statistics (ABS) reveal that one in four children aged between 5 and 17 is now overweight or obese. As in the UK, this is resulting in increased demand for healthier products.
SELECTED GLOBAL COMPETITORS

Calbee Foods
Tokyo-based Calbee Foods is a savoury snack producer with factories throughout Japan. It was established as the Matsuo Food Processing Co Ltd in 1949 in Hiroshima, and changed its name to Calbee Foods & Confectionery Co Ltd in 1955, and again to Calbee Foods Co Ltd in 1973. In 1970, a US subsidiary of Calbee America Inc was established, while Calbee has since expanded into Thailand, the PRC and Hong Kong. In its financial year ending March 2009, Calbee Foods saw revenue increase by 3.6% compared with the previous year, while net profit was more than five times higher than in the year ending March 2008. However, 2008 saw exceptionally low net profit, and the net profit for 2008/2009 was still lower than in 2006/2007.
Intersnack Knabber-Gebck
The Intersnack group was founded in 1995 as a result of a merger between the Convent Group and Wolf-Bergstrasse. Headquartered in Cologne, Germany and with a base in County Durham in the UK, the company has more than 4,000 employees globally, and is among Europes leading suppliers of fried and baked savoury snacks. Its brands, which include Chio, Goldfischli and Wolf, are also prominent in Eastern Europe, while it is best known for its Pom-Bear fried potato snacks and Penn State pretzels in the UK.
62
Key Note Ltd 2010
Snack Foods
The Global Market
During 2009, Intersnack made a significant investment in its Bastini subsidiary, increasing production speeds and doubling capacity at a newly-built factory in the Netherlands. Bastini manufactures some of the best-known snacks in the Netherlands, and also produces own-brand snacks for many leading European retailers. The new factory which manufactures extruded snacks, pellet snacks and several varieties of popcorn replaces a former unit that was badly damaged by fire.
ITC
ITC is one of Indias largest companies and is involved in diversified markets including cigarettes, hotels, confectionery, apparel and personal care. ITC employs in excess of 26,000 people at more than 60 locations across India. Its Bingo range of potato chips and snacks is the first serious national level competitor to Frito-Lay in the Indian savoury snack market. ITC saw its pre-tax profit increase by 26% in the quarter ending 30th September 2009, compared with the same period in 2008.
J&J Snack Foods

Based in New Jersey, J&J Snack Foods is a manufacturer, marketer and distributor of branded snack foods and beverages for food service and retail supermarket customers in the US. It was founded in 1972 and has expanded through subsequent acquisitions, including that of SnackWorks LLC a manufacturer of pretzels in 2005. The companys sales for the fiscal year ending 27th September 2008 increased by 11% to $629.4m, compared with the previous year, but net earnings, which were adversely affected by rises in the cost of raw materials, were down by 13% to $27.9m.
Largo Food Exports

In the Republic of Ireland, the Tayto brand name is owned by Largo Food Exports Ltd, which bought the business from C&C Group PLC in 2006 for 62m. Largo was founded in 1983 and is based in Ashbourne in the Republic of Ireland. The company has plants in Ashbourne and Donegal, as well as one in the Czech Republic. In 2007, a 15% stake in Tayto was sold to the German Intersnack group for 15m, and it has been reported that the latter could be interested in increasing that share. The Tayto business in the Republic of Ireland is actively pursuing growth in overseas markets, and has entered a joint venture in Libya, which it hopes will lead to Tayto entering other North African markets, such as Algeria. Largo Food Exports had a turnover of 89.8m in 2007, on which a pre-tax loss of 7.4m was incurred.
Key Note Ltd 2010
63
The Global Market
Snack Foods
Liberation Foods
Liberation Foods was established in 2007 and is part owned by the farmers of the nuts it sells. More than 22,000 smallholder producers from co-operatives in Asia, Africa and Latin America own a collective share of 42% of the company, maximising their returns and thereby offering a more secure future for them and their families. Through Liberations supply chain, farmers sell directly to retailers in Europe, which include Waitrose and Oxfam. In addition to snacks, Liberation also supplies fresh Fairtrade nuts to Sainsburys, Morrisons and Tesco for their own-brand ranges.
Lorenz Snack-World
The origins of Lorenz Snack-World are in a German company founded in 1889. In 1993, the existing Group restructured into sweet and savoury divisions the latter being called Bahlsen Picanterie, before changing its name to Lorenz Snack-World in 2001. Headquartered in Neu-Isenburg, Lorenz Snack-World also has operations in Poland, Austria, Croatia and Russia, and its brands which include Crunchips, Saltletts, Curly and Country Chips are sold around the world.
PepsiCo
PepsiCo comprises PepsiCo Americas Foods (PAF), PepsiCo Americas Beverages (PAB) and PepsiCo International (PI). PAF includes Frito-Lay North America, Quaker Foods North America and all Latin America food and snack businesses; PAB includes PepsiCo Beverages North America and all Latin American beverage businesses; and PI comprises all PepsiCo businesses in the UK, Europe, Asia, the Middle East and Africa. In early 2009, PepsiCo realigned certain countries within PI, resulting in its businesses in Turkey and certain central Asia markets becoming part of the UK & Europe sub-division (UKEU), which was renamed the Europe division. These countries were formerly part of the Middle East, Africa & Asia sub-division (MEAA), which was renamed the Asia, Middle East & Africa division. In 2008, PepsiCo had a net revenue of $43.3bn (compared with $39.5bn in 2007) and a net income of $5.1bn (compared with $5.7bn in the previous year). In October 2008, the company announced plans to cut 3,300 jobs globally, responding to an unprecedented fall in US soft drink sales.
Procter & Gamble

From its origins as a small family-run soap and candle company established in 1837, Procter & Gamble (P&G) now employs around 138,000 people and markets to consumers in more than 180 countries. Its products range from household cleaners and laundry care to prescription drugs and fine fragrances. It has around 23 brands that generate more than $1bn in sales revenue annually, one of which is Pringles. The snack brand went into production in the US in 1964, but began its global expansion in 1990. It is now available around the world in 45 flavours and in different size formats.
64
Key Note Ltd 2010
Snack Foods
The Global Market
In May 2009, Procter & Gambles UK operation was dealt a blow in the Court of Appeal when it lost a legal battle with HM Revenue & Customs over its Pringles snack. Foods are normally exempt from paying tax, with the exception of potato crisps, and the High Court had agreed with Procter & Gamble that Pringles were not classified as crisps, and were therefore not liable for VAT. However, the Court of Appeal overruled that decision on the grounds that a Pringle contained enough potato content for it to be a reasonable view that it is made from potato (Lord Justice Jacob), and Procter & Gamble will be forced to pay out tens of millions of pounds as a result. In its 2008/2009 financial year, Procter & Gamble reported a sales revenue of $79.02bn, compared with $81.75bn in the previous year. Operating income was slightly reduced from $16.64bn in 2007/2008 to $16.12bn in 2008/2009.
Snack Foods
As the owner of Snack Brands Australia, Snack Foods Ltd is one of the largest suppliers of snack foods in Australia, and the main competitor to the PepsiCo subsidiary The Smiths Snackfood Company. When the latter was acquired by PepsiCos Frito-Lay, the Australian Competition and Consumer Commission directed it to divest a range of brands, which included Cheezels, Thins and Tasty Jacks, as well as several manufacturing facilities under a package named Snack Brands Australia. This was acquired by Dollar Sweet Holdings (now Snack Foods Ltd). In April 2008, Snack Brands Australia acquired the Samboy brand, which had been all but discontinued approximately 4 years previously. A campaign for its return included a page on the social networking website Facebook, which generated around 8,000 members. Samboy was consequently relaunched in 2009.
Snyders of Hanover
The origins of Snyders of Hanover date back to 1909 when the Hanover Canning Company Snyders parent company until 1980 began producing pretzels for the Hanover Pretzel Company. William V Snyder began modernising the company in 1940 and, when distribution of its products stretched across Virginia, Pittsburgh, Pennsylvania and New York, the company extended the shelf life of its products by packing them in innovative aluminium foil bags. The company now also produces tortilla chips, crisps and popcorn, but remains best known for pretzels. It employs around 2,250 people and has annual revenues in the region of $750m. In November 2009, Snyders announced that it had abandoned plans for a merger with Utz Quality Foods because a protracted approval process by the Federal Trade Commission looked likely. The two family-owned companies operate five factories between them, which are major employers in Hanover, Pennsylvania.
Key Note Ltd 2010
65
The Global Market
Snack Foods
66
Key Note Ltd 2010
Snack Foods
Forecasts
10. Forecasts
INTRODUCTION
The Economy
There are tentative signs of a growth in consumer confidence. Figures published by National Statistics in late October 2009 showed that sales volumes in the 3 months ending September 2009 increased by 0.9% compared with the previous quarter.
Population
According to National Statistics, the population of the UK is projected to increase from 61.8 million in 2009 to 63.5 million by 2013. Any such increase in the size of the population bodes well for demand for consumer goods, including savoury snacks, and an ageing population will continue to ensure more emphasis on premium adult snacks rather than those aimed at a diminishing child population the most avid consumers of snacks. Some of the population increase will come from net migration. Ethnic food is already firmly established in the restaurant and retail sectors, and there are pockets of ethnic concentrations in areas of the UK where shops selling ethnic foods and flavourings will also appeal to the indigenous population.
Table 10.1: Forecast UK Resident Population by Sex (000), Mid-Years 2009-2013

2009 Female Male Total % change year-on-year 31,420 30,374 61,794 0.7 2010 31,614 30,609
62,222
2011 31,807 30,842 62,649 0.7
2012 32,001 31,073 63,074 0.7
2013 32,196 31,302 63,498 0.7
0.7
does not sum due to rounding by source
Source: Population Projections Database (2008-based projections), National Statistics website Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queens Printer for Scotland)
Key Note Ltd 2010
67
Forecasts
Snack Foods
Gross Domestic Product

The UKs gross domestic product (GDP) contracted by 4.5% 2009, but is expected to return to growth (albeit a minimal one of 1.1%) in 2010. However, the economic growth seen in recent quarters comes from a low base, and has been largely reliant on financial stimulus packages. These will have to end at some stage in the future, and this could necessitate tax and/or interest rate increases that are likely to affect consumer demand. As it is, the rate of VAT is due to return to its previous level in January 2010, having been at the reduced rate of 15% since December 2008.
Table 10.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2009-2013
2009 Gross domestic product growth (%) Percentage point change year-on-year -4.5 2010 1.1 5.6 2011 2.0 0.9 2012 2.3 0.3 2013 2.7 0.4
Source: Forecasts for the UK Economy, November 2009, Treasury Independent Average Crown copyright
Savoury snack manufacturers have had to contend with rising costs of wheat, maize, flour, potatoes and crude oil, as well as an increase in the amount of land given over to biofuel production. Regular savoury snack purchasers feeling pressure on their disposable incomes may be reluctant to give up buying snacks altogether, but the steep rises that manufacturers have had to pass on may result in demand being price-sensitive as consumers opt for less premium own-brand snacks.
Inflation
The inflation rate in 2009 is expected to be negative at -0.7%, before recovering gradually in the remaining 4 years of the forecast period to finish at 3.1% in 2013.
68
Key Note Ltd 2010
Snack Foods
Forecasts
Table 10.3: Forecast UK Rate of Inflation (%), 2009-2013

2009 Inflation (%) Percentage point change year-on-year -0.7 -4.7 2010 2.5 3.2 2011 2.5 0.0 2012 2.9 0.4 2013 3.1 0.2
Note: inflation is at retail price index (RPI).
Unemployment
Unemployment is forecast by the Treasury to increase by 72.5% to 1.6 million by the end of 2009, and will peak at 1.9 million in 2010 and 2011 before beginning a slow recovery. However, many economists consider these figures to be too optimistic, as the most recent report from National Statistics revealed that 2.5 million people were out of work in the 3 months ending September 2009. Unemployment is always a lagging factor during recessions, mainly because companies remain cautious in their recruitment for some time after the economy recovers.
Table 10.4: Forecast Actual Number of Unemployed Persons in the UK (million), 2009-2013
2009 Actual number of claimants (million) % change year-on-year 1.57 72.5 2010 1.90 21.0 2011 1.90 0.0 2012 1.79 -5.8 2013 1.63 -8.9
Key Note Ltd 2010
69
Forecasts
Snack Foods
FORECASTS 2010 TO 2014

2008/2009 saw a sharp rise in retail prices as manufacturers could no longer absorb escalating commodity costs. The consequential increase in the value of the market is not expected to be sustained at the same level in the immediate future, but factors contributing to market growth will include the developments made by manufacturers to reduce fat and salt levels, through healthier raw materials and cooking processes, and the increase in snacking occasions, such as working lunches. While the recession has increased demand for the premium products that many feel are an affordable luxury (particularly if foregoing an evening out), there is no doubt that many consumers will continue to economise by opting for cheaper own-brand products. The football World Cup (to be held in South Africa in 2010) and the Olympic Games in 2012 (London 2012) will be closely followed by many on television a prime occasion for snacking on which manufacturers will capitalise. According to the European Snacks Association (ESA), several exhibitors attending SNACKEX in June 2009 were demonstrating products with African-influenced seasonings in preparation for the World Cup. Such positive factors are expected to contribute to an increase in market value of savoury snacks, and Key Note forecasts that the market will grow in value by 3.6% to 2.48bn in 2010. Overall, the snack foods market is expected to increase by 5.3% over the 5-year forecast period to reach a retail sales value of 2.61bn by 2014. The potato crisps sector is forecast to experience by far the highest level of growth over this period (8.5% compared with 2.8% in the other savoury snacks sector and 2.2% in the snack nuts category).
Table 10.5: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2010-2014
2010 Potato crisps Other savoury snacks Snack nuts Total % change year-on-year
2011 1,104.0 1,200.0 208.0 2,512.0 1.5
2012 1,124.0 1,216.0 210.0 2,550.0 1.5
2013 1,145.0 1,219.5 211.0 2,575.5 1.0
2014 1,180.0 1,213.5 211.5 2,605.0 1.1
1,088.0 1,180.0 207.0 2,475.0 3.6
Source: Key Note
70
Key Note Ltd 2010
Snack Foods
Forecasts
Figure 10.1: The Forecast UK Snack Foods Market by Sector by Value at Current Prices (m at rsp), 2010-2014
Potato crisps 2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 500 250 0 2010 2011 2012 2013 2014 Other savoury snacks Snack nuts
Source: Key Note
MARKET GROWTH
Figure 10.2 illustrates the actual and forecast growth in the total snack foods market. Key Note estimates that the value of the market will increase by an overall 22.1% between 2005 and 2014 to reach a value of 2.61bn.
Key Note Ltd 2010
71
Forecasts
Snack Foods
Figure 10.2: Growth in the UK Snack Foods Market by Value at Current Prices (m at rsp), 2005-2014
2,700 2,650 2,600 2,550 2,500 2,450 2,400 2,350 2,300 2,250 2,200 2,150 2,100 2,050 2,000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Source: Key Note
FUTURE TRENDS
Industry Consolidation
2009 was a particularly difficult year for the food industry in general, as cash-strapped consumers looked to save money during the worst of the recession. The snack foods market has also been hard hit by huge rises in commodity costs for items such as potatoes, peanuts and sunflower oil. Consequently, there have been corporate casualties that competitors have been quick to snap up. This trend is likely to continue into 2010, as any recovery from the recession will be gradual, and snack companies with access to funds are likely to take advantage of distress purchases, meaning that the industry will see further consolidation.
72
Key Note Ltd 2010
Snack Foods
Forecasts
Overseas Markets
The food and drink industries of the ten countries that joined the EU in 2004 have been transformed by the expansion of Europes borderless market, while the process is also evident in Bulgaria and Romania, which joined in 2007. Turkey is endeavouring to accede to the EU and benefit from the single market but manufacturers are also looking further afield for new markets to penetrate as the incidence of snacking increases in, for example, Latin America and North Africa. Largo Foods of the Republic of Ireland has a joint venture in Libya and has set up a production facility in Tripoli to avoid the fact that imported snack foods into the country carry a 20% duty. Certainly, as the food industry becomes ever more global, it is likely that UK manufacturers may increasingly set up local production facilities to bypass such regulations and take advantage of lower production costs.
Health Issues
The healthier ranges of lower-fat and lower-sodium content have been drivers of growth in savoury snacks over recent years, and the sector is subject to significant new product development (NPD), even if critics argue that better-for-you alternatives compromise on taste. In fact, with manufacturers turning their efforts to developing healthier formulations through the use of different cooking oils, etc., the divide between regular and healthy is likely to continue to narrow as sales of the former cannibalise those of the latter, to some extent.
Key Note Ltd 2010
73
Forecasts
Snack Foods
74
Key Note Ltd 2010
Snack Foods
Company Profiles
11. Company Profiles

INTRODUCTION
The following section contains financial profiles of some of the principal companies identified as operating within the market sector discussed in this report. The financial results of some of the important names within the sector may not be reported if: their principal activities are so varied that their results are not considered applicable to the survey they are no longer trading as separate companies their financial data are very out of date.
DEFINITIONS
A company which has a Y consolidated value has filed consolidated accounts for the relevant year. denotes that the growth rate calculation is invalid, because the figures either move from positive to negative or from negative to positive.
Turnover (Sales)
This includes all income derived from the principal activities of the firm, net of VAT. It encompasses UK sales, exports and overseas and intercompany sales.
Pre-Tax Profit
The net trading profit figure after deduction of all operating expenses, including depreciation and finance charges but before deduction of tax, dividends, subventions or group relief, and other appropriations. Where applicable, it will include the share of profits and losses of associated companies. Items described by the company as exceptional are included; extraordinary items are excluded.
Profit Margin
Pre-tax profit expressed as a percentage of sales.
Average Remuneration
Total employee remuneration divided by the number of employees.
Sales per Employee

Sales divided by the number of employees.
FURTHER INFORMATION
For more detailed financial information telephone ICC Customer Services on: 020-7426 8855
Key Note Ltd 2010
75
Company Profiles
Snack Foods
INTERSNACK LTD
Registered Office Unit BT95-4 Tanfield Lea Industrial Estate Stanley County Durham, DH9 9XS Telephone: 0118-958 0163 01237998 18/12/75 Intersnack International BV Intersnack Knabber-Gerback Unternehmensverwaltungs GmbH & Co
Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company
Previous Name(s) and Date(s) of Change

Vico Foods (UK) Ltd (18/04/00) Janeshourne Ltd (31/12/76)
Principal Activities
A group engaged in import and distribution of snack products.
SIC Code
51390, Non-specialised wholesale of food, beverages and tobacco.
Structure
Intersnack UK is a part of the Germany-based Intersnack Knabber-Gebck GmbH, and has its headquarters in County Durham. It owns a stake in the Irish company Largo Food Exports Ltd, which owns the Tayto brand in the Republic of Ireland.
Brand Information
Intersnack brands include Pom-Bear, Mr Mash and Penn State pretzels. In June 2009, it also acquired Percy Daltons Famous Peanut Co. Ltd a supplier of branded and own-brand nut, seed and dried fruit products.
Recent Developments
In June 2009, Intersnack UK ran a competition whereby entrants suggested their perfect night in. Winners were treated to a return flight for two to New York and a 4-night stay in one of the Citys hotels.
76
Key Note Ltd 2010
Snack Foods
Company Profiles
FINANCIAL PROFILE
Year End Weeks Consolidated 31/12/08 52 Y 31/12/07 52 Y 31/12/06 52 N 31/12/05 52 N
Sales
Sales (000) % change year-on-year Exports (000) Exports/Sales (%) 24,919 9.24 700 2.81 22,811 126.21 1,196 5.24 10,084 413 4.10 -
Profits
Pre-Tax Profit (000) % change year-on-year Profit Margin (%) Operating Profit (000) -565 -2.27 299 668 -26.43 2.93 1,619 908 226.62 9.00 937 278 297
Employees
Number of Employees Average Employee Remuneration () Sales per Employee () Profit per Employee () Capital Employed per Employee () 242 21,475 102,971 -2,335 61,802 219 20,922 104,160 3,050 72,845 55 26,491 183,345 16,509 20,945 53 23,453 5,245 21,340
Balance Sheet/Ratios
Capital Employed (000) Return on Capital (%) Net Worth (000) Current Ratio Liquidity Ratio 14,956 -3.78 -5,709 1.01 0.71 15,953 4.19 -5,674 1.10 0.86 1,152 78.82 589 1.43 1.27 1,131 24.58 -22 1.65 1.45
Key Note Ltd 2010
77
Company Profiles
Snack Foods
SEABROOK CRISPS LTD

Registered Office Seabrook House Duncombe Street Bradford West Yorkshire, BD8 9AJ Telephone: 01274-546 405 00472391 31/08/49 RJJ Management Ltd Seabrook Group Ltd

Seabrook Potato Crisps Ltd (26/08/04)
The manufacture and distribution of potato crisps.
SIC Code
15310, Processing and preserving of potatoes.
Structure
The family-owned business of Seabrook Crisps has been producing crisps in the North of England since 1945.
Brand Information
Seabrook now outsells all brands except Walkers in Yorkshire, Lancashire and north east England. Brands include Seabrook and Hot & Spicy.
Recent Developments
Seabrook Crisps is experiencing ongoing record sales figures, having added 5,000 national stockists (including 50 Waitrose stores in the south of England) and invested 4m in new production lines.
78
Key Note Ltd 2010
Snack Foods
Company Profiles
FINANCIAL PROFILE
Year End Weeks Consolidated 30/09/08 52 N 30/09/07 52 N 30/09/06 52 N 30/09/05 52 N
Sales
Sales (000) % change year-on-year Exports (000) Exports/Sales (%) 15,389 18.64 12,971 -13.76 15,041 -5.71 15,952 -
Profits
Pre-Tax Profit (000) % change year-on-year Profit Margin (%) Operating Profit (000) 750 4.87 725 -1,924 -14.83 -1,998 580 -42.63 3.86 518 1,011 6.34 970
Employees
Number of Employees Average Employee Remuneration () Sales per Employee () Profit per Employee () Capital Employed per Employee () 2 7,694,500 375,000 1,573,000 119 19,630 109,000 -16,168 21,429 147 20,415 102,320 3,946 27,918 151 20,298 105,642 6,695 25,132
Capital Employed (000) Return on Capital (%) Net Worth (000) Current Ratio Liquidity Ratio 3,146 23.84 3,101 1.89 1.72 2,550 -75.45 2,550 1.71 1.51 4,104 14.13 3,908 2.79 2.63 3,795 26.64 3,515 2.12 1.99
Key Note Ltd 2010
79
Company Profiles
Snack Foods
TAYTO (NI) LTD

Registered Office Company Registration Number Date of Incorporation Holding Company Ultimate Holding Company Castle Factory Tandragee County Armagh, BT62 2AB NI003670 06/04/56 None Manderley Food Group Ltd

None.
The manufacture and distribution of potato crisps and snack foods.
SIC Code
Structure
Tayto (NI) Ltd is the long-established market leader in the snacks industry in Northern Ireland. The family-owned concern, based in County Armagh, was founded in 1956. Tayto has made various acquisitions in recent years, including Golden Wonder and, more recently, Jonathan Crisp.
Brand Information
Brands include Tayto, Golden Wonder, Mr Porky pork scratchings and Jonathan Crisp. (The Tayto name in the Republic of Ireland is owned by Largo Food Exports, in which the German snack company Intersnack Knabber-Gebck GmbH & Co. KG has a share.)
Recent Developments
Following Taytos acquisition of Red Mill Snack Foods in 2008, it has been disclosed that the Red Mill factory in Wednesbury will close by 2011. Production is to move to the companys base in Corby, where it is understood that there will be opportunities for some of the 300-plus employees facing redundancy from the Wednesbury factory.
80
Key Note Ltd 2010
Snack Foods
Company Profiles
FINANCIAL PROFILE
Sales
Sales (000) % change year-on-year Exports (000) Exports/Sales (%) 26,196 9.25 23,978 -0.46 24,089 21.59 19,812 -
Profits
Pre-Tax Profits (000) % change year-on-year Profit Margin (%) Operating Profit (000) 371 1.42 890 -143 -0.60 350 178 0.74 809 -762 -3.85 -301
Employees
Number of Employees Average Employee Remuneration () Sales per Employee () Profit per Employee () Capital Employed per Employee () 374 18,885 68,721 973 52,024 382 18,128 62,770 -374 36,945 381 17,808 63,226 467 36,281 386 14,653 51,326 -1,974 34,070
Capital Employed (000) Return on Capital (%) Net Worth (000) Current Ratio Liquidity Ratio 19,457 1.91 10,382 1.32 1.12 14,113 -1.01 10,466 0.90 0.72 13,823 1.29 9,452 0.88 0.71 13,151 -5.79 9,435 0.88 0.68
Key Note Ltd 2010
81
Company Profiles
Snack Foods
UNITED BISCUITS TOPCO LTD

Registered Office Hayes Park Hayes End Road Hayes Middlesex, UB4 8EE 05957921 05/10/06 United Biscuits Luxco SCA United Biscuits Luxco SCA

Precis (2648) Ltd (17/11/06)
A group engaged in the manufacture and sale of a wide range of food products including biscuits and savoury snacks.
SIC Codes
15820, Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes. 15310, Processing and preserving of potatoes.
Structure
United Biscuits (UB) was founded in 1948 following the merger of two Scottish family businesses McVitie & Price and MacFarlane Lang. In October 2006, UB agreed a 1.6bn takeover deal with Paribas Affaires Industrielles (PAI) and US-based equity investment firm Blackstone Group.
Brand Information
UBs brands of relevance to this report include McCoys, Phileas Fogg, Twiglets, Hula Hoops, KP, Mini Cheddars, Skips, Nik Naks and go ahead!
Recent Developments
In 2009, UB acquired a manufacturing facility in India in anticipation of a market launch in the country. It is also said to be considering plans to outsource up to 125 of the 750 jobs at its Aintree factory to India.
82
Key Note Ltd 2010
Snack Foods
Company Profiles
FINANCIAL PROFILE
Year End Weeks Consolidated 03/01/09 53 Y 29/12/07 52 Y
Sales
Sales (000) % change year-on-year Exports (000) Exports/Sales (%) 1,201,400 5.17 1,142,300 -
Profits
Pre-Tax Profit (000) % change year-on-year Profit Margin (%) Operating Profit (000) -16,600 -1.38 128,400 -11,200 -0.98 150,600
Employees
Number of Employees Average Employee Remuneration () Sales per Employee () Profit per Employee () Capital Employed per Employee () 8,477 28,530 139,051 -1,921 201,852 8,726 26,003 130,908 -1,284 190,821
Capital Employed (000) Return on Capital (%) Net Worth (000) Current Ratio Liquidity Ratio 1,711,100 -0.95 -1,239,700 1.09 0.92 1,665,100 -0.67 -1,154,900 1.10 0.93
Key Note Ltd 2010
83
Company Profiles
Snack Foods
WALKERS SNACK FOODS LTD

Registered Office 1600 Arlington Business Park Theale Reading Berkshire, RG7 4SA Telephone: 0118-930 6666 02333074 09/01/89 PepsiCo Holdings PepsiCo Inc

Walkers Snack Foods Ltd (23/04/99) Walkers Smiths Snack Foods Ltd (01/01/95) Walkers Crisps Holdings Ltd (04/11/92) Precis (679) Ltd (06/06/89)
The manufacture of snack products for fellow group companies.
SIC Code
Structure
Walkers was established as a pork butchery business in the 1880s, and it diversified into making potato crisps when meat was in short supply after the Second World War. Walkers merged with Smiths in 1979, and the US-based PepsiCo Inc acquired both companies in 1989. Walkers is now the UKs leading manufacturer of savoury snacks.
Brand Information
Walkers crisps come in a wide variety of flavours, and the company also manufactures healthier variants Walkers Lights and Walkers Baked as well as premium ranges, Walkers Max and Sensations. Other brands owned by the company include Quavers, Monster Munch, Wotsits and Doritos.
Recent Developments
In July 2009, Walkers Snack Foods announced the creation of 50 jobs at its crisps factory in Leicester, following a 2m investment in new equipment. It has said that it is committed to continuing investment in its site in Beaumont Leys, Leicester, which is its largest UK site employing nearly 2,000 people. Walkers has added its Builders Breakfast variant as a permanent flavour following the Do us a Flavour competition that invited people to invent a new flavour for its crisps.
84
Key Note Ltd 2010
Snack Foods
Company Profiles
FINANCIAL PROFILE
Sales
Sales (000) % change year-on-year Exports (000) Exports/Sales (%) 223,481 13.47 196,947 13.03 174,238 5.80 164,688 -
Profits
Pre-Tax Profit (000) % change year-on-year Profit Margin (%) Operating Profit (000) 31,052 3.39 13.89 14,381 30,034 70.54 15.25 10,123 17,611 10.11 1,802 -13,037 -7.92 -14,940
Employees
Number of Employees Average Employee Remuneration () Sales per Employee () Profit per Employee () Capital Employed per Employee () 3,001 31,364 74,469 10,347 195,352 2,777 36,923 70,921 10,815 202,863 2,696 32,604 64,628 6,532 186,113 2,824 28,313 57,217 -4,529 174,232
Capital Employed (000) Return on Capital (%) Net Worth (000) Current Ratio Liquidity Ratio 586,252 5.30 490,320 0.73 0.68 563,350 5.33 461,823 2.82 2.78 501,761 3.51 398,904 0.41 0.36 492,031 -2.60 392,022 0.62 0.57
Key Note Ltd 2010
85
Company Profiles
Snack Foods
86
Key Note Ltd 2010
Snack Foods
Company Financials
12. Company Financials

The following companies, listed in alphabetical order, are taken from the my ICC database. ICCs links with Companies House mean that when the latest accounts for a company are made available, they can be incorporated on our database and be ready for inclusion in Key Note Market Report Plus. A short delay occurs at Companies House between receipt of documents and their public release. As this delay can be longer, the availability of accounts can sometimes be affected. It should be noted that the financial results for certain companies are not restricted to sales of the products covered by this report.
Turnover (000) Company Bahlsen Ltd Bobbys Foods PLC Bombay Halwa Ltd Del Monte Foods International Ltd Discovery Foods Ltd Highlander Snacks Ltd Intersnack Ltd Kent Bacon Dryers Ltd Kettle Foods Ltd Napier Brown Holdings Ltd Natco Foods Ltd Pasta Foods Ltd Percy Daltons Famous Peanut Co Ltd Prima Quality Foods PLC Red Mill Snack Foods Ltd RM Curtis & Company Ltd S&B Herba Foods Ltd Seabrook Crisps Ltd Sun Valley Ltd Tayto (NI) Ltd Trigon Snacks Ltd 21,626 34,640 16,393 90 45,906 4,996 24,919 68 58,997 7,931 55,994 21,646 27,421 11,323 47,581 20,257 88,065 15,389 26,227 26,196 18,286
Pre-Tax Profit (000) 2,425 495 521 -1,433 -2,449 -397 -565 3 10,878 9,754 169 99 -1,556 182 -1,024 165 7,366 750 -259 371 60
Year End 31/12/08 30/09/08 31/12/08 26/12/08 31/12/08 31/12/08 31/12/08 28/03/08 30/09/08 31/03/08 31/12/08 02/05/09 30/03/08 31/03/09 30/06/08 31/12/08 31/12/08 30/09/08 31/12/08 05/07/08 31/12/08
Key Note Ltd 2010
87
Company Financials
Snack Foods
Turnover (000) Company Unilever Bestfoods UK Ltd United Biscuits (UK) Ltd United Biscuits Topco Ltd Walkers Snack Foods Ltd
Name changes:
Pre-Tax Profit (000) 49,775 60,900 -16,600 31,052
Year End 31/12/08 03/01/09 03/01/09 27/12/08
141,995 999,400 1,201,400 223,481
W Jordan (Cereals) Ltd is now W Jordan & Son (Silo) Ltd Non-trading: G Costa & Company Ltd PepsiCo Foods & Beverages International Ltd Sunscoop Products Ltd Union Snack Ltd
88
Key Note Ltd 2010
Snack Foods
Further Sources
13. Further Sources

Associations
British Retail Consortium 21 Dartmouth Street London, SW1H 9BP Telephone: 020-7854 8900 Fax: 020-7854 8901 http://www.brc.org.uk European Snacks Association 6 Catherine Street London, WC2B 5JJ Telephone: 020-7420 7220 Fax: 020-7420 7221 E-mail: esa@esa.org.uk http://www.esa.org.uk The Food Commission (UK) Ltd 94 White Lion Street London, N1 9PF http://www.foodcomm.org.uk Food and Drink Federation 6 Catherine Street London, WC2B 5JJ Telephone: 020-7836 2460 Fax: 020-7836 0580 E-mail: generalenquiries@fdf.org.uk http://www.fdf.org.uk The Guild of Fine Food Station Road Wincanton Somerset, BA9 9FE Telephone: 01963-824 464 Fax: 01963-824 651 http://www.finefoodworld.co.uk Snack Food Association 1600 Wilson Boulevard Suite 650 Arlington, VA 22209 US Telephone: 001-70 3836 4500 Fax: 001-70 3836 8262 http://www.sfa.org Snack, Nut and Crisp Manufacturers Association 6 Catherine Street London, WC2B 5JJ Stroke Association Stroke House 240 City Road London, EC1V 2PR Telephone: 020-7566 0300 Fax: 020-7490 2686 E-mail: info@stroke.org.uk http://www.stroke.org.uk
Key Note Ltd 2010
89
Further Sources
Snack Foods
General Sources
BMRB International Ealing Gateway 26-30 Uxbridge Road Ealing London, W5 2BP Telephone: 020-8433 4000 Fax: 020-8433 4001 http://www.bmrb.co.uk ICC Ltd Field House 72 Oldfield Road Hampton Middlesex, TW12 2HQ Telephone: 020-8481 8800 Fax: 020-8941 6014 E-mail: info@icc.co.uk http://www.icc.co.uk http://www.icc-credit.co.uk ICC provides in-depth, business-critical information for risk and credit decision-making. A range of flexible online tools provide access to the most comprehensive content on all UK and Irish businesses. ICC offers access to information through high-speed online delivery tools: my ICC my ICC credit management Plum. The data include: access to over 370 million original document images information on individual directors, shareholders, stakeholders and consumers information on limited and non-limited companies analysed financial, risk and business information reports industry information for benchmarking. Nielsen Media Research Atrium Court The Ring Bracknell Berkshire, RG12 1BZ Telephone: 01344-469 100 Fax: 01344-469 102 E-mail: mediacommunicationuk @nielsen.com http://www.nielsenmedia.co.uk NEMS Market Research 22-23 Manor Way Belasis Hall Technology Park Billingham, TS23 4HN Telephone: 01642-373 355 Fax: 01642-373 350 http://www.nemsmr.co.uk
90
Key Note Ltd 2010
Snack Foods
Further Sources
Government Sources
Australian Bureau of Statistics ABS House 45 Benjamin Way Belconnen, ACT 2617 Australia http://www.abs.gov.au Department for Business, Innovation and Skills 1 Victoria Street London, SW1H 0ET http://www.foresight.gov.uk Foresight Tackling Obesities: Future Choices Department of Health Richmond House 79 Whitehall London, SW1A 2NS Health Survey for England European Commission 8 Storeys Gate London, SW1P 3AT Telephone: 020-7973 1992 http://ec.europa.eu Food Standards Agency Aviation House 125 Kingsway London, WC2B 6NH Telephone: 020-7276 8000 http://www.food.gov.uk HM Treasury 1 Horse Guards Road London, SW1A 2HQ Telephone: 020-7270 4558 Fax: 020-7270 4861 http:/www.hm-treasury.gov.uk Forecasts for the UK Economy, November 2009 National Statistics 1 Drummond Gate London, SW1V 2QQ Telephone: 020-7533 5888 Fax: 01633-812 599 http://www.statistics.gov.uk Consumer Trends, Quarter 2 2009 Economic & Labour Market Review, November 2009 Family Spending 2008 Monthly Digest of Statistics, November 2009 Population Projections Database (2008-based projections) PRODCOM PRA15310 UK Business: Activity, Size and Location 2009 Office of Fair Trading Fleetbank House 2-6 Salisbury Square London, EC4Y 8JX Telephone: 020-7211 8000 http://www.oft.gov.uk
Key Note Ltd 2010
91
Further Sources
Snack Foods
Other Sources
Information Resources Inc Eagle House Bracknell Berkshire, RG12 1HS Telephone: 01344-746 000 Fax: 01344-746 001 http://www.infores.co.uk Leatherhead Food International Ltd Randalls Road Leatherhead Surrey, KT22 7RY Telephone: 01372-376 761 Fax: 01372-386 228 E-mail: Help@leatherheadfood.com http://www.leatherheadfood.com Nielsen Nielsen House London Road Headington, Oxford, OX3 9RX Telephone: 01865-742 742 Fax: 01865-732 461 http://www.nielsen.com Nielsen MarketTrack Nielsen ScanTrack NPD Group 900 West Shore Road Port Washington, NY 11050 Telephone: 001-51 6625 0700 Fax: 001-86 6444 1411 E-mail: contactnpd@npd.com http://www.npd.com
Key Note Sources

Key Note Ltd
Field House 72 Oldfield Road Hampton Middlesex, TW12 2HQ Telephone: 020-8481 8750 Fax: 020-8783 0049 E-mail: sales@keynote.co.uk http://www.keynote.co.uk
Key Note Market Reports Plus

Biscuits & Cakes Canned Foods Chilled Foods Confectionery Fast Food & Home Delivery Outlets Frozen Foods Ice Creams & Frozen Desserts Ready Meals Sauces & Spreads 605 each Concentrating on more dynamic consumer markets, these offer the same incisive market intelligence as Market Reports, but include additional chapters and primary research data.
Key Note Market Reports

Bread & Bakery Products Soup Market 460 each Invaluable aids to anyone needing to gain a highly detailed understanding of a specific market for more informed decision-making.
92
Key Note Ltd 2010
Snack Foods
Further Sources
Key Note Market Reviews

Catering Market Food Market 750 each Focusing on the bigger picture, Key Note Market Reviews are designed to inform you of developments and opportunities across entire industry sectors.
Key Note Market Focus Reports

699 each/999 set of 10 volumes Please contact sales@keynote.co.uk for sector-specific individual volume prices. Top Markets and Market Forecasts add a further dimension to the Key Note range, providing an in-depth, strategic and global view of key industries. Compiled using Key Note Market Reports, Market Report Plus and Market Assessments published in the previous year, Top Markets and Market Forecasts are an indispensable and authoritative mini business library, providing a one-stop shop for all your research needs. Other Market Focus reports are created in conjunction with specialist authors, consultancies and industry experts whose wealth of knowledge is vital in publishing this type of report.
Key Note Market Assessments

Cooking & Eating Habits Diet Foods Functional Foods Healthy Eating Low-Fat & Low-Sugar Foods Sweet & Salty Snacks Trends in Food Shopping 899 each Providing in-depth strategic analysis and including primary research, these premium reports examine the scope, dynamics and shape of key UK and European markets, with a particular focus on financial services, consumer and lifestyle sectors.
Key Note Financial Survey Reports

Baking Industry Food Processors Frozen Food Industry Grocery Wholesalers & Supermarkets 420 each For each key industry sector, there is a detailed Financial Survey report, bringing you invaluable financial information and contact details. You can choose from approximately 90 industry sectors where thousands of companies are profiled in each report.
Key Note Ltd 2010
93
Further Sources
Snack Foods
Key Note Business Ratio Reports

Confectionery Manufacturers The Food Ingredients Industry Frozen Food Distributors Frozen Food Producers Grocery Wholesalers 365 each Over 148 titles evaluating each UK industry sector. They compare, contrast, analyse and comment on the financial performance of the leading companies in each marketplace.
Key Note Bespoke Data Service

As well as choosing the companies you want to analyse, you can also choose exactly what performance information you need on them with our Bespoke Data Service. We will be able to provide you with information covering the companies, sectors, performance figures, ratios and other data items specific to your individual requirements alone. Even historical figures can be provided. Contact us for more information: sales@keynote.co.uk
Key Note UKplc Report

UKplc is an indispensible guide for managers and for those interested in gaining a greater insight into the financial performance of an average company operating in each of the main industries in the UK. Providing up-to-date information and analysis, the publication will allow the reader to gain a greater level of market intelligence as well as a good knowledge of the current state of the UK industry.
Key Note Carnet

A service that offers a discount on multiple report purchases. Contact us for further details: sales@keynote.co.uk
Key Note Research Consultancy

We can offer a full-service bespoke solution for any research requirements not covered by the published report range. Our comprehensive market research and information consultancy service is managed in house. Contact us for more information: bespoke@keynote.co.uk
Key Note Regional Leads Reports

420 For each region of Great Britain, there is a detailed Regional Leads Report, bringing you invaluable financial information and contact details for thousands of companies, which are profiled in each report. You can also choose from these further services:
94
Key Note Ltd 2010
Snack Foods

TGI tables, produced by BMRB International Ltd, are generally based on one of the following groups: Households a private household consists of either one person living alone or a group of people, usually, but not always, members of one family, who live together and whose food and other household expenses are managed as one unit. Adults any person aged 15 or over. Housewives a member of a private household who is solely or mainly responsible for the household duties.
Number, Profile, Penetration

Tables used in Key Note reports may give figures for the Number, Profile, and/or Penetration. These terms are explained in the following table.
The total number of adults, housewives, households, etc. Across The % of 15-24 year-olds, etc. who are users.
Table Heading
Population Number (000) 13,535 Profile (%) 100.0
Penetration (%) 66.4
All housewives Age 15-24 25-34 Social Grade AB C1 Region Greater London
20,371
This is the projected number of people in each subgroup who use the product.
1,045 2,697
Down The % of each subgroup who are users. Each subgroup should total 100% vertically.
7.7 19.9
0.03 12.1
.0 .0
61.5 71.9
2,557
10.4
55.2
Source: Target Group Index, BMRB International, 1995
TGI data used in Key Note reports are broken down by age, social grade and standard region.
Key Note Ltd 2010
95
Snack Foods
Social Grade
This is normally based on the occupation of the Head of the Household, or if the Head of the Household is retired, their former occupation. If this information is not available, social grade is based on environmental factors such as type of dwelling, amenities in the home, presence of domestic help, etc. Social grade is assessed by the interviewer when collecting the information and is, therefore, based on information given personally and verbally by the respondent. Social grade is checked by BMRBs coding and editing office. The following table broadly defines the six social grades used. The relationship between social grade and net income of the Head of the Household is a complex one and readers should note that income is not determinant of social grade.
Social Grade Social Status A B C1 Upper middle class Middle class Lower middle class Head of Households Occupation Higher managerial, administrative or professional Intermediate managerial, administrative or professional Supervisory or clerical and junior managerial, administrative or professional Skilled manual workers Semi and unskilled workers State pensioners or widows
C2 D E
Skilled working class Working class Those at lowest levels of subsistence (no other earner)
Standard Region
This is as defined by the Registrar-General.
96
Key Note Ltd 2010
Snack Foods
Key Note Research
Key Note Research

Key Note is a leading supplier of market information, publishing an extensive range of consumer, industrial, business-to-business and services titles. With over 25 years experience, Key Note represents clear, concise, quality market information. For all reports, Key Note undertakes various types of research: Online searching is carried out by product code or free search method, and covers the period from the last edition of the report to the current day. The internal my ICC service is used to select company information relevant to the particular report. The financial information extracted may then be backed up by further online searching on particular companies. Trade sources, such as trade associations, trade journals and specific company contacts, are invaluable to the Key Note research process. Secondary data are provided by Kantar Media (TGI) and Nielsen Media Research for consumer/ demographic information and advertising expenditure, respectively. In addition, various official publications published by National Statistics, etc. are used for essential background data and market trends. Interviews are undertaken by Key Note for various reports, either face-to-face or by telephone. This provides qualitative data (industry comment) to enhance the statistics in reports; questionnaires may also be used. Field research is commissioned for various consumer reports and market reviews, and is carried out by NEMS Market Research. Key Note estimates are derived from statistical analysis and trade research carried out by experienced research analysts. Up-to-date figures are inserted where possible, although there will be some instances where a realistic estimate cannot be made or external sources request that we do not update their figures. Key Note Editorial, 2010
Key Note Ltd 2010
97
Key Note Research
Snack Foods
98
Key Note Ltd 2010
Snack Foods
The Key Note Range of Reports

Key Note publishes over 180 titles each year, across both the Key Note and Market Assessment product ranges. The total range covers consumer, lifestyle, financial services and industrial sectors.
Title Edition Published Title Edition Published
Market Reports and Reports Plus

A
Cigarettes & Tobacco Cinemas & Theatres 2008 2009 2003 2002 2005 2010 2010 2001 2008 2010 2010 2009 2009 2007 2009 2009 2007 2009 2009 2009 2008 2008 2010 2008 2009 2008 2008 2009 2004 2002 2009 2009 2010 2010 2009 2009 2010 Closed-Circuit Television Clothing Manufacturing Clothing Retailing Commercial Radio Commercial Vehicles Computer Hardware Computer Services Computer Software Confectionery Consumer Internet Usage Consumer Magazines Contraception Contract Catering & Foodservice Management Contract Cleaning Cooking Sauces & Food Seasonings Corporate & Promotional Giftware Corporate Hospitality Cosmetics & Fragrances Cosmetic Surgery Courier & Express Services
D
23 9 11 15 7 8 15 8 8 7 28 4 17 4 21 21 3 3 6 22 8 15 3 5 11 3 4 1 2 19 7 13 1 14 5
2009 2001 2009 2008 2009 2004 2009 2010 2008 2008 2010 2000 2010 2009 2010 2010 2008 2008 2007 2009 2010 2008 2004 2008 2010 2000 2009 2009 2003 2009 2009 2009 2007 2009 2005
Access Control Accountancy Aerospace Agrochemicals & Fertilisers Air Freight Airlines Airports Animal Feedstuffs Arts & Media Sponsorship Automatic Vending Automotive Services Autoparts
B
10 13 12 3 2 21 14 11 3 24 7 19 14 2 22 16 19 16 24 14 27 15 5 16 10 13 9 14 10 13 17 16 13 13 8 15 27
Baths & Sanitaryware Bearings Betting & Gaming Biscuits & Cakes Book Publishing Bookselling Bread & Bakery Products Breakfast Cereals Breweries & the Beer Market Bricks & Tiles Bridalwear Builders Merchants Building Contracting Building Materials Bus & Coach Operators Business Press
C
Dark Spirits & Liqueurs Debt Management (Commercial & Consumer) Defence Equipment Design Consultancies Digital Broadcasting Digital Communications Digital TV Direct Marketing Discount Retailing Disposable Paper Products Document Imaging Systems Domestic Heating Dry Cleaning & Laundry Services
Cable & Satellite TV Camping & Caravanning Canned Foods Carpets & Floorcoverings Catering Equipment Chemical Industry Childrenswear Chilled Foods China & Earthenware
Key Note Ltd 2010
99
Snack Foods
Title E
Edition
Published
Title
Edition
Published
Electrical Contracting Electrical Wholesale Electricity Industry Electronic Component Distribution Electronic Component Manufacturing Electronic Games Equipment for the Disabled Equipment Leasing Estate Agents Ethnic Foods Exhibitions & Conferences
F
9 5 6 12 11 4 5 12 17 15 11 2 23 4 11 8 14 7 4 16 12 8 17 24 12 21 6 13 5 18 15 25 15 9 22 9 19 13 17 24 19
2009 2009 2009 2002 2002 2003 2009 2003 2008 2009 2009 2003 2008 2002 2000 2006 2010 2007 2009 2009 2010 2004 2009 2009 2008 2009 2009 2009 2009 2009 2009 2009 2010 2009 2003 2002 2009 2009 2008 2009 2009
Household Appliances (Brown Goods) Household Appliances (White Goods) Household Detergents & Cleaners Household Furniture
I
11 16 16 18 14 8 5 8 12 8 9 12 25 7 9 14 9 10 1 20 17 5 23 7 2 2 3 17 2 21 5 16 14 12
2008 2008 2009 2008 2010 2001 2000 2001 2009 2005 2009 2009 2009 2009 2008 2002 2010 2003 2005 2009 2009 2009 2009 2010 2007 2007 2002 2008 2008 2008 2009 2008 2010 2007
Ice Creams & Frozen Desserts Industrial Fasteners Industrial Pumps Industrial Valves Insurance Companies Internet Usage in Business IT Security IT Training
J
Factoring & Invoice Discounting Fast Food & Home Delivery Outlets The Film Industry Finance Houses Fire Protection Equipment Fish & Fish Products Fitted Kitchens Football Clubs & Finance Footwear Franchising Free-To-Air TV Freight Forwarding Frozen Foods Fruit Juices & Health Drinks Fruit & Vegetables Further & Higher Education
G
Jewellery & Watches

K
Kitchenware
L
Laboratory Equipment Lighting Equipment Lingerie

M
Management Consultants Market Forecasts Meat & Meat Products Medical Equipment Metal Recycling Milk & Dairy Products Mobile Phones Mobile Telecommunications
N
Garden Equipment Gas Industry Giftware Glassware Greetings Cards Plus

H
Natural Products New Media Marketing Newspapers Non-Metal Recycling

O
Hand Luggage & Leather Goods Health Clubs & Leisure Centres Health Foods Heating, Ventilating & Air Conditioning Home Furnishings Home Shopping Horticultural Retailing Hotels Housebuilding
Office Furniture Offshore Oil & Gas Industry Ophthalmic Goods & Services OTC Pharmaceuticals Own Brands
100
Key Note Ltd 2010
Snack Foods
Title P
Edition
Published
Title T
Edition
Published
Packaging (Food & Drink) Packaging (Glass) Packaging (Metals & Aerosols) Packaging (Paper & Board) Packaging (Plastics) Paper & Board Manufacturing Personal Banking Photocopiers & Fax Machines Plant Hire Plastics Processing Poultry Power Tools Premium Lagers, Beers & Ciders Printing Private Healthcare Protective Clothing & Equipment Public Houses
R
6 13 12 14 15 14 11 14 13 10 3 5 8 15 20 7 26 7 11 10 10 3 24 16 22 11 14 4 8 12 20 17 3 12 15 7 24
2010 2008 2003 2008 2010 2002 2000 2005 2007 2003 2008 2007 2009 2010 2009 2009 2010 2008 2009 2010 2010 2009 2009 2010 2009 2008 2009 2001 2000 2010 2010 2008 2009 2009 2009 2009 2008
Take Home Trade Telecommunications Timber & Joinery Toiletries Tourist Attractions Toys & Games Training Travel Agents & Overseas Tour Operators Tyre Industry
V
17 21 19 23 5 23 18 22 4 9 4 8 17 10 5 19 20 1 21 12 11 11 3 7 10 11 18 8 2 19 10 10 1 15 2 2 3 1 12 2 9 1
2008 2007 2008 2010 2001 2009 2009 2009 2008 2010 2007 2005 2006 2010 2010 2008 2009 2005 2009 2008 2004 2009 2007 2003 2009 2009 2008 2010 2009 2009 2005 2009 2005 2005 2008 2008 2010 2001 2008 2010 2010 2003
Vehicle Security Videoconferencing Video & DVD Retail & Hire

W
Wallcoverings & Ceramic Tiles Waste Management Water Industry Windows & Doors Wine White Spirits
Rail Travel Ready Meals Recruitment Agencies (Permanent) Recruitment Agencies (Temporary & Contract) Renewable Energy Restaurants Retail Chemists & Drugstores Road Haulage
S
Market Reviews
Catering Market Clothing & Footwear Industry UK Computer Market Construction Industry Contracted-Out Services Defence Industry Distribution Industry DIY & Home Improvements Industry Drinks Market Energy Industry Film Market Food Industry Healthcare Market Insurance Industry The Legal Services Market Leisure & Recreation Market Leisure in the Home Leisure Outside the Home Local Government Services Mechanical Handling Motor Industry Music Industry Office Equipment Industry Packaging (Food & Drink) Industry
Sauces & Spreads Shopfitting Short Break Holidays Slimming Market Small Domestic Electrical Appliances Snack Foods Soft Drinks (Carbonated & Concentrated) Soup Market Sports Clothing & Footwear Sports Equipment Sports Sponsorship Stationery (Personal & Office)
Key Note Ltd 2010
101
Snack Foods
Title
Edition
Published
Title
Edition
Published
Passenger Travel in the UK Pharmaceuticals Industry Process Plant Industry Publishing Industry Railway Industry Security Industry Sports Market Travel & Tourism Market UK Internet Market
5 6 1 13 2 13 13 16 1
2007 2008 2000 2010 2006 2010 2010 2009 2009
Customer Loyalty in Financial Services Customer Magazines & Contract Publishing Customer Relationship Management Customer Services in Financial Organisations C2DE Consumer
D
2000 2009 2008 2010 2008 2009 2007 2010 2008 2000 2006
Market Assessment Reports

A
Diet Foods DINKY Market 2008 2009 2007 2000 2010 2000 2006 2008 2000 2000 2002 2007 2003 2002 2008 2008 2008 2002 2005 2008 2008 2000 2009 2005 2009 2008 2007 2010 2002 2009 2000 2008 Direct Insurance Direct Mortgages Domestic Lighting and Electrical Products Domestic Telecommunications
E
ABC1 Consumer Activity Holidays Advertising Agencies All-Inclusive Holidays Alternative Healthcare Audio-Visual Retailing
B
Baby Foods Baby Products Baths and Showers Beds, Bedrooms and Upholstered Furniture Betting and Gaming Book Retailing on the Internet Bottled Water Bridalwear Business Postal Services B2B Marketing Business Travel Market
C
E-Commerce: The Internet Grocery Market E-Commerce: The Internet Leisure & Entertainment Market Electronic Banking EMU The Impact on the UK Financial Services Industry E-Recruitment E-Shopping Estate Agents and Services Ethnic Foods European Electricity Industry European Gas Industry European Long-Term Insurance European Oil & Gas Industry European Renewable Energy Industry European Short Breaks European Telecommunications European Tourist Attractions European Trends in Food Shopping European Water Industry Extended Financial Families
2009 2008 2008 2003 2006 2002 2010 2002 2007 2007 2008 2007 2008 2008 2008 2002 2009 2009 2007 2005
Cable and Satellite Services Charity Funding Childcare Childrens Publishing Clothing Retailers Coffee & Sandwich Shops Commercial Dynamics in Financial Services Commercial Insurance for Small Businesses Condiments and Sauces Consumer Credit & Debt Contact Centres Contraception Cooking & Eating Cross-Border Shopping Cruise Market
102
Key Note Ltd 2010
Snack Foods
Title F
Edition
Published
Title L
Edition
Published
Financial Services Marketing to ABs Financial Services Marketing to ABC1s Financial Services Marketing to BCs Financial Services Marketing to C1C2DEs Financial Services Marketing to DEs Financial Services Marketing to Over 60s Financial Services Marketing to the Affluent Financial Services Marketing to the Retired and Elderly Financial Services Marketing to Start-Up Businesses and the SelfEmployed Financial Services Organisations on the Internet The Fish Industry Forecourt Retailing Functional Foods Funding in Higher Education
G
Lifestyle Magazines 2006 2000 2009 2006 2009 2004 2009 2007 Low-Fat & Reduced-Sugar Foods The Luggage Market
M
2008 2008 2000 2003 2009 2010 2007 2008 2008 2002 2009 2008 2005 2008 2008 2004 2010 2007 2010 2000 2005 2009 2004 2002 2009 2003 2010 2008 2009 2008 2005 2009 2001 2007 2001 2004 2001 2000 2000 2001 2009
Marketing to Children 4-11 Marketing in the Digital Age Media Marketing Medical & Health Insurance Men and Womens Buying Habits Mens Toiletries & Fragrances Millennium Youth Mobile Marketing Motor Finance
N
The Newspaper Industry 2003 2009 2001 2010 2010 2002 2010 2007 2007 2008 2009 2008 2009 2008 2009 2000 2008 2005 2008 2009 2005 2002 2006 2010 Non-Food Sales in Supermarkets Nutraceuticals
O
Off-Trade Spirits Opticians & Optical Goods Organic Baby & Toddler Care Organic Food & Drink OTC Pharmaceuticals Over-40s Consumer Over-50s Consumer
P
General Insurance Generation Y Global Waste Management Green and Ethical Consumer Grey Consumer
H
Pay TV Pension Extenders Pensions Personal Banking Personal Lines Insurance Personal Loans Pet Market Planning for Retirement Plastic Cards in Europe Plus-Size Fashion Private Sector Opportunities in Education Public Relations Industry Public Transport
R
Healthy Eating Holiday Purchasing Patterns Home Entertainment Hot Beverages

I
In-Car Entertainment Independent Financial Advisers Individual Savings Accounts Insurance Prospects Internet Advertising Internet Service Providers Issues and Challenges in the UK Life Assurance Market Issues in Higher Education Funding IT Recruitment
The Railway Industry Ready Meals Recycling and the Environment Retail Credit Retail Development Rural Economy
Key Note Ltd 2010
103
Snack Foods
Title S
Edition
Published
Title U
Edition
Published
Savings & Investments Saving Trends in the Eurozone Singles Market Shopping Centres Short Breaks Slimming Market Small Businesses & Banks Small Office Home Office Consumer Small Office Home Office Products The Soup Market Sponsorship Supermarket Own Label Supermarket Services Sweet & Salty Snacks
T
2007 2002 2009 2008 2004 2009 2010 2001 2001 2001 2000 2009 2007 2009 2008 2009 2003 2008 2007 2005
Utilities
V
2007 2009 2010 2009 2000 2007 2009
Vegetarian Foods Vehicle Breakdown Services Vitamins, Minerals & Supplements

W
White Goods Women Over 45 Working Women
Teenage Fashionwear Teenage & Pre-Teen Magazines Teleworking Trends in Food Shopping Trends in Leisure Activities Tweenagers
Key Note Ltd 2010

All rights reserved. No part of this publication may be reproduced, copied, stored in an electronic retrieval system or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988. Published by Key Note Ltd, 5th Floor, Harlequin House, 7 High Street, Teddington, Richmond Upon Thames, TW11 8EE. Telephone: 0845-504 0452 Stringent efforts have been made by Key Note to ensure accuracy. However, due principally to the fact that data cannot always be verified, it is possible that some errors or omissions may occur; Key Note cannot accept responsibility for such errors or omissions. Details supplied by Key Note should only be used as an aid, to assist the making of business decisions, not as the sole basis for taking such decisions. Under the new Privacy and Electronic Communications Regulations 2004, it is unlawful for a business to make an unsolicited sales & marketing call to a corporate subscriber if it is either registered with CTPS or has requested NOT to receive such calls. Key Note Ltd holds and regularly updates (every 28 days) its data in accordance with the regulations and ensures that its data are compliant, as of the date created. It is the responsibility of the caller to ensure that these data are up to date; Key Note Ltd does not hold itself liable for any subsequent legalities. If you have any queries regarding the CTPS legislation you may find the following website useful: www.ico.gov.uk
104
Key Note Ltd 2010

Snack Foods 2010 Keynote

Загружено:

Сведения о документе

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

Snack Foods 2010 Keynote

Загружено:

Авторское право:

Доступные форматы

Market Report Plus 2010

20th Edition January 2010 Edited by Sophie Worth ISBN 978-1-84729-564-4

James Donovan Managing Director Key Note Limited

Key Note Ltd 2010

THE TOTAL MARKET................................................................................................................11

Key Note Ltd 2010

Key Note Ltd 2010

RECENT HISTORY.......................................................................................................................23 NUMBER OF COMPANIES.......................................................................................................23

ADVISORY AND INFORMATION SERVICES .......................................................................27

THE MARKETPLACE..................................................................................................................29 MARKET LEADERS.....................................................................................................................29

Key Note Ltd 2010

6. Strengths, Weaknesses, Opportunities and Threats

Key Note Ltd 2010

HOUSEHOLD EXPENDITURE ON FOOD AND DRINK......................................................55 CONSUMER PENETRATION ...................................................................................................55

CLOSURES, MERGERS AND ACQUISITIONS ......................................................................59

BOARD AND SENIOR MANAGEMENT CHANGES............................................................59

NEW PRODUCT DEVELOPMENT ..........................................................................................59

9. The Global Market

Key Note Ltd 2010

FORECASTS 2010 TO 2014......................................................................................................70

11. Company Profiles

Key Note Ltd 2010

12. Company Financials 13. Further Sources

Understanding TGI Data

Key Note Research The Key Note Range of Reports

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

Table 1.1: UK Resident Population Estimates by Sex (000), Mid-Years 2004-2008

Gross Domestic Product

Key Note Ltd 2010

2005 1,254,058 4.2

2006 1,325,795 5.7

2007 1,398,882 5.5

2008 1,448,054 3.5

Key Note Ltd 2010

Table 1.3: UK Rate of Inflation (%), 2004-2008

Note: inflation is at retail price index (RPI).

Table 1.4: Actual Number of Unemployed Persons in the UK (million), 2004-2008

Key Note Ltd 2010

Household Disposable Income

Table 1.5: UK Household Disposable Income Per Capita (), 2004-2008

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

Key Note Ltd 2010

2006 942.0 1,010.0 192.0 2,144.0 0.5

2007 944.0 1,015.0 194.5 2,153.5 0.4

2008 980.0 1,022.0 203.0 2,205.0 2.4

2009 1,075.0 1,110.0 205.0 2,390.0 8.4

938.0 1,005.0 190.5 2,133.5 -

Source: Key Note

Key Note Ltd 2010

rsp retail selling prices

Source: Key Note

Key Note Ltd 2010

Snack nuts 8.6%

Potato crisps 45.0% Other savoury snacks 46.4%

Source: Key Note

Key Note Ltd 2010