Packaged Food in The Philippines

PACKAGED FOOD IN THE PHILIPPINES
Euromonitor International April 2013
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LIST OF CONTENTS AND TABLES

Executive Summary ..................................................................................................................... 1 Modest Value Growth in 2012 .................................................................................................. 1 Higher Demand for Healthier Packaged Food Products ........................................................... 1 Domestic Manufacturers Dominate Packaged Food................................................................. 1 Supermarkets Remains the Most Important Distribution Channel ............................................ 1 Higher Value Growth Expected Over the Forecast Period ........................................................ 1 Key Trends and Developments .................................................................................................... 2 Economic Growth Sustains Packaged Food Consumption ....................................................... 2 Higher Demand for Healthier Goods......................................................................................... 3 Consumers Prefer Value-for-money Products .......................................................................... 3 Stable Packaged Food Commodity Prices ............................................................................... 4 Domestic Companies Dominate Philippines Packaged Food ................................................... 5 Foodservice Key Trends and Developments ............................................................................. 6 Headlines.................................................................................................................................. 6 Trends ...................................................................................................................................... 7 Competitive Landscape ............................................................................................................ 7 Prospects .................................................................................................................................. 8 Category Data .......................................................................................................................... 8 Table 1 Table 2 Table 3 Table 4 Foodservice Sales of Packaged Food by Category: Volume 20072012 ............................................................................................................. 8 Foodservice Sales of Packaged Food by Category: % Volume Growth 2007-2012 .................................................................................................... 9 Forecast Foodservice Sales of Packaged Food by Category: Volume 2012-2017 .................................................................................................. 10 Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2012-2017 ........................................................................ 10
Impulse and Indulgence Products Key Trends and Developments ......................................... 11 Headlines................................................................................................................................ 11 Trends .................................................................................................................................... 11 Competitive Landscape .......................................................................................................... 12 Prospects ................................................................................................................................ 13 Category Data ........................................................................................................................ 14 Table 5 Table 6 Table 7 Table 8 Table 9 Table 10 Table 11 Table 12 Sales of Impulse and Indulgence Products by Category: Volume 2007-2012 .................................................................................................. 14 Sales of Impulse and Indulgence Products by Category: Value 20072012 ........................................................................................................... 14 Sales of Impulse and Indulgence Products by Category: % Volume Growth 2007-2012 ..................................................................................... 14 Sales of Impulse and Indulgence Products by Category: % Value Growth 2007-2012 ..................................................................................... 15 Company Shares of Impulse and Indulgence Products 2008-2012 ........... 15 Brand Shares of Impulse and Indulgence Products 2009-2012 ................. 16 Forecast Sales of Impulse and Indulgence Products by Category: Volume 2012-2017 ..................................................................................... 17 Forecast Sales of Impulse and Indulgence Products by Category: Value 2012-2017 ........................................................................................ 17
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Table 13 Table 14
Forecast Sales of Impulse and Indulgence Products by Category: % Volume Growth 2012-2017 ........................................................................ 17 Forecast Sales of Impulse and Indulgence Products by Category: % Value Growth 2012-2017 ........................................................................... 18
Meal Solutions Key Trends and Developments ....................................................................... 18 Headlines................................................................................................................................ 18 Trends .................................................................................................................................... 18 Competitive Landscape .......................................................................................................... 19 Prospects ................................................................................................................................ 20 Category Data ........................................................................................................................ 20 Table 15 Table 16 Table 17 Table 18 Table 19 Table 20 Table 21 Table 22 Table 23 Table 24 Sales of Meal Solutions by Category: Volume 2007-2012 ......................... 20 Sales of Meal Solutions by Category: Value 2007-2012 ............................ 21 Sales of Meal Solutions by Category: % Volume Growth 2007-2012 ......... 21 Sales of Meal Solutions by Category: % Value Growth 2007-2012 ............ 21 Company Shares of Meal Solutions 2008-2012 ......................................... 22 Brand Shares of Meal Solutions 2009-2012 ............................................... 23 Forecast Sales of Meal Solutions by Category: Volume 2012-2017 .......... 23 Forecast Sales of Meal Solutions by Category: Value 2012-2017 ............. 24 Forecast Sales of Meal Solutions by Category: % Volume Growth 2012-2017 .................................................................................................. 24 Forecast Sales of Meal Solutions by Category: % Value Growth 20122017 ........................................................................................................... 24
Nutrition/staples Key Trends and Developments ..................................................................... 25 Headlines................................................................................................................................ 25 Trends .................................................................................................................................... 25 Competitive Landscape .......................................................................................................... 26 Prospects ................................................................................................................................ 27 Category Data ........................................................................................................................ 28 Table 25 Table 26 Table 27 Table 28 Table 29 Table 30 Table 31 Table 32 Table 33 Table 34 Sales of Nutrition/Staples by Category: Volume 2007-2012....................... 28 Sales of Nutrition/Staples by Category: Value 2007-2012.......................... 28 Sales of Nutrition/Staples by Category: % Volume Growth 2007-2012 ...... 28 Sales of Nutrition/Staples by Category: % Value Growth 2007-2012 ......... 29 Company Shares of Nutrition/Staples 2008-2012 ...................................... 29 Brand Shares of Nutrition/Staples 2009-2012 ............................................ 30 Forecast Sales of Nutrition/Staples by Category: Volume 2012-2017 ........ 31 Forecast Sales of Nutrition/Staples by Category: Value 2012-2017 ........... 31 Forecast Sales of Nutrition/Staples by Category: % Volume Growth 2012-2017 .................................................................................................. 31 Forecast Sales of Nutrition/Staples by Category: % Value Growth 2012-2017 .................................................................................................. 32 Sales of Packaged Food by Category: Volume 2007-2012 ........................ 32 Sales of Packaged Food by Category: Value 2007-2012 ........................... 33 Sales of Packaged Food by Category: % Volume Growth 2007-2012 ....... 33 Sales of Packaged Food by Category: % Value Growth 2007-2012 .......... 34 GBO Shares of Packaged Food 2008-2012 ............................................... 34 NBO Shares of Packaged Food 2008-2012 ............................................... 35 NBO Brand Shares of Packaged Food 2009-2012 .................................... 36 Penetration of Private Label by Category 2007-2012 ................................. 37
Market Data ................................................................................................................................ 32 Table 35 Table 36 Table 37 Table 38 Table 39 Table 40 Table 41 Table 42
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Table 43 Table 44 Table 45 Table 46 Table 47 Table 48
Sales of Packaged Food by Distribution Format: % Analysis 20072012 ........................................................................................................... 37 Sales of Packaged Food by Category and Distribution Format: % Analysis 2012 ............................................................................................. 38 Forecast Sales of Packaged Food by Category: Volume 2012-2017 ......... 40 Forecast Sales of Packaged Food by Category: Value 2012-2017 ............ 40 Forecast Sales of Packaged Food by Category: % Volume Growth 2012-2017 .................................................................................................. 41 Forecast Sales of Packaged Food by Category: % Value Growth 2012-2017 .................................................................................................. 41 Research Sources ...................................................................................... 42
Sources ...................................................................................................................................... 42 Summary 1
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EXECUTIVE SUMMARY Modest Value Growth in 2012
Philippines packaged food value sales are expected to grow modestly in 2012 thanks to stronger economic growth, improved disposable income and the trends of convenience and health and wellness. The value performance will be an improvement on the previous year but is among the lowest of the review period. This was due to slowing volume consumption as a result of slower population growth, low average unit price growth and higher spending on non-food consumer goods.
Higher Demand for Healthier Packaged Food Products

Many of the new product developments in 2012 highlighted the health benefits that served the needs of the increasing number of health-conscious consumers. These health benefits mainly help consumers with weight management, maintenance of cardiovascular health and supplementation of vitamins and minerals. Similarly, brand manufacturers continuously develop products not only to be healthier but also better-tasting. Among the companies that introduced new products were Nestl Philippines Inc, Universal Robina Corp, Gardenia Philippines Inc and San Miguel Pure Foods Co Inc.
Domestic Manufacturers Dominate Packaged Food

Domestic manufacturers accounted for the majority share of packaged food sales in 2012 due to the large number of local players and the large shares of key domestic manufacturers such as Monde Nissin Corp, Universal Robina Corp, The Purefoods-Hormel Co Inc and San Pablo Manufacturing Corp among others. The local brand manufacturers benefit from having popular and established brands and focusing on providing consumers with value-for-money products. Multinationals, however, are trying to increase presence and share in the local market through partnership with and acquisition of domestic manufacturers.
Supermarkets Remains the Most Important Distribution Channel

The majority of packaged food sales were generated through supermarkets. The expansion of the major supermarket chains such as SM, Robinsons and Puregold continued to increase the number of supermarkets outlets across the country and improve its accessibility in both residential and rural areas. Hypermarkets is a fast-growing channel in packaged food as its presence is increasing in the key cities. Convenience stores continues to be an important channel for a niche of consumers, especially for those who work night shifts in the business process outsourcing industry.
Higher Value Growth Expected Over the Forecast Period

The annual value growth from 2013 to 2017 is expected to be higher than that of the review period due to the potential improvement in volume consumption fuelled by the expected stronger economic performance. Consumer spending on packaged food will continue to account
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for a large portion of household expenditure although its share may experience a decline as a result of the apparent increased spending on non-food products.
KEY TRENDS AND DEVELOPMENTS Economic Growth Sustains Packaged Food Consumption
In 2012, the Philippine economy continued to grow with a GDP of 5%. The countrys positive economic performance helped maintain the consumption levels of packaged food in the Philippines. Consumer spending was buoyed by the continuous influx of remittances from overseas Filipino workers and the growing number of foreign investments in tourism, property development and business process outsourcing companies. More investments came into the Philippines due to the weaker economic performance in other countries. Current impact Packaged food retail value is expected to increase by 5% in 2012 to Ps439 billion. These growths will be similar to the retail value increase experienced in the 2011. Packaged food total retail value was Ps416.3 billion in 2011. All packaged food categories experienced positive value and volume growth in 2012. Majority of the packaged food industry experienced growth rates stronger than that of the industry average. Meal replacement, dairy, baby food and confectionery had slower growth rates due to its already high penetration rate for its intended target markets. Confectionerys slower growth is due in part to many of the products being perceived as too sweet and hence less healthy. Snack bars also experienced slow positive growth due to the development of cheaper locally produced brands. Outlook The Philippines GDP is expected to continue to grow faster than the global economic growth in the forecast period due to the governments economic stimulus, policies that promote efficient and corruption-free governance, programmes that encourage investment, potential strong gains from services and agricultural sectors, and the prospective development of natural resources such as natural gas. The country is expected to maintain a GDP of 5% while the global output performance is expected to be at 3-4% over the forecast period. Consumer spending and overseas Filipino workers remittances are likely to continue to increase over the forecast period. Future impact The optimistic economic forecast for 2013-2017 may encourage investment and entry of new and smaller packaged food manufacturers. As a result, stiffer price competition is expected to occur which will result in lower value growth of packaged food despite projected higher annual volume growth. Packaged food is expected to have a 3% CAGR in the forecast period and four of the packaged food categories may maintain modest to healthy value growth including spreads, bakery, oils and fats, and ready meals. To continue to gain share in the expected competitive business environment in the forecast period, brand manufacturers should strengthen quality product offerings, apply creative packaging and broaden and serve market niches. This can be done through continuous awareness of emerging niches, consumer lifestyle and constant access and constructive acceptance of consumer feedback on packaged food brands.
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Higher Demand for Healthier Goods

The health and wellness trend continued to be a main contributing factor in the performance of packaged food in 2011 and 2012. Consumers are increasingly becoming conscious of the food they eat to avoid being overweight and to improve overall well-being. However, a large segment of the market still seeks indulgence products but is likely to try healthier variants when available. Consumers are beginning to look for comfort food that they can consume without feeling guilty about consuming unhealthy food. Current impact Taste remained a key consideration in the packaged food purchase decision in 2012 despite the on-going health and wellness trend for many consumers. In response, manufacturers developed healthier variants that include benefits such as low calorie, reduced fat and less sugar. Many manufacturers were able to develop these products without sacrificing the quality or taste of the products. Many of these new healthier variants were for foods that were typically perceived as fattening and unhealthy. In ice cream, for example, Nestl Philippines Inc unveiled its zero sugar ice cream products while Unilever RFM Ice Cream Inc launched dark chocolate flavoured Magnum single portion ice cream. In dairy, Nestl Philippines Inc introduced Nido Lite. This was the first low calorie and low fat powder milk product in the Philippines. In pasta sauces, Del Monte Spaghetti Sauce launched a variant fortified with vegetable ingredients such as mung beans, moringa and squash. Outlook Health and wellness is expected to be a stronger trend over the forecast period and this may become a key consideration in purchasing food products for consumers. As a result, brand manufacturers are expected to launch more new products that are healthy but innovative to beat competition. Manufacturers are likely to stress health benefits along with improving the products taste. Future impact Healthy new product developments are expected to become more prevalent in more packaged food. Brand manufacturers are expected to support these new products with strong marketing campaigns and the products are likely to be accepted by consumers who are increasingly becoming aware of the importance of having a healthy lifestyle. Brand manufacturers are likely to start capitalising on organic food products and organic farming to benefit from the long-term trend of health and wellness. Additionally, corporate social responsibility showing concerns about consumer health and participation and cooperation with government nutrition programmes are likely to give consumers a lasting impression of companies commitment to wellness.
Consumers Prefer Value-for-money Products

The Philippines has a significant portion of its population coming from low-income households with over 40% of the population earning less than US $1,500 and about 20% earning between US$1,500 US$2,000 according to Euromonitor Internationals Countries and Consumers data. Those in the lower income segment tend to spend a larger portion of their money on food as compared to those in the higher income segments. Low income households tend to prioritise expenditure on food.
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Current impact Standard and economy brands were the most widely-consumed in packaged food as a result of the large low-income and middle-income market base. The brand manufacturers which sell standard price brands such as Universal Robina Corp and Monde Nissin Corp experienced overall value share growth in packaged food. Consequently, the brand manufacturers carrying products that are positioned as premium suffered the most as a result of low number of households earning high incomes. For example, ice cream producer Haagen-Dazs discontinued distribution in 2012 while Nestl Philippines Incs overall packaged food value share declined. Outlook Standard and economy brands will continue to generate the bulk of the packaged food sales. However, there will be a noticeable improvement in the premium brands, particularly those with healthy positioning despite having higher unit prices. Optimistic development in industries such as tourism, business process outsourcing and agriculture in addition to the expected increase in dollar reserves may improve the disposable income of middle-income consumers. Hence, consumption of premium brands could grow in middle-income households. Future impact Premium brand providers may recover from the recent value share decrease in packaged food. They are likely to have faster sales growth over the forecast period as a result of the potential increased consumption of premium brands driven by the improvement in disposable incomes and higher employment rate over the forecast period. Premium brand-owners may consider entering the Philippines market. Premium brands may have better value growth over the forecast period although they are unlikely to outperform standard brands. Premium brand manufacturers are expected to create new and creative ways of encouraging customer purchases by highlighting the brands competitive value over standard and economy brands so consumers will increasingly become more aware of premium products and use them. Moreover, premium brands will have better product quality than the standard brands to justify their cost as consumers will continue to use standard brands if they do not see a difference in quality between the two price bands.
Stable Packaged Food Commodity Prices

In 2012, the commodity prices of flour and the raw materials for oils and fats and others were stable due the less frequent oil price increases. In previous years, the political crisis in the Middle East in 2011 caused successive oil price increases in the country which significantly increased the prices of raw materials and packaged food ingredients. In 2012, as the political crisis eased, oil prices and commodity prices became less volatile. This resulted in more competitive packaged food selling prices which consequently helped brand manufacturers thrive and increase volume sales. Current impact The stable commodity prices helped key packaged food brand manufacturers such as San Miguel Purefoods Co Inc sustain growth with 9% company growth and 4% value growth in packaged food as many of its food products remained price competitive. Similarly, RFM Corp maintained double digit sales growth in 2012 and the easing of prices of commodities such as sugar was one of the contributing factors to its strong sales. The trend also helped companies achieve more efficient operational costs which contributed to an acceptable unit price movement of most packaged food types. Average unit price increases were kept low and directly affected the countrys inflation rate of 3% in 2012. Aside
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from the stable commodity prices, the other main factors for low unit price growth are competition and high usage of the standard brands. Outlook More stable oil prices in the country and hence commodity prices are expected over the forecast period as the country battles for oil sufficiency through the potential development of the oil-rich provinces. Manufacturers are likely to invest in more cost-effective manufacturing techniques to reduce their dependency on fossil fuels. This may include streamlining production methods or purchasing more efficient machines. The administrations new agricultural programme, Agri-Pinoy, which aims to achieve sustainable agriculture, can help ensure the sufficient supply of commodities, packaged food ingredients and raw materials over the forecast period. This may warrant long-term price stability of major food sources. Such a trend will be beneficial to brand manufacturers who locally source and manufacture packaged food products. Future impact The projected long-term stability of commodity prices will contribute to slightly lower unit prices of most packaged food over the forecast period. This is expected to consequently decrease the average annual value growth of most categories. The stable commodity prices will also help minimise companies production costs and allot more budgets on other operati ons such as research and development and marketing. Other reasons that may help stabilise average unit prices include the predicted stiffer competition due to the potential increase in the number of players in packaged food as a result of a better economic environment. New players may adopt value-for-money strategies to win share against established players. With such conditions, established brand manufacturers could acquire promising new players to maintain or increase value share in packaged food. They could therefore continuously enjoy significant revenue growth due to cost savings generated from stable commodity prices and more efficient operational costs.
Domestic Companies Dominate Philippines Packaged Food

Domestic companies accounted for the bulk of packaged food value share in 2012 due to the high number of local brand manufacturers with high value sales. Their combined shares surpassed multinationals brand share despite the strong sales of some premium brand manufacturers. Multinationals value share also declined against that of local brand manufacturers due to the latters aggressive marketing campaigns, price positioning and good product quality. Domestic brands continued to enjoy a comfortable lead against multinationals throughout packaged food. Current impact Due to the growing share of domestic manufacturers, multinational manufacturers such as Nestl Philippines Inc, Unilever Philippines Inc, Kraft Foods Asia Inc, Mead Johnsons Inc and Abbot Philippines Inc made strong marketing efforts to keep sales and market share growing. The most visible was Nestl Philippines Inc which used the strategy of common shared values with Filipino consumers to allow consumers to be able to relate to its brands. Such efforts include employment building through Nestl products, health and nutrition promotion through its improved dairy and breakfast cereals products and frequent television commercials. The company also launched healthier new product variants such as the Nido Lite and Zero Fat and No Sugar Added Nestl Mango Ice Cream.
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Unilever Philippines Inc had frequent multimedia advertisements and was active in sponsoring top-rated television programmes. These activities, however, were insufficient to completely dominate the market as they too have a limited product portfolio and were not able to lower prices that could compete and discourage purchases of local brands. Outlook Domestic manufacturers are expected to continue to dominate. However, the better economic outlook may improve the value growth of multinationals as more consumers will be able to afford their brands over the forecast period. However, value growth may not be sufficient to win share against the domestic companies who offer quality products at more affordable prices. The leadership of Nestl Philippines Inc in packaged food is also at risk due to the aggressiveness and increasing product portfolio of Universal Robina Corp. Future impact Multinational companies marketing activities are likely to remain the same over the forecast period as there is an expected confidence in sales due to the higher disposable of consumers. They are unlikely to use low price positioning as they would prefer to keep their higher quality brand image. Nevertheless, they may engage in occasional price discounts, product giveaways, television game show sponsorship and contests for product purchase to help win share among the middle-income and low-income consumers. Local brand manufacturers, on the other hand, may continue being aggressive in their marketing campaigns through creative and celebrity-led multimedia advertisements and in-store promotions. Universal Robina Corp as a packaged food manufacturer has a competitive edge in terms of distribution as it is under the same umbrella company as Robinsons (a key retailer in the Philippines), and hence has an affiliate supermarket and hypermarket with numerous branches across the country. The continuous product expansion of Universal Robina Corp, distribution advantages, value-for-money strategy, increasing involvement in health and wellness products and other marketing strategies will make it possible for the company to grow ahead of Nestl Philippines Inc and lead in Philippines packaged food. To advance value share against competitors, multinational companies are expected to adopt a price competitiveness strategy and continue expanding their product portfolios in order to have presence in more packaged food categories.
FOODSERVICE KEY TRENDS AND DEVELOPMENTS Headlines

Foodservice packaged food volume is expected to grow by 4% in 2012 Foodservice outlet expansion drives growth Frozen processed poultry is expected to have the highest foodservice volume growth in 2012 at 8% Other RTE cereals is expected to have the strongest volume decline at -9% San Miguel Purefoods - Great Foods Solutions Inc is expected to be the leading player in 2012 Foodservice volume is expected to have 3% CAGR over the forecast period
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Trends
The increasing number of outlets of restaurant chains continued to drive growth of foodservice in 2012. Restaurant chains continued to expand outside Metro Manila to attract more sales from those in less-developed parts of the Philippines. Disposable incomes in less-developed parts of the Philippines increased as more business process outsourcing companies expanded in these areas. In addition, tourism to other parts of the Philippines continues to grow. All these factors contribute to the growth of packaged food foodservice. Volume sales growth of foodservice in 2012 is expected to be 4% which is the lowest since the review period. Over the years, volume sales of packaged food are slowing since packaged food continues to be more popularly purchased for consumption at home. The growing interest in cooking was influenced by cooking shows and family bonding while eating breakfast, dinner or lunch at home. This was also supported by packaged food manufacturers multimedia advertisements which encouraged consumption of these foods at home rather than in foodservice establishments. The availability of easy-to-prepare and ready-to-eat packaged food in the retail channels served the needs of busy consumers. These types of food also enabled consumers to save money as they cooked at home rather than going out to foodservice establishments. There are no major changes in the consumer lifestyle that significantly impact the consumption of packaged food in the foodservice sector. The retail volume share of packaged food remained the same. Only a slightly slower growth of foodservice volume is expected in 2012. Frozen processed poultry is expected to have the highest value growth of 8% which is due to consumer preference for chicken as it is perceived as a healthier meat. Numerous new flavour variants in frozen processed poultry increased the interest of consumers; innovations include chicken tocino flavour which was inspired by a popular local dish. Chicken nuggets and chicken hotdogs are commonly served in foodservice establishments and continue to gain popularity due to its low price position and heavy advertising. Other RTE cereals is expected to have the strongest decline in foodservice volume sales at 9%. This decline was due to the limited number of establishments that use other RTE cereals in their menu offerings. Consumers also tend to prefer rice meals over cereal products in the Philippines. Cereals tend to be consumed at home more often than at foodservice establishments.
Competitive Landscape
San Miguel Purefoods - Great Foods Solutions Inc is expected to maintain a strong presence in foodservice since it is a distributor of frozen processed food, chilled processed food and dried processed food which account for a large percentage of foodservice packaged food volume. The company benefits from being part of a food manufacturer with large capital funding which enables it to have a diversified portfolio, produce meaningful and competitive new products, execute effective marketing campaigns and capitalise on its wide distribution network. Its strong alliances with other foodservice establishments further strengthen its position in this area. For similar reasons, the company continues to experience growth benefiting from being a leader in the distribution of packaged food in the country. Effective company strategies of foodservice companies include alliances with other foodservice establishments on marketing activities such as conventions and price promotions. This was carried out by San Miguel Purefoods - Great Foods Solutions Inc Bakeshops such as the Goldilocks Bakeshop and the Red Ribbon Bakeshop which had multimedia advertisements and price promotions and incentives during important days such as Fathers Day, Mothers Day, etc.
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New product launches in foodservice in 2012 were mainly in baked goods including cakes and bread produced by Red Ribbon Bakeshop and Goldilocks Bakeshop Inc. These products are new to the market and still have a small contribution to the companies growth in foodservice. A new cake by Goldilocks Bakeshop Inc is targeted at male consumers while the rest of the new products are aimed at families. Domestic companies continued to contribute to most of foodservice sales in the Philippines. Exclusive domestically-based distributors such as Flyace Corp, ScanAsia Overseas Inc and PTC Commercial Corp performed better than their multinational counterparts due to their better understanding of local requirements and the ability to quickly adapt to the changing preferences of clients. There are only a few multinational distributors in the market such as Nestl Professional Philippines and Unilever Food Solutions. Most players find it more practical to use local distributors instead of developing a distribution division.
Prospects
The busier lifestyles of consumers are expected to help sustain packaged food consumption in foodservice over the forecast period. However, the higher cost of packaged food products in foodservice may prevent it from having stagnant volume growth. Foodservice is expected to prepare and create product offerings with more health benefits to increase sales and benefit from the increasing number of health-conscious consumers. Some of the potential offerings will be frozen meat goods with fruits and vegetables, pasta with vegetable soup, high-fibre breakfast goods with fruits etc. The expected higher disposable incomes with the development of the business process outsourcing industry are also likely to encourage more consumers to eat out. Despite the positive economic outlook for the country which is likely to improve consumers disposable income, foodservice volume is expected to have 3% CAGR over the forecast period which is slightly lower compared to the average volume growth over the review period. The slower volume growth could be attributed to increasing production costs. In addition, it is likely that due to increasing disposable incomes, consumers may begin to prefer more expensive foodservice outlets compared to those that provide value-for-money. The fragmented nature of the industry is one of the threats to growth of foodservice establishments having numerous smaller players that makes competition stiffer. The higher cost of commodities, labour and management issues and infrastructure problems in rural areas are among the other factors that may prevent key foodservice companies from achieving higher growth and expansion. Efforts will be made to increase foodservice consumption and these will include new product developments, healthier menu offerings, partnerships with banks/credit card companies for food promotions, expansion to underserved areas, food trade fairs and exhibitions, discounts for special occasions and customer loyalty schemes. The performance of foodservice distributors will rely on the performance of foodservice outlets.
Category Data
Table 1 tonnes 2007 Baby Food Bakery 99,169.0 2008 102,594.2 2009 103,188.6 2010 104,770.1 2011 106,493.7 2012 108,332.6 Foodservice Sales of Packaged Food by Category: Volume 2007-2012
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Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source:
29,032.9 14,398.4 2,762.7 47,059.0 63,256.2 53,056.7 4,103.3 13,106.1 108,258.0 32,241.8 245.2 45,369.0 333.2 3,540.7 16,813.2 58,136.0 286,754.0 142,460.2 486,819.2
31,440.6 15,622.2 2,829.6 47,991.3 66,606.6 57,841.8 4,168.4 13,715.9 114,537.2 34,176.4 253.7 47,812.1 348.2 3,593.3 17,764.6 60,216.1 299,793.5 153,344.7 512,801.9
33,324.3 16,559.6 2,880.0 48,676.8 68,918.1 66,349.2 4,214.5 14,285.0 120,118.1 35,543.4 260.7 49,855.5 360.5 3,607.8 18,424.1 61,210.5 308,739.3 166,736.9 536,116.5
35,304.8 17,470.4 2,938.8 49,490.1 71,832.3 74,528.8 4,280.6 14,848.9 126,599.9 37,320.6 270.2 51,797.6 374.2 3,642.5 19,017.0 62,554.1 319,936.1 179,774.5 561,672.7
37,245.0 18,396.3 2,999.5 50,330.1 74,398.5 78,882.2 4,335.0 15,390.8 132,181.1 38,813.4 278.9 53,658.2 389.1 3,683.4 19,535.0 63,923.5 329,949.2 188,879.5 582,138.1
39,120.8 19,316.1 3,062.0 51,160.6 76,795.9 83,226.9 4,394.0 15,924.3 137,992.6 40,171.9 286.7 55,443.4 405.4 3,729.0 20,005.1 65,295.1 340,090.3 197,830.4 602,578.9
Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources
Table 2
Foodservice Sales of Packaged Food by Category: % Volume Growth 20072012
% volume growth 2011/12 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source:
2007-12 CAGR 1.8 6.1 6.1 2.1 1.7 4.0 9.4 1.4 4.0 5.0 4.5 3.2 4.1 4.0 1.0 3.5 2.3 3.5 6.8 4.4
2007/12 Total 9.2 34.7 34.2 10.8 8.7 21.4 56.9 7.1 21.5 27.5 24.6 16.9 22.2 21.7 5.3 19.0 12.3 18.6 38.9 23.8
1.7 5.0 5.0 2.1 1.7 3.2 5.5 1.4 3.5 4.4 3.5 2.8 3.3 4.2 1.2 2.4 2.1 3.1 4.7 3.5
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Table 3
Forecast Foodservice Sales of Packaged Food by Category: Volume 20122017
tonnes 2012 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source:
2013 110,291.1 40,964.4 20,243.3 3,122.6 51,994.0 78,926.1 87,587.5 4,457.8 16,434.4 144,136.5 41,377.1 294.3 57,127.3 423.1 3,778.5 20,435.6 66,675.4 350,377.8 206,672.2 623,064.7
2014 112,397.6 42,819.6 21,154.2 3,187.8 52,834.1 80,955.8 91,875.2 4,530.7 16,924.5 150,710.6 42,535.6 301.2 58,736.8 442.7 3,833.3 20,817.6 68,069.9 361,105.9 215,363.4 643,853.3
2015 114,659.1 44,684.8 22,063.9 3,256.2 53,709.2 82,813.0 95,730.4 4,613.1 17,394.7 157,836.8 43,599.0 307.8 60,296.4 463.9 3,893.2 21,156.8 69,486.1 372,357.2 223,582.1 664,713.0
2016 117,083.7 46,549.7 22,946.4 3,327.8 54,607.6 84,564.0 99,584.6 4,705.5 17,858.0 165,646.0 44,601.8 313.9 61,812.2 488.3 3,958.4 21,456.8 70,931.2 384,322.0 231,731.2 686,242.7
2017 119,712.2 48,423.8 23,818.4 3,404.0 55,535.3 86,121.8 103,357.7 4,808.4 18,301.4 174,192.8 45,493.8 319.9 60,702.6 516.2 4,029.3 21,721.6 72,414.9 397,011.5 237,175.8 705,828.0
108,332.6 39,120.8 19,316.1 3,062.0 51,160.6 76,795.9 83,226.9 4,394.0 15,924.3 137,992.6 40,171.9 286.7 55,443.4 405.4 3,729.0 20,005.1 65,295.1 340,090.3 197,830.4 602,578.9
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 4
Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2012-2017
% volume growth 2016/17 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup 2.2 4.0 3.8 2.3 1.7 1.8 3.8 2.2 2.5 5.2 2.0 1.9 -1.8 5.7 2012-17 CAGR 2.0 4.4 4.3 2.1 1.7 2.3 4.4 1.8 2.8 4.8 2.5 2.2 1.8 5.0 2012/17 Total 10.5 23.8 23.3 11.2 8.6 12.1 24.2 9.4 14.9 26.2 13.2 11.6 9.5 27.3
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Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source:
1.8 1.2 2.1 3.3 2.3 2.9
1.6 1.7 2.1 3.1 3.7 3.2
8.1 8.6 10.9 16.7 19.9 17.1
IMPULSE AND INDULGENCE PRODUCTS KEY TRENDS AND DEVELOPMENTS Headlines

Impulse and indulgence products is expected to have value growth of 5% in 2012 Smaller pack sizes continues to be a key strategy for manufacturers Savoury biscuits and crackers is expected to have the highest value growth in 2012 of 9% Impulse and indulgence products is expected to have moderate average unit price growth in 2012 Universal Robina Corp is expected to lead in 2012 with 20% value share Impulse and indulgence products is expected to have a constant value CAGR of 2% over the forecast period
Trends
Smaller pack sizes continued to be a key driver of growth in impulse and indulgence products. For example, miniature and fun size bars continued to be key sellers in chocolate confectionery. Sweet biscuits also used this strategy by creating miniature sizes. This strategy allows manufacturers to target the lower-income segment who were able to purchase the products with smaller cash layout. Manufacturers are also able to distribute their products more effectively through sari-sari stores (traditional street stores in the Philippines) using this strategy. Impulse and indulgence products had modest value growth in 2012 which is an improvement since the economic recession in 2009 due to better economic performance and stable remittances. Higher disposable income among all consumer segment due to higher wages and employment supported the snacking habits and consumption of impulse and indulgence products despite increased unit prices. The category also benefited from the presence of affordable brands and small pack size impulse and indulgence products which are attractive to low- and middle-income consumers. Savoury biscuits and crackers is expected to have the largest value growth in 2012 of 9% due to its low average unit price compared to other impulse and indulgence products. Its low price positioning allowed all income segments to be able to afford savoury biscuits and crackers. Savoury biscuits and crackers brands tend to cater to a wide target market including children, students, parents/families and fitness enthusiasts. Its strong nationwide distribution along with celebrity-led advertisements assisted growth. Gum is expected to have the slowest value growth with a decline of less than -1% in 2012. Gum was affected by the health and wellness trend which reduced consumption of high-sugar foods, stiffer competition due to more presence of imported confectionery and higher tobacco
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tax which decreased cigarette smoking and hence gum consumption. Cheaper sugar confectionery brands were also used as a substitute by consumers. Impulse and indulgence products continue to have strong sales through other grocery retailers. This was attributed to the strong sales in sari-sari stores (traditional street stores typically found in residential areas). Sari-sari stores tend to sell impulse and indulgence products on a per piece basis, making it more affordable for consumers. For example, sarisari store owners purchase sugar confectionery in a bulk pack of 50 pieces then resell this same product in individual pieces. The average unit price is expected to increase by 3% in 2012 due to higher operating costs and the increase in commodity/ingredients prices and electricity costs. The increase, however, is lower than the inflation rate of food products as brand manufacturers limited price adjustments to encourage sales amidst stiffer competition among existing, local and imported brands.
Universal Robina Corp is expected to lead impulse and indulgence products in 2012 with a 20% value share mainly due to the high production and value shares of its Jack n Jill brands. Universal Robina Corps brands are present in several impulse and indul gence categories in the Philippines including sugar confectionery, chocolate confectionery and biscuits. Many of its brands are leaders in their respective categories. Monde Nissin Corp is expected to have strong value growth in 2012 due to its leadership and rapid development in biscuits which accounted for 25% of impulse and indulgence volume sales and 21% of value. Monde Nissin Corp has a wide biscuits product portfolio and ran the most number of television commercials. Its brands are widely-known and have strong brand equity among consumers. Laura's Food Product Corp experienced the fastest growth in 2012. Its value sales grew by nearly 17%. Its strong growth can be attributed mainly by its small value share in the market, allowing its brands to have large growth potentials. In addition, its low price positioning and improved distribution throughout the Philippines boosted its sales performance in 2012. Due to the better economic situation compared to 2008 and 2009, impulse and indulgence brand manufacturers had a better sales performance in 2012. The availability of small pack size was a trend since 2008 during the difficult economic period but continued to be an effective strategy in 2012 as it served the low-income consumers and hence helped increase sales. The better economic conditions also enabled brand manufacturers to implement more marketing activities that helped improve consumption. New product developments in 2012 were mainly in biscuits, baked goods, confectionery and ice cream. Products introduced were from Gardenia Bakeries Philippines Inc, Goldilocks Bakeshop, Red Ribbon Bakeshop, Suncrest Foods Incorporated, Universal Robina Corp, Monde Nissin Corp, San Miguel Purefoods Co Inc, Unilever RFM Ice Cream Inc and Nestl Philippines Inc. Key new products were Cadbury Zip which placed competitive pressure on Kit Kat chocolate confectionery; the Gardenia Hotdog Cheezey Pocket Pies, Gardenias Chunky Chicken Pandesal, GrossiniRolls with Bavarian filling, For Him Greeting Cake, Triple Chocolate Roll, Butter Mamon and Chocolate cake which added significant volume and value sales to baked goods; Snitch chocolate bar, Jack n Jill Filled Stix Nutty Choco Delight and the Ace Cracker Chocolate Chip Cookies which added more choices in biscuits and contributed to the fast growth of chocolate-coated biscuits and biscuits in general.
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The impulse and indulgence ad campaigns in 2012 appealed to taste, celebrations, and needs of particular target markets such as children, students and families. Many advertisements were also celebrity-led and communication of products health benefits became a common tactic to induce consumption. Some examples include Overflowing Pure Chocolate Taste; Go Bananas over the newest and craziest treat from Kimy and Mas Masaya Talaga Pag May Selecta (Life is happier with Selecta). Advertisements promoting contests and product raffles were also visible in 2012. Impulse and indulgence products in standard and economy price bands were the bestperforming brands in 2012 due to their affordability and good quality. This was due to the income profile of Filipino consumers where around 70% of the population belongs to lowincome and middle-income consumers. Private label made minimal impact on impulse and indulgence products in 2012. Domestic brand manufacturers dominate impulse and indulgence due to the leadership of Universal Robina Corp, Monde Nissin Corp and Liwayway Marketing Corp. The fragmented nature of the industry led to the presence of numerous domestic brand manufacturers which contributed to the higher value share of the local companies.
Prospects
Health and wellness will be a stronger trend in impulse and indulgence products over the forecast period as reflected in the launch in 2012 of healthier variants in ice cream, cakes, biscuits and snack bars. Child-friendly shapes and mini-size impulse and indulgence products are also likely to increase in volume and value as a result of the companies targeting their marketing at schoolchildren and students. The government will continue to impact the category through its encouragement to fortify products. Impulse and indulgence is expected to have a constant value 2% CAGR over the forecast period which is faster compared to that of the review period. This is due to the expected sustainable level of impulse and indulgence products consumption as a result of stable economic growth over the forecast period. Healthier variants of impulse and indulgence products are likely to be a key driver for growth over the forecast period. A potential threat is the growing trend of weight management which may reduce the snacking habits of Filipinos. However, this trend also opens opportunities to target this growing niche market. More manufacturers are likely to develop healthier brand variants such as low fat, reduced sugar or those fortified with vitamins. Marketing activities are unlikely to change over the forecast period. Traditional marketing activities tend to be the most effective for impulse and indulgence products. These include point of sales advertising, print ads and multimedia advertisements. These strategies tend to draw attention and encourage customers to recall brand names. Players also tend to compete by keeping unit prices low and by shrinking package sizes. Smaller pack sizes encourage purchases among the lower-income segment because less money is required to purchase the product. The unit price of impulse and indulgence products is likely decline slightly in constant terms due to the expected price competition among the brands which will lead to greater discounts. Lower-cost brands or variants may also be developed over the forecast period. Consumers are likely to buy lower-cost brands in order to make their budgets go further. New product developments are likely to only produce short-term growth. Impulse and indulgence tends to be volatile and consumers tend to experiment when new brands are launched. It is inevitable that newer and more interesting brands will be launched over the forecast period which is likely to take shares from existing brands.
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Category Data
Table 5 tonnes 2007 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
Sales of Impulse and Indulgence Products by Category: Volume 2007-2012
2008 87,033.6 43,649.3 30,177.4 114,047.0 42,061.2 116,604.8 19.6 433,592.8
2009 88,018.8 43,624.1 30,085.5 119,204.4 42,755.1 121,230.0 16.8 444,934.7
2010 89,274.7 44,203.1 30,358.2 124,693.4 43,851.7 125,971.5 16.1 458,368.7
2011 88,958.4 44,919.6 30,629.4 130,516.6 45,770.9 131,247.7 15.9 472,058.6
2012 89,161.6 45,692.6 30,901.1 136,773.6 47,903.3 136,541.3 16.1 486,989.8
85,134.0 43,018.6 29,731.4 107,816.0 41,289.0 109,933.1 17.9 416,939.8
Table 6 Ps million
Sales of Impulse and Indulgence Products by Category: Value 2007-2012
2007 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2008 28,018.1 5,827.8 8,067.5 18,891.4 7,889.8 29,601.8 14.8 98,311.1
2009 28,808.9 6,093.4 8,302.0 20,038.5 8,176.7 31,896.2 12.6 103,328.2
2010 29,676.7 6,382.2 8,578.2 21,355.2 8,547.8 33,340.0 12.2 107,892.4
2011 29,892.5 6,720.2 8,896.0 22,906.4 8,914.2 35,394.4 12.3 112,736.0
2012 30,428.3 7,103.6 9,202.5 24,686.1 9,420.3 37,682.2 12.4 118,535.3
26,543.1 5,398.4 7,625.5 17,444.1 7,410.4 27,047.2 12.9 91,481.5
Table 7
Sales of Impulse and Indulgence Products by Category: % Volume Growth 2007-2012
% volume growth 2011/12 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2007-12 CAGR 0.9 1.2 0.8 4.9 3.0 4.4 -2.1 3.2
2007/12 Total 4.7 6.2 3.9 26.9 16.0 24.2 -10.1 16.8
0.2 1.7 0.9 4.8 4.7 4.0 0.7 3.2
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Table 8
Sales of Impulse and Indulgence Products by Category: % Value Growth 2007-2012
% current value growth 2011/12 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2007-12 CAGR 2.8 5.6 3.8 7.2 4.9 6.9 -0.8 5.3
2007/12 Total 14.6 31.6 20.7 41.5 27.1 39.3 -4.0 29.6
1.8 5.7 3.4 7.8 5.7 6.5 0.9 5.1
Table 9 % retail value rsp Company
Company Shares of Impulse and Indulgence Products 2008-2012
2008 19.3 5.7 5.3 3.8 3.5 1.5 2.7 2.3 2.4 2.2 1.6 1.6 1.4 1.4 1.6 1.8 1.4 1.4 0.9 0.9 1.3 0.8 0.8 0.7 0.6 0.7 0.6 0.6 0.7
2009 19.6 6.3 5.2 4.0 3.5 1.5 2.7 2.4 2.4 2.1 1.6 1.7 1.5 1.4 1.6 1.8 1.4 1.4 0.9 0.9 1.2 0.8 0.8 0.7 0.6 0.7 0.6 0.6 0.6
2010 19.8 6.6 4.7 4.0 3.7 3.8 2.7 2.4 2.4 2.1 1.6 1.7 1.5 1.4 1.6 1.8 1.4 1.4 1.0 1.0 1.1 0.8 0.8 0.7 0.7 0.7 0.6 0.6 0.6
2011 20.2 6.8 4.5 4.1 3.7 3.6 2.7 2.5 2.4 2.1 1.7 1.6 1.6 1.5 1.5 1.6 1.4 1.4 1.0 1.0 1.0 0.9 0.8 0.7 0.7 0.7 0.7 0.6 0.6
2012 20.4 7.0 4.4 4.2 3.8 3.6 2.7 2.5 2.4 2.1 1.7 1.6 1.5 1.5 1.5 1.5 1.5 1.4 1.1 1.0 1.0 0.9 0.8 0.7 0.7 0.7 0.7 0.6 0.6
Universal Robina Corp Monde Nissin Corp Nestl Philippines Inc Liwayway Marketing Corp Unilever RFM Ice Cream Inc Kraft Foods (Philippines) Inc Food Industries Inc Republic Biscuit Corp Tobi Marketing Inc Columbia International Food Products Inc JBC Corp Perfetti Van Melle Philippines Inc Delfi Foods Philippines Inc GFI Enterprises Inc Wrigley Philippines Inc SPI Corp Regent Foods Corp Mars Philippines Inc Goldilocks Bake Shop Inc Leslie Corp Hershey Philippines Inc Procter & Gamble Philippines Inc Big E Food Products Suncrest Foods Inc Red Ribbon Bake Shop Inc San Miguel Pure Foods Co Inc Frito-Lay Co Grand Alphatech International Corp Martinez & Co Inc,
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Felicisimo Ferrero Group Cadbury Adams Philippines Inc First Choice Food Corp Artisanal Others Total
Source:
0.6 2.1 1.2 7.0 19.5 100.0
0.5 2.1 0.5 6.8 19.3 100.0
0.5 6.7 19.4 100.0
0.5 6.6 19.3 100.0
0.5 6.4 18.9 100.0
Table 10 % retail value rsp Brand Jack 'n' Jill Sky Flakes Selecta Oishi Nagaraya Tobi Maxx Rebisco Happy Nestl Growers Kit Kat Goldilocks Leslie's Mentos Eggnog Goya Pringles Regent Bingo Lemon Square Fita Granny Goose Red Ribbon Doublemint Magnolia Oreo Chips Delight La Pacita Starr Artisanal Others Total
Source:
Brand Shares of Impulse and Indulgence Products 2009-2012
Company Universal Robina Corp Monde Nissin Corp Unilever RFM Ice Cream Inc Liwayway Marketing Corp Food Industries Inc Tobi Marketing Inc Universal Robina Corp Republic Biscuit Corp JBC Corp Nestl Philippines Inc GFI Enterprises Inc Nestl Philippines Inc Goldilocks Bake Shop Inc Leslie Corp Perfetti Van Melle Philippines Inc Monde Nissin Corp Delfi Foods Philippines Inc Procter & Gamble Philippines Inc Regent Foods Corp Monde Nissin Corp Big E Food Products Monde Nissin Corp Universal Robina Corp Red Ribbon Bake Shop Inc Wrigley Philippines Inc San Miguel Pure Foods Co Inc Kraft Foods (Philippines) Inc Grand Alphatech International Corp Martinez & Co Inc, Felicisimo SPI Corp
2009 15.3 3.2 3.1 3.0 2.7 2.3 2.4 1.7 1.6 1.6 1.4 1.3 0.9 0.9 1.0 0.9 0.8 0.8 0.9 0.7 0.8 0.7 0.7 0.6 0.7 0.7 0.6 0.6 0.6 0.6 6.8 39.8 100.0
2010 15.6 3.4 3.3 3.0 2.7 2.3 2.4 1.7 1.6 1.5 1.4 1.4 1.0 1.0 1.1 0.9 0.9 0.8 0.9 0.7 0.8 0.7 0.7 0.7 0.7 0.7 0.6 0.6 0.6 0.6 6.7 39.0 100.0
2011 15.9 3.5 3.3 3.0 2.7 2.3 2.3 1.8 1.7 1.5 1.5 1.3 1.0 1.0 1.0 0.9 0.9 0.9 0.9 0.8 0.8 0.7 0.7 0.7 0.7 0.7 0.6 0.6 0.6 0.6 6.6 38.4 100.0
2012 16.2 3.7 3.4 3.1 2.7 2.3 2.2 1.8 1.7 1.6 1.5 1.3 1.1 1.0 1.0 0.9 0.9 0.9 0.9 0.8 0.8 0.8 0.7 0.7 0.7 0.7 0.6 0.6 0.6 0.6 6.4 37.9 100.0
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Table 11
Forecast Sales of Impulse and Indulgence Products by Category: Volume 2012-2017
tonnes 2012 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2013 90,833.4 46,525.9 31,173.4 143,178.9 48,864.8 141,908.0 16.1 502,500.4
2014 92,632.4 47,423.6 31,446.5 149,921.7 49,766.1 147,074.1 16.1 518,280.5
2015 94,581.1 48,390.5 31,720.6 156,978.7 50,604.0 152,344.3 16.1 534,635.3
2016 96,676.8 49,432.1 31,996.4 164,291.7 51,376.6 157,642.3 16.2 551,432.1
2017 98,921.6 50,554.7 32,274.2 171,883.3 52,080.2 163,222.1 16.3 568,952.4
89,161.6 45,692.6 30,901.1 136,773.6 47,903.3 136,541.3 16.1 486,989.8
Table 12
Forecast Sales of Impulse and Indulgence Products by Category: Value 20122017
Ps million 2012 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2013 30,418.7 7,129.3 9,168.8 25,595.0 9,583.8 38,994.1 12.0 120,901.8
2014 30,518.5 7,174.9 9,163.6 26,581.3 9,738.9 40,340.8 11.7 123,529.7
2015 30,735.1 7,235.8 9,182.9 27,651.8 9,887.3 41,684.8 11.4 126,389.1
2016 31,052.0 7,312.4 9,226.6 28,788.3 10,023.7 43,060.9 11.2 129,475.3
2017 31,443.0 7,415.5 9,297.1 30,030.7 10,158.5 44,430.3 11.1 132,786.3
30,428.3 7,103.6 9,202.5 24,686.1 9,420.3 37,682.2 12.4 118,535.3
Table 13
Forecast Sales of Impulse and Indulgence Products by Category: % Volume Growth 2012-2017
% volume growth 2016/17 Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2012-17 CAGR 2.1 2.0 0.9 4.7 1.7 3.6 0.3 3.2
2012/17 Total 10.9 10.6 4.4 25.7 8.7 19.5 1.3 16.8
2.3 2.3 0.9 4.6 1.4 3.5 0.5 3.2
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Table 14
Forecast Sales of Impulse and Indulgence Products by Category: % Value Growth 2012-2017
% constant value growth 2012-17 CAGR Confectionery Pastries Cakes Biscuits Ice Cream Sweet and Savoury Snacks Snack Bars Impulse and Indulgence Products
Source:
2012/17 TOTAL 3.3 4.4 1.0 21.7 7.8 17.9 -10.1 12.0
0.7 0.9 0.2 4.0 1.5 3.3 -2.1 2.3
MEAL SOLUTIONS KEY TRENDS AND DEVELOPMENTS Headlines

Meal solutions is expected to have value growth of 7% in 2012 Convenience continues to drive growth Canned/preserved meat and meat products is expected to have the fastest volume growth at 5% Average unit price is expected to increase by 3% The Purefoods-Hormel Co Inc is expected to lead in 2012 with 22% value share Meal solutions is expected to grow at a constant value 3% CAGR over the forecast period
Trends
The busier lifestyles of consumers continued to drive growth in 2012. The growing business process outsourcing industry forces its work force to turn to more convenient meal formats due its demanding work schedules. As a result, many consumers have less time to cook at home. The growing number of single person households also encouraged a lifestyle of using meal solutions as meal alternatives as opposed to purchasing fresh food. Meal solutions in the Philippines was stable in 2012 with expected value growth of 7%. Growth was moderate in all categories as demand for these goods continued to be fuelled by the expansion of hypermarkets and supermarkets throughout the country. Household disposable incomes continued to rise due to more job creation and higher wages in 2012 together with the increasing number of dual income households. Canned/preserved meat and meat products is expected to have the fastest volume growth in 2012 at 5%. Demand for canned/preserved meat and meat products in the Philippines grew due to the stronger economic performance in 2012. More households in the lower-income segment were able to afford these products on a more regular basis. In addition, new product developments such as Highlands Corned Beef assisted in driving growth. Dessert mixes is expected to have the slowest volume growth in 2012 at 3%. The slow growth of dessert mixes can be attributed to its limited target market of middle- and upper-income households. The high price of dessert mixes tends to limit growth. Many consumers also
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prefer to purchase ready-made desserts in foodservice outlets instead of having to prepare them at home. The average unit price is expected to increase by 3% in 2012. The growth was limited by the preference for cheaper brands. Consumers continued to buy cheaper local brands such as Purefoods, CDO and Argentina. Competition among these local brands limited unit price growth even further as many players used price promotions to increase sales. Smaller packaging sizes continued to grow in volume in meal solutions and remained an important tool to capture sales. Many consumers in the lower-income segment prefer to purchase these smaller pack sizes to maximise their budgets. Smaller pack sizes also allow for less money to purchase products. In addition, pouch packaging continued to become a more important packaging type for meal solutions manufacturers in the Philippines. These are normally cheaper packaging alternatives and allow companies to sell at lower prices and increase profitability.
The Purefoods-Hormel Co Inc is expected to continue to lead meal solutions in 2012 with a 22% value share. This is due to the companys strong performance in frozen processed food, the largest value contributor in meal solutions. The Purefoods-Hormel Co Inc also dominated chilled processed food. Its strong position in the market can be attributed to its persistent multimedia marketing campaigns which created strong brand equity among consumers over the years. The strong sales performance was harnessed through its widespread distribution throughout the country. The company also leveraged on its brand equity as it considered as one of the pioneer companies in the Philippines. Successful strategies used by manufacturers include diversifying company brand portfolios. Companies such as San Miguel Pure Foods Co Inc, Century Canning Corp and Pacific Meat Co Inc offered a wide range of pack sizes and pack types in order to sell at various price points and capture a larger market base. These companies offer smaller pack sizes, marketed as budget packs, to capture the lower-income segment. At the same time, they provided consumers with larger pack sizes for those who prefer to get value-for-money. They also sell premium varieties typically made of higher-quality ingredients to target those with larger disposable incomes. Some of the notable launches in 2012 include Knorr Rice Mate and Highlands Corned Beef. Knorr Rice Mate was developed by Unilever Foods Philippines and was launched in the first quarter of 2012. The product is used as an additive to rice and claims to make rice softer, whiter and of better quality. The brand was priced at Ps2.50 for 5g sachet size, making it affordable for low-income households. Highlands Corned Beef was developed by CDO Foodsphere Inc and was launched in the last quarter of 2011. The brand is made from Angus beef and claims to be of better quality compared to competitors. The brand has different pack sizes available ranging from 100 to 260g food cans. The brand targets mid-level income households. Many of the meal solutions brand manufacturers used celebrities to endorse their products through multimedia advertisements. The majority used this strategy to support new product launches. Noticeable themes are those that target children and families. Many emphasised the health benefits of their products. Online marketing was also extensively used to announce new product launches and communicate promotions. These were made through social networking sites and online blogging. Standard brands were the best-performing as they are mostly affordable and of good quality and therefore attracted mass consumers. Economy brands also performed well but not as fast as standard brands as they sometimes are of lower quality. Premium brands had slower
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growth due to their high price which makes them less affordable to the middle- and lowerincome groups. Private label continued to account for a small percentage of the market. Private label continued to have difficulty in competing with established brand names in the market. Domestic manufacturers continued to contribute the bulk of value sales in meal solutions. Domestic companies such as The Purefoods-Hormel Co Inc, CDO Foodsphere Inc, and Century Canning Corp have a clearer understanding of the Philippines market and react faster to consumer demands. Nonetheless, international brands remain competitive in other categories such as sauces, dressing and condiments as a result of their early entry. Some international companies were able to establish an early lead.
Prospects
Health and wellness is expected to be a stronger trend over the forecast period which may negatively affect meal solutions despite the convenience it brings as it is dominated by foods known to contain preservatives. As a result, the categorys forecasted volume CAGR is expected to be 3%. This is lower than the review period volume CAGR of 5%. Manufacturers are likely to develop healthier variants to renew growth. Despite the expected slowdown in volume growth, demand for meal solutions is expected to continue growing. This will be buoyed by the continued demand for more convenient products. The busier lifestyles in the Philippines and the growing number of working parents are likely to keep demand stable. The shifting consumer lifestyles are likely to support growth of meal solutions products. The main potential threat to growth of meal solutions is consumer preference for purchasing fresh food and cook meals at home. Many households perceive home-cooked meals as healthier and cheaper. Affordable labour cost for house help allows many middle-income households to continue cooking at home. Another possible threat to growth is that many young working adults are beginning to prefer to eat out at foodservice establishments. Unit prices are expected to decline slightly in constant terms over the forecast period. Due to the high number of low-income households in the Philippines the demand for value-for-money products is likely to remain strong. Major players are also likely to keep unit prices stable in order to stay competitive. Price promotions are likely to be the most common promotional activity over the forecast period. Knorr Rice Mate and Highlands Corned Beef are expected to have moderate growth over the forecast period. The high consumption of rice in the Philippines indicates that there is likely to be demand for products such as Knorr Rice Mate. Knorr Rice Mate is also a unique product and offers new benefits that other seasonings do not provide. Highlands Corned Beef is likely to find demand among middle-income consumers who demand higher-quality products. Its price is also cheaper compared to imported brands and is likely to take some market share from imported brands.
Category Data
Table 15 '000 tonnes 2007 Ready Meals Canned/Preserved Food 10.7 200.0 2008 11.2 212.9 2009 11.6 223.0 2010 12.0 234.5 2011 12.6 245.6 2012 13.1 256.6 Sales of Meal Solutions by Category: Volume 2007-2012
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Frozen Processed Food Dessert Mixes Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
140.4 0.3 75.4 168.9 3.6 599.3
148.0 0.3 80.0 178.9 3.8 635.1
153.9 0.4 82.8 187.7 3.9 663.3
160.4 0.4 86.5 195.8 4.0 693.6
169.3 0.4 89.8 203.7 4.2 725.5
176.2 0.4 92.9 211.1 4.3 754.7
Table 16 Ps million
Sales of Meal Solutions by Category: Value 2007-2012
2007 Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
2008 2,438.2 25,078.2 22,943.7 117.2 13,785.4 19,062.9 1,123.0 84,548.4
2009 2,570.0 26,874.1 24,450.9 122.4 14,336.8 20,158.6 1,220.3 89,733.1
2010 2,752.9 28,807.3 25,920.4 128.6 15,053.6 21,239.5 1,317.1 95,219.4
2011 2,960.6 30,976.9 28,148.2 135.6 15,881.6 22,425.2 1,423.7 101,951.8
2012 3,204.4 33,251.3 30,208.5 142.4 16,834.5 23,721.8 1,540.4 108,903.3
2,237.2 22,689.1 20,950.0 111.1 13,005.1 17,590.8 1,035.5 77,618.8
Table 17 % volume growth
Sales of Meal Solutions by Category: % Volume Growth 2007-2012
2011/12 Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
2007-12 CAGR 4.2 5.1 4.7 3.0 4.3 4.6 3.7 4.7
2007/12 Total 22.7 28.3 25.5 15.7 23.2 25.0 19.7 25.9
4.5 4.5 4.1 3.2 3.5 3.7 3.4 4.0
Table 18
Sales of Meal Solutions by Category: % Value Growth 2007-2012
% current value growth 2011/12 Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes 8.2 7.3 7.3 5.0 2007-12 CAGR 7.5 7.9 7.6 5.1 2007/12 Total 43.2 46.6 44.2 28.2
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Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
6.0 5.8 8.2 6.8
5.3 6.2 8.3 7.0
29.4 34.9 48.8 40.3
Company Shares of Meal Solutions 2008-2012
2008 23.8 5.4 6.6 4.3 3.6 4.5 3.5 2.3 1.9 1.5 1.6 1.7 1.6 1.4 1.5 1.3 1.4 1.0 0.9 0.9 1.0 0.9 0.7 0.7 0.6 0.6 0.6 0.7 0.7 0.5 22.3 100.0
2009 22.3 6.3 6.8 4.5 3.7 4.3 3.6 2.4 1.9 1.6 1.6 1.7 1.6 1.5 1.3 1.3 1.4 1.0 1.0 0.9 1.0 0.9 0.8 0.7 0.7 0.6 0.6 0.7 0.7 0.5 22.0 100.0
2010 21.7 6.8 7.0 4.5 3.8 4.2 3.7 2.4 1.9 1.6 1.6 1.7 1.6 1.5 1.4 1.2 1.2 1.1 1.0 0.9 1.0 0.9 0.9 0.8 0.7 0.7 0.6 0.7 0.6 0.6 21.7 100.0
2011 22.2 7.1 7.0 4.5 3.9 4.0 3.8 2.4 1.9 1.7 1.6 1.6 1.6 1.6 1.3 1.2 1.2 1.1 1.0 0.9 1.0 0.9 0.9 0.8 0.7 0.7 0.7 0.7 0.6 0.6 20.9 100.0
2012 22.0 7.3 7.0 4.5 3.9 3.9 3.8 2.4 2.0 1.7 1.6 1.6 1.6 1.6 1.3 1.2 1.1 1.1 1.0 0.9 0.9 0.9 0.9 0.8 0.8 0.7 0.7 0.7 0.6 0.6 20.9 100.0
Purefoods-Hormel Co Inc, The CDO Foodsphere Inc Century Canning Corp Unilever Foods Philippines (CMC) Pacific Meat Co Inc Ajinomoto Philippines Corp Del Monte Philippines Inc A Tung Chingco Trading RFM Corp New Seorito Frozen Food Co SM Retail Inc Maunlad Canning Corp Dole Philippines Inc Campbell Soup Co Nestl Philippines Inc Kraft Foods (Philippines) Inc King Sue Ham & Sausage Co Inc Superb Catch Inc Southeast Asia Food Inc Silver Swan Manufacturing Corp Inc Sara Lee Corp UFC Philippines Inc Bambi Foods Mfg Corp Del Monte Foods Co Alson's Aqua Technologies Inc Bagumbuhay Industrial Corp Supervalue Inc HDR Foods Corp B2 Maling Foods Corp Marigold Commodities Corp Others Total
Source:
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Table 20 % retail value rsp Brand Purefoods CDO Argentina 555 Ajinomoto Del Monte Century Ligo Knorr Swift New Seorito SM Bonus Youngstown Lady's Choice Campbell's Maggi King Sue Dole Seaking Sara Lee Silver Swan Datu Puti Bambi Kraft Del Monte Sarangani Bay Master Bestfoods SM Bonus Mother's Best Others Total
Source:
Brand Shares of Meal Solutions 2009-2012
Company Purefoods-Hormel Co Inc, The CDO Foodsphere Inc Pacific Meat Co Inc Century Canning Corp Ajinomoto Philippines Corp Del Monte Philippines Inc Century Canning Corp A Tung Chingco Trading Unilever Foods Philippines (CMC) RFM Corp New Seorito Frozen Food Co SM Retail Inc Maunlad Canning Corp Unilever Foods Philippines (CMC) Campbell Soup Co Nestl Philippines Inc King Sue Ham & Sausage Co Inc Dole Philippines Inc Superb Catch Inc Sara Lee Corp Silver Swan Manufacturing Corp Inc Southeast Asia Food Inc Bambi Foods Mfg Corp Kraft Foods (Philippines) Inc Del Monte Foods Co Alson's Aqua Technologies Inc Bagumbuhay Industrial Corp Unilever Foods Philippines (CMC) Supervalue Inc HDR Foods Corp
2009 22.1 6.3 3.7 3.7 4.1 3.1 3.1 2.4 2.1 1.9 1.6 1.6 1.7 1.6 1.4 1.3 1.4 1.1 1.0 1.0 0.9 0.8 0.8 0.9 0.7 0.7 0.6 0.7 0.6 0.7 26.4 100.0
2010 21.5 6.8 3.8 3.8 3.9 3.2 3.2 2.4 2.1 1.8 1.6 1.6 1.7 1.6 1.4 1.4 1.2 1.2 1.1 1.0 0.9 0.9 0.9 0.8 0.8 0.7 0.7 0.7 0.6 0.7 26.1 100.0
2011 22.0 7.1 3.9 3.8 3.8 3.2 3.2 2.4 2.1 1.8 1.7 1.6 1.6 1.6 1.4 1.3 1.2 1.1 1.1 1.0 0.9 0.9 0.9 0.8 0.8 0.7 0.7 0.7 0.7 0.7 25.4 100.0
2012 21.8 7.3 3.9 3.8 3.6 3.2 3.2 2.4 2.1 1.9 1.7 1.6 1.6 1.6 1.4 1.3 1.1 1.1 1.1 0.9 0.9 0.9 0.9 0.8 0.8 0.8 0.7 0.7 0.7 0.7 25.3 100.0
Table 21 '000 tonnes
Forecast Sales of Meal Solutions by Category: Volume 2012-2017
2012 Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes Dinner Mixes 13.1 256.6 176.2 0.4 -
2013 13.8 267.4 182.8 0.4 -
2014 14.4 278.1 189.0 0.4 -
2015 15.1 288.7 194.8 0.4 -
2016 15.9 299.2 200.2 0.4 -
2017 16.7 309.7 205.3 0.5 -
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Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
92.9 211.1 4.3 754.7
96.0 218.2 4.5 783.0
99.0 224.7 4.6 810.2
102.1 230.7 4.8 836.6
105.2 236.4 5.0 862.3
108.2 241.7 5.2 887.3
Table 22 Ps million
Forecast Sales of Meal Solutions by Category: Value 2012-2017
2012 Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
2013 3,341.9 34,462.8 31,084.6 145.3 17,339.5 24,335.5 1,588.5 112,298.1
2014 3,489.8 35,678.3 31,928.9 148.3 17,842.3 24,906.9 1,639.0 115,633.6
2015 3,649.1 36,880.8 32,749.7 151.6 18,341.9 25,434.7 1,691.8 118,899.6
2016 3,821.0 38,084.2 33,531.9 155.1 18,837.2 25,919.5 1,747.4 122,096.1
2017 4,007.0 39,268.9 34,245.7 158.8 19,326.9 26,360.9 1,805.6 125,173.8
3,204.4 33,251.3 30,208.5 142.4 16,834.5 23,721.8 1,540.4 108,903.3
Forecast Sales of Meal Solutions by Category: % Volume Growth 2012-2017
2016/17 Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments Soup Meal Solutions
Source:
2012-17 CAGR 4.9 3.8 3.1 3.6 3.1 2.7 3.7 3.3
2012/17 Total 26.8 20.7 16.5 19.3 16.5 14.5 20.0 17.6
5.1 3.5 2.6 3.8 2.9 2.3 3.9 2.9
Table 24
Forecast Sales of Meal Solutions by Category: % Value Growth 2012-2017
% constant value growth 2012-17 CAGR Ready Meals Canned/Preserved Food Frozen Processed Food Dessert Mixes Dinner Mixes Chilled Processed Food Sauces, Dressings and Condiments 4.6 3.4 2.5 2.2 2.8 2.1 2012/17 TOTAL 25.0 18.1 13.4 11.5 14.8 11.1
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Soup Meal Solutions

Source:
3.2 2.8
17.2 14.9
NUTRITION/STAPLES KEY TRENDS AND DEVELOPMENTS Headlines

Nutrition/staples is expected to have value growth of 5% in 2012 New product developments continue to emphasise health benefits Pasta is expected to have the highest value growth in 2012 of 12% Nutrition/staples is expected to have moderate average unit price increase in 2012 Nestl Philippines Inc is expected to lead with an 18% value share Nutrition/staples is expected to have constant value 2% CAGR over the forecast period
Trends
In 2012, there were numerous nutrition/staples products which were marketed as healthier. Low calorie and low fat products such as Nido Lite were introduced. In yoghurt and sour milk drinks, Nestl Acti-V was launched and claimed to regulate bowel movement. The use of fortifications was also seen in products such as rice and bread. The expected 5% value growth in 2012 was one of the slowest growth rates compared to the review period. This is because many of the categories in nutrition/staples are reaching maturity. Bread, rice and noodles have high penetration in the Philippines significantly reducing their opportunities for growth. Industries with lower penetration such as those in dairy face the challenge of increasing awareness among lower-income households. Its higher average unit prices also create another barrier as consumers are unable to afford these products on a regular basis. Pasta is expected to have the highest value growth in 2012 of 12% due to the increasing interest in it as part of a daily meal rather than a product consumed only occasionally. Pasta is typically used to substitute rice in the Philippines and is therefore becoming a regular or weekly meal for middle- and high-income households. Multimedia advertisements featuring home-cooked pasta encouraged families to cook pasta at home rather than consume it in foodservice outlets. Yoghurt and sour milk drinks is expected to have the slowest performance in nutrition/staples as it is not considered a necessity food product but is regarded as a supplement. Some yoghurt products performed well such as fruited spoonable yoghurt due it its health benefits and advertisements. However, the slower sales of pro/prebiotic drinking yoghurt negated its value growth. Pro/prebiotic manufacturers reduced their marketing campaigns due to the high awareness of such products in the Philippines. Nutrition/staples products are mainly distributed in the grocery channels including supermarkets and hypermarkets, convenience stores and Other grocery retailers. Supermarkets continued to be a strong channel for distribution while hypermarkets continued to grow. Other grocery retailers such as sari-sari stores are important to reach the mass markets as these are a key distribution channel that reaches less-developed areas in the Philippines.
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The products were mostly packed in the usual packaging types that have been used for years. There is, however, a noticeable increase in the usage of sachet packs particularly in cheese. Pouches are also gaining share against the metal food can in pasta while small pack sizes are increasing in volume in spreads, cheese and oils and fats. There were no major changes to packaging formats for nutrition/staples products in the Philippines. However, there was one notable development over the review period. Cheez Whiz and Magnolia began using sachet type packages in order to make its brands more affordable and to expand its reach further to lower-income households. Magnolia went to the extent of using a screw cap closure on its sachets to provide consumers with more convenience. Average unit prices of nutrition/staples products are expected to increase overall. Pasta and unpackaged/artisanal bread is expected to have the fastest unit price growths at 7% and 4% respectively. Consumers of these products continued to switch to higher quality brands. Pasta saw an increase due to the shift from rice to pasta as more middle-income consumers became influenced by cooking shows. Unpackaged/artisanal bread saw its unit price growth due to the growing number of premium unpackaged/artisanal bread manufacturers. Cheese, on the other hand, saw negligible unit price growth due to the development of cheaper packaging formats such as the sachet formats of Cheez Whiz and Magnolia. These cheaper brands captured a stronger following over the review period.
Nestl Philippines Inc is expected to lead brand manufacturers in 2012 with an 18% value share. This is due to its large penetration in baby food and dairy products which together accounts for 50% of all nutrition/staples. The company benefits from having a wide product portfolio in dairy serving the middle- to high-income households. The company also used smaller packaging formats to reach lower-income segments. Nestl Philippines Inc also had numerous multimedia campaigns which helped promote its products. RFM Corp is expected to have the fastest growth in 2012 at 16%. Its pasta brand, White King Fiesta, benefited from the increasing consumer demand for pasta. More consumers became experimental with culinary arts, influenced by cooking shows. Being one of the lower-priced brands, many middle-income consumers chose White King in order to extend their budgets. RFM Corp also benefited from the positive growth of its dairy brand, Selecta. Distribution remained a key factor to sales of nutrition/staples products in the Philippines. Due to numerous competitors in the market it was important that manufacturers maximised the number of distribution channels it used. Many nutrition/staples brands are perceived as homogeneous, resulting in minimal brand loyalty among consumers. In order to have greater market reach and increase their chances to sell, manufacturers needed to ensure strong distribution and acquire prime shelf space in retail outlets. Notable launches in 2012 included Nido Lite and Cheez Whiz Easy Squeeze. Nido Lite was launched in the last quarter in 2011 and was the first low fat and low calorie powder milk drink in the Philippines market. Cheez Whiz Easy Squeeze was launched in the first quarter of 2012. The brand was mainly a packaging innovation for its flagship brand, Cheez Whiz. The new brand variant used flexible packaging to target the lower-income segments. Its main rival, Magnolia, launched a similar brand variant at the same time but added a screw closure to the flexible packaging for differentiation. Marketing campaigns were used to highlight new product launches in 2012. The bulk of new product launches such as Nido Lite, Magnolia Cheezee Squeeze and Nestl Acti-V used TV commercials to introduce their brands. The use of point of sale advertising was also common
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in order to attract impulse purchases. Blog reviews were also used to target the growing number of internet users in the Philippines. Standard brands perform better than premium and economy brands in most of nutrition/staples. Standard brands compete for share in terms of price and product quality. Private label does well in rice due to the high demand for lower cost rice in the Philippines. Premium brands that performed well were usually dairy products due to the high number of imported brands that compete in this segment. Both multinationals and domestic companies had a strong presence in nutrition/staples in 2012. Nestl Philippines Inc is expected to lead the multinationals in 2012, contributing to a large portion of sales for multinational brands. Its early entry in the market resulted in strong brand equity among consumers giving it a significant advantage. The individual shares of domestic manufacturers were more fragmented. Domestic manufacturers tend to compete through price and target similar market segments. However, domestic manufacturers were able to adapt faster to consumer trends compared to brands that belong to multinational brands.
Prospects
Nutrition/staples constant value is expected to grow at a 3% CAGR over the forecast period. The higher growth is expected to be driven by the stronger economic performance in the Philippines. The better economic outlook is likely to allow consumers to purchase these products on a more regular basis. In addition, the demand for higher-quality products in unpackaged/artisanal bread and dairy is expected to continue which is expected to push stronger value growth. A potential threat to growth over the forecast period is competition with sales in wet markets. Wet markets typically sell unpackaged rice at a lower cost and are able to capture a large portion of the lower-income segment. Similarly, unpackaged noodles are also found in wet markets in the Philippines. Dairy is faced with the potential problem of not being able to keep up with demand. A large portion of Philippine dairy is dependent on imported goods. Company activities are unlikely to change over the forecast period. However, manufacturers are likely to increase the emphasis of the health benefits of their products in order to leverage the growing health and wellness trend. Companies are also likely to continue shifting to smaller package sizes in order to cater to lower-income segments. This would also allow for ease of distribution to sari-sari stores, a key distribution channel in the Philippines. Unit prices of nutrition/staples products are expected to remain stable over the forecast period. Cheese and unpackaged/artisanal bread are anticipated to have the fastest unit price growth. The demand for higher quality bread as a result of the increasing number of independent unpackaged/artisanal bread shops is expected to drive average unit prices. Cheese prices are expected to increase due to the high dependence on imported products and raw materials. Other products in nutrition/staples are expected to have negligible or negative average unit price growths due to price competition among the top brands. Nido Lite is expected to have moderate growth over the forecast period. It is expected to capture a niche market of health-conscious consumers. Cheez Whiz Easy Squeeze and Magnolia Cheezee Squeeze are expected to have stronger growth over the forecast period. Its lower price positioning and more convenient packaging is likely to find stronger demand among lower-income households. Its new packaging is also likely to make distribution easier to sari-sari stores and ultimately increase its reach.
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Category Data
Table 25 '000 tonnes 2007 Bread Breakfast Cereals Dairy Meal Replacement Oils and Fats Baby Food Spreads Pasta Noodles Rice Nutrition/Staples
Source:
Sales of Nutrition/Staples by Category: Volume 2007-2012
2008 131.0 12.8 324.0 1.1 449.1 53.6 14.5 67.4 164.9 89.3 1,307.7
2009 130.6 13.2 325.7 1.2 467.3 53.3 14.3 68.6 168.7 90.2 1,333.1
2010 132.0 13.6 335.8 1.3 486.5 53.5 14.4 70.4 178.4 91.5 1,377.3
2011 135.6 14.1 341.6 1.3 506.3 53.6 14.7 72.5 189.4 93.4 1,422.4
2012 139.5 14.6 344.2 1.3 525.0 54.0 15.1 75.4 200.1 95.7 1,464.9
127.3 12.3 327.1 1.0 428.6 53.4 14.2 66.2 162.8 86.3 1,279.0
Table 26 Ps million
Sales of Nutrition/Staples by Category: Value 2007-2012
2007 Bread Breakfast Cereals Dairy Meal Replacement Oils and Fats Baby Food Spreads Pasta Noodles Rice Nutrition/Staples
Source:
2008 13,272.7 3,072.7 57,308.7 1,431.6 36,987.2 29,564.2 3,628.4 4,969.6 18,488.2 3,910.8 172,634.2
2009 13,908.3 3,237.1 60,467.0 1,535.0 39,536.2 30,459.7 3,667.1 5,764.8 19,299.8 4,047.7 181,922.7
2010 14,649.2 3,393.3 67,056.1 1,667.0 41,952.2 31,648.5 3,727.3 6,514.2 20,567.6 4,169.2 195,344.5
2011 15,566.6 3,585.3 69,483.4 1,753.0 44,996.4 32,287.4 3,949.7 7,295.9 22,061.6 4,398.5 205,377.8
2012 16,618.8 3,810.6 71,741.9 1,831.4 48,032.6 32,988.1 4,194.4 8,134.9 23,603.1 4,662.4 215,618.2
12,189.6 2,841.7 54,095.0 1,242.5 33,643.1 26,492.9 3,415.9 4,229.5 17,375.4 3,587.9 159,113.4
Sales of Nutrition/Staples by Category: % Volume Growth 2007-2012
2011/12 Bread Breakfast Cereals Dairy Meal Replacement Oils and Fats Baby Food Spreads Pasta Noodles Rice Nutrition/Staples 2.9 3.7 0.8 2.9 3.7 0.7 2.5 4.0 5.7 2.5 3.0
2007-12 CAGR 1.8 3.5 1.0 7.1 4.1 0.2 1.2 2.7 4.2 2.1 2.8
2007/12 Total 9.6 18.9 5.2 40.9 22.5 1.0 6.0 14.0 23.0 10.9 14.5
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Source:
Table 28
Sales of Nutrition/Staples by Category: % Value Growth 2007-2012
% current value growth 2011/12 Bread Breakfast Cereals Dairy Meal Replacement Oils and Fats Baby Food Spreads Pasta Noodles Rice Nutrition/Staples
Source:
2007-12 CAGR 6.4 6.0 5.8 8.1 7.4 4.5 4.2 14.0 6.3 5.4 6.3
2007/12 Total 36.3 34.1 32.6 47.4 42.8 24.5 22.8 92.3 35.8 29.9 35.5
6.8 6.3 3.3 4.5 6.7 2.2 6.2 11.5 7.0 6.0 5.0
Company Shares of Nutrition/Staples 2008-2012
2008 18.4 6.7 7.6 6.4 6.0 5.8 4.4 3.8 2.9 2.6 1.9 1.8 1.5 0.7 1.7 1.3 1.2 1.1 0.7 0.6 0.6 0.8
2009 18.2 7.0 7.5 6.6 6.1 5.9 4.5 3.6 2.9 2.5 1.9 1.9 1.4 1.2 1.5 1.3 1.3 1.1 0.8 0.6 0.6 0.6
2010 18.4 7.9 7.3 6.5 6.2 5.7 4.4 3.5 2.9 2.6 1.9 1.8 1.4 1.2 1.5 1.4 1.3 1.1 0.8 0.6 0.6 0.6
2011 18.3 7.6 7.1 6.7 6.4 5.7 4.5 3.5 2.9 2.6 1.9 1.8 1.6 1.5 1.5 1.4 1.3 1.1 0.8 0.6 0.6 0.6
2012 18.1 7.5 6.9 6.9 6.5 5.7 4.5 3.4 2.8 2.6 2.0 1.8 1.6 1.6 1.5 1.5 1.3 1.1 0.9 0.6 0.6 0.6
Nestl Philippines Inc Alaska Milk Corp Mead Johnson Philippines Inc San Pablo Manufacturing Corp Monde Nissin Corp International Oil Factory San Miguel Pure Foods Co Inc Wyeth Philippines Inc Kraft Foods (Philippines) Inc Fonterra Brands (Phils) Inc Universal Robina Corp Yakult Philippines Inc Gardenia Philippines Inc RFM Corp Unilever Foods Philippines (CMC) Supervalue Inc Abbott Laboratories (Phils) Inc UFC Philippines Inc Goldilocks Bake Shop Inc SM Retail Inc Agana Circle Enterprises Nissin-Universal Robina Corp
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Quaker Oats Asia Inc MLM Foods Inc Ideal Macaroni & Spaghetti Inc Malabon Soap & Oil Industrial Co Inc Zest-O Corp Del Monte Philippines Inc Poms Venture Corp New Zealand Creamery Inc Artisanal Others Total
Source:
0.6 0.6 0.4 0.5 0.5 0.4 0.3 0.4 4.2 13.6 100.0
0.6 0.6 0.4 0.5 0.5 0.3 0.3 0.4 4.2 13.2 100.0
0.5 0.6 0.5 0.5 0.5 0.4 0.3 0.4 4.0 12.9 100.0
0.5 0.5 0.5 0.5 0.4 0.4 0.3 0.4 3.9 12.6 100.0
0.6 0.6 0.5 0.5 0.4 0.4 0.4 0.3 3.9 12.5 100.0
Table 30 % retail value rsp Brand Minola Lucky Me Alaska Baguio Bear Brand Milo Lactum Nido Magnolia Yakult Payless Anchor Kraft Star Gardenia SM Bonus White King Nestl Enfalac UFC Nan Promil Nestogen Royal Goldilocks Anlene Alacta S-26
Brand Shares of Nutrition/Staples 2009-2012
Company San Pablo Manufacturing Corp Monde Nissin Corp Alaska Milk Corp International Oil Factory Nestl Philippines Inc Nestl Philippines Inc Mead Johnson Philippines Inc Nestl Philippines Inc San Miguel Pure Foods Co Inc Yakult Philippines Inc Universal Robina Corp Fonterra Brands (Phils) Inc Kraft Foods (Philippines) Inc San Miguel Pure Foods Co Inc Gardenia Philippines Inc Supervalue Inc RFM Corp Nestl Philippines Inc Mead Johnson Philippines Inc UFC Philippines Inc Nestl Philippines Inc Wyeth Philippines Inc Nestl Philippines Inc Unilever Foods Philippines (CMC) Goldilocks Bake Shop Inc Fonterra Brands (Phils) Inc Mead Johnson Philippines Inc Wyeth Philippines Inc
2009 6.6 6.1 6.3 5.9 4.9 4.0 3.6 2.3 2.2 1.9 1.8 1.7 1.7 1.6 1.4 1.3 0.9 1.4 1.5 1.1 1.1 1.1 1.0 0.9 0.8 0.8 0.9 0.9
2010 6.5 6.2 7.0 5.7 5.5 3.8 3.5 2.3 2.2 1.8 1.8 1.8 1.7 1.6 1.4 1.4 1.0 1.3 1.4 1.1 1.1 1.0 0.9 0.9 0.8 0.9 0.8 0.8
2011 6.7 6.4 6.6 5.7 5.6 3.8 3.5 2.3 2.3 1.8 1.8 1.8 1.7 1.6 1.6 1.4 1.2 1.3 1.4 1.1 1.1 1.0 0.9 0.9 0.8 0.9 0.8 0.8
2012 6.9 6.5 6.5 5.7 5.6 3.8 3.4 2.3 2.2 1.8 1.8 1.8 1.7 1.7 1.6 1.5 1.4 1.3 1.3 1.1 1.0 1.0 1.0 0.9 0.9 0.9 0.8 0.8
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Carnation Chuckie Artisanal Others Total

Source:
Alaska Milk Corp Nestl Philippines Inc
0.7 0.7 4.2 28.8 100.0
0.8 0.7 4.0 28.3 100.0
0.8 0.7 3.9 27.8 100.0
0.7 0.7 3.9 27.4 100.0
Forecast Sales of Nutrition/Staples by Category: Volume 2012-2017
Source:
2013 141.4 15.2 352.9 1.4 544.8 54.8 15.2 78.7 210.6 98.4 1,513.4
2014 143.6 15.8 361.3 1.5 566.4 55.8 15.5 82.2 220.7 101.3 1,564.0
2015 146.1 16.4 369.3 1.5 590.1 57.0 15.7 86.1 230.4 104.7 1,617.3
2016 148.9 17.1 376.4 1.6 616.3 58.3 16.0 90.4 240.1 108.3 1,673.5
2017 152.0 17.8 382.9 1.7 645.1 59.7 16.3 95.2 249.6 112.4 1,732.8
139.5 14.6 344.2 1.3 525.0 54.0 15.1 75.4 200.1 95.7 1,464.9
Table 32 Ps million
Forecast Sales of Nutrition/Staples by Category: Value 2012-2017
Source:
2013 16,866.1 3,916.1 73,642.9 1,915.6 49,372.4 33,266.7 4,188.0 8,582.3 24,467.5 4,778.9 220,996.8
2014 17,151.9 4,039.9 75,520.2 2,003.7 50,832.5 33,709.9 4,198.8 9,011.5 25,320.2 4,912.7 226,701.4
2015 17,486.6 4,178.7 77,404.5 2,095.7 52,423.0 34,315.1 4,220.4 9,417.0 26,175.9 5,060.1 232,777.0
2016 17,863.9 4,338.4 79,252.1 2,191.6 54,162.9 35,034.8 4,255.2 9,793.7 27,015.2 5,227.1 239,134.9
2017 18,295.5 4,520.9 80,948.2 2,286.1 56,064.4 35,826.5 4,304.2 10,136.4 27,855.1 5,410.1 245,647.4
16,618.8 3,810.6 71,741.9 1,831.4 48,032.6 32,988.1 4,194.4 8,134.9 23,603.1 4,662.4 215,618.2
Table 33
Forecast Sales of Nutrition/Staples by Category: % Volume Growth 20122017
% volume growth 2016/17 Bread Breakfast Cereals Dairy 2.1 4.2 1.7 2012-17 CAGR 1.7 4.0 2.2 2012/17 Total 9.0 21.7 11.3
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Meal Replacement Oils and Fats Baby Food Spreads Pasta Noodles Rice Nutrition/Staples
Source:
3.9 4.7 2.5 2.1 5.3 4.0 3.8 3.5
4.4 4.2 2.0 1.6 4.8 4.5 3.3 3.4
24.0 22.9 10.7 8.5 26.3 24.7 17.5 18.3
Table 34
Forecast Sales of Nutrition/Staples by Category: % Value Growth 2012-2017
% constant value growth 2012-17 CAGR Bread Breakfast Cereals Dairy Meal Replacement Oils and Fats Baby Food Spreads Pasta Noodles Rice Nutrition/Staples
Source:
2012/17 TOTAL 10.1 18.6 12.8 24.8 16.7 8.6 2.6 24.6 18.0 16.0 13.9
1.9 3.5 2.4 4.5 3.1 1.7 0.5 4.5 3.4 3.0 2.6
MARKET DATA
Table 35 '000 tonnes 2007 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup 53.4 320.2 200.0 75.4 85.1 327.1 316.7 140.4 41.3 1.0 162.8 428.6 66.2 10.7 168.9 0.0 3.6 2008 53.6 331.7 212.9 80.0 87.0 324.0 323.2 148.0 42.1 1.1 164.9 449.1 67.4 11.2 178.9 0.0 3.8 2009 53.3 336.7 223.0 82.8 88.0 325.7 329.1 153.9 42.8 1.2 168.7 467.3 68.6 11.6 187.7 0.0 3.9 2010 53.5 344.9 234.5 86.5 89.3 335.8 341.9 160.4 43.9 1.3 178.4 486.5 70.4 12.0 195.8 0.0 4.0 2011 53.6 355.8 245.6 89.8 89.0 341.6 356.8 169.3 45.8 1.3 189.4 506.3 72.5 12.6 203.7 0.0 4.2 2012 54.0 367.5 256.6 92.9 89.2 344.2 372.9 176.2 47.9 1.3 200.1 525.0 75.4 13.1 211.1 0.0 4.3 Sales of Packaged Food by Category: Volume 2007-2012
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Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
14.2 109.9 416.9 1,279.0 599.3 2,282.3
14.5 116.6 433.6 1,307.7 635.1 2,362.7
14.3 121.2 444.9 1,333.1 663.3 2,427.1
14.4 126.0 458.4 1,377.3 693.6 2,514.5
14.7 131.2 472.1 1,422.4 725.5 2,604.6
15.1 136.5 487.0 1,464.9 754.7 2,690.6
Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Sum of sectors does not equal total packaged food because of double counting (eg canned soup is included in soups and canned foods)
Table 36 Ps million
Sales of Packaged Food by Category: Value 2007-2012
2007 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
2008 29,564.2 49,132.0 25,078.2 13,785.4 28,018.1 57,308.7 27,998.2 22,943.7 7,889.8 1,431.6 18,488.2 36,987.2 4,969.6 2,438.2 19,062.9 14.8 1,123.0 3,628.4 29,601.8 98,311.1 172,634.2 84,548.4 352,457.3
2009 30,459.7 51,579.1 26,874.1 14,336.8 28,808.9 60,467.0 29,767.2 24,450.9 8,176.7 1,535.0 19,299.8 39,536.2 5,764.8 2,570.0 20,158.6 12.6 1,220.3 3,667.1 31,896.2 103,328.2 181,922.7 89,733.1 371,739.7
2010 31,648.5 54,358.1 28,807.3 15,053.6 29,676.7 67,056.1 31,949.5 25,920.4 8,547.8 1,667.0 20,567.6 41,952.2 6,514.2 2,752.9 21,239.5 12.2 1,317.1 3,727.3 33,340.0 107,892.4 195,344.5 95,219.4 394,971.6
2011 32,287.4 57,674.6 30,976.9 15,881.6 29,892.5 69,483.4 34,499.3 28,148.2 8,914.2 1,753.0 22,061.6 44,996.4 7,295.9 2,960.6 22,425.2 12.3 1,423.7 3,949.7 35,394.4 112,736.0 205,377.8 101,951.8 416,307.0
2012 32,988.1 61,421.6 33,251.3 16,834.5 30,428.3 71,741.9 37,189.1 30,208.5 9,420.3 1,831.4 23,603.1 48,032.6 8,134.9 3,204.4 23,721.8 12.4 1,540.4 4,194.4 37,682.2 118,535.3 215,618.2 108,903.3 438,979.0
26,492.9 45,499.2 22,689.1 13,005.1 26,543.1 54,095.0 25,801.7 20,950.0 7,410.4 1,242.5 17,375.4 33,643.1 4,229.5 2,237.2 17,590.8 12.9 1,035.5 3,415.9 27,047.2 91,481.5 159,113.4 77,618.8 325,449.8
Sales of Packaged Food by Category: % Volume Growth 2007-2012
2011/12 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy 0.7 3.3 4.5 3.5 0.2 0.8
2007-12 CAGR 0.2 2.8 5.1 4.3 0.9 1.0
2007/12 Total 1.0 14.8 28.3 23.2 4.7 5.2
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Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
4.5 4.1 4.7 2.9 5.7 3.7 4.0 4.5 3.7 0.7 3.4 2.5 4.0 3.2 3.0 4.0 3.3
3.3 4.7 3.0 7.1 4.2 4.1 2.7 4.2 4.6 -2.1 3.7 1.2 4.4 3.2 2.8 4.7 3.3
17.7 25.5 16.0 40.9 23.0 22.5 14.0 22.7 25.0 -10.1 19.7 6.0 24.2 16.8 14.5 25.9 17.9
Table 38
Sales of Packaged Food by Category: % Value Growth 2007-2012
% current value growth 2011/12 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
2007-12 CAGR 4.5 6.2 7.9 5.3 2.8 5.8 7.6 7.6 4.9 8.1 6.3 7.4 14.0 7.5 6.2 -0.8 8.3 4.2 6.9 5.3 6.3 7.0 6.2
2007/12 Total 24.5 35.0 46.6 29.4 14.6 32.6 44.1 44.2 27.1 47.4 35.8 42.8 92.3 43.2 34.9 -4.0 48.8 22.8 39.3 29.6 35.5 40.3 34.9
2.2 6.5 7.3 6.0 1.8 3.3 7.8 7.3 5.7 4.5 7.0 6.7 11.5 8.2 5.8 0.9 8.2 6.2 6.5 5.1 5.0 6.8 5.4
Table 39 % retail value rsp
GBO Shares of Packaged Food 2008-2012
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Company Nestl SA San Miguel Corp JG Summit Holdings Inc Monde Nissin Corp Mead Johnson Nutrition Co San Pablo Manufacturing Corp Royal FrieslandCampina NV Unilever Group International Oil Factory CDO Foodsphere Inc Century Canning Corp Kraft Foods Group, Inc Pfizer Inc Republic Biscuit Corp Fonterra Co-operative Group RFM Corp Liwayway Marketing Corp Del Monte Pacific Ltd Mondelez International, Inc Nutri-Asia Inc Ajinomoto Co Inc Pacific Meat Co Inc Yakult Honsha Co Ltd Mars Inc QAF Ltd Food Industries Inc Goldilocks Bake Shop Inc Tobi Marketing Inc Abbott Laboratories Inc Liberty Gold Fruit Co Inc Artisanal Private Label Others Total
Source:
2008 11.1 7.6 6.3 4.5 3.1 0.3 2.9 2.9 1.3 1.6 1.4 1.3 0.8 1.1 1.0 1.0 1.1 0.8 0.9 0.9 0.7 0.7 0.6 0.7 0.6 0.6 4.0 1.7 38.7 100.0
2009 10.9 7.3 6.4 4.7 3.7 3.2 0.3 2.8 2.9 1.5 1.7 1.8 1.4 1.2 1.0 1.2 1.0 1.0 1.0 0.9 0.9 0.9 0.7 0.8 0.7 0.7 0.6 0.6 3.9 1.7 32.9 100.0
2010 10.9 7.1 6.4 4.9 3.6 3.2 0.3 2.9 2.8 1.6 1.7 1.7 1.4 1.3 1.1 1.2 1.0 1.0 1.0 0.9 0.9 0.9 0.7 0.7 0.7 0.7 0.6 0.6 3.8 1.8 32.9 100.0
2011 10.8 7.4 6.4 5.0 3.5 3.3 0.3 2.9 2.8 1.7 1.7 1.7 1.4 1.3 1.2 1.2 1.0 1.0 1.0 0.9 0.9 0.8 0.8 0.7 0.7 0.6 0.6 0.6 3.7 1.8 32.3 100.0
2012 10.6 7.4 6.5 5.1 3.4 3.4 3.4 3.0 2.8 1.8 1.7 1.7 1.7 1.4 1.3 1.3 1.2 1.1 1.0 1.0 1.0 0.9 0.9 0.8 0.8 0.7 0.7 0.7 0.6 0.6 3.7 1.8 26.2 100.0
NBO Shares of Packaged Food 2008-2012
2008 10.9 6.3 4.5 5.3 3.3 3.7 3.1 2.9 2.1
2009 10.7 6.4 4.7 4.9 3.4 3.7 3.2 2.9 2.2
2010 10.7 6.4 4.9 4.8 3.9 3.6 3.2 2.8 2.8
2011 10.6 6.4 5.0 5.0 3.8 3.5 3.3 2.8 2.7
2012 10.4 6.5 5.1 5.0 3.7 3.4 3.4 2.8 2.7
Nestl Philippines Inc Universal Robina Corp Monde Nissin Corp Purefoods-Hormel Co Inc, The Alaska Milk Corp Mead Johnson Philippines Inc San Pablo Manufacturing Corp International Oil Factory Kraft Foods
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(Philippines) Inc San Miguel Pure Foods Co Inc Unilever Foods Philippines (CMC) CDO Foodsphere Inc Century Canning Corp Wyeth Philippines Inc Fonterra Brands (Phils) Inc RFM Corp Liwayway Marketing Corp Del Monte Philippines Inc Unilever RFM Ice Cream Inc Ajinomoto Philippines Corp Pacific Meat Co Inc Supervalue Inc Yakult Philippines Inc Gardenia Philippines Inc UFC Philippines Inc Food Industries Inc Goldilocks Bake Shop Inc SM Retail Inc Republic Biscuit Corp Tobi Marketing Inc Artisanal Others Total
Source:
2.3 1.9 1.3 1.6 1.9 1.3 0.8 1.1 1.0 1.0 1.1 0.8 0.8 0.9 0.7 0.7 0.7 0.6 0.7 0.6 0.7 4.0 31.5 100.0
2.4 1.8 1.5 1.7 1.8 1.2 1.0 1.2 1.0 1.0 1.0 0.9 0.8 0.9 0.7 0.7 0.8 0.7 0.7 0.7 0.7 3.9 31.0 100.0
2.4 1.8 1.6 1.7 1.7 1.3 1.1 1.2 1.1 1.0 1.0 0.9 0.8 0.9 0.7 0.7 0.7 0.7 0.7 0.7 0.7 3.8 30.0 100.0
2.4 1.8 1.7 1.7 1.7 1.3 1.2 1.2 1.1 1.0 1.0 0.9 0.9 0.9 0.8 0.7 0.7 0.7 0.7 0.7 0.6 3.7 29.5 100.0
2.4 1.9 1.8 1.7 1.7 1.3 1.3 1.2 1.1 1.0 1.0 0.9 0.9 0.9 0.8 0.8 0.7 0.7 0.7 0.7 0.7 3.7 29.4 100.0
Table 41 % retail value rsp Brand Purefoods Jack 'n' Jill Minola Lucky Me Alaska Baguio Bear Brand Milo CDO Lactum Magnolia Nido Nestl Kraft Del Monte Sky Flakes
NBO Brand Shares of Packaged Food 2009-2012
Company Purefoods-Hormel Co Inc, The Universal Robina Corp San Pablo Manufacturing Corp Monde Nissin Corp Alaska Milk Corp International Oil Factory Nestl Philippines Inc Nestl Philippines Inc CDO Foodsphere Inc Mead Johnson Philippines Inc San Miguel Pure Foods Co Inc Nestl Philippines Inc Nestl Philippines Inc Kraft Foods (Philippines) Inc Del Monte Philippines Inc Monde Nissin Corp
2009 4.9 4.2 3.2 3.0 3.1 2.9 2.4 2.0 1.5 1.8 1.3 1.1 1.2 1.0 0.9 0.9
2010 4.7 4.3 3.2 3.1 3.5 2.8 2.7 1.9 1.6 1.7 1.3 1.2 1.1 1.1 0.9 0.9
2011 4.9 4.3 3.3 3.1 3.3 2.8 2.8 1.9 1.7 1.7 1.3 1.2 1.1 1.0 1.0 1.0
2012 4.9 4.4 3.4 3.2 3.2 2.8 2.7 1.9 1.8 1.7 1.3 1.1 1.1 1.0 1.0 1.0
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555 Argentina Selecta Oishi SM Bonus Yakult Ajinomoto Payless Anchor Star Gardenia Century Nagaraya Goldilocks Artisanal Others Total
Source:
Century Canning Corp Pacific Meat Co Inc Unilever RFM Ice Cream Inc Liwayway Marketing Corp Supervalue Inc Yakult Philippines Inc Ajinomoto Philippines Corp Universal Robina Corp Fonterra Brands (Phils) Inc San Miguel Pure Foods Co Inc Gardenia Philippines Inc Century Canning Corp Food Industries Inc Goldilocks Bake Shop Inc
0.9 0.9 0.9 0.9 0.8 0.9 1.0 0.9 0.8 0.8 0.7 0.8 0.8 0.7 3.9 49.3 100.0
0.9 0.9 0.9 0.9 0.8 0.9 1.0 0.9 0.9 0.8 0.7 0.8 0.7 0.7 3.8 48.6 100.0
0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.8 0.8 0.8 0.7 0.7 3.7 48.2 100.0
0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.8 0.8 0.8 0.7 0.7 3.7 47.9 100.0
Penetration of Private Label by Category 2007-2012
2007 Bakery Chilled Processed Food Dried Processed Food Frozen Processed Food Meal Solutions Noodles Nutrition/Staples Oils and Fats Packaged Food Sauces, Dressings and Condiments
Source:
2008 0.4 2.0 4.4 7.7 2.6 0.4 2.1 5.9 1.7 0.7
2009 0.5 2.0 4.4 8.0 2.7 0.4 2.2 6.2 1.7 0.7
2010 0.6 2.0 4.3 8.3 2.7 0.4 2.2 6.3 1.8 0.7
2011 0.5 2.1 4.2 8.1 2.7 0.4 2.3 6.5 1.8 0.7
2012 0.5 2.2 4.3 8.0 2.7 0.4 2.4 6.7 1.8 0.7
0.4 2.0 4.3 7.5 2.5 0.4 2.1 5.9 1.6 0.7
Sales of Packaged Food by Distribution Format: % Analysis 2007-2012
2007 Store-Based Retailing - Grocery Retailers -- Supermarkets -- Hypermarkets -- Discounters -- Small Grocery Retailers --- Convenience Stores --- Independent Small Grocers --- Forecourt Retailers 99.8 95.6 42.6 3.9 15.0 1.3 13.5 0.2
2008 99.8 95.5 42.6 4.5 14.3 1.4 12.7 0.2
2009 99.9 95.5 42.9 4.8 13.4 1.3 11.8 0.2
2010 99.9 95.6 42.7 5.4 12.7 1.3 11.1 0.2
2011 99.9 95.7 42.6 5.8 12.2 1.3 10.6 0.3
2012 99.9 95.9 42.7 6.0 12.1 1.4 10.4 0.3
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-- Other Grocery Retailers - Non-Grocery Retailers -- Health and Beauty Retailers -- Other Non-Grocery Retailers Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total
Source:
34.1 4.2 4.2 0.0 0.2 0.0 0.0 0.1 100.0
34.1 4.4 4.4 0.0 0.2 0.0 0.0 0.1 100.0
34.5 4.4 4.4 0.0 0.1 0.0 0.0 0.1 100.0
34.8 4.3 4.3 0.0 0.1 0.0 0.0 0.1 100.0
35.1 4.2 4.2 0.0 0.1 0.0 0.0 0.1 100.0
35.1 4.0 4.0 0.0 0.1 0.0 0.0 0.1 100.0
Table 44
Sales of Packaged Food by Category and Distribution Format: % Analysis 2012
% retail value rsp BF Store-Based Retailing Grocery Retailers Supermarkets Hypermarkets Discounters Small Grocery Retailers Convenience Stores Independent Small Grocers Forecourt Retailers Confectionery specialists Other Grocery Retailers Non-Grocery Retailers Health and Beauty Retailers Other Non-Grocery Retailers Non-Store Retailing Vending Homeshopping Internet Retailing Direct Selling Total 100.0 57.7 39.9 5.9 0.0 11.9 1.1 10.8 0.0 0.0 42.3 42.3 0.0 0.0 0.0 0.0 0.0 0.0 100.0 DPF Store-Based Retailing Grocery Retailers Supermarkets Hypermarkets Discounters Small Grocery Retailers Convenience Stores Independent Small Grocers Forecourt Retailers Confectionery specialists Other Grocery Retailers Non-Grocery Retailers 100.0 100.0 44.1 6.3 0.0 15.6 2.4 13.1 0.2 34.0 0.0 B 100.0 98.6 26.2 3.6 0.0 5.9 0.4 5.1 0.4 62.9 1.4 1.4 0.1 0.0 0.0 0.0 0.0 0.0 100.0 FPF 99.9 99.9 63.0 9.0 0.0 13.5 1.0 12.5 0.0 14.4 0.0 CPF 100.0 100.0 51.7 7.1 0.0 18.0 1.3 16.4 0.3 23.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 IC 100.0 100.0 67.8 10.0 0.0 18.3 2.0 15.6 0.8 0.0 3.9 0.0 CHP 100.0 100.0 49.5 6.9 0.0 7.6 1.6 6.0 0.0 36.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 MR 84.4 40.9 21.7 3.0 0.0 16.2 0.0 16.2 0.0 0.0 43.5 C 99.8 93.9 35.1 4.9 0.0 13.7 4.3 8.3 1.1 4.2 36.0 5.9 5.9 0.0 0.2 0.0 0.0 0.2 0.0 100.0 NOO 100.0 100.0 38.5 5.5 0.0 13.3 2.2 11.0 0.2 42.7 0.0 D 99.7 99.7 44.6 6.4 0.0 13.4 1.7 11.5 0.1 35.4 0.0 0.0 0.0 0.3 0.0 0.0 0.0 0.3 100.0 OF 100.0 99.9 50.9 7.0 0.0 7.2 0.1 7.2 0.0 34.8 0.1
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Health and Beauty Retailers Other Non-Grocery Retailers Non-Store Retailing Vending Homeshopping Internet Retailing Direct Selling Total
0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 P
0.0 0.0 0.1 0.0 0.0 0.1 0.0 100.0 RM 100.0 100.0 62.5 8.3 0.0 23.8 5.2 16.0 2.6 5.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 SDC 100.0 100.0 38.6 5.3 0.0 7.2 1.1 5.8 0.3 48.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0
43.5 0.0 15.6 0.0 0.0 0.0 15.6 100.0 SB 100.0 95.8 80.0 11.6 0.0 4.2 3.0 0.0 1.2 0.0 4.2 4.2 0.0 0.0 0.0 0.0 0.0 0.0 100.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 SOU 100.0 100.0 51.3 7.2 0.0 23.3 6.0 15.3 2.0 18.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0
0.0 0.1 0.0 0.0 0.0 0.0 0.0 100.0 SPR 100.0 100.0 50.4 7.1 0.0 18.5 1.0 16.6 0.9 24.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0
Store-Based Retailing Grocery Retailers Supermarkets Hypermarkets Discounters Small Grocery Retailers Convenience Stores Independent Small Grocers Forecourt Retailers Confectionery specialists Other Grocery Retailers Non-Grocery Retailers Health and Beauty Retailers Other Non-Grocery Retailers Non-Store Retailing Vending Homeshopping Internet Retailing Direct Selling Total
100.0 100.0 49.0 6.8 0.0 17.0 2.5 14.5 0.0 27.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 SSS
Store-Based Retailing Grocery Retailers Supermarkets Hypermarkets Discounters Small Grocery Retailers Convenience Stores Independent Small Grocers Forecourt Retailers Confectionery specialists Other Grocery Retailers Non-Grocery Retailers Health and Beauty Retailers Other Non-Grocery Retailers Non-Store Retailing Vending Homeshopping Internet Retailing Direct Selling Total
100.0 100.0 31.5 4.5 0.0 17.4 1.4 15.5 0.5 46.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0
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Source: Key:
Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources BF = baby food; B = bakery; CPF = canned/preserved food; CHP = chilled processed food; C = confectionery; D = dairy; DPF = dried processed food; FPF = frozen processed food; IC = ice cream; MR = meal replacement; NOO = noodles; OF = oils and fats; P = pasta; RM = ready meals; SDC = sauces, dressings and condiments; SB = snack bars; SOU = soup; SPR = spreads; SSS = sweet and savoury snacks
Forecast Sales of Packaged Food by Category: Volume 2012-2017
2012 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
2013 54.8 377.5 267.4 96.0 90.8 352.9 389.3 182.8 48.9 1.4 210.6 544.8 78.7 13.8 218.2 0.0 4.5 15.2 141.9 502.5 1,513.4 783.0 2,782.1
2014 55.8 388.2 278.1 99.0 92.6 361.3 405.9 189.0 49.8 1.5 220.7 566.4 82.2 14.4 224.7 0.0 4.6 15.5 147.1 518.3 1,564.0 810.2 2,875.0
2015 57.0 399.6 288.7 102.1 94.6 369.3 422.9 194.8 50.6 1.5 230.4 590.1 86.1 15.1 230.7 0.0 4.8 15.7 152.3 534.6 1,617.3 836.6 2,970.1
2016 58.3 411.7 299.2 105.2 96.7 376.4 440.6 200.2 51.4 1.6 240.1 616.3 90.4 15.9 236.4 0.0 5.0 16.0 157.6 551.4 1,673.5 862.3 3,067.9
2017 59.7 424.5 309.7 108.2 98.9 382.9 459.0 205.3 52.1 1.7 249.6 645.1 95.2 16.7 241.7 0.0 5.2 16.3 163.2 569.0 1,732.8 887.3 3,168.8
54.0 367.5 256.6 92.9 89.2 344.2 372.9 176.2 47.9 1.3 200.1 525.0 75.4 13.1 211.1 0.0 4.3 15.1 136.5 487.0 1,464.9 754.7 2,690.6
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Sum of sectors does not equal total packaged food because of double counting (eg canned soup is included in soups and canned foods)
Table 46 Ps million
Forecast Sales of Packaged Food by Category: Value 2012-2017
2012 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles 32,988.1 61,421.6 33,251.3 16,834.5 30,428.3 71,741.9 37,189.1 30,208.5 9,420.3 1,831.4 23,603.1
2013 33,266.7 62,675.4 34,462.8 17,339.5 30,418.7 73,642.9 38,638.6 31,084.6 9,583.8 1,915.6 24,467.5
2014 33,709.9 64,111.7 35,678.3 17,842.3 30,518.5 75,520.2 40,074.2 31,928.9 9,738.9 2,003.7 25,320.2
2015 34,315.1 65,735.8 36,880.8 18,341.9 30,735.1 77,404.5 41,501.9 32,749.7 9,887.3 2,095.7 26,175.9
2016 35,034.8 67,529.6 38,084.2 18,837.2 31,052.0 79,252.1 42,902.4 33,531.9 10,023.7 2,191.6 27,015.2
2017 35,826.5 69,559.7 39,268.9 19,326.9 31,443.0 80,948.2 44,284.4 34,245.7 10,158.5 2,286.1 27,855.1
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Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
48,032.6 8,134.9 3,204.4 23,721.8 12.4 1,540.4 4,194.4 37,682.2 118,535.3 215,618.2 108,903.3 438,979.0
49,372.4 8,582.3 3,341.9 24,335.5 12.0 1,588.5 4,188.0 38,994.1 120,901.8 220,996.8 112,298.1 449,953.7
50,832.5 9,011.5 3,489.8 24,906.9 11.7 1,639.0 4,198.8 40,340.8 123,529.7 226,701.4 115,633.6 461,442.6
52,423.0 9,417.0 3,649.1 25,434.7 11.4 1,691.8 4,220.4 41,684.8 126,389.1 232,777.0 118,899.6 473,450.4
54,162.9 9,793.7 3,821.0 25,919.5 11.2 1,747.4 4,255.2 43,060.9 129,475.3 239,134.9 122,096.1 485,881.0
56,064.4 10,136.4 4,007.0 26,360.9 11.1 1,805.6 4,304.2 44,430.3 132,786.3 245,647.4 125,173.8 498,554.5
Forecast Sales of Packaged Food by Category: % Volume Growth 2012-2017
2016/17 Baby Food Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
2012-17 CAGR 2.0 2.9 3.8 3.1 2.1 2.2 4.2 3.1 1.7 4.4 4.5 4.2 4.8 4.9 2.7 0.3 3.7 1.6 3.6 3.2 3.4 3.3 3.3
2012/17 Total 10.7 15.5 20.7 16.5 10.9 11.3 23.1 16.5 8.7 24.0 24.7 22.9 26.3 26.8 14.5 1.3 20.0 8.5 19.5 16.8 18.3 17.6 17.8
2.5 3.1 3.5 2.9 2.3 1.7 4.2 2.6 1.4 3.9 4.0 4.7 5.3 5.1 2.3 0.5 3.9 2.1 3.5 3.2 3.5 2.9 3.3
Table 48
Forecast Sales of Packaged Food by Category: % Value Growth 2012-2017
% constant value growth 2012-17 CAGR Baby Food 1.7 2012/17 TOTAL 8.6
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Bakery Canned/Preserved Food Chilled Processed Food Confectionery Dairy Dried Processed Food Frozen Processed Food Ice Cream Meal Replacement Noodles Oils and Fats Pasta Ready Meals Sauces, Dressings and Condiments Snack Bars Soup Spreads Sweet and Savoury Snacks Impulse and Indulgence Products Nutrition/Staples Meal Solutions Packaged Food
Source: Note:
2.5 3.4 2.8 0.7 2.4 3.6 2.5 1.5 4.5 3.4 3.1 4.5 4.6 2.1 -2.1 3.2 0.5 3.3 2.3 2.6 2.8 2.6
13.2 18.1 14.8 3.3 12.8 19.1 13.4 7.8 24.8 18.0 16.7 24.6 25.0 11.1 -10.1 17.2 2.6 17.9 12.0 13.9 14.9 13.6
SOURCES
Sources used during research include the following: Summary 1 Research Sources Official Sources
Camara Oficial Espaola de Comercio Industria y Navegacion en Filipinas, Inc Department of Agriculture Department of Health Industrial Technology Development InstituteDepartment of Science & Technology National Dairy Authority National Food Authority National Statistical Coordination Board National Statistics Office Philippine Stock Exchange
Trade Associations
Association of Filipino Franchisers Inc Philippine Association of Meat Processors Inc Philippine Coconut Oil Producers Association Philippine Federation of Bakers Association Inc Rice Association
Trade Press
Business World Online
Passport
43
Food & Agribusiness Monitor

Source: Euromonitor International

Packaged Food in The Philippines

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Packaged Food in The Philippines

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PACKAGED FOOD IN THE PHILIPPINES

Euromonitor International April 2013