Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Baby food; Bakery products; Canned/preserved food; Chilled processed food;
Confectionery; Dairy products; Dried processed food; Frozen processed food;
Ice cream; Impulse snack products; Meal replacement products; Meal solutions;
Noodles; Nutrition/staples; Oils and fats; Pasta; Ready meals; Sauces;
dressings and condiments; Snack bars; Soup; Spreads; Sweet and savoury snacks
Executive summary
Improved performance in 2007
The overall performance of packaged food in 2007 was better than the current
value CAGR seen in the review period as a whole. The economy in Hong Kong
improved in the last half of the review period. Unemployment rates decreased
and wage levels increased. The overall atmosphere in Hong Kong is better and
people are more optimistic about their future. Thus they are willing and able
to spend more on their enjoyment and to buy better quality packaged food for
their meals.
Health remains strong
The health trend remained popular in Hong Kong for most of the review period.
As people became more educated and the media became more developed, consumers
received more information on health and food safety. In 2007, trans fats were
found in some bakery goods and Sudan dyes in poultry feeds, being used to
enhance the colour of egg yolks. Both of these ingredients are harmful to
health. Sudan dyes are non-permitted colouring matters under the Colouring
Matter in Food Regulations in Hong Kong. These scandals were widely published
by the media and raised large scale concern and discussions regarding food
safety. Companies are therefore under pressure to improve the formula of their
products and to launch new and healthier products.
Significant participation by domestic and mainland companies
Packaged food is one of the few industries in Hong Kong with a significant
participation for domestic and mainland Chinese companies. Local companies
such as Garden Co Ltd and Vitasoy International Holdings Ltd have a long
history and strong brand loyalty in Hong Kong. Mainland Chinese companies
meanwhile have the advantages of low production costs and production
facilities close to Hong Kong. China National Cereals, Oils & Foodstuffs Imp &
Exp Corp (COFCO) for example offers a comprehensive product portfolio and
remains strong in packaged food.
Supermarkets/hypermarkets still the major distribution channel
Supermarkets/hypermarkets continues to dominate packaged food. The two major
chained supermarkets/hypermarkets, ParknShop and Wellcome, are able to offer
goods at a lower price because of bulk purchases. Their shops are located at
key sites that people can visit conveniently. These aim to offer a
comprehensive product range in order to meet the daily needs of every people.
To increase their competitiveness, ParknShop launched the Money Back
membership card scheme. This enables consumers to receive discounts and
special promotions at its chains ParknShop, Taste, Gourmet and Great. Wellcome
meanwhile joined the Octopus Rewards scheme, offering consumers monetary
rewards. Both supermarkets also use in-house promotions to attract consumers.
Stable growth expected in forecast period
Growth for packaged food is expected to be slow and stable in the forecast
period. Ice cream will see the highest growth because of the prolonged summer
with higher temperatures in Hong Kong. Apart from the global warming condition
that is likely to improve sales of ice-cream, demand for convenience is
expected to increase its prevalence in the forecast period. For instance, soup
is also expected to see high growth as it can be prepared easily and can also
be used as sauce. Dried processed food will see low growth meanwhile because
it faces competition from many more convenient substitutes such as
canned/preserved food and frozen processed food.
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