The breakfast biscuit sector has boomed in the past three years, experiencing triple-digit growth, according to Euromonitor International.
But, Pinar Hosafci, packaged food research analyst at Euromonitor, told BakeryandSnacks.com this growth would inevitably slow to double-digit over the next five years. This slowdown was a natural shift as the market matured, she said, but would also be underpinned by health concerns starting to overshadow the convenience aspect of breakfast biscuits.
“As people become more health conscious, they might question the high sugar content that these products actually have. I don’t think that has happened yet, but I think there is a danger of that,” she said.
To overcome this, she said manufacturers should consider cutting the sugar and calorie content of their biscuits and communicating that on pack. “The communication will be important,” she said.
Companies could also develop healthier variants with added protein or fruit content, for example, she said.
Target busy, city consumers
Hosafci said demand for breakfast biscuits predominantly came from single occupancy households and working women, where there was less incentive to prepare food from scratch. In particular, it was cities and large towns where the products had most opportunity, she added.
“In smaller cities and towns, these products may not be perceived as beneficial. For these consumers, I think manufacturers will have a hard time convincing people that eating biscuits for breakfast will sustain them throughout the morning,” she said.
However, for the busier, city dwellers, she said the convenience aspect still appealed, particularly as working days became less traditional – away from a typical 9-5 day.
“They work longer hours and spend less time cooking or preparing food and consumers are looking for ‘easy to use’ and ‘easy to prepare’ portable breakfast options.”
UK huge but expansion promise beyond
Globally, demand for breakfast biscuits came from developed markets like Australia and New Zealand, North America, and the UK, where, collectively, biscuits accounted for 2% of the breakfast cereal market, Hosafci said. The UK, she said, was the most dominant market, but growth opportunity did exist elsewhere.
“Germany really stands out as a strong market for convenience foods. Around 40% of households are single occupancies. Similarly a lot of Scandinavian markets in Norway and Sweden through Denmark and even Estonia are key markets for this particular trend,” she said.
Small players could come in, but it’s a risk
Global players like Mondelez, Kellogg and Weetabix currently dominated the market, Hosafci said, leaving room for smaller manufacturers to join the sector.
However, she warned that it would be a risk for a small player. “It’s just a risky investment for the smaller manufacturers because they don’t have the distribution channels as developed as the big manufacturers and they might have difficulty pitching their product,” she said.