Regional Concentration in the Global Food Economy
Mark Gehlhar1
Presented at the First Biennial Conference of the Food System Research Group June 27, 2003
Madison, Wisconsin.
1
Mark Gehlhar is a senior economist in the Market and Trade Division, ERS-USDA.
Abstract
The global food manufacturing industry is comprised of diverse firms, varying in their
geographic coverage and product portfolios. While the largest firms have wide product portfolios
and global coverage, many concentrate on few product categories or in regional markets. There
are variations in the four-firm concentration ratio across regions at the aggregate level and at the
product-specific level. In addition firm concentration varies across countries within the same
region. Sales concentration in packaged food is highest in Latin America and Australasia and
lowest in Asia Pacific and Eastern Europe.
2
Introduction
Large and growing food companies are a prominent feature in the landscape of the global food
industry. Some predict that in the near future there will be four or five large retail firms and
about twenty or twenty-five manufacturers operating globally (Grievink, Josten, Valk 2002).
Many industries have evolved into markets with a transnational dimension where the leading
firms in an industry are the leading firms in the same industry of other countries (Connor 1985).
However, outside of Western Europe and the United States little is known about the structure at
the manufacturing level in processed food. Evidence is scant whether large multinational
manufacturers have dominate positions in food markets globally or whether local firms have a
greater presence in home markets.
The current structure of world food industry is unlike other manufacturing such as auto, aircraft,
or electronics, which are dominated by large firms with manufacturing facilities located in few
locations. Food manufacturing comprises of a wide array of industries, each using different
inputs and producing products that require specific marketing expertise and brands for individual
markets. This provides broader scope for different firms tailoring product for specific consumer
demands. In many cases different sized firms have advantages allowing for their coexistence in
world food. In the United States, for example, there is a growing bimodal distribution of firms as
larger firms expand and the number of smaller firms increases (Rogers 2001).
Consolidation in food manufacturing is continuing in Western Europe and the United States
(Cotterill 1999). However it is debatable whether the food industry structure will converge to a
similar structure as other manufacturing with few dominant firms. Although the largest
3
multinational food companies may become proportionately larger in the next decade, this may or
may not lead to more concentrated markets. International expansion and sheer size of companies
do not necessarily translate to greater market power (Scherer and Ross 1991). It is not the size of
a corporation that confers power, but the nature of the market in which a firm operates and their
position in these markets. The ability of firms to gain access to retail channels and heighten
entry barriers can lead to higher concentration in specific food markets.
The paper provides a global view of the structure of food manufacturing by identifying key
players and examining levels of concentration at the global and regional level. It begins with
reasons why and how some food manufacturers have evolved into the largest firms in the world.
Early history of the firm and incentives for acquisition are important for understanding industry
structure in global food manufacturing. Concentration is examined using the four-firm
concentration ratio (CR4). Differences in concentration are compared across regions by
examining concentration at the product and country-specific level. Cases of firm dominance are
also examined and in specific cases brands are identified which may play a role in determining a
firm’s position in international food markets.
Diversity of firms and their global presence
An important feature in global food markets is the diversity of firms in terms of size, uniqueness
in products and brands, and geographic coverage. Large firms coexists with many smaller firms,
with the top twenty-five firms in the world accounting for less than 25 percent of global
packaged food sales. The structure of an industry is influenced by firm history, brand
4
acquisition, geographic coverage, and resistance towards expansion either from legal authorities
or by firm choice.
History’s role
Simply being first in a market has been important in the success of the world’s largest food
corporations. Large-scale commercial food processing and retailing originated in Western
Europe and the United States. Of the world’s fifty largest food manufacturing firms, thirty-six
are based either in the United States or Western Europe (table 1). The most renowned food
companies today were founded in the late 1800’s and during the turn of the 20th century when
household incomes grew rapidly with the industrial revolution. As households could no longer
afford the time processing farm products, entrepreneurs gained greater access to capital from
private and public sources for launching new food companies. This led to strong growth in
commercial processing in the United States and Western Europe where the two regions today
account for more than 53 percent of global packaged food sales (table 2). Product innovations in
some food categories such as ready meals, frozen foods, and meal replacement drinks are
marketed mainly in the United States and Western Europe accounting for nearly 70 percent of
global sales (table 2)2. The high level of packaged food sales gave U.S. and European firms
more opportunity to introduce new products and establish consumer loyalty.
The three largest companies in packaged food sales, Nestlé, Unilever, and Kraft continue to have
their most profitable activity in products they established in their early history. The Nestlé
Company, founded in 1865 in Switzerland by Henri Nestlé started with an initial focus on infant
2
All data for this paper is from Euromonitor International (www.euromonitor.com) a private vendor for global
consumer markets and business data.
5
nutrition and later was followed by other milk-based products. This company is now the world’s
largest food company with a strong focus on the same items. Unilever is the global leader in ice
cream and spreadable oils and fats. Its roots can be traced to the 1930 merger between a Dutch
margarine manufacturer, Margarine Unie, and the British company, Lever Brothers, a company
that had previously diversified into ice cream. In 1903, James Kraft began a wholesale cheese
business in Chicago which later became Kraft Foods, and is now the world’s largest cheese
supplier to retail markets.
Food companies soon realized they needed recognizable brands in order to differentiate their
products from competitors to retain and expand their customer base. Technology employed by
food processing firms was relatively unsophisticated and could easily be replicated by rivals.
Preserving their product identity with brands was essential in preventing displacement by
competitors using similar processing technology. For example, Kraft Foods would not have
attained its global presence without its famous cheese brands, patented trademarks, and the
longstanding goodwill earned from consumers. In the food industry, these intangible assets are
often more important than capital and technology.
Brand acquisition
Firm expansion with new products and brands are less frequent in the contemporary food
industry. Rather the expansion of food companies, particularly the largest firms, is principally
achieved through acquisition of existing brands. This strategy has been employed in numerous
occasions in recent years for growth and entering new markets. For example Unilever’s
6
acquisition of the successful meal replacement drink (Slim fast) significantly helped the
company in this product category in the U.S. market
Global food industry structure has evolved from a series of acquisitions over time. Large
diversified companies have accumulated premium brands in their core product categories (table
3). Nestlé and Unilever compete with each other in ice cream markets globally. Recently they
became more aggressive in the U.S. market as incentives to acquire U.S. brands were amplified
with consumer demand shift toward premium ice cream. In 2000, Unilever acquired the U.S. ice
cream manufacturer Ben and Jerry’s Ice Cream. Nestlé, on the other hand expanded its ice cream
core business by acquiring General Mill’s stake in Ice Cream Partners USA, giving it ownership
of the premium Häagen-Dazs in the United States. In 2002, Nestlé acquired a majority stake in
Dreyers’s Grand Ice Cream.
The combination of processing technology and specific brands helped Unilever differentiate its
oils and fat products from those of its rival ConAgra. For example, some of Unilever’s
margarine products, having a butter-like flavor, opened an opportunity to attract more consumers
away from other margarine. The strategy helped Unilever compete with ConAgra’s strong
domestic margarine brands (table 3) acquired previously from Nabisco’s table spread business.
Accumulating high-performance brands is a way for firms to boost their regional presence and
compete for market share. Nestle’s acquisition of the Stouffers brand in the United States gave
the company the leading position in the “ready meals” product category. ConAgra, the second
largest supplier of ready meals has acquired many brands through the purchase of companies
7
such as International Home Foods, GoodMark Foods (meat snacks), Golden Valley Foods
(microwaveable popcorn), Knotts Berry Farm Foods, and Beatrice Foods. In another example,
General Mills extended its presence in bakery goods, canned and frozen foods, and snacks foods
through acquisition of Pillsbury in 2001. This substantially increased its market share in North
America and provided the company with strong brands, including Betty Crocker, Old El Paso,
and Green Giant.
Geographic expansion
Geographic expansion will likely become a more important growth strategy in the future as
Western European and North American markets become saturated. Developing country markets
will be critical for food volume growth. Only a few companies currently have sales in every
region in the world, and firms with a global presence are not necessarily associated with product
and size (table 4). Firms with a global presence generally have extensive expertise in certain
product categories where they have an inherent technological and marketing advantage. Nestlé
exemplifies this point with its global sales in baby food products, drawing expertise from its
extensive research and development program in infant formulation. The company is the largest
food manufacturer with a diversified product portfolio and extensive geographic sales reach.
Similarly, Unilever has extensive geographic coverage in its core products. Technology and
marketing expertise of smaller firms help them achieve a global presence as well. Two examples
are the Wrigley Jr. Company specializing in confectionery, and the newly formed Fonterra
Cooperative Group specializes in dairy products. Wrigley has less than one tenth the sales in
packaged food as Nestlé, yet it is a truly global company specializing in gum products, supported
by extensive product development and global marketing expertise. The Fonterra Cooperative
8
Group, based in New Zealand, has sales in more than 140 countries and maintains extensive
research and development and dairy technology. The U.S. based ConAgra Company is at the
other extreme where it has limited geographic sales in its packaged food but has a diverse
product portfolio. Its primary geographical market is North America. L
Local orientation would characterize Dean Foods (USA) and Meiji Dairies (Japan). They have
limited product portfolios specializing in milk products. Despite their current local orientation
many companies are striving for extending their geographical coverage. Meiji a leading dairy,
ice cream, and baby food manufacturer for the Asia Pacific region is targeting South East Asia,
where it has subsidiaries in Indonesia and Thailand. In Western Europe Arla Foods Amba is
Europe’s largest dairy co-operative with a regional market orientation. However, Arla Foods is
setting up a new Middle East subsidiary in the United Arab Emirates.
PepsiCo, another U.S. based company is continuously extending its geographical reach with its
international marketing arm in snack foods focussing on Latin America, Eastern Europe and
Asia. The Heinz Company is capitalizing on it brand strength and strong growth potential in
Eastern Europe and Asia Pacific where it is building it presence through local acquisitions and
joint ventures. Danone is developing stronger presence in Africa and the Middle East through
investments in fresh dairy products and bakery products. Italy’s popular confectionery company
Ferrero is expanding operations in North America, Australasia, Asia-Pacific and Eastern Europe.
Geographic expansion will likely become the most important growth strategy in the future as the
food demand outside of North America and Western Europe grow with faster growth in incomes
9
and population. Latin America and Asia are regions where U.S. and European-based firms are
trying to establish themselves for the future growth.
There are certain forces resisting further acquisition and the drive for diversification. In some
cases, a firm may choose to limit it self, or in other cases the legal environment may restrain firm
activities in specific markets. Firms must constantly evaluate whether there is a good fit between
their inherent strengths and the new opportunities that lie ahead. Diversifying a firm’s product
portfolio may reduce marketing focus and prevent the firm from achieving economies of scale.
Multinationals have not gained a strong foothold in all regions of the world. Local firms hold
leading positions in certain regional markets. In such cases firms may have a greater identity
with consumers and the general public. This is noticeable in Northern Europe and East Asia. In
Scandinavian countries Danish and Swedish firms hold the top positions (table 5). There seems
to be support for locally owned and managed companies among the East Asian countries of
Japan, South Korea, and China. For example Korea’s top four food manufacturing firms (Lotte,
Nong Shim, Namy Dairy Products, and Cheil Jedang) are nationally owned companies. In sharp
contrast, Brazil’s leading manufacturing firms are all European based multinationals (Nestlé,
Unilever, Pamalat, and Danone). Lack of domestic capital is one reason for greater foreign
investment but many laws still prevent foreign control of domestic assets.
Aggregate concentration by region
There are wide variations in firm concentration ratios within geographic regions. How
concentration is calculated can matter in some cases. For example the CR4 ratio for Western
10
Europe, treating the regional as an aggregate, is 12.2. In contrast, the simple average CR4 using
all individual countries in Western Europe is 22, with a range from 39.8 to 11.8 (listed in table
6). Northern European countries, Denmark, Finland, Norway and Sweden, all have CR4 ratios
above 27. Many national food manufacturers make up the leading firms in these countries such
as, Arla Amba Foods, Danish Crown Amba, Tine, Norske Meireier, and Valio Oy. The rest of
Western Europe is less concentrated. In these other countries, multinational such as Nestlé,
Unilever, Danone, and Kaft share the packaged food market more evenly with national
companies. Germany, France, Italy, and the United Kingdom all have CR4’s below 19. Eastern
Europe is the least concentrated region in the world with an aggregate CR4 ratio of 6 and a
simple average CR4 for individual countries of 13, ranging from 5.4 in Russia to 20 in Hungary.
In this region, the leading four firms are nearly exclusively national firms and with no single firm
having a share above 7 percent.
The structure for packaged food sales in North America is closer to that of the largest Western
European countries. Canada and the United States both have CR4 ratios both of 19 percent.
Kraft Foods is the leading firm in both countries, but is the only common firm in the top four. As
in many industrialized countries, each have their own national firms, such as Maple Leaf Foods
in Canada and ConAgra Foods in the United States which share their respected markets with
other multinationals. In contrast to North America, Australia and New Zealand have very
different market structures. New Zealand is the most concentrated with a CR4 ratio of 44.1. In
this case, concentration is largely accounted by New Zealand’s biggest firm, Fonterra, having a
dominant position (22 percent) in New Zealand’s total packaged food sales. In Australia, Nestlé
is the leading firm with only 6 percent of packaged food sales.
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Asia Pacific and Latin America have wide variations in firm concentration across individual
countries. In these regions, countries with more multinationals in leading positions tend to have
higher concentration levels. South East Asian countries have higher concentration levels than
East Asian countries, where multinationals are noticeable absent from in the top four positions.
In Latin American countries, however, Nestlé, Unilever and Parmalat are pervasive throughout
the region.
Importance of concentration in product markets
The global size of firms and widening disparity in the size of firms is inevitable as the global
food industry evolves. But differences in the relative size of firms is not itself directly related to
concentration, rather the degree of control firms possess in individual product markets is of more
importance. The tendency for firms to specialize in specific product categories by acquiring
brands and obtaining exclusive rights to retail channels raises questions regarding concentration
levels.
Aggregate industry level data is often too broad to reflect a true economic market. Industrial
organization economists have traditionally defined markets as a break in the distinct chain of
substitutes that exist for an array of products. They are primarily concerned with the extent to
which consumers differentiate substitute products. Industry classifications are based on
similarity of production technologies and major inputs purchased. The problem is that many
products within the industry may not be substitutes in consumption. Other market definition
problems are caused by differences in the geographic scope of product markets. Food industries
12
in particular often are comprised of local and regional markets. The relevant market becomes
more local as one moves down the distribution channel towards consumers (Cotterill 2003).
Which company acquires another has implications for how concentration changes in specific
markets. The U.S. confectionery industry comprises individual product markets where
concentration could become a concern to regulators if further acquisitions were to take place in
the future. Wrigley and Pfizer are the largest firms in the U.S. gum market, whereas Hershey,
Mars, and Nestlé are major suppliers of chocolate confectionery products. If Nestlé had acquired
in Hershey, concentration would have increased in the U.S. chocolate confectionery market, as
Nestlé share would have increased from 6 percent to 38 percent. However if Wrigley had
acquired Hershey, concentration in chocolate confectionery would not have increased. Wrigley is
not a supplier of chocolate products to the U.S. market, so concentration in the chocolate market
would remain unchanged. On the other hand, the U.S. gum market would become more
concentrated. The reason is that Wrigley would have acquired Hershey’s share of the U.S. gum
market (12 percent), add to its current share (43 percent) of U.S. market. Thus, concern over
concentration may differ under each acquisition scenario due to specificity of the products
involved.
As described earlier, Nestlé has extensive sales throughout the world and across many product
categories, making it the leading food manufacturer in the world. But, one can hardly say that
the global food industry is concentrated with Nestlé having only a 3 percent share of world food.
A very different story emerges by progressing from the aggregate level to individual country and
product specific markets (table 8). Market dominance becomes more evident in core categories
13
of the firm in individual countries. Nestlé shares at the regional level for total packaged food
ranges from 1.3 percent in Asia Pacific to 6.3 percent in Latin America. At the product level in
its core categories, its global share ranges from 25.7 percent in pet food to 0.5 percent in bakery
products. But for these same product categories, its shares increase considerably in individual
regions and countries. While Nestlé holds 6.3 percent share of the Latin American packaged
food market, it commands a substantially higher share of the baby food products in Latin
America (60.7 percent). And at the sub-product level, Nestlé has near-monopoly control (91.2
percent) in infant milk-based formula market in Brazil. Similar examples are evident for other
core categories, including chocolate confectionery in the U.K (24.6 percent), dehydrated soup in
Russia (58.9 percent), cat food in the United States (40 percent), milk in the Philippines (48.3
percent), and cookies in Israel (42.3 percent).
With local brand ownership of foreign firms consumers are sometimes unaware they are
purchasing products from a multinational company. For example, the top-three baby food
brands in Brazil (Mucilon, Nan, and Nestogeno, and Neston) are brands owned by Nestlé. It is
Nestlé local brand ownership that gives it strong presence in the Brazilian baby food market.
Gerber a global brand owned by Novartis accounts, for only 1 percent of this market.
The next example of firm dominance is Unilever. It is a very large and diverse global food
manufacturer but with a different mix of product categories than Nestlé (table 9). Similar to
Nestlé it has does not have a dominate position in any particular region (4 percent in Western
Europe and 1 percent in Asia Pacific). But at the global-product level, its core products have
noticeably higher shares ranging from 39 percent in meal replacement drinks to 7 percent in
14
spreads. It has a dominant position in Austrian ice cream market (60 percent) and a nearmonopoly control (81 percent) in the sub-product category of impulse ice cream.
A weak position at the regional level does not leave the door shut for attaining a strong position
in a specific country market in the same region. This is the case oils and fats in the Asia Pacific
region, where it has a weak overall presence (4.4 percent). However, in Indonesia Unilever
controls more than a third of the country’s oil and fats product category, with 84 percent of the
spreadable oils and fats. It achieves this high share through a single brand (Blue Brand) in the e
oils and fats. This type of single brand market penetration is seen elsewhere where it achieved
high market shares with its Slim Fast (meal replacement drink) in the United States, Knorr (soup)
in Poland, and Hellman’s (Ketchup) in Argentina.
At the global level, sales concentration using the four-firm concentration ratio reveals wide
differences. As a result of previous brand acquisitions by leading firms, certain products are
becoming increasingly dominated by fewer firms. Pet food, soups, breakfast food, and baby
foods have concentration ratio of greater than 50 percent. For example the CR4 ratio for global
pet food is 63, with Nestlé alone accounting for 26 percent of global pet foods sales. Evidently
there is strong incentives among leading food firms to acquire high-margin premium brands in
this product category. The same can be seen in soups and baby foods. In baby foods, global
brands such as Enfamil, Gerber, and Similac account for 70 percent of world sales. For soup,
Campbells, Knorr, Maggi, and Progresso brands account for nearly 60 percent of the global soup
sales.
15
At the regional level, there are differences in concentration within each product category. For
example, breakfast cereals in Latin America have the highest level of concentration (CR4 = 91),
while Eastern Europe is much lower (CR4 = 42). In many cases the level of concentration will
depend on a single firm with a dominant position. In Latin America Kellogg’s has a dominant
position, with over 40 percent of sales compared with only 5 percent Eastern Europe.
Multinationals can have territorial specialization leading to high concentration in selected
regions. This is illustrated in the case of baby food where the CR4 ratio is 39 in Asia Pacific but
93 in Australasia. The reason for this is that Heinz has a dominant position with 50 percent of
baby food sales in Australisia but has little or no baby food sales in Asia Pacific. This is also true
in confectionery but with Cadbury Schweppes dominating the Australisia region while having
only a minor presence in Asia Pacific. There appears to be a tendency for firms to be territorial
in many cases.
Summary
In the global food manufacturing industry most firms operate in regional markets with few large
companies having a truly global geographic reach. The world food industry is made up of many
types of firms that specialize in product and regional markets. Both local and global brands help
firms penetrate foreign markets and enter retailer channels, but products and brands are often
tailored to specific markets to compete with national firms. Large firms are better able to manage
brands with international appeal, giving them extensive geographical reach in sales such as Kraft
Foods, Nestlé, and Unilever. There is not a clear tendency for firms to continue to expand by
diversifying their product portfolios. Rather many firms specialize in core product categories.
This is what leads to more concentrated regional markets.
16
Wide differences in concentration levels can be found across countries even within the same
region. This is most evident in Western Europe and Asia Pacific. Aggregate sales concentration
is highest in Latin America, Australasia and lowest in Asia Pacific and Eastern Europe. High
concentration is observed where both national and transnational firms are present. There is
stronger tendency for firms, large and small, to focus on specific core categories. Brand
acquisition will likely be an important strategy for firms to enter new markets. In some cases
this can lead to a single-firm achieving a dominant position.
17
References
Connor, J.M., R. T. Rogers, B.W. Marion, and W.F. Mueller. (1985) The Food Manufacturing
Industries: Structure, Strategies, Performance and Policies. Lexington Massachusetts: D.C.
Health and Company.
Cotterill, W. Ronald (1999) “Continuing Concentration in Food Industries Globally: Strategic
Challenges to an Unstable Status Quo” Food Marketing Policy Center, Research Report No. 49,
University of Connecticut.
Cotterill, W. Ronald (2003) “Perspectives on Global Concentration and Public Policy” workshop
on Global Markets for High-Value Food, February 14 2003 at U.S. Department of Agriculture
Economic Research Service.
Grievink, Jan-Willem, Lia Josten, and Conny Valk (2002) State of the Art in Food: The
Changing Face of the Worldwide Food Industry, Elsevier Business Information.
Rogers, R.T, (2001) “Structural Change in the U.S. Food Manufacturing, 1958-1997”
Agribusiness, Vol. 17 (1)
Scherer, F.M. and D. Ross,(1990). “Industrial Market Structure and Economic Performance
(3rd ed.) Boston: Houghton Mifflin Company.
18
Table 1. Leading 50 food manufacturing firms in packaged food sales worldwide
Sales Rank Company name
Country origin
Firm sales in packaged food
percent
1
Nestle
Switzerland
51.7
2
Kraft Foods
USA
30.4
3
Unilever
UK/Netherlands
50.2
4
PepsiCo
USA
61.2
5
Danone
France
73.9
6
Mars
USA
50.4
7
Kellogg
USA
97.7
8
ConAgra Foods
USA
81.0
9
Heinz Co
USA
58.2
10
Campbell Soup
USA
90.4
11
General Mills
USA
87.1
12
Dean Foods
USA
100.0
13
Hershey Foods
USA
99.0
14
Parmalat
Italy
66.3
15
Cadbury Schweppes
UK
43.9
16
Ferrero SpA
Italy
100.0
17
Bimbo
Mexico
96.0
18
Meiji Dairies Corp
Japan
86.6
19
Morinaga Milk Industry
Japan
na
20
Sara Lee
USA
28.6
21
Yamazaki Baking Co
Japan
92.9
22
Lotte Group
South Korea
100.0
23
Wrigle Jr Co
USA
100.0
24
Arla Foods Amba
Denmark
94.2
25
Snow Brand Milk Products
Japan
90.0
26
Sodiaal SA
France
89.3
27
Pfizer Inc
USA
6.3
28
George Weston Ltd
Australia
na
29
Nissin Food Products Co
Japan
100.0
30
Barilla G. R Flli SpA
Italy
100.0
31
Interstate Bakeries Corp
USA
100.0
32
Procter & Gamble Co
USA
10.5
33
Bristol-Myers Squibb Co
USA
9.8
34
Lactalis, Groupe
France
85.5
35
Ezaki Glico Co Ltd
Japan
na
36
Fonterra Co-operative Group
New Zealand
40.1
37
Hormel Foods Corp
USA
79.3
38
United Biscuits (Holding) Plc.
Belgium
na
39
Ajinomoto Co Inc.
Japan
na
40
Bongrain SA
France
na
41
Abbott Laboratories Inc
USA
7.1
42
Perfetti Van Melle Group
Italy
100.0
43
Orkla Group
Norway
28.8
44
Morinaga & Co
Japan
na
45
Del Monte Foods Co
USA
78.6
46
Friesland Coberco Dairy Foods Netherlands
na
47
Tine Norske Meierier BA
Norway
na
48
Meiji Seika Kaisha Ltd
Japan
65.4
49
SanCor Cooperatives Unidas
Argentina
na
50
Ting Hsin International Group
China
na
Source: Euromonitor International
19
Table 2. Share of global sales in U.S. and Western Europe by product category
USA
Western Europe
Rest of World
percent of global sales
Bakery products
25
33
42
Dairy products
22
35
43
Chilled foods
14
29
57
Confectionery
25
34
42
Dried food
14
11
75
Frozen food
37
32
31
Canned food
28
24
48
Sauces, condiments
23
19
58
Snack foods
39
18
43
Oils and fats
10
28
62
Ice cream
29
29
41
Ready meals
40
33
27
Pet food
38
30
31
Noodles
8
2
90
Baby food
31
25
43
Pasta
16
37
47
Spreads
23
34
43
Soup
42
25
33
Meal replacement drinks
66
11
22
Packaged Food
24
29
47
Source: Euromonitor International, product categories are defined by Euromonitor
consistently across all regions
20
Table 3. Examples of important brands in core product categories for selected companies
Nestlé
Unilever
ConAgra
Baby food
Carnation
Oils and fats
Rama
Oils and fats
Nan
Mazola
Lactogen
Flora
Cerelac
I Can't Believe Its Not Butter!
Alete
Bertolli
Nido
Becel
Nestogen
Country Crock
Confectionery KitKat
Smarties
After Eight
Butterfinger
Crunch
Soups
Ice cream
Haagen-Dazs Ice cream
Nestle
Frigor
Drumstick
Ice Screamers
Camy
Ready meals
Stouffers
Maggi
Buitononi
Tivaul
La Cocinera
Wesson
Parkay
Pam
Fleishchmann's
Knorr
Lipton
Unox
Findus
Contenental
Spreads
Peter Pan
Knotts Berry Farm
Magnum
Breyer's
Algida
Cornetto
Ben and Jerry's
Klondike
Snacks
Orville Redenbacker's
Slim Jim
Pennican
Crunch 'n' Munch
Super Slim
Act II
Ready meals
Healthy Choice
Chef Boyardee
Banquet
Marie Callender's
Libby's
Replacement drinks Slim fast
Slim fit
Source: Euromonitor International
21
Table 4. Firm aggregate sales share in packaged food in regions and world
W.Europe
Nestlé
4
Kraft Foods
1.5
Unilever
4.3
PepsiCo
0.6
Danone
2.4
Mars
1.4
Kellogg
0.5
ConAgra Foods
0
Heinz
0.8
Campbell Soup
0.3
General Mills
0.1
Dean Foods
Hershey Foods
Parmalat
0.4
Cadbury Schweppes
1
Ferrero SpA
1.2
Bimbo
Meiji Dairies Corp
Morinaga Milk Industry
Sara Lee
Yamazaki Baking Co
Lotte Group
Wrigle Jr Co
0.4
Arla Foods Amba
1.1
Snow Brand Milk Products
Sodiaal SA
0.5
Pfizer Inc
0.1
George Weston Ltd
Nissin Food Products Co
Barilla G. R Flli SpA
0.7
Interstate Bakeries Corp
Procter & Gamble Co
0.2
Bristol-Myers Squibb Co
Lactalis, Groupe
0.6
Ezaki Glico Co Ltd
Fonterra Co-operative Group
0.1
Hormel Foods Corp
United Biscuits (Holding) Plc.
0.6
Ajinomoto Co Inc.
Bongrain SA
0.4
Abbott Laboratories Inc
Perfetti Van Melle Group
0.3
Orkla Group
0.5
Morinaga & Co
Del Monte Foods Co
0.2
Friesland Coberco Dairy Foods
Tine Norske Meierier BA
0.5
Meiji Seika Kaisha Ltd
SanCor Cooperatives Unidas
Ting Hsin International Group
Top 50 firm total
24.7
Source: Euromonitor International
E.Europe
2.3
1
1.4
0.3
1.3
0.7
0
0
0.3
N. America
sales share (%)
2.3
7.8
2.7
4.6
0.4
2
2.2
3
1.5
2.1
2.3
2.5
2.2
0.4
0.2
Latin America
Asia Pacific
World
6.3
2.4
3.6
4.3
2.8
1.3
0.6
0.9
0.2
0.4
0.2
3.2
3
2.7
1.9
1.4
1.1
0.9
0.8
0.8
0.7
0.7
0.6
0.6
0.6
0.6
0.5
0.4
0.4
0.4
0.4
0.3
0.3
0.3
0.3
0.3
0.3
0.3
0.3
0.3
0.3
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.1
0.1
0.1
0.1
28.3
0.8
0.3
0.1
0.2
0.2
0.2
0.2
2.8
0.2
0.2
0.3
3.4
1.8
1.7
1.1
0.4
0.1
1.5
1.5
0.2
0.4
0.5
0.4
0.4
0.5
1.2
0.1
0.2
0.1
1
0.1
0.1
0.1
0.1
0.7
0.9
0.1
1.7
1.1
1
0.5
0.7
0.2
0.7
0.8
0.4
0.3
0.6
0.2
0.2
0.7
0.5
0.2
0.3
0.2
0.7
1.4
11.1
22
41.9
32.8
0.6
17.8
Table 5. Leading four firms in packaged food sales by individual country
Country
Firm 1
Firm 2
Firm 3
Argentina
Danone
SanCor Cooperative Nestle
Australia
Nestlé
Goodman Fielder
Cadbury Schweppes
Austria
Unilever
Benalandmilch
Kraft Foods
Belgium
Danone
Unilever
Nestle
Brazil
Nestlé
Unilever
Pamalat
Bulgaria
Obedinena
Kraft Foods
Boni Oborot
Canada
Kraft Foods
Saputo
Maple Leaf Foods
Chile
Nestlé
Soprole
Unilever
China
Ting Hsin
Uni-President
Long Fong
Colombia
Alpina
Nestle
Parmalat
Czech Republic
Nestlé
Hame
Danone
Denmark
Arla Foods Amba
Danish Crown Amba Unilever
Egypt
Nestlé
Cadbury Scheppes
Salvala
Finland
Valio Oy
Fazer Oy
Ingman Foods
France
Danone
Nestlé
Lactilis
Germany
Unilever
Nestle
Ferrero
Greece
Philippou
Chipita
Unilever
Hong Kong
Nestlé
Garden
Golden Resources
Hungary
Pick Szeged
Unilever
Friesland Coberco
India
Gujarat Cooperative
Unilever
Danone
Indonesia
Indofood Sukes
Nestlé
Unilever
Ireland
Unilever
Glanbia
Cadbury Schweppes
Israel
Tnuva Central Co-op Nestlé
Vadash
Italy
Barilla
Unilever
Nestlé
Japan
Meiji Dairies
Morinaga
Yamazki Baking
Malaysia
Nestlé
Friesland Coberco
Jasmine Food
Mexico
PepsiCo
Bimbo
Nestlé
Morocco
Centrale Laitier
Montedison
Indusalim
Netherlands
Unilever
Campina Mekunia
Friesland Coberco
New Zealand
Fonterra
Goodman Fielder
Heinz
Norway
Tine Norske Meirerier Orkla
Kraft Foods
Phippines
Nestlé
San Miquel
JG Summit
Poland
Unilever
Danone
Nestle
Portugal
Unilever
Nestle
Fonterra
Romania
Napolact
Topway
Prodlacta
Russia
Cherkizovo
Nestlé
Wimm Bill Dann
Saudi Arabia
Nestlé
Al Marai
Danone
Singapore
QAF
Nestle
Faser Neavel
Slovakia
Nom Ag
Henkel
Nestlé
South Africa
Tiger Brands
Unilever
Nestlé
South Korea
Lotte
Nong Shim
Namyang Dairy
Spain
Danone
Nestlé
Sos Arana
Sweden
Arla Foods Amba
Orkla
Unilever
Switzerland
Migros
Nestle
Unilever
Taiwan
Uni-President
Wei Chuan Foods
I-Mei Foods
Thailand
Nestle
Saha Pathana
Friesland Coberco
Turkey
Ulker Gida
Unilever
Nestle
Ukraine
Shepetovsky
Cherkasskaya
Keivsky
United Kingdom
Unilever
Cadbury Scheppes
Mars
USA
Kraft Foods
PepsiCo
ConAgra
Venezuela
Empresas Polar
Cargil
Parmalat
Vietnam
Haihaco
Kinh Do23
Generics
Source: Euromonitor International, with abbreviated company names
Firm 4
Ancor
Campbell Soup
Ferrero
Kraft Foods
Danone
Nestlé
Parmalat
Empresas Carozzi
Hai Pa Wang
Productos Naturales
Unilever
Toms Fabrikker
Hayed Saeed
Unilever
Unilever
Kraft Foods
Friesland Coberco
Nissen
Parmalat
GlaxoSmithKline
Friesland Coberco
Kerry
Strauss-Elite
Ferrero
Snow Brand Milk
Yep Hiap Seng
Ganaderos
Margarinerie
United Biscuits
Danone
Nestlé
Unilever
Cadbury Schweppes
Nutrinvest
Kraft Foods
Babayevsky
Abdul-Kadir
Kraft Foods
Kraft Foods
Danone
Cheil Jedang
Unilever
Spira AB
Chocoladefabriken
Kraft Foods
Unilever
Eti Gida
Kamenents
Nestlé
Dean Foods
Kraft Foods
Vietnam Dairy
Table 6. Four-firm concentration ratio in aggregate packaged food sales of individual countries
Country
Region
Four-firm concentration (CR4)
Israel
Africa and Middle East
43.4
South Africa
Africa and Middle East
33.2
Morocco
Africa and Middle East
31
Saudi Arabia
Africa and Middle East
20.1
Egypt
Africa and Middle East
9.4
Phippines
Asia Pacific
27.7
Malaysia
Asia Pacific
26.9
Indonesia
Asia Pacific
25.2
Hong Kong
Asia Pacific
23.3
South Korea
Asia Pacific
21.5
Thailand
Asia Pacific
19.8
Singapore
Asia Pacific
17.6
India
Asia Pacific
17.2
Taiwan
Asia Pacific
15.1
Vietnam
Asia Pacific
13.7
China
Asia Pacific
10.1
Japan
Asia Pacific
10.1
New Zealand
Australasia
44.1
Australia
Australasia
21.7
Hungary
Eastern Europe
20.1
Czech Republic
Eastern Europe
19.8
Slovakia
Eastern Europe
16.5
Ukraine
Eastern Europe
15.9
Poland
Eastern Europe
12.1
Bulgaria
Eastern Europe
11.2
Romania
Eastern Europe
7.2
Russia
Eastern Europe
5.4
Venezuela
Latin America
35
Argentina
Latin America
31.6
Chile
Latin America
29.9
Colombia
Latin America
28.1
Mexico
Latin America
26.3
Brazil
Latin America
18.5
Canada
North America
19.1
USA
North America
18.5
Norway
Western Europe
39.8
Finland
Western Europe
37.1
Portugal
Western Europe
33.5
Ireland
Western Europe
29.3
Denmark
Western Europe
27.3
Sweden
Western Europe
27.3
Austria
Western Europe
18.7
France
Western Europe
18.7
Switzerland
Western Europe
17.8
Belgium
Western Europe
17.6
Spain
Western Europe
16.7
Greece
Western Europe
16.3
United Kingdom
Western Europe
16.3
Netherlands
Western Europe
16
Turkey
Western Europe
15.5
Germany
Western Europe
13.7
Italy
Western Europe
11.8
Source: Euromonitor International
24
Table 7. Global sales share of top 5 food companies by product category
Nestlé
Kraft
Unilever PepsiCo
sales share (%)
Confectionery
9.0
5.6
Bakery Products
0.5
3.0
1.0
1.2
Ice cream
8.9
0.1
19.3
Dairy Products
4.4
3.7
0.3
Savory Snacks
0.1
3.0
32.4
Snack bars
3.1
4.0
5.7
9.9
Meal replacement drinks
0.2
38.7
Ready meals
9.7
5.7
3.0
0.2
Soup
6.9
0.2
17.3
Pasta
4.6
3.1
0.1
0.4
Noodles
1.3
0.4
1.3
Canned food
0.7
0.6
1.1
0.4
Frozen food
6.1
2.6
4.2
Dried food
2.3
3.2
3.3
0.2
Chilled food
0.9
2.6
0.2
Oils and fats
0.3
0.4
13.4
Sauces, dressings, condiments
3.0
4.3
10.7
0.8
Baby food
16.9
0.2
0.2
0.1
Spreads
0.6
2.2
7.1
Dog and cat food
25.7
0.5
Source: Euromonitor International
25
Danone
Mars
9.4
1.7
0.2
4.8
0.3
1.3
1.9
0.3
1.7
0.8
0.4
0.8
0.6
0.7
2.6
0.2
0.7
0.4
24.0
Table 8. Firm sales share at regional, country, and product levels: The case of Nestlé
Global
Market share %
Packaged Food
(3.2 %)
Region
Market share %
W. Europe
(4.0)
E. Europe
(2.3)
N. America
(2.3)
Latin America
(6.3)
Asia Pacific
(1.3)
Africa and Middle East
(5.8)
Global
Product category
Market share %
Confectionery
(9.0)
Soup
(17.3)
Pet food
(25.7)
Baby Food
(13.0)
Dairy Products
(4.4)
Bakery Products
(0.5)
Region
Product category
Market share %
W.Europe
Confectionery
(12.5)
E. Europe
Soup
(25.7)
N. America
Pet food
(30.7)
Latin America
Baby Food
(60.7)
Asia Pacific
Dairy Products
(5.2)
Africa and Middle East
Bakery Products
(1.5)
Country
Product category
Market share %
U.K
Confectionery
(20.2)
Slovakia
Soup
(52.5)
USA
Pet Food
(31.0)
Brazil
Baby food
(82.4)
Philippines
Dairy Products
(37.2)
Israel
Bakery Products
(8.0)
Russia
Dehydrated soup
(58.9)
USA
Cat Food
(40.0)
Brazil
Milk formula
(91.2)
Philippines
Milk
(48.3)
Israel
Biscuits
(42.4)
Country
U.K.
subproduct category
Chocolate
Market share %
(24.6)
Source: Euromonitor International
26
Table 9. Firm sales share at regional, country, and product levels: The case of Unilever
Global
Market share %
Packaged Food
(2.7)
Regional
Market share %
W. Europe
(4.2)
E. Europe
(1.4)
Global
Product category
Market share %
Ice cream
(19.3)
Soup
(32.9)
Region
Product category
Market share %
W.Europe
Ice cream
(30.5)
Country
Product category
Market share %
Austria
Ice cream
(59.6)
Country
Austria
Product
Ice cream
Subproduct
Impulse
Market share %
(81.2)
Source: Euromonitor International
N America
(2.7)
Latin America
(3.6)
Asia Pacific
(0.9)
Africa and Middle East
(3.0)
Replacement drinks Sauces and Condiments
(38.7)
(10.7)
Oils and Fats
(13.4)
Spreads
(7.1)
E. Europe
Soup
(25.7)
N. America
Latin America
Replacement drinks Sauces and Condiments
(49.9)
(32.6)
Asia Pacific
Oils and Fats
(4.4)
Africa and Middle East
Spreads
(22.0)
Poland
Soup
(38.4)
USA
Argentina
Replacement drinks Sauces and Condiments
(50.1)
(43.0)
Indonesia
Oils and Fats
(37.2)
South Africa
Spreads
(46.6)
Poland
Soup
Instant
(76.5)
USA
Argentina
Replacement drinks Sauces and Condiments
Slimming drinks
Ketchup
(79.1)
(76.8)
Indonesia
Oils and Fats
Spreadables
(83.9)
South Africa
Spreads
Yeast-based spreads
(94.9)
Table 10. Four-Firm Concentration (CR4) by product category and region
Pet food
Soups
Breakfast Cereal
CR4
Western Europe
67.9
64
61.7
Eastern Europe
79.4
65.8
41.8
North America
62.7
73.3
78.3
Latin America
63.4
87.5
90.6
Asia Pacific
49.9
56.1
73.9
Australasia
75.1
88.5
89
Africa Middle East
60.3
88.1
60.8
Source: Euromonitor International
27
Baby food
Confectionery
Cheese
65.6
46.2
89.8
75.9
38.7
93
67.5
38.4
33.4
51.2
42.2
26
79.1
36.4
14.4
21.2
41.6
17.7
50.9
56.6
30.9