Australia's increasing appetite for guilt-free snacks

Consumption of snack foods is increasing as Australians navigate increasingly busy lifestyles, leaving less time to prepare and eat home-made meals. IBISWorld forecasts that Australia’s snack food manufacturing and health snack food production industries will generate combined revenue of over $3.0 billion in 2015–16.

While the greatest overall revenue is still generated by traditional snack food manufacturing, the health snack food production industry has grown at a faster pace over the past five years, increasing by an annualised average of 3.0%, compared with 1.4% growth achieved by traditional snack foods.

IBISWorld senior industry analyst Ryan Lin said that snack food options have expanded beyond traditional snacks — such as potato chips and biscuits made with standard white flour — over the past five years, and health snack foods are expected to make up a greater share of consumer snacking habits in the future.

“However, there has also been a tangible shift towards premium snack foods, such as gourmet-flavoured chips, alongside those perceived to be healthier options or that respond to specific dietary requirements — such as low fat, low salt, low sugar, organic, gluten-free, dairy-free, vegan and so forth,” said Lin.

While potato chips remain the most popular form of snack food, increasing consumer demand for healthier options is expected to drive growth and deliver both challenges and opportunities for industry players. Health snack products include dried fruits and nuts, which account for 42.8% of industry revenue, muesli bars (29.1%), protein bars (17.4%) and other items such as fruit and vegetable bars (10.7%).

IBISWorld believes key sectors impacted by the trend to premium and health snacks will be biscuit manufacturing, potato chip production, cake and pastry manufacturing and chocolate and confectionery manufacturing. These sectors can pursue growth through product innovation, provided healthy substitutes can be sourced.

Source: IBISWorld.