The market for non-sweet snack foods includes a wide range of products: nuts; seeds; dried fruit; fruit and nut mixes; potato chips; corn chips; extruded snacks; crackers; salted rusks and biscuits; snacks from dried fish, seafood and meat; and many others.
Despite the popularity of snacks having arrived from the Western market, the Russian market is characterized by its own national preferences and authenticity. These features manifest themselves in snacks being bought not only to actually snack on, but also to accompany beer. Active development of the beer market in Russia contributed to development of such segments as rye rusks and seafood snacks.
All in all, the market for non-sweet snacks is fairly consolidated and shared among market participants. It is possible that new small local market players will emerge, although no serious changes in the larger picture are expected in the near future.
One of the important characteristics of the Russian market for non-sweet snack foods today is the share of domestic production being dominant. A retrospective analysis of the period from 2011 to 2017 reveals that the volumes of imported supplies were declining. The drop was particularly rapid in 2014–2016.
The largest share in the market for non-sweet snacks is occupied by potato chips, namely 57% in monetary terms. The category of salted snacks is second in popularity – its share amounted to 24% in 2017. Salted snacks include the following salted goods: rusks, bread crisps, dried seafood and meat, extruded foods, pretzel sticks, corn flour chips, popcorn, and others. The share of natural snacks (nuts, dried fruits, and seeds) equals 10%. Under the influence of the healthy lifestyle propaganda, a number of consumers have been switching from sweets to nuts and dried fruit. The nuts most popular in Russia are peanuts and pistachios. Salted crackers rank last in the list of snack groups and occupy the share of 9%.
According to the Russian Federal State Statistics Service (Rosstat), in 2017, the total volume of non-sweet snack production in the Russian Federation increased by 4.4% in physical terms compared with the similar indicator for the previous year and equaled 303.3 thousand tonnes. The overall structure of production demonstrates the prevalence of potato snacks, the share of which amounted to around 43% in 2017.
In 2017, the total volume of non-sweet snack imports in physical terms increased by 25.9% compared with the similar indicator for the previous year, amounting to 93.7 thousand tonnes. In the structure of snack import volumes in physical terms, the leaders were categories such as dried fruit, including mixes with nuts added (28.5%), as well as extruded foods, spicy or salted (24.9%).
In 2017, the volume of the market for non-sweet snacks in Russia grew by 0.2% and reached 240 trillion rubles. It should be noted that the Russian snack market is approaching the state of stagnation. By 2020, retail sales of snack products in Russia may reach the value of 259 billion rubles. Annual growth rates are expected to be at 2–3%.
RETAIL SALES CHANNELS
Most snacks are distributed through food network retail, which includes hypermarket, supermarket and convenience store chains. The share of said sales channel equals 52%, and it grows every year. It is worth highlighting that development of retail trade affects growth in sales of goods packaged under private labels.
Non-centralized trade accounts for around 38% of snack sales in physical terms. This sales channel includes kiosks, markets, street vendors and other such formats. The share of this channel has been undergoing a stable decline.
The share of non-sweet snack sales at independent stores amounts to 10% and has been demonstrating a decrease year to year as well. Having a wide choice, consumers have been increasingly opting for supermarket and hypermarket chains.
A fairly new category has been developing in the market – namely non-store retailing. This channel implies Internet commerce, vending machines and direct sales. The segment of vending machines has been most active in development – these offer packaged nuts, chips and other snacks.
All segments of the non-sweet snack market are represented by both Russian and foreign manufacturers. The leading players include major foreign companies such as “Kraft Foods Inc.” and “PepsiCo”. Among domestic companies, the leaders in the market for packaged snacks as a whole are “KDV Group” LLC (Tomsk), “Moskovskaya Orekhovaya Kompaniya (Moscow Nut Company)” LLC (Moscow region), and “Good Food” Group (Moscow).
In the segment of chips, the leaders are “Lay’s” and “Cheetos” (“Frito Lay Manufacturing” LLC, “PepsiCo”), “Estrella” (“Кraft Foods Inc.”), and the Russian “Super Chipsy (Super Chips)”, “Nash Kartofel (Our Potatoes)” and “Russkaya Kartoshka (Russian Potato)” (“Russkart” LLC, Moscow region).
“Кraft Foods Inc.” does not have local production established in Russia and imports goods from its facilities in Ukraine and the Baltic states.
“KVD Group” is the leader in the market for rusks: in 2008–2009, the company combined the assets of “Bridgetown Foods” CJSC and “Sibirsky Bereg (Siberian Coast) International” OJSC with the well-known brands “3 Korochki (3 Crusts)”, “Kirieshki”, and “Kompashki”.
Producers of meat snacks include such companies as “Intersnack Foods” LLC (Moscow, “Smeat” trademark), “Fresh and Snack Company” LLC (Moscow region, “Grizzon” trademark), “Karat (Carat)” LLC (Leningrad region, “Big Energy”, “Rancho Myassuri (Meat-ssouri Ranch)” trademarks) and others.
Dried meat snacks in Russia are mainly produced by regional companies selling their goods locally within the home region. Competing with major meat processing plants, which also have snack products in their range, and large manufacturers of other snack foods (chips and rusks) at the federal level is problematic to them.
Just like meat snacks, seafood snacks are largely produced by local manufacturers. Said segment has several dozen regional companies which activate production during the warm months of the year, which correspond with the sales season.
A number of major players offer seafood snacks among their range – for instance, “Barentsev” and “BEERka (Label)” trademarks by “KDV Group”.
The leaders among nut and dried fruit manufacturers are “Good-Food” LLC, “Natur-Foods” LLC (Moscow), “Nutsi” LLC (Novosibirsk), “Maag” LLC (Saint Petersburg), and “Moskovskaya Orekhovaya Kompaniya (Moscow Nut Company)”. Said companies control around half of the market for nuts and dried fruit in Russia.
More than 40% of dried fruit and nut sales fall on private labels. The leaders in sales of private label nuts are “Magnit”, “X5 Retail Group”, “Auchan”, and “Metro Cash & Carry”.
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