Major manufacturers in the confectionery market. PH "Sphere": What is the situation with prices on the market? Prices for which of the confectionery rose in price more than others? Confectionery Market: Development Forecast
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Overview of the Russian confectionery market
Research Information Agency "Credinform"
VOLUME OF INTERNAL PRODUCTION
The Russian confectionery market is one of the largest global markets. It presents a large number of products of famous brands. To increase profitability, key foreign manufacturers are building or acquiring production facilities in the Russian Federation. The rich history and culinary traditions are abundant in domestic companies as well.
At the end of 2016, 3569 thousand tons of various confectionery products were manufactured in Russia, which is 2.1% more than in 2015 (Fig. 1 ) . And if you compare last year's figure with the level of 2010, then the increase in domestic production will be 23.5%.
For the last 3 years, the production of confectionery products has increased at a not so significant pace as it was until 2014, which is explained by the general decline in consumer demand caused by a drop in real disposable incomes of the population, rising prices for key raw materials - cocoa beans. It should be noted that at the end of 2016 the decline in prices for cocoa beans began. However, as a rule, companies create inventories, especially for raw materials that can be stored in warehouses for a long time. Most likely, domestic companies were purchased at prices that were significantly higher today.
MARKET STRUCTURE
The confectionery market is divided into 2 large groups (segments):
* sugary - berries, caramel, dragee, chocolate, and products based on cocoa powder, candy, toffee, halva and oriental sweets such as caramel and candy;
* flour - cookies, gingerbread, waffles, muffins, rum women, rolls, floury oriental sweets, cakes, pastries. In turn, the category of flour confectionery products can be divided into products of long-term and non-durable storage. In the first case, many preservatives and substitutes are used for its manufacture.
Cocoa and chocolate confectionery form 49.4% of the market in real terms (Fig. 2 ) . Sweet cookies and gingerbread, waffles, cakes for long-term storage form a share of 40.5%. Cakes, pastries and other flour confectionery products of non-durable storage account for the remaining share of the domestic market, equal to 10%.
PRODUCTION DYNAMICS BY MAIN SEGMENTS
The production of chocolate-based confectionery reached its historical peak in the modern history of Russia in 2014 - 1,759 thousand tons (Fig. 3 ) . In 2015, there was a slight decrease in the indicator, and at the end of 2016 there was a slight increase.
The reason is quite obvious: the devaluation of the ruble at the same time the rise in prices for primary raw materials - cocoa beans, increased the costs of companies, there was a rise in prices, there was a decrease in demand, which ultimately resulted in the stagnation of the chocolate industry.
Flour confectionery products of long-term storage, on the contrary, demonstrate steady positive dynamics of production indicators. If we compare the results of last year (1,436,000 tons) with the level of 2010, the increase will be 30.9%.
The demand for confectionery products of non-durable storage (cakes, pastries) is kept at a stable level. The production of sweets in this category in 2016 slightly exceeded 356 thousand tons.
FOREIGN TRADE VOLUME
After analyzing the foreign trade turnover, it can be stated with confidence that Russian confectioners almost completely satisfy domestic demand, and also successfully deliver their products to other countries. With the exception of cocoa beans, domestic suppliers can offer all the primary raw materials for the production of sweets.
In 2016, the volume of imports of confectionery products amounted to 162 thousand tons, and 339 thousand tons were exported, with the volume of domestic production of 3569 thousand tons (Fig. 4 ) . Thus, in real terms, the share of imports in Russian stores does not exceed 5% with a total market volume of 3,392 thousand tons. Based on these data, it can be established that the consumption of sweets in Russia per capita is 23.1 kilograms per year.
The main foreign trade partners in the import of confectionery products to Russia are the EU countries, first of all - Germany, Italy and Poland. Also in the Top 5 importers include partners in the EAEU - Belarus and Kazakhstan. Together, these countries account for 60% of all shipments. (tab. 1 ) .
Ukraine lost the Russian market almost completely: if in 2013 the share of products from this country reached 33%, then in 2016 it decreased to a modest 1.6%. In total, in 2016, confectionery products were imported to Russia from 79 countries of the world.
Despite all the difficulties, the export of sweets from Russia remains fairly stable - in 2016 it amounted to 339 thousand tons, and the fall in purchase prices (due to the devaluation of the ruble) for foreign contractors made domestic products more competitive in foreign markets.
Russia's main export partners are the EAEU member states: Kazakhstan (26.3% of deliveries in physical terms), Belarus (13.8%), and China (10.4%). Together, these 3 countries account for 50.5% of total domestic exports. (tab. 2 ) .
The share of EU countries in total exports of Russian confectionery products remains insignificant - about 4% in physical terms. The total export of Russian products in 2016 was carried out in 78 countries of the world, up to such exotic states as, for example, Somalia, Algeria, Tunisia, Chile and others.
PRICES
Considering the average retail prices that were established for the main types of confectionery products in the whole country, we can trace a certain stabilization of the situation, especially after a surge in inflation in 2015–2016. The exception is chocolate, the value of which continues to grow, but not so fast. The reason lies in the adverse world prices for cocoa beans, and the domestic producer is completely dependent on this raw material.
In June 2017, a kilogram of chocolate in Russia cost an average of 836 rubles (Fig. 5 ) . Chocolates were sold at 591 rubles per kilogram, cakes - at 431 rubles each, and gingerbread - at 127 rubles each.
A limiting factor in further price growth is the decline in the purchasing power of the population.
MANUFACTURERS
According to the GLOBAS ® information and analytical system of the Credinform Information Agency, among the confectionery manufacturers can be identified Top 10 companies operating on the Russian market, the most successful in terms of annual revenue from sales. The key players here are: Nestle Russia LLC, Mars LLC and Mondelis Rus LLC (tab. 3 ) . Three leaders firmly hold their positions on the Russian confectionery market on an industrial scale. Companies organized their own production in the country and produce products under all well-known and recognizable global brands.
We should also mention Fazer LLC, which shows a significant decrease in annual revenue due to the high import content of the main food ingredients, which led to a significant increase in costs. Thus, in today's economic conditions, those players who did not manage to localize production as closely as possible and organize supply chains directly in Russia noticeably lose.
Almost all Russians in one form or another indulge themselves with all sorts of sweets. Today, there is a transformation of the confectionery market: the Ukrainian manufacturer has completely left, the supply of imported products from other countries has been significantly reduced. The devaluation of the ruble gives an excellent chance to domestic companies both to aim at expanding their presence in nearby countries and to open up new directions for the sale of products, which are almost as good as European ones.
Anton Scherbakov,
expert of the news agency "Credinform"
The confectionery segment in Russia is at the stage of saturation. To increase the demand, enterprises update production, give the product a corporate style, create products of new types. Today, there is a tendency to increase the complexity of the products, as flour confectionery products, on the one hand, are practically everyday goods, and at the same time, products for pleasure. Increasingly, there is a "specialized" products, such as lean products and sweets from various cuisines of the world, which have steadily occupied their niche in the Russian market.
The most popular type of flour products is cookies. On average, Russia consumes about 4.5 kilograms of this product per person, that is, in our country only 645,750 tons of cookies are eaten per year, and almost half of this amount is accounted for by residents of major cities.
The share of cookies in this segment is estimated by a number of experts and researchers in different ways and varies from 30 to 60%. The question is which categories should be included in the flour confectionery category when assessing the market, and which regions are in question. If we talk about the largest cities of Russia and the most popular types of flour confectionery in them, then cookies look like the most attractive segment - it occupies 60% of the market volume among such competitive groups as gingerbread, which occupy 16% of the market, cakes and pastries 8% , muffins and biscuits 7%, and waffle cakes only 4% of the market. Figure 1 shows the structure of the flour confectionery market in 2013 in kind.
Pic.1
As can be seen from table 6, oatmeal and sugar cookies are the most demanded in the flour confectionery market - they account for 18.6 and 18.3% of the total consumption, respectively.
Domestic manufacturers dominate the Russian confectionery market. However, the share of foreign products is gradually increasing: in 2012 it amounted to 12.3%.
Table 6
Distribution of market shares by types of cookies,% of average consumption
|
Types of cookies |
Market share by consumption,% |
Market share of packaged products by consumption,% |
Market share of weighted products for consumption,% |
|
Sugar |
|||
|
Cottage cheese |
|||
|
Butter with Filling |
|||
|
Other butter |
|||
|
Dry type "Maria" |
|||
|
Multilayer |
|||
The structure of imported flour confectionery products is traditionally the largest share is butter cookies. This category includes gingerbread, biscuit biscuits, sandwiches and chocolate chip cookies. In the first half of 2013, the share of imports of sweet butter biscuits amounted to 37.3% of the total supply of flour confectionery in physical terms (Fig. 2).
Fig. 2
For comparison, the volume of imports of protracted cookies (crackers, biscuits) was only 4.5%. In second place in terms of supply are cakes and desserts - these sweets account for 22.8% of total imports. It should be noted that about 8% of imported pastries and desserts are frozen products. The top three leaders are waffles (including wafer wafers and wafer cakes), whose import share is 12.9%. The category “other” includes cakes, cakes, rolls, muffins, buns, donuts, gingerbread, ready-to-cook foods, ready-made breakfasts, crackers, dryers, tartlets and some other types of flour confectionery.
More than 38% of flour confectionery products, which entered the territory of our country in the first half of 2013, were produced at the enterprises of Ukraine, which is traditionally the largest supplier of these products to Russia (Fig. 3).
Fig. 3
Germany accounts for 16% of imports in monetary terms, followed by Italy with a share of imports of 15%, followed by Poland, the Netherlands, the Republic of Korea and France - their shares ranged from 7 to 2% of total imports. The remaining 18% share is distributed among 43 countries.
On the Russian side, the regional structure of the import of flour confectionery products is represented by 46 regions. The leader in terms of purchases is the Vladimir region, whose market share is 28% in terms of value, or 10.9 thousand tons for a sum of $ 44.2 million (Fig. 4).
Fig. four
The leadership of the region is due to the fact that two large importers are located on its territory: Ferrero Russia, which ranks first among Russian importing companies, and Mondelis Rus, which is the third largest. The fourth part of the market (9.6 thousand tons in the amount of $ 38.4 million) is occupied by Moscow - the capital region holds the second place in terms of the volume of direct imports. The Kursk region with a 12% share (9.2 thousand tons in the amount of $ 18 million) also entered the top three of the main regions-importers of flour confectionery due to the company Conti-Rus, located in the region - the company ranks second among importing companies .
It is worth noting that in the first half of 2013, purchases were made by 529 organizations. Nevertheless, six companies occupied 51% of the market (Fig. 5).
Fig. five
Russian waffles and waffle cakes enjoyed the greatest demand among foreign companies, whose share in the sales structure was 40.3% (Fig. 6).
Fig. 6
In second place in terms of sales was sweet butter cookies - the share of this type of confectionery accounted for 32.8%. Rolls and other pastries occupy 22.9%.
Ukraine, a leader in the delivery of flour confectionery products to Russia, occupies a leading position in the procurement of these products - it owns 20% of exports (Fig. 7).
Fig. 7
In the second and third place are Azerbaijan and Brazil, with shares of respectively 17 and 16%. The same shares are occupied by Mongolia and Kyrgyzstan - these countries each own 8%. Tajikistan and Georgia account for respectively 6 and 4% of exports.
A detailed examination of the structure of exports of sweet cookies can be noted that half of the supply is made of cookies coated with chocolate icing or containing cocoa. In the second place in the structure of exports of sweet cookies - sugar cookies, whose share is 42.4%. The main supplies of this cookie are sent to neighboring countries - Kyrgyzstan, Azerbaijan, Tajikistan and Georgia. Sandwich cookies and butter biscuits share the third place in the export structure - they account for 3.5% and 3.2% respectively. The main producer of pastry sandwiches is Conti-Rus, and more than 40% butter biscuits are produced by Orkla Brands Russia.
In total, in the first half of 2013, 276 Russian enterprises were engaged in the export of flour confectionery products. The leader’s share, Nestle Russia LLC (Samara region), accounts for 25% of the exported products.
During the period under review, this company sold 3.7 thousand tons of KitKat wafers worth $ 16.3 million. The second place among exporting enterprises was taken by Mars LLC (Moscow region) with a share of 9%. This was due to the fact that sales of Twix cookies amounted to $ 5.8 million. The top three exporters are the leaders of LLC Chipita St. Petersburg, which owns 6% of supplies worth $ 3.6 million. The products of this company are recognizable by TM 7 -Days. (Fig. 8).
Fig. eight
Summing up, it can be noted that in recent years there has been a tendency towards an increase in the volumes of imports and exports of flour confectionery products, the structure of imports and exports is changing, new players are emerging. By 2015, in terms of the prospects for joining the WTO, the duty rate on imported flour confectionery products will be reduced from 15 to 10%. It is expected that there will be more goods and prices will decrease. In terms of exports, positive changes are also possible. Russian manufacturers will increase supply, improve quality and sell more products abroad.
A cookie segment can be divided into two groups, which are very different both in price and in structure - these are weighed and packaged cookies. In fact, these are two different markets. The main difference between these two groups from each other is the difference in price (weighted cookies are much cheaper) and the absence of a unified Russian leader offering their products throughout Russia in the weighted biscuit segment. In each region, the largest part of the market is occupied by local producers. In Russia as a whole, sales of weighted biscuits are larger than packaged ones, and constitute, according to expert estimates, about 60% of the total. The main advantages of unpacked biscuits: affordable retail price, the possibility of any weight when buying, the ability to clearly see the quality and freshness of the product. This product does not require special advertising.
With packaged cookies, the situation is somewhat different. The success of small bakeries in local markets is due to greater flexibility in production capacity and the ability to meet the rapidly changing needs of consumers. In recent years, there has been an increase in the share of packaged cookies and a decrease in the share of weighed. The reason for this is the increasing role of modern retail, namely, self-service supermarkets.
Packaging for cookies can be very different - both cardboard and film, and even quite expensive tin, are used in the course. When creating their own packaging, which would allow to highlight the product on the market and attract the attention of consumers to it, manufacturers conduct marketing research and test - polls of focus groups. On the one hand, Russian consumers, in their own words, are attracted by bright, stylish, original packaging. On the other hand, everyone remembers very well Soviet times, when placer biscuits had high taste qualities and it was immediately possible to accurately assess its freshness and preservation.
That is why many manufacturers produce packaged biscuits in a transparent film - the bright logo of the company becomes the only focus on such packaging. But such a cookie should really attract attention and be original in itself.
The packaged biscuit market is more concentrated compared to the weight of biscuits - ten manufacturers account for up to 70% of total sales, and it is in this category of cookies that there is increased competition among manufacturers. In the packaged biscuit segment, the importance of the brand, the structuring of the price offer comes to the fore. Traditionally, products of the lower price segment are leading in the biscuit market - mainly due to the volume of sales in capacious regional markets. However, analysts say that the niches of the middle and lower price segments in the cookie market are approaching their saturation.
The segment of expensive cookies, the segment of “healthy foods” enriched with vitamins, low-calorie foods, etc. grows. The production of complex types of cookies is increasing. All this is accompanied by the introduction of memorable brands to the market and the offering of product concepts. Such producers' reactions are caused by a change in the culture of consumption of confectionery products in general - consumer demand is gradually being restructured towards higher-quality products that are aesthetically designed and functional.
The price factor in packaged cookies is less significant, since packaged cookies are targeted to more affluent segments of the population compared to the weighted ones, the consumer is willing to pay extra money for the brand.
The distribution of sales between varieties of cookies depends on the region, on the size of the city and its remoteness from the federal center. Usually in big cities consumers have more choice and they prefer something “original”. But mostly Russians prefer sweet cookies, whose share in total sales is about 50%.
The share of complex cookies in the sales of packaged products is still lower, which is largely due to the high price of this product. In general, prices for cookies have a large variation, which is due to the presence of a large number of different types of cookies. The range of products presented in stores is very wide.
Today, an increasing number of packaged and branded products from small local manufacturers appear on the market. Not least, this is due to the requirements imposed by chain stores on products, and to the fact that with today's abundance of various sweets, it is no longer profitable to produce “just” cookies. Moreover, for a successful launch of new products should be made under well-known and / or actively advertised brands.
For example, Bezhitsky Food Factory (Bryansk) produced an original line of crackers under the Pikantel TM, which includes such positions as Piantel with Basil, a fragrant cracker with a piquant taste of basil and a delicate cheese aroma and Pikantel with Taste Pizza, with a taste of classic pizza.
Today, many manufacturers find a certain "zest", which can successfully focus the attention of consumers and push them to the necessary associations.
So, the company "Sweet Sloboda" (Kirov) released in 2008 cookies "Rustic glazed" in color flow - a package weighing 285 grams. The attention of buyers to the manufacturer attracted to the fact that the cookies are made on rustic milk, which is associated with naturalness, environmental friendliness and benefit.
The marketing campaign of Russian companies that has been popular recently has been positioning its products as goods for people who observe the post. For example, the Confectionery Association "Favorite Land" (Leningrad Oblast, the city of Otradnoe) in 2008 developed lean products to the beginning of Lent. The company has released oatmeal and butter cookies under the brands "Stunt" and "Posidelkino".
Another trend is the growth of sales of complex confectionery products - chocolate coated cookies, or products with a filling, for example, marshmallow cookies, marmalade cookies. The buyer likes interesting products, therefore any unusual decisions of manufacturers are in high demand with the consumer. Most large manufacturers have such products in their assortment portfolio.
The company "Harris" produces biscuit "sandwich" type with a variety of fillings: vanilla, strawberry, cocoa, "boiled condensed milk." Confectionery factory "Bolshevik" produces both biscuits with fillings, and coated with icing.
In the assortment of the factory there are cookies “Yubileinoye”, covered with milk or chocolate icing, cookies “Fad” with various fillings (apricot, orange, cherry, pear, strawberry jam, caramel souffle) and coated with dark chocolate icing, and also cookies “Prince” in the form of a sandwich with nut, chocolate and dairy fillings.
The company Orion specializes in the production of complex cookies. The best-known biscuit biscuits in chocolate glaze with the Mashmallow "Choco-Pie" cream filling and the shortbread in the shape of a mushroom with a choco Boy chocolate hat.
Experts see the need for continuous expansion of the range of manufacturers. Confectionery is the segment in which the consumer has less persistent preferences and is more willing to experiment and try everything new.
On the packaged biscuit market, the following companies can be distinguished among the main Russian producers:
Bolshevik OJSC (Moscow) is a leading manufacturer and distributor of confectionery products. The trademarks of this company include "Jubilee", "Barney", "Tornado", "Shokobarokko". The Bolshevik company is one of the largest producers of packaged cookies in Russia (its market share is 30 - 40% of 40% of the total sales of packaged cookies). Among the major brands of sugar cookies, the maximum growth in market share was recorded for the most expensive brand, Yubileiny, with icing.
The research results show that 97% of the population of Russia know the Yubileinoye brand, 50% of consumers prefer the Yubileinoye to other brands.
The United Confectioners Holding is the largest confectionary holding in Russia, uniting more than a dozen food industry enterprises in Moscow and many regions from St. Petersburg to Blagoveshchensk. The holding’s assets include the most famous and oldest Moscow confectionery factories - Krasny Oktyabr, Rot Front, and Babaevsky Confectionery Concern, founded in the 19th century.
The holding's enterprises own the most recognizable and popular confectionery brands in Russia and the CIS, under which almost all types of confectionery products are produced: chocolate and bars, sweets of mass consumption and premium segment, various types of cookies and biscuits, marmalade, marshmallows and other sweets. “Mouth Front”, “Red October” and “Babaevsky” are included in the “Top - 40 most expensive brands of Russia” list (according to Interbrand Zintzmeyer & Lux AG).
The United Confectioners Holding has been successfully competing in the Russian market with the transnational corporations Nestle, Mars and Kraft Foods. Products are sold through a well-developed distribution network throughout Russia, as well as in the USA, Europe, Israel, the CIS countries and a number of countries in the Middle East. Among the constant consumers of the holding's products are the Federal State Unitary Enterprise Kremlin Power Plant, the Government of Russia, the Moscow Mayor's Office and the Moscow Patriarchate.
Russian holding company United Bakers (Voronezh) is the largest Russian manufacturer of crackers, cookies and extrusion products, owns 38% of the Russian market of crackers, 7.5% of cookies, 23.5% of the production of extrusion finished products, 90% of semi-finished products for the confectionery industry .
The company owns registered trademarks:
“Lyubyatovo” is the leading Russian brand in the segment of ready-to-use extrusion products.
"Yantar" - popular varieties of cookies, combined under the umbrella brand of a major manufacturer.
"Surprise" - extrusion breakfasts for children.
"Fantex" - extrusion semi-finished products for use in the food industry. Used in the manufacture of premium chocolates, chocolate and ice cream from well-known Russian and foreign manufacturers (Cadberry, Nestle, Kraft Foods, Korkunov and others).
Confectionery Association "SladKo" - one of the largest manufacturers of confectionery products in Russia. The association is in the top five leaders in the confectionery industry and produces all main types of confectionery: chocolate, candy, caramel, cookies, waffles.
SladCo is a company with national distribution, the products of which are represented in the whole of Russia from Khabarovsk to Kaliningrad. SladCo products are also present in the CIS countries. In 2005, the company was acquired by the Norwegian concern Orkla. Currently, SladCo is a company with foreign capital (100%).
Confectionery association is presented in three main categories:
1. Chocolate (candies in boxes, chocolate bars, candy bars, by weight candies, packed candies by weight);
2. Flour confectionery (cookies, waffles, waffle cakes, crackers);
3. Caramel (weight, packaged).
Currently, SladCo products are manufactured at two production sites: in Yekaterinburg; in Ulyanovsk.
Product quality and consumer interests are an absolute priority for the company.
Lakom Group is a large Russian trading and production holding company in the confectionery industry. The head office is located in St. Petersburg, production sites are located in St. Petersburg and the Leningrad region. Production capacity of the holding can produce up to 60,000 tons of confectionery products per year. Lakom Group of Companies occupies 10% of the Russian sugar cookie market. The distribution of products of factories belonging to the Lacom group covers all federal centers and the largest cities of Russia.
The holding includes “First Biscuit Factory”, “Golden Key (confectionary factory)”, “PK“ Ladoga ””, as well as the company of the same name - “Lacom”. The range of the group consists of different types of cookies, waffles, marshmallow, marmalade and has more than 500 items.
By the nature of production, sugar cookies are the most common today. The predominance of sugar cookies on the market is explained by the peculiarities of its production, since its production uses high-performance conveyor lines, while in the production of so-called spritz cookies (typical representatives are kurabe, verbs, etc.) small productions are used (up to 1.5 thousand kg in shift). That is why there is a predominance of only a few trademarks of sugar cookie manufacturers, the most famous of which is OJSC Bolshevik. At the same time, the production of spritz varieties of cookies remains the lot of small and medium businesses. The proportion of dry biscuits (typical representatives are crackers) is not very large. A number of experts explain this by some monotony of this type of cookie.
Biscuits with filling has not yet won a decent place among the other varieties. This is due to the small supply of this type of cookies and, consequently, weak demand, as well as the fact that the technique that allows it to make appeared relatively recently, it is quite expensive and is not very common in the industry.
Manufacturers seek to place on the packaging of visual information about the additives contained in the cookies, causing the image of nuts, chocolate, lemon, grapes, etc. This allows the buyer to accurately distinguish cookies with the desired flavor on the counter without subtracting information about the composition. The optimal packing weight of cookies for individual consumption is 200 g, for family (collective) consumption, 400 to 500 g. It is for this range of weight that retail outlets aspire to self-package weight cookies.
As a rule, the buyer prefers small cookies, as it is contained in the package in larger quantities, which is important for collective consumption. Some manufacturers, when it is difficult to visually determine the quantity of the product, indicate on the package not only the weight, but also the number of pieces in one package, thereby protecting the cookie from damage as a result of buyers ’attempts to determine the quantity using the“ probing ”method.
Summarizing the analysis of the domestic market of flour confectionery, it should be noted that the production of cookies increases annually, and the number of domestic producers of cookies is growing. Manufacturers are looking for new niches for this market. The niche of the so-called office cookies is considered relevant. Now this market niche is filled exclusively with imported cookies - only it corresponds to the “premium class” category.
The niche of packaged cookies is practically free in a large package (250 - 300 grams) - a kind of table biscuits for the whole family, designed for daily mass consumption. 26
Currently, the Russian biscuit market continues to grow, but in many ways its development begins to slow down the negative trends regarding the growth of the population’s well-being. In the future, the growth of the cookie market will continue, however, it will be characterized by tougher competition, the emergence of new players and new, sophisticated types of cookies, the increasing role of the quality and appearance of the manufactured products.
Currently, the Russian confectionery market is conditionally represented by two large commodity groups: 1) cocoa, chocolate and sugar confectionery, 2) flour confectionery products. The first group includes caramel, dragee, candies, glazed, chocolate and chocolate products, toffee, halva, marmalade and pastila, eastern sweets and other sugary products. The second group includes cookies, crackers and crackers, gingerbread and gingerbread, cakes, pastries, muffins, waffles and other flour products.
According to the results of the first half of 2016, the share of the first group in physical terms is 47.8%, the share of the second - 52.2%. Based on the available data from Russian statistics, the division into segments can be represented as follows (Figure 1): ginger cookies and gingerbread and similar products, sweet cookies, waffles make up the largest market share - 41.7% of the total production, cocoa, chocolate and sugar confectionery (except for caramel, other chocolate candies) - 31.1%.
Figure 1. The structure of the confectionery market by volume of production in physical terms in the first half of 2016,% of total weight
In the structure of the largest commodity group, the largest share belongs to sweets (Figure 2). The segment occupies 48% of the total output of this category. On the second position are waffles and wafer wafers with a share of 16.7%, on the third - gingerbread (13.1%). The share structure was built at the end of 2015. In general, compared with 2014, it has not undergone significant changes. Chocolate candies with a share of 22.4% occupy a leading position in the “Cocoa, chocolate and sugar confectionery” product group (Figure 3). The second place is occupied by chocolate and food products containing cocoa (except for sweetened cocoa powder) with a share of 14.0%. On the third - caramel (12.1%), including candy caramel, with chocolate icing and with various fillings. The share structure is also built on the basis of 2015. In general, compared with 2014, it has not undergone significant changes.
Figure 2. Structure of the largest segment of the confectionery market by volume of production in real terms in 2015,% of total weight
Figure 3. The structure of the segment “Cocoa, chocolate and sugar confectionery products” by the volume of production in physical terms at the end of 2015,% of total weight
Confectionery production, despite the difficulties of Russia's economic development, shows an increase from year to year. At the end of 2015, more than 3.4 million tons of confectionery were produced, while the increase compared to 2014 was 1.2%. Compared with 2010, the production of confectionery products increased by 20% (Figure 4.). Of course, consumer demand contributed to the growth of production indicators. Even in the last three years, starting in 2014, when the purchasing power as a whole declined due to a significant weakening of the ruble, the consumer remained true to himself, and no twists and turns did not weaken his love for tasty and sweet. Therefore, if in 2010, consumption in Russia was 20.5 kg of confectionery per capita, then by the end of 2016, consumption is expected to exceed 23 kg.
Figure 4. Trend diagram of confectionery production in physical terms for the period 2010–2015 and 2016 (calculated value).
It should be emphasized that the increase in demand was also influenced by the producers themselves by bringing new products to the market and expanding the range of attractive confectionery products. Also, sellers are making their contribution, improving the marketing system and product promotion technology. In addition, niches are vacated due to a decrease in the supply of imported products. By the end of 2016, imports of confectionery products to Russia in physical terms will be lower than the results of 2015, when it did not exceed 150 thousand tons and amounted to only 4% of the total supply of the products studied in the Russian market.
Significant on the Russian confectionery market is the fact that, starting in 2013, the export component in physical terms began to exceed the import, in monetary terms (meaning dollar) - from 2014. Thus, the balance of trade in confectionery products has gained a positive value. Nevertheless, in 2016, the volume of exports from Russia is also expected to decline in real terms as compared to 2015, when exports exceeded 300 thousand tons and amounted to only 9% of the total confectionery production. In general, in 2015, imports of confectionery products to Russia in physical terms decreased 2.3 times compared with 2013, in 2016, the decrease will increase to 2.5 times.
In monetary terms, imports in 2015 decreased 2.2 times compared to 2013, in 2016 the decline will increase to 2.8 times. The decline in exports of confectionery products from Russia in physical terms in 2015 compared with 2013 amounted to 1.1%. The same drop in supply will be characteristic in 2016. In monetary terms, the figures for the volume of export supplies from Russia will decrease, respectively, in 2015 by 1.5 times, in 2016 - by 1.7 times. As can be seen, the values of import and export deliveries do not significantly affect the volumes of the Russian confectionery market, because they are insignificant against the background of production. According to experts of the Information Agency “Credinform”, in 2015 the market volume in physical terms approached 3.3 million tons. In 2016, it is expected to reach 3.4 million tons.
In monetary terms, in 2015 the market volume reached the following results: in dollar equivalent - 19.5 billion in ruble - 1.2 trillion. In 2016, with an average annual rate of 65 rubles per $ 1, the market volume may exceed $ 20 billion, or more than 1.319 trillion rubles. With an average annual rate of 70 rubles per US dollar, it will be about 19 billion, i.e., lower than the 2015 figure, or 1.318 trillion rubles. Thus, in 2016, the market volume in ruble equivalent will exceed 2015 in any of the above average rates.
According to the results of 2015, according to the data of the Information and Analytical System Globas-i, the top three manufacturers in terms of sales revenue are headed by: Nestle Russia LLC, Moscow; Mars LLC, Moscow Region; LLC Mon'delis Rus, Vladimir region (see table 1). Comparison of the revenue with the market volume allows determining the shares of the leaders in the market in 2015: 10.2; 8.0; 5.0% respectively. Representatives of the top ten are also presented in the table.
Table 1. The largest manufacturers in the confectionery market in terms of sales revenue for 2015
| | Name | Revenue, billion rubles, 2015 | Growth / decrease in revenue,% | Market share, % |
| 1 | Nestle Russia LLC, Moscow | 120,46 | 23,6 | 10,2 |
| 2 | Mars LLC, Moscow region | 93,95 | 16,9 | 8,0 |
| 3 | LLC Mon'delis Rus, Vladimir region | 58,58 | -6,5 | 5,0 |
| 4 | CJSC Ferrero Russia, Vladimir region | 33,62 | 14,7 | 2,8 |
| 5 | NAO "Wrigley", St. Petersburg | 19,86 | 2,9 | 1,7 |
| 6 | PJSC "Moscow Confectionery Factory" Red October " | 12,24 | 22,2 | 1,0 |
| 7 | NJSC Konti-Rus, Kursk region | 11,86 | -1,2 | 1,0 |
| 8 | PJSC "Rot Front", Moscow | 11,86 | 15,3 | 1,0 |
| 9 | PJSC "Confectionary Concern" Babaevsky ", Moscow | 9,85 | 10,1 | 0,8 |
| 10 | LLC “Perfetti Van Melle”, Moscow region | 8,95 | 282,7 | 0,8 |
According to the results of 2016, in the absence of serious problems in the global economy, we should expect an increase in the production of confectionery products in physical terms according to the basic forecasting variant at the level of 3%; The volume of the confectionery market in monetary terms according to the basic forecasting variant may increase in 2016 compared with 2015 by 11–12%.
The next 2-3 years, while maintaining the trend of price growth, the increase will vary within 4–8%. The market will be positively affected by the continuing consumer demand. However, there are fears that an uncontrolled rise in prices for confectionery products may still affect this trend. The impetus to the rise in prices may also be new rules for the trade industry, which entered into force in July 2016 as a result of amendments to the law on trade. According to them, the bonus paid by the supplier to the retailer should not exceed 5 percent, and the terms of deferment of payments to retail chains are also reduced.
For sellers, this situation will be unprofitable, as the amount of payments received from suppliers decreases. In addition, the growth of expenses on conclusion and execution of contracts with manufacturers and suppliers is expected, since retailers must conclude new supply contracts with the adopted amendments, and old ones must be brought into line with the new requirements by January 1, 2017. As a result, unearned income and additional costs will be transferred to the cost of the goods, which may lead to its appreciation.
The confectionery market: due to falling incomes and the devaluation of the ruble, Russians in 2015 reduced their consumption of chocolate products, but they began to eat more cookies, gingerbread and waffles, according to research firm Nielsen.
In the category of confectionery in 2015, sales of chocolate fell most of all, follows from the data of the research company Nielsen Poccia provided by RBC. Compared to 2014, sales of chocolate products decreased by 3% in physical terms, which is explained by rising prices and a decrease in the purchasing power of Russians. “Chocolate is not a necessity, therefore its consumption is reduced,” explains the director of the group for work with companies of the food market Nielsen Russia, Sergey Glamazda. This statistics is confirmed by the international research company Euromonitor International. According to her, sales of chocolate and chocolates in Russia in 2015 in real terms decreased by 3.1%, to 716.6 thousand tons.
According to the Center for Confectionery Research (CICR), the consumption of chocolate products fell even more - by 8.4%, to 3.99 kg per person per year. The Executive Director of the CECR, Elizaveta Nikitina, explains this by saying that first of all the Russians refuse expensive, in particular imported, products. In 2015, imports of chocolate and cocoa products fell by 27.6%, follows from the calculations of the International Trade Center of Moscow, based on statistics from the Federal Customs Service.
The drop in demand for chocolate turned out to be beneficial for flour confectionery manufacturers: sales of cookies, gingerbread and waffles increased in 2015 by 6, 7 and 9%, respectively, in physical terms, follows from Nielsen data. In monetary terms, sales of cookies increased by 21%, gingerbread - by 24%, and waffles - by 25%.
Changes in Russian preferences are explained by the price factor, Glamazda says. According to Rosstat, a kilogram of cookies in Russia in January cost an average of 140 rubles, gingerbreads - 118 rubles, and chocolate and chocolates - 752 rubles. and 570 rubles. respectively. The growth rates of prices for chocolate and chocolate products during the year were noticeably higher than for gingerbread and cookies. While chocolate rose in price by an average of 33.5%, the cost of gingerbread rose only by 16%.
The increase in sales of flour confectionery products of long-term storage of RBC was confirmed by the main owner of the JSC Confectionery Association "Favorite Land" (a manufacturer of cookies and gingerbreads under the TM "Posidelkino" and "Orange Sun") Dmitry Kostygin. The largest producers of chocolate and chocolates in Russia are United Confectioners (TM Krasny Oktyabr, Rot Front and Babayevsky), Mars Inc (Mars, Snickers, Twix, Milky Way, Dove, Korkunov, etc. ), Ferrero Group (Ferrero Rocher, Kinder) did not respond to RBC requests.
Nielsen analysts also point out a significant increase in sales of cookies under private labels of retail chains. In 2014, for the first time, private brands of retailers selling in volume terms overtook the market leader, the Yubileinoye brand of the international company Mondelez Int. According to Nielsen, in 2014 the share of private labels was 18.7 against 15.8% for Yubileiny. In 2015, the products of retailers accounted for 21.1% of the market, and the share of Yubileyny fell to 15.6%. The representative of the company Mondelez did not answer the questions of RBC. “Russia is a critically important market for us, in the top ten most significant, and in the categories of cookies and chocolate it is one of the most important countries for us,” said the head of Mondelez Int. Irene Rosenfeld in an interview with RBC in November 2015.
Confectionery market.
I want to note the serious changes in the confectionery market in Russia, which affected me, my family, and did not pass by each of you and your loved ones. These changes open up new opportunities, and it is precisely today that the candy store as a business is promising and timely. What are the changes, why a small business in the confectionery industry gets new chances for development, let's look at a detailed article.
The history of the confectionery business has more than 20 centuries. The first sweets traders arrived on the territory of modern Europe from the east as early as the 6th-5th centuries BC. Primitive lollipops, simple pastries, curd pancakes and sugar baklava were on the tables of the ancient nobility. In the Middle Ages, spices from India and chocolate from South America were brought to Europe. It was a revolutionary moment in the history of the confectionery business.
In France, coffee shops and chocolate shops were opened, in England, scones (a kind of cupcakes), popular to this day, appeared. Russian pretzels and pies also aroused interest abroad. However, only by the end of the 18th century could the cultural traditions, different confectionery manufacturing techniques, textures and completely different ingredients be combined, and the next century was considered the birth of world confectionery cooking. Its homeland is considered to be France. But there is one more, no less popular trend of confectionery art ¬- eastern.
It is difficult to compare French desserts and oriental delights, baklava and Saint Honore, Turkish delights and Tiramisu. However, the Eastern techniques of making sweets account for about 40% of fans all over the world, therefore it is impossible not to take them into account.
The consumer demand for sweet has been kept at a high level for almost 300 years. Moreover, the change in market conditions is obvious: if in the 1920s, gingerbread and cakes were bought as a festive attribute, now the culture of consumption of sweets brings sweet dishes to everyday consumption.
We regularly see pastry shops and coffee shops on the streets, offering a wide range of complex and simple sweets. Strudels, cheesecakes, brownies, muffins, cupcakes await us at gas stations, in the halls of business centers, in parks and theater buffets, in street stalls and even McDonalds. Confectionery products from the group of elite privileged products passed into the category of fast food.
But not even this serious market change is the root cause for a new round of development in the small business segment. The fact that cakes and pastries have become the usual affordable "fast food" for each day, led to cheaper prices to the detriment of quality. Confectioners use spreads instead of butter, animal or synthetic fats instead of vegetable fats. This makes the cost of the product lower, which allows you to survive in the competition.
The main features of the confectionery market in Russia
The Russian confectionery environment, thanks to the fundamental school of the Soviet Union, has a good qualitative theoretical and practical basis. However, due to the closed nature of Soviet politics, a moment of flexibility was lost. Now the dynamics of the development of domestic confectionery are significantly lower than the western one. However, if we compare the quality of in-line products, then even taking into account the trend towards cheaper products, products of our Russian companies can be called tasty and edible, which, alas, cannot be said of many European products (I’ll emphasize not yet about private pastry shops).
The peculiarities of the confectionery market in Russia are:
- short term sales of products;
- the complexity of large-scale logistics and distant delivery;
- a huge number of species and subspecies of products;
- complete dependence of manufacturers on the quality of raw material suppliers (ingredient goods);
- the tradition of home baking;
- a wide selection of authentic, local raw materials for fillers (berries, fruits, nuts;
- intense competition in the niche of inexpensive confectionery products and low competition in the segment of natural, high-quality, expensive products;
- the prevalence of small businesses in the fresh baking segment.
Now, as mentioned above, the Russian confectionery market is filled with low-quality cheap products, and finding a tasty, beautiful and at the same time natural cake that is safe for children's health is practically unreal.
Private traders who make cakes to order, small mini-bakeries, private pastry shops working in 1-2 cafes or a couple of stores survive on this dissonance. Therefore, now the candy store as a business is interesting and has a good income perspective.
Experts comment on the market:
Alto Consulting Group in its study of the confectionery market in Russia focuses on the constant and nonstop growth in piece turnover. The number of products. produced in the Russian Federation is growing, consumption too. However, in comparison with the increase in prices in 2013, the current market, despite major changes in the ratio of currencies, has remained almost unchanged. The quality of ingredients is reduced, due to this, the retail price of the confectionery product, instead of a regular increase, is kept at the same level.
And now we will carefully look at the prices themselves, broken down by federal districts of Russia:
This picture demonstrates a hypothesis stating that reducing the quality and reducing the cost of production releases a niche of high-quality fresh baking and / or complex confectionery products with a short shelf life. This is precisely the segment in which small business can flourish. We have already considered how to open a pastry shop or a pastry shop from scratch in one of the articles, so we will not dwell on this moment, but limit ourselves to the statement that it is now a promising business for a number of points:
- major manufacturers work on the shaft, so they strive to maintain the maximum implementation time, which cannot be achieved using only natural ingredients;
- the need for high-quality, natural and safe goods, especially in the segment of children's products, remains increasingly unfulfilled;
- the market requires great flexibility from manufacturers, the ability to follow the fashion and grasp the changing taste preferences that large factories and concerns cannot technically realize or do so very clumsily and for a long time.
Here is evidence of a change in the structure of demand, as can be seen from the graph below, the growth in the production of cakes and pastries that are not long-term
Fig. 2. The number of tons of products by types of confectionery products produced in Russia for the period 2010-2013. The dynamics of the market in piece equivalent.
How the confectionery business works: a description of business models and a brief analysis of the market
As in any other segment, there are several models in the confectionery business that are implemented for profit:
Model 1: Production and sale of own products through a network of company stores and / or counterparties (a vivid example is the Red October Confectionery Factory, Moscow). The advantage of such a model is direct communication with the consumer, and the minus is high economic risks.
Model 2: Production of products under the order of counterparties (this is how the Lironas Confectionery Company, the Volga region, works). Plus models in reduced costs to sell products. and minus is. that the manufacturer can not actually track the reaction of the buyer to the change in the product portfolio, prices. quality and does this through focus groups and research. which is also not cheap.
Model 3: Production and sales through franchised clients. In this case, the manufacturer sells its products in stores operating under its brand name, for example, the Medobory confectionery shop, Crimea. Plus the model in the practical absence of the cost of sales promotion and the creation of a trading network, and a minus in the uncontrollability of the company's reputation (if any of the franchise customers leads themselves in an inappropriate manner with the buyer, the manufacturer’s image suffers).
In other words, you need to separate two business processes:
- confectionery production and sale. There are companies that combine these two processes.
- production and wholesale, or wholesale purchase and retail. There are enterprises that use only one process in full, and the second - in a shortened one.
Among the largest Russian producers, such as the KDV Yashkino Confectionary Factory (Kemerovo Region), the Konti Confectionery Group, the Lipetsk Confectionary Factory Roshen, the Akkond Confectionery Factory (Cheboksary), and Kraft Foods Rus OJSC (Vladimir region), confectionary factory "Chipita" (St. Petersburg), confectionary factory "Galan" (Krasnodar Territory), OJSC "ROT FRONT" (Moscow).
Important points in the organization of the confectionery business are:
- selection of production / sales niche (today is a snack group, and an acute shortage is observed in the field of cream products for short storage);
- selection of places and competent calculation of the turnover of the confectionery outlet;
- supplier selection.
I would like to focus attention on choosing a supplier. When an aspiring entrepreneur is going to plunge into the confectionery market, it is important for him to get a hot commodity. For this we need to understand what kind of products I would like to sell.
Confectionery products are products of daily demand: on average, each resident of Russia in 2012 consumed 23 kg of sweets, of which 12 kg were sugary, and 11 kg - flour products. At the same time, about 18% of sweets are bought in Moscow.
Competition in the Russian confectionery market is high. Today, the industry employs about 1,500 organizations in all regions of the Russian Federation and more than 15,000 local confectioneries (Rosstat data). enterprises producing 55 percent of the total annual turnover of products.
The largest confectionery segments in the Russian market:
- chocolates - 21%;
- all types of cookies (including crackers) - 20%;
- cream products (cakes, pastries) - 8%;
- tiled and shaped chocolate - 8%.
In the period of 2010 - 2014, according to Rosstat, the share of imports is constantly decreasing and, until the introduction of the food embargo in August, was 12.2%. Domestic production, respectively, is about 87.8%. The main suppliers of sugar confectionery to Russia (sugary products include sweets, caramel, toffee and dragee):
For thirteen years (2000-2013), according to Rosstat, the demand for raw materials such as sugar shows constant growth, and since it is sugar that is an integral ingredient in confectionery products, experts tend to see a direct relationship with the growth in demand for ready-made confectionary. The average growth rate is 5% annually. Those. it can be said that each year the consumption of confectionery products in Russia increases by 5% (both in value and in piece equivalent).
Experts believe that by 2017 the market volume will reach $ 4.5 billion.
Since confectionery products do not belong to basic necessities, the demand for them is due to traditions and external market influences.
The structure of food expenses of the average Russian family includes about 9.5 - 15% of the costs related to confectionery products. With the size of the grocery basket of 1 Russian family (3 people) in the amount of 9.5 thousand rubles, an average of 1,500 rubles a month is spent on confectionery. If this figure is attributed to the number of households in Russia (52,707 thousand), then we obtain the nominal market volume: 79 billion rubles / month.
Analysis of the seasonality of the confectionery business
Seasonal fluctuations in demand for confectionery products - an objective reality in all areas of the market. This factor has a significant impact on both sales volumes and their structure. Therefore, a comparative analysis in the industry most adequately carry out by comparing the same periods of the reporting and past yearsbecause the adjacent periods may differ dramatically in the level of turnover, sales structure depending on the influence of holidays, fasting, holiday season, the emergence of commodity substitutes (berries, fruits), etc.
The bottom shows the seasonality coefficients calculated on the basis of the base December - as the month with the highest turnover in the confectionery industry, due to the pre-New Year mood of the consumer (see figure 1, chart 1).
| Impact on consumer activity | |||||
|---|---|---|---|---|---|
| New year by the old calendar | |||||
| Easter, parent's day | |||||
| appearance of seasonal first berries |
|||||
| Great demand for berries, fruits |
|||||
| holiday season in coastal and tourist regions | |||||
| september | holiday season in coastal and tourist regions |
||||
| weather demand |
|||||
| New Year, corporate holidays |
One color gamut highlighted periods with approximately a single level of activity of the buyer.
Thus, the 1st phase of seasonality (orange) is characterized by increased demand due to the presence of holidays. In this phase, February is weak due to the short monthly period.
Phase 2 season (blue) is characterized by a sharp reduction in demand until July, which is associated with Lent, the emergence of cheaper substitutes, the onset of the warm period. In April, there is a change in the structure of production: the sale of weighted cream products decreases, the sale of flour products (Easter cakes) increases, which affects the turnover. This phase is most in need of marketing incentives and maintaining sales.
July (yellow) - transitional month from 2 to 3 phases (green), characterized by a gradual increase in turnover and, accordingly, the volume of output. In terms of seasonality coefficient, it is comparable to phase 4 (yellow) of consumer activity observed in October and November, where the opposite trend is observed - a decrease in commodity turnover and output due to the outflow of tourists from recreational areas, the lack of traditional holidays until mid-December.
December (red) is the month that gives the highest turnover in the industry. These seasonal factors are average for the market as a whole.
Small business in the pastry arena
The implementation of the confectionery business in the segment of private entrepreneurship is, as a rule, a cafe-pastry shop. There are few options for implementing this format: a private owner can organize his own small production (confectionery shop for 100-300 kg per day) or purchase ready-made confectionery from nearby suppliers.
The advantages of its own production is direct contact with the consumer, the uniqueness of the offer and the ability to adapt the range to the needs of visitors. However, this is also the difficulty: to produce a new type of product, the workshop must develop flow charts and change the production scheme. These are time and financial expenses.
When purchasing products from a large supplier (or several), the exclusivity of the product itself is lost, but the risk of unnecessary costs for the creation of production lines is eliminated. In addition, this scheme is more fast-paying.
Therefore, it is necessary to begin the opening of the cafe-pastry shop with a fundamental decision: we produce ourselves or purchase finished products from a large manufacturer. If an entrepreneur does decide on his mini-workshop, then the costs of the technologist, removable pastry chefs, equipment and storage facilities should be taken into account, where both finished products and blanks will be stored.
It is precisely warehouse storage that is often not provided for beginning businessmen, which leads to enormous problems: the products are light, but very voluminous and capricious. For example. To place 20-25 standard cakes, you need a rack with shelves 1.5 * 1.5 m in a cool place with sanitary permission. And if we are talking about baking, then the cornerstone is the durability of the equipment, since you cannot prepare such products.
Benchmarketing: successful examples of the implementation of a small confectionery business
Foreign models:
Ukraine
Unexpectedly, an interesting pastry shop works in the small Ukrainian town of Melitopol. With all the provinciality of the city itself, the pastry shop surprises with its sophistication, literate products, a wide coffee card and original recipes:
Coffee confectionery "Bourgeois", Melitopol - restaurant project. This is a complete coffee shop with its own pastry shop. Interesting and sophisticated products, classic interior and at the same time low prices (average bill $ 10-12).
France
Confectionery CAFÉ POUCHKINE, Paris - confectionery in the style of the French palace of the XVIII century.The choice of visitors includes cakes with cream, honey, berries, fruits, jam, macaroons, custom-made cakes from cream, sweets, powdered sugar. Average bill $ 5-25
