Snack Foods Manufacturing Industry Profile

The US snack foods manufacturing industry includes about 500 companies with combined annual revenue of $27 billion. Major companies include PepsiCo's Frito-Lay, Kraft's Nabisco subsidiary, Diamond Foods, Snyder's-Lance, and ConAgra Foods. The industry is highly concentrated: the top 50 companies account for 90 percent of industry revenue.

The global snack foods manufacturing industry generates revenue of about $280 billion, according to Global Industry Analysts. Europe and the US are the largest markets. Major companies outside the US include Grupo Bimbo (Mexico), United Biscuits (UK), Calbee Foods (Japan), and Nongshim (South Korea).

The snack foods manufacturing industry includes companies that make roasted nuts and nut mixes; potato, tortilla, and corn chips; popped popcorn; hard pretzels; and peanut butter. Makers of cookies and candy, which are not classified as snack foods, are covered in the Cookie & Cracker Manufacturing and Candy Manufacturing industry profiles.

COMPETITIVE LANDSCAPE

Demand is driven by consumer tastes and health considerations. The profitability of individual companies depends on efficient operations, effective marketing, and a strong sales force. Large companies have advantages in raw material purchasing, manufacturing efficiencies, distribution, and marketing budgets. Small operations can compete effectively by self-distributing products, selling online, or marketing snacks as gift items. The industry is capital-intensive: average annual revenue per employee is $500,000.

Snack food manufacturing competes against other "impulse" food items, including cookies and crackers, baked goods, fruits and vegetables, and fast food items.