international beverage plan update

7/30/2019 International beverage plan update

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NCA International Strategic PlanUpdate

A custom report compiled by Euromonitor Internationalfor the National Confectioners Association (NCA)

January-February 2012


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Welcome & Introduction

Karen HoranSenior Director of International Trade ServicesNational Confectioners Association


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International Strategic Plan (ISP)Objectives & Deliverables

Frank AmatoChairman of International Development Committee

Director of International Development Just Born, Inc.


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ISP Objectives

Determine the needs and objectives of NCAs members regarding

International Business Development

Define global market dynamics of the confectionery industry

Highlight opportunistic regions and/or markets, and recommendspecific strategies and tactics to generate a long-term increase ofU.S. confectionery exports

Define toolbox currently utilized by members and identify key gaps

Review NCAs role in supporting international development andmodify as necessary to better support members objectives

Enhance NCAs core international focus while addressing

constraints that U.S. confectionery companies face


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ISP Key Deliverables

Guide NCAs International Strategic Direction

To produce a clearly defined Unified Export Strategy that will addvalue to member companies, both large and small

To develop a plan that will positively enhance members

opportunities to participate and thrive in international markets

Define how the NCA can best support members interested indeveloping or supporting an export or international business

Clearly defined NCA toolbox, inclusive of data, tactics, strategies,resources, etc.


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Preliminary Research Findings& Market Entry Considerations

Zandi Brehmer & Heather PrekopConsulting Group

Euromonitor International


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Research Update

PROJECT OVERVIEW

MARKET OVERVIEW:

WHY EXPORT?

PRELIMINARY FINDINGS:

KEY MARKET ENTRY CONSIDERATIONS

CONCLUSIONS


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Project Methodology

OVERVIEW | WHY EXPORT? | MARKET ENTRY | CONCLUSIONS

Evaluate CurrentSituation & Needs

Qualitative Interviews

Market Entry evaluatecurrent export activities ofNCA members (large andsmall)

NCA Services understandcurrent tools/services utilizedby members

ProvideRecommendations

April Workshop

Market Entry identify keyquestions as well as broadstrategies for NCA membersto consider when enteringnew markets

NCA Services recommendmodifications as necessary tobetter support membersobjectives and establishinternational role

Gain Further

Insights

Quantitative Surveys

Market Entry betterunderstand global marketdynamics and member needs

NCA Services reviewNCAs role in supporting

members and identify keygaps in services/support

1 2 3


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Oct 31, 2011 Project Kick-off

Nov Jan Qualitative Interviews

Jan 31 Feb 1 ISM Presentation of Preliminary Findings

Jan 24 Feb Quantitative Interviews

Feb March Final Analysis and Validation

Feb March Incorporation of Tactical Piece

April ISP Workshop Presentation of Final Strategic Findings

June Final Report Tactical Recommendations

OVERVIEW| WHY EXPORT? | MARKET ENTRY | CONCLUSIONS

Project Timeline


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PROJECT OVERVIEW

WHY EXPORT?MARKET ENTRY

CONCLUSIONS


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Global Confectionery

Source: Euromonitor Data, 2011.



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4 Cases for U.S. Export


Go where the growth is look at actual dollar sales

Go where the growth is look at volume consumption

U.S. sales wont cut it represents shrinking slice of the pie

Just because you are small doesnt mean you cant think global

1

2

3

4


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2.1%

3.0%

2.0%

1.9%

3.6%

5.5%

1.4%1.0%

0%

1%

2%

3%

4%

5%

6%

0

5,000

10,000

15,000

20,000

25,000

CAGRGro

th

ActualValueGrowth(Tonnes)

VALUE GROWTH For U.S. Is Below Global Average (2011-16)



Actual Growth

% Growth

TOTAL CONFECTIONERY GROWTH (% and Actual)

Global Average


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1.8%

3.9%

1.2%

2.1%

2.9%

4.4%

-0.8%

0.5%

-2%

-1%

0%

1%

2%

3%

4%

5%

-200

0

200

400

600

800

1,000

1,200

1,400

1,600

%

CAGRGrowth

ActualVolumeGrowth(To

nnes)

VOLUME GROWTH Actually Declining In The U.S. (2011-16)Actual Growth

% Growth



TOTAL CONFECTIONERY GROWTH (% and Actual)

Global Average


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Emerging Regions STEALING SHARE From Developed Markets

35%

22%

16%

10%

11%

4% 2%

Retail Values: 2001

Western EuropeNorth America

Asia Pacific

Latin America

Eastern Europe

ME/Africa

Australasia

32%

20%17%

13%

12%

4% 2%

Retail Values: 2011




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Significant OPPORTUNITIES REMAIN For Companies Of All Sizes

46%

4%

50%

Top 5

Private Label

Everyone Else


Global Confectionary Companies(2011, US$ value sales)



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PROJECT OVERVIEW


CONCLUSIONS


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Preliminary Findings


Member needs & focus vary greatly

The right approach to exporting differs based on level ofexperience, size of company & type of product offered

NCA role should be broad and educational

Develop general export guidelines/factors to consider formembers looking to enter new markets

Provide foundational resources rather than specific tactics

No one size fits all; teach members how to find the rightapproach for their organization


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Market Entry Points to Consider


MARKET SIZE

MARKET GROWTH

REGULATORY ENVIRONMENT

RETAILING ENVIRONMENT

COMPETITION

LOCAL TASTES


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MARKET SIZE (Value)

MARKET ENTRY: MARKET SIZE & GROWTH | REGULATORY | RETAIL | COMPETITION | LOCAL TASTES

How DEVELOPED is the current market?


31

.9

4.4 2

1.6

24

.9

8.0

36

.1

58.6

0

10

20

30

40

50

60

Asia-Pacific Australasia E Europe LatinAmerica

Middle East& Africa

N America W Europe

2011MarketSize(US$RSP,

billion)

Country 2011

USA 32.3

UK 12.8

Brazil 12.5Germany 12.2

Russia 11.8


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MARKET GROWTH (Value)


5.2

4.1

8.7

10.7 10.9

2.92.3

3.0

2.0 1.9

3.6

5.5

1.4 1.0

0

2

4

6

8

10

12


Middle East& Africa

N America W Europe

CAGRGrow

th%

Historic CAGR (2006-11) Forecast CAGR (2011-16)


Which regions are GROWING?

Country2011-16

CAGR

India 13.9%

Peru 5.2%

Indonesia 4.9%Brazil 4.5%

Saudi Arabia 4.5%


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0%

2%

4%

6%

8%

10%

12%

-2% 0% 2% 4% 6% 8% 10% 12% 14% 16%

Identify Hot Spots (Value)

MARKET ENTRY: MARKET SIZE & GROWTH | REGULATORY | RETAIL | COMPETITION | LOCAL TASTES Western Europe North America Latin America Asia Pacific Australasia Eastern Europe Middle East & AfricaoChocolate

oCandy

oGum

Middle East & Africagum expected to growfastest over forecast

period (11.5%)

Latin America (andEastern Europe)chocolate well

positioned for growth

Asia-Pacific marketsare sizable, withmoderate growth

Western Europe andNorth America marketsare large, yet poised for

slower growth

Historic Growth (2006-11 CAGR)

ForecastGrowth(2011-16CAGR)


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Regulatory Environment


Key regulatory issues to consider:

Ingredients/Product Composition (e.g. Western Europe)

Labeling and Marketing Claims

Packaging Standards

Product Documentation and/or Registration

Trademark/Copyright laws (e.g. China, India)

Other Market Access Considerations: Tariffs, Taxes& Free Trade Agreements


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Retailing Environment


0%

10%20%

30%

40%

50%

60%

70%

80%

90%

100%


Middle East& Africa

N America W Europe

Retai

lChannelShare(2011U

S$RSP

value

,by

region) Supermarkets/Hypermarkets

Discounters

Small Grocery Retailers

Confectionery specialists

Other Grocery Retailers

Non-Grocery Retailers

Non-Store Retailing

Channel TypeNational vs. Regional CoverageProduct Placement


WHERE are confections sold in-market?


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Competitive Environment

MARKET ENTRY: MARKET SIZE & GROWTH | REGULATORY | RETAIL| COMPETITION | LOCAL TASTES

Concentration/FragmentationLocal vs. Foreign PlayersTotal Number of Players (Saturation)Pricing & Retailer Profiles

0%

10%

20%

30%

40%

50%

60%

70%

80%

Asia Pacific Australasia E Europe Latin America Middle East andAfrica

N America W Europe

CompanyShare(US$%,2010)

Player 1

Player 2

Player 3

Player 4

Player 5

Kraft

KraftKraft

Mars

Lotte

MarsKraft

Mars

Kraft


Who are the TOP FIVE PLAYERS in each region?


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Category Sales & Market Trends



What PRODUCTS are popular in each region? Are there any current TRENDS?

36%

64%71%

42% 47%57%

65%55%

19%

9%9%

22% 16%14%

10%14%

44%

27%20%

37% 37%29% 26% 31%

0%

20%

40%

60%

80%

100%

AsiaPacific

Australasia EasternEurope

LatinAmerica

MiddleEast andAfrica

NorthAmerica

WesternEurope

WorldCateg

ory(%

oftotalconfectionery

sales

,US$RSP

)

Chocolate Gum Candy


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PROJECT OVERVIEW


CONCLUSIONS


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Key Questions to Ask

Market Size/Growth: Strategic (go where the $$ is) vs. opportunisticapproach (what makes the most sense for my company/products)?

Distribution: In-country operations vs. sale to in-countryimporters/distributors vs. use of U.S.-based export agent?

Retailing: Direct to retailer sales (e.g. Wal-Mart) vs. sell through localdistributors?

Competition: Go after whitespaces (innovator)vs.

do what has proven tobe successful for other companies in the past (imitation)?

Local Tastes: Create a custom product to appeal to local tastes vs.stick to standard format across markets for cost efficiency?


Again, different approaches will depend on the needs and positioning of your company


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How to Get There


Keep it Simple!

Start small, focused and realistic

Go after the low hanging fruit Do what is right for you

Approach new markets from an opportunisticperspective

Do not feel that you have to chase the largest orfastest growing markets to succeed


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Formulating the Plan:Goals/Tactics/Measurements

Eric RosenbergBryant Christie, Inc.


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Next Steps Assess the NCAs role

Review existing NCA services

Determine industry needs and market opportunities

Define success

Define tactics (ISP Workshop)

Quick wins

Longer-term strategic shifts

Final strategic/tactical plan

INTRODUCTION | MARKET OVERVIEW | MARKET ENTRY | CONCLUSIONS


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Thank You


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Disclaimer:

Information in this report researched by Euromonitor has been produced by Euromonitor

International Ltd (Euromonitor) solely for its client the National Confectioners Association.Euromonitor does not have any control over the particular purpose(s) for which itsinformation or intelligence is used. Euromonitor has agreed to permit the reproduction ofEuromonitors report on condition that Euromonitor disclaims and excludes any and allliability (whether arising in contract, tort or otherwise) for any loss of any nature suffered byany party as a direct or indirect result of any error in or omission from the report, as a direct

or indirect result of the use of any of the report or of making any business decision, orrefraining from making any such decision, in reliance or based wholly or partly on any data,expression of opinion, statement or other information or data contained in the report.

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