- Foods in this market all have stable shelf lives
- A demand for convenience foods boosts sales
- The market is highly fragmented with no clear market-share leader
The prepared-meals market is forecasted to reach $99.1 billion globally by 2021, according to GlobalData. In 2016, the market was valued at $83.4 billion, representing a compound annual growth rate of (CAGR) of 3.5%.
Prepared foods are defined as having a stable shelf life. They can be dried, canned, boxed chilled or frozen. These foods require no preparation other than heating before being served. The most common covering type is film.
This category also includes pasta, rice, noodles, canned meat, and meat-substitute dishes.
Favorable Factors and Challenges
Many factors have led to this market’s growth.
The demand for convenient and ready-to-eat products has risen as more women enter the workforce and people lead increasingly busy lives. Customers are seeking products that save time and effort.
Changing eating patterns also have boosted sales as fewer people make time to cook food from scratch. In developing countries such as India and China, the younger population lacks, not only time, but cooking skills.
Finally, urbanization in Latin America, the Middle East and Africa has lead to more families with disposable incomes.
The market also faces several challenges.
In developed regions, market players face intense price battles while in emerging countries, there is economic uncertainty.
There also is the perception that frozen and chilled categories are unhealthy because they contain few vegetables and have preservatives. To overcome this, manufacturers are launching products with healthier recipes, featuring natural and organic ingredients. They also are using labels when products are “free from” certain ingredients.
Growth strategies include introducing healthier snacks and a wider distribution.
The global market is highly fragmented. The top five brands – Stouffers, Heinz, Amy’s, Marumiya, and DiGiorno – hold less than 11% of the combined market share. Nestlé owns two of these brands.
Even regional markets are highly fragmented. In Eastern Europe, for example, the top four brands hold only a 14.9% combined market share.
Eleven distribution channels are used by this market. The largest are hypermarkets and supermarkets, holding a 68% market share, and convenience stores, at 19.7%. The next largest channels are health and beauty stores, department stores, cash- and-carries along with warehouse clubs, dollar stores, variety stores and general merchandise retailers.
- In 2016, the largest market was the U.S. with a 23.3% share of global sales.
- By 2021, China is forecasted to be one of the fastest-growing markets, with a CAGR of 9.2%.
- In 2016, Western Europe was the largest regional market with a value share of 39.5%.
- By 2021, Asia-Pacific will grow at a CAGR of 6.5%.