Better For You Packaged Food in Venezuela

PROSPECTS

Manufacturers continue to favour the production of reduced fat dairy

Reduced fat dairy remained the largest category in better for you (BFY) packaged food in 2017. Reduced fat dairy is largely comprised of reduced fat milk (excl organic and FF), mostly the liquid variant.

Sales growth is down to price increases in 2017

Venezuelan consumers are not willingly switching from regular packaged food to BFY packaged food, but feel pressured to do so owing to the current supply. While the price gap between regular packaged food and BFY reduced sugar, reduced fat and reduced salt variants is significant, consumers are almost forced to purchase the latter because the alternative is going home empty-handed.

Volume growth occurs in a handful of categories

Besides reduced fat milk, which recorded a flat sales performance during 2017, there were some other categories that increased in volume terms more significantly, but still remained marginal in the BFY category. Such categories were reduced fat shelf stable meat, seafood, fruit and vegetables; and reduced salt savoury snacks excluding nuts, seeds and trail mixes.

COMPETITIVE LANDSCAPE

Cadbury Adams SA leads after competitors pull out of the category

While the supply of Trident sugar-free gum continued to be erratic in 2017, the absence of other sugar-free products and a high average unit price allowed Cadbury Adams to take the lead in the BFY category in 2016 and maintain it in 2017. Several categories such as BFY reduced salt food and BFY reduced sugar packaged food have lost half of the brands that were available in 2015, due to the combination of high-priced imported inputs and lower demand.

BFY packaged food maintains its premium profile in spite of the recession

BFY packaged food tends to be premium-orientated in terms of positioning and retailing. The great majority of Venezuelans prefer regular packaged food, which can be consumed by all family members and which is sold at lower unit prices than those of health and wellness varieties.

Companies in the reduced fat dairy category continue to dominate BFY packaged food in 2017

As reduced fat is the largest category in BFY packaged food, companies manufacturing these products are among the leading positions. A government-owned company, Empresa Nacional Lácteos Los Andes (Enlandes), occupied the second position in 2017, based on a tightly controlled supply chain and a strategic alliance with a government-owned packaging company.

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