The entire food industry, from growing to processing to retailing, is an extremely competitive field where profit margins are typically so low that it is often challenging to maintain profitability. The processed food industry worldwide has been challenged by low growth rates, high-energy costs and changing consumer tastes. Nonetheless, there are a few high growth segments, including health foods, energy drinks, bottled water and organics. According to a recent report from Plunkett Research, Ltd., the largest and most important factors affecting this evolving industry are:

1) Wal-Mart Dominates as the World’s Biggest Retailer (and now America’s Biggest Grocer).

Wal-Mart is the world’s largest non-oil company, based on revenue ($344.9 billion during 2007). One way in which the company has expanded dramatically is through its revolutionary entry into the grocery business It is rapidly adding new Wal-Mart Supercenters to its chain, which have immense, well-stocked, supermarket-like grocery departments that work on profit margins up to 30% lower than those of traditional supermarkets.

2) Agricultural Biotechnology Scores Breakthroughs but Causes Controversy.

Genetically modified foods (frequently referred to as “GM” for genetically modified, or “GMO” for genetically modified organisms) offer tremendous promise in agriculture—particularly in high-population nations like China and India.

3) Exacting Organic Standards Create Consumer Demand for Products.

Organic farms provide about 2% of the food supply in the U.S., and sales of organic foods hit an estimated $15 billion in 2006. In fact, organic food is one of the fastest-growing segments of the U.S. food industry, along with nutritionally-enhanced foods and energy drinks.

4) Functional Foods Promise Health Benefits.

Worldwide sales of foods that claim to foster nutrition, health, weight loss or other advantages are enjoying immense sales. The U.S. accounts for about one-third of the market for such foods, followed by Europe, Japan and the rest of Asia.

To find out more about these exciting trends and others, check out the recently released Plunkett’s Food Industry Almanac 2008, or go to www.plunkettresearch.com and sign up for a subscription to Plunkett’s completely up-to-date online database!

About Plunkett Research, Ltd.
Plunkett Research, Ltd. is a leading publisher of complete business research and analysis resources, designed to enable professionals in marketing, research and finance to access complete trends analysis, statistics, technology analysis and financial analysis of the world’s most exciting industries. For more information, visit www.plunkettresearch.com, or call 713.932.0000.